How Client Accounting Fits Into Firm Workflow

The strategic decision to move client bookkeeping processes into the cloud offers accounting professionals a choice on how they will work with client information. Practitioners in the cloud experience a wide range of benefits, which include direct importing of transactions, real time reporting, rules for automatically classifying transactions and anytime anywhere access to transactions and supporting documents. Clients obtain more relevant and timely data, and firms can reduce staff overtime.

The Challenge: Workload Compression

One of the more significant management challenges in an accounting firm is workload compression, where a large portion of the work occurs in a relatively short time period. The traditional client bookkeeping model revolves around the client sending bank statements and checkstubs in a batch at the end of the month for processing. While many of the transactions have been posted to the client’s bank for a month by the time they are received, traditional firms wait for the checkstubs to arrive before starting the monthly bookkeeping.

Firms working in the cloud avoid this bottleneck by creating rules to classify transactions imported daily from the client’s bank and credit card companies. Accountants who practice in the cloud can also be better business advisors to their clients, as they see transactions as they occur in near real-time instead of a month or more after they occur. This time advantage enables more timely and relevant advice to the client, and makes it easier to meet filing deadlines.

Some common ways to begin the transition to client accounting in the cloud are:

  • Implement online banking and mobile payments for your firm and your clients
  • Manage receivables and payables using cloud-based tools
  • Adopt an online or hosted bookkeeping application which can be used simultaneously by the accountant and the client
  • Adopt online payroll tools

Although it may take awhile to transition clients to web-based tools, this change is required to maintain the relevance of the accounting profession to small businesses. Planning and leadership from both partners and staff are needed to minimize errors and interruptions.


Implement Online Banking and Mobile Payment Acceptance

The mobile payments revolution has changed the way we pay for everything from gasoline to Girl Scout Cookies, and many of our clients need to revise their business processes so that they can accept payments via credit cards. Merchant services can help improve your clients cash flow. Services are available from traditional banks, accounting software vendors like Intuit Payments and Sage Payments, as well as payment companies like PayPal and Square.

New tools like check scanners can be used to electronically deposit the few remaining checks written to your firm, eliminating bank visits altogether. These steps can eliminate 15-30 minutes of staff time needed to visit the bank every day, and frequently provide more rapid access to funds than traditional paper deposits.


Use Online Tools for Receivables and Payables Management

A frequent problem of many organizations is entering, tracking and payment of receivables and payables. Services like SmartVault,, and Concur Small Business make it possible for clients to capture, store and organize digital images of invoices and receipts using devices like smartphones and tablets.

Clients can also manage their receivables and payables from a computer, tablet, or mobile phone using cloud accounting tools like the AccountantsWorld PowerPractice suite,, QuickBooks Online, Xero, FreshBooks Cloud Accounting, Sage One and Wave Accounting. Tools like these permit the client to enter transactions and process payments for A/R and A/P, and potentially eliminate the need for the accountant to enter the same transactions into client accounting systems.


Adopt Hosted or Online Bookkeeping Solutions with Bank Integration

Clients and accountants no longer have to accept the 15-45 day delay between when a transaction occurs and when it is included in the financial reports. Real-time financial reporting makes it possible for employees to post transactions on the earlier of (1) when they are entered into the software by the client, or (2) when the transaction is recorded at the client’s bank or credit card company.

Clients can have real-time financial information which can be used to make rapid adjustments to strategies to take advantage of emerging opportunities or eliminate unprofitable transactions. Outside accounting professionals no longer have to wait until the client sends the checkstubs and bank statement to work on the client’s books, as the work now occurs in real-time instead of in a batch at the end of the month.

This transition eliminates the workload compression and overtime associated with the month- end closing of the books and gives the firm earlier access to the data needed to prepare required filings like payroll and income tax returns.


Online Payroll Preparation and Tax Reporting

Payroll is one of the most mature cloud-based services offered to clients. Many firms have been preparing client payroll online for years, and the products, systems and procedures have been proven to be effective. Firms who are not yet using cloud-based tools can try them out on a small number of clients first.

There are a wide range of online payroll products available where the client, the firm and the payroll service work together to meet the client’s business requirements. More information on specific products can be found in the reviews section of

Moving client accounting online is a strategy whose time has come. The tools have the potential to save accounting professionals and their clients significant amounts of overtim e while also providing better client service. There is no question that the future of accounting is online – the only question is how and when your firm will implement the required changes.

Brian is a CPA and consultant whose practice is focused on technology consulting and training for accountants. He is also a nationally recognized speaker with K2 Enterprises (, and blogs on accounting technology at Comments, suggestions, and errata are always welcome, and should be e-mailed to