computing is profoundly impacting your members v3

CPA2Biz, Inc. - Proprietary and Confidential Information

Cloud Compu)ng is Having a Profound Impact on Your Members

Test Your Own Understanding of the Cloud

Gregory L. LaFollette Vice President – Product Strategy, CPA2Biz

AICPA & CPA/SEA Interchange 2012

Session 44: Friday, July 20, 2012 - 8:30 to 9:30AM


Gregory L. LaFolle@e, CPA, CITP, CGMA Vice President of product strategy – CPA2Biz Columnist & Speaker Former

•  Eide Bailly, LLP – Senior Manager, Tax and Technology Consul=ng (6 years) •  LaFolle/e Consul4ng, LLP -‐-‐ Consultant to the industry (12 years) •  The CPA Prac4ce Advisor -‐-‐ Execu=ve Editor (6 years) •  Thomson Reuters (Crea4ve Solu4ons) -‐-‐ Vice President -‐ Product Strategy (5 years) •  LaFolle/e, Jansa, Brandt & Co. , LLP -‐-‐ Tax & Technology partner (23 years)

AICPA Commi@ees §  Journal of Accountancy – Technology Advisory Board §  Prior Service:

§  CITP Creden=al CommiQee – Chair (7 years; Member 4, Chair 3) §  TECH+/Prac==oners Conference -‐-‐ Planning CommiQee (6 years) §  Na=onal Accredita=on Commission – ad hoc (3 years) §  Na=onal Tax Educa=on Program (AICPA/UI) -‐-‐ Graduate and former Staff Lecturer (12 years) §  Top 10 Technology Ini=a=ves -‐-‐ Review CommiQee (5 years) §  Microcomputer Advisory Services CommiQee (3 years)


Contact Informa)on Greg LaFolle@e

[email protected] [email protected] [email protected]

New York Office -‐ 212-‐596-‐6267 South Dakota Office – 605-‐977-‐4823 Cell – 734-‐330-‐9015 200 East 10th Street #500 Sioux Falls, SD 57104


CPA2Biz

Firm Technology Solu)ons

Online Portal

Marke)ng &

Technology Services

Mobile Apps

LMS

CPA2Biz.com, IFRS.com -Leading Sites

Transforming Accounting Services Cloud Computing Programs -Growing Use

AICPA & State Societies -Leading Capabilities

New Learning Gateway -Launched in 2011

C2B, Firm, AICPA, States

CPA2Biz Business Focus


CPA2Biz Opera)ons – 100% Cloud Based

Accounting Platform

Bill Payment

Performance Management

Email Website Operations

CRM

All of our business is managed through cloud based applications

LMS

Data Center


CPA2Biz Broad Firm Solu)ons Strategy

PlaQorm & Distribu)on

Educa)on Integra)on


CPA2Biz Firm Solutions Portfolio

Bill Pay (Bill.com)

Payroll (Paychex)

General Ledger (Intacct)

Audit Confirm-

ations

Newsletter, other misc.

(C2B)

Email & Backup

(CPA.com)

Practice Workflow

(XCM)

Client Accounting Tools (Over 1,000 firms now using)

Firm Workflow Management (Used by 50 of Top 200 firms)

Audit workflow (7,000 firms now using)

Digital Brand for the Firm

Email & Other IT Services

(0ver 900 users)

Client Dashboards

CPA2Biz Firm Solu)ons PorQolio

Paychex has introduced a firm payroll platform


Posi)oning for Success in a Digital Age

Key Ques)ons For You:

1)  What does this mean to your members?

2)  How will they retool and compete?

3)  What should your member firm’s technology strategy be?

4)  How are they developing talent? 5)  How are your member firm’s client services changing?

6)  What does this change about how you serve your members?


Posi)oning for Success

Technology Drivers

Client Accoun)ng Services

7 Early Warning Signs

Agenda


Three Concurrent Drivers

Technology

Business Prac)ces

Client Expecta)ons

1st Driver

2nd Driver

3rd Driver


The Hardware Driver

1965 -‐ 1975

All manual to Service Bureaus

1975 -‐ 1985

Service Bureau to Mini-‐

computers

1985 – 1995

Mini’s to Micro’s

1995 -‐ 2005

DOS to Windows

2005 – 2015

Premise-‐based to SaaS


•  Socware, services & support offerings specifically designed for one-‐to-‐many delivery over the Internet

Socware as a Service

•  Packaged socware customized, deployed & managed by provider Hosted

•  Today’s packaged socware deployed on-‐premise

Tradi)onal Socware

The Socware Driver


•  1980s: Digital Office Work Begins –  Personal Compu=ng, Excel, Quicken, etc.

