IN-FIRM: 12 FutureTech Musings

From the Jan./Mar. 2008 Issue

New Years bring new opportunities. Most firms have stabilized their network infrastructures and production processes, and are now experiencing a minor lull in activity before the busy season really kicks in. This lull provides all of us with an opportunity to contemplate new technologies for the year ahead as well as dream about those that are on the horizon.

This month’s column is dedicated to 12 future technologies and predictions to give you something to mull about over your next cup of coffee.

All tax and accounting firms will utilize a portal solution that is integrated either with their tax workflow application or their document management application, so that it is easy to use for both clients and firm personnel. While most will be in-house for 2008, there will be a push towards web-based solutions managed by the big three vendors (CCH, Thomson, Intuit) as they can provide enterprise-class security and management.

According to the 2007 AAA Paperless Benchmark Survey, the majority of firms had standardized on dual-screen monitors this past busy season, and 10 percent had someone with triple screens, which we expect to be the standard in 2008. We believe that the trend will be to utilize 24-inch monitors (at a price point under $350) that will be used in a traditional “landscape” mode, while the existing 19-inch monitors will flex to a “portrait” mode for viewing scanned documents. We can also expect to see laptops and docking stations to come out with three or four external video ports to take advantage of these monitors, while at the same time providing mobility to the user.

With virtually all data within a tax and accounting firm being digitized, the need to proactively protect this data will be driven home. Firms will outsource more and more security requirements such as using outsourced e-mail/spam services, network monitoring, and having formal security audits performed. Access controls will tighten up beyond just changing passwords to include security tokens and biometrics. All data within the firm and offsite will be encrypted using tools such as PGP.

Reliability of scanning applications will improve dramatically this year to push scanning to the front end, creating a standard bookmarked PDF source document. Within a few years, these applications will import data directly into the appropriate space on the tax return, particularly once IRS mandated bar coding allows this information to be input with 100 percent accuracy.

The ability of firms to capture and manage knowledge
will become a priority in the next decade, as all data is stored digitally in Terabytes of hard disk space either within the firm or to an Internet site. Tools such as SharePoint and Groove will drive collaboration between firms and their clients, further cementing the trusted advisor relationship. These Microsoft knowledge
management capabilities could evolve to become the document management systems of the future, making today’s DM systems obsolete.

Staffing resources will continue to get tighter, and accounting vendors will begin integrating ERP systems to optimize the
utilization of personnel. These tools will look at last year’s actual workflow, the current year’s staffing resources and workload, and run through thousands of calculations to optimize the use of staff, which can be updated in a near real-time basis. Expect to see such planning tools roll out not only from the Practice Management (time and billing) applications, but also from tax workflow providers and document management applications.

Verizon, Sprint and AT&T will roll out 1Mbps and faster broadband connectivity either through WiMax or other broadband
cellular services. This will allow remote users to connect to firm resources via Citrix/Windows Terminal Services and access firm data and resources without having any data locally, reducing the security implications of a lost or stolen laptop.

The multiple touch capabilities of Apple’s iPhone and Microsoft’s Surface computing platform will fire up the imagination of developers to allow us to deliver data access capabilities that will get us to a truly “paperless” world. Imagine the ability to review multiple documents on a flat electronic desktop and “push” them onto a projection screen, to an e-mail account or to a document management system with a touch of the screen or a flick of the wrist. Next-generation auditors and tax personnel will review and analyze data in a fashion similar to the movie “Minority Report,” but on huge conference tabletop screens. The first working phase will happen within a few years when accounting vendors optimize their applications for Tablet PCs and other touch-screen technologies.

Google has the cash, momentum and vision to take Microsoft on in the next five years, and is partnering with innovators such as Apple (iPhone) and Intuit (QuickBooks integration) to develop a relationship with consumers that will eventually carry over into small business and then larger organizations. Google’s web-based office productivity tools will gain market share in small business and home use, forcing Microsoft to accelerate development of ASP-optimized versions of Word, Excel, Outlook and other Office tools.

Vista and Microsoft Office 2007 will become the standard in tax and accounting firms for at least the next six years.Firms and vendors will standardize on Office 2007 for longer than previous versions of Office, as the rest of the business world transitions to web-based applications and “Software as a Service.” Microsoft and Google will duke it out to deliver these completely web-based applications, most of which are not compatible with today’s accounting vendor applications. The longer Office lifecycle will be forced as accounting vendors scramble to rewrite their applications to run with Microsoft WinMin and a thin web version of Office that downloads just what you need, just when you need it. In the interim, there will be a HUGE opportunity for a comprehensive accounting suite that is completely web-based and written in current programming languages to evolve and take measurable market share during the next decade as the product is scalable to any size firm and has tightly integrated security, making Google/Intuit a fierce Microsoft competitor. With the deadline for being able to buy Windows XP extended to June 2008, most firms will begin transitioning to Windows Vista during summer 2008. And by the following year, the transition will have been similar to all previous Windows upgrades, which are stable in the accounting environment after the release of the first service pack.

More firms will replace their aging phone systems with Internet-based systems that also allow for “softphone” capabilities. Softphones can be carried outside the office and provide office extension access wherever these phones can get an Internet connection. Digital cellular providers will also begin offering VoIP plans that will provide a virtual phone extension anywhere the recipient can get a signal.

As smartphone devices proliferate and can access and process virtually every firm application and data, the ability to see the complete document on a screen projected into video glasses will happen and also provide privacy in viewing these documents. Prototypes such as Lumus Video Eyeglasses will eventually be made small enough to attach to any eyeglasses to see full-screen documents so you can provide laptop-like functionality in a hand-held device. With the continued development of ultra-mobile PCs, the lines between a smartphone and PC will blur.

The wonderful thing about technology is that it constantly evolves and provides exciting opportunities for those that can see them. By taking the time to muse into how future technologies are changing other businesses, tax and accounting professionals can match these opportunities to how they can better service their clients.