•  1990s: Digital Value Chains –  Internet, Networks, Email, Tax & Audit Somware, e-‐

Commerce

•  2000s: Digital Consump=on –  Paperless, Online Research, Mobile, Social Media,

Self-‐Service

•  2010s: Digital Engagements –  Portals, Cloud, Collabora=on, Apps, etc

20th

Cen

tury

21

st C

entu

ry

Geoffrey Moore Slide – Adopted for CPA Marketplace

The Business Prac)ce Driver


The Client Expecta)on Driver

Systems of Engagement

•  Collaborative •  Intelligent •  Knowledge Based

TODAY FUTURE

•  Consolidate •  Organize •  Report

(The Digital CPA )

Geoffrey Moore Slide – Adapted for CPA Marketplace

Systems of Record Systems of Record


Firm Value Chain

Analyze & Interpret

Advise & Consult

Input Data

Assemble & Verify Report

Higher Value & Future Focus

Lower Value & Historical Focus


We’re in the Midst of a Great Sea Change

“Things take longer to happen than you think they will, and then happen faster than you thought they could”

—old axiom

“Rate of change today is much greater than it was during dot com era” — Jeff Bezos, CEO Amazon

Acceleration of Change (Highlighted By Cloud & Mobile Movement)


Four Technology Drivers of the Digital CPA


CPA2Biz Focus On Technology Drivers

Transforming Technology Drivers

Mobile Cloud Computing Digital Brand

Information Security

Change Management


•  Being able to work anywhere, any)me: 88% 5%

•  Disaster backup & recovery : 85%

•  Improved client service & collabora)on: 84%

•  Being able to use the latest applica)ons: 82% 4%

•  Being able to serve non-‐local clients: 80%

•  Expand services, create new revenue sources: 79% 11%

Key Benefits of Accoun)ng Firm Usage of Cloud Applica)ons CPA2Biz 2012 Technology Survey


Regarding a physical office:

•  In 2011 4% of firms were “virtual”

•  By 2012 those numbers have grown to 8%

Growth of Virtual Office CPA2Biz 2012 Technology Survey


Mobile


US Market Forecast

Source: eMarketer

60.2

90.1

106.7

119.9

133.0

13.0

33.7

54.8

75.6

89.5

0.00

20.00

40.00

60.00

80.00

100.00

120.00

140.00

2010 2011 2012* 2013* 2014*

US Smartphone & Tablet User Base Forecast (in millions)

Smartphones

Tablets


Accounting Firm-Branded Apps

Eide Bailly

KPMG

Moss Adams

THE APP IS THE WEB SITE OF THE 90’s AND IS COMING TO SMALL FIRMS


Mobile-Friendly Practice Management Tools

Thomson Mobile CS

Salesforce.com


Accounting Software in Your Mobile Device

Bill.com

Intacct


CPA2Biz Mobile Friendly Site


Digital Brand


Importance of Digital Brand in Client Rela)onship Historical

•  Meeting in an office •  Phone •  Classified •  Yellow Pages •  Word of mouth

Today

•  Online Collaboration •  Email •  Social Networking •  Search •  Review sites


Consumer Email Account

[email protected]

What’s Your Online Digital Brand?

Professional Email

1. Firm Branded Domain: -  www.smithcpa.com -  Branded web site and email 2. CPA.com Domain -  [email protected]


Accoun)ng Firm Use of Social Media CPA2Biz 2012 Technology Survey

•  34% of CPAs surveyed are using tablets (iPads) for business purposes, and another 12% plan to soon

•  According to recent Boomer study, this is as high as 57% for mid sized firms

-‐

10

20

30

40

50

60

70

80

LinkedIn FaceBook TwiQer Blog

2011

2012

Firm Usage of Blogs and Twitter each up 60% year-over-year


Accoun)ng Firm Use of Video


Informa)on Security


• Security: 73% concerned ( 8% from 2011)

• Confiden)ality: 72% concerned ( 8% from 2011)

• Privacy: 67% concerned ( 11% from 2011)

• Availability: 64% concerned ( 4% from 2011)

TOP CONCERNS (SIGNIFICANTLY OR SOMEWHAT CONCERNED)

CPA2Biz Survey Results – April 2012 Accoun=ng Firm Usage of Web-‐Based Applica=ons


What alleviates CPAs’ concerns? CPA2Biz 2012 Technology Survey

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Company reputa=on

SOC 2 Other firms' usage

Strong SLAs in place

Training on cloud service

Not Important

Somewhat

Very Important


Cyber Security – Importance of Topic Cyber Security - Extent of Issue:

•  The growing number of attacks on our cyber networks has become, in President Obama's words, "one of the most serious economic and national security threats our nation faces.“

•  FBI Director Quote. “Today there are only two types

of companies – those that have been hacked or will be hacked.”


Cyber Security – Best Prac)ces 1. Informa)on Security Framework

–  Third Party Security Reviews (SOC Reviews, Intrusion tes=ng, etc.) –  Document processes and procedures –  Understand Your Threat Landscape –  IT Security Policies & Vendor Agreement Reviews

2. Incident Response Framework –  Know when to acknowledge outside support is needed –  Leverage established response network (law enforcement, cyber experts,

specialists) 3. Ongoing Educa)on Ac)vi)es

–  Educate how you communicate digitally to members, customers, employees, etc

4. Cyber Insurance


Cyber Security Threat Landscape Areas •  External – phishing aQacks, hacking, state sponsored

espionage

•  Internal – disgruntled, disloyal, depar=ng employees

•  Human error

•  Ac)vists – denial of service, reputa=on aQacks

•  Iden)ty Thec – IRS tax refund fraud

•  Economic espionage (state sponsored, compe=tors)


Cyber Security Landscape

Defining Your Threat Landscape §  You need to define the par=culars of your situa=on §  Different measures and strategies

− Na=onal Security Organiza=ons − Fortune 100 Companies − Poli=cal Targets − Small Businesses − Consumers


•  Vendor management •  Cloud compu=ng •  WriQen informa=on security

policy •  Affiliate with local security

consultant/forensic vendor •  Smart password prac=ces •  Back-‐up’s •  Strong encryp=on

•  Mobile device policy •  Educa=on to avoid falling

for phishing scams or social engineering

•  Insurance op=ons where affordable

•  Employee training and educa=on

•  An= virus / malware vigilance, currency

Member Educa)on: What CPA Firms Should Be Doing


•  Service Organiza)on Control (SOC) Reports –  SOC 1: Financial Repor=ng –  SOC 2 & SOC3: Based on Trust

Services

•  Trust Services –  Security –  Availability –  Processing Integrity –  Confiden=ality –  Privacy

•  Opportunity to Lead

Expansion of SAS 70 to Meet Market Needs


Rebirth of Client Accoun=ng Services

in the Cloud


Client Accoun)ng

Significant Impact of Cloud Compu)ng & Mobile to Major Firm Service Lines

Key Outcomes: Automation, collaboration, improved workflow, processing efficiencies, improved quality of service

Audit

Efficiencies Innovation

Tax

Efficiencies Innovation

Transformative Revenue Growth


1990

2000

Today

Client Accoun)ng Over Past 20 Years

Today’s Opportunity

ü Cloud based

ü  Integrated

ü  Paperless

ü  Dashboards

ü  Real Time

Small Businesses push work back to

firms to focus more on their business

Role of Firms Reduced QuickBooks introduced

to small businesses Re-claiming of Client Accounting

& Trusted Advisor Role


Disrup)on in OUR World •  Accoun=ng is on cusp of disrup=on •  Freshbooks / Accountants Relief / Xero / Wave, etc. •  CPA2Biz •  Thomson Reuters / CCH / Intuit •  Countdown is two to four years •  PERSONAL PREDICTION:

“By 2017 there will be no premise-‐based soBware leB in public accounCng.”


Client Accoun)ng Services…

Virtual Controllership

Collabora)ve Advisory Services –

Virtual CFO

Write-‐Up

Accoun)ng Socware Must Scale to Firm and Client Needs

Business Process Outsourcing

Advisory

TransacConal

Specialize in Client Industry Verticals �  Healthcare

�  Not-For-Profit

�  Technology

�  Professional Services

�  Property Management

�  Government Contractors

�  Retail

�  Franchises


Driving Adop)on in a Digital Age

Business Change

Talent

Technology

Most significant challenge


40 Products You Should Know About

10 Prac)ce-‐specific Products

10 Client-‐facing Products

10 General Financial Products

10 General Use Products


Selected Prac)ce-‐specific Products Available Today

1.  Global Fx 2.  Intuit Tax Online 3.  XCM 4.  Firmflow 5.  GoSystem Tax

6.  Confirma=on.com 7.  ProfitCents 8.  GruntWorx 9.  Beyond 415 10. AverQ


Selected Prac)ce-‐specific Products Available Today

1.   Global Fx 2.   Intuit Tax Online 3.  XCM 4.  Firmflow 5.   GoSystem Tax

6.  Confirma=on.com 7.   ProfitCents 8.  GruntWorx 9.   Beyond 415 10. AverQ


1.  Quickbooks Online 2.  Bill.com 3.  NetSuite 4.  Wave 5.  Sure Payroll

6.  webKPI 7.  Accountants Relief 8.  Xero 9.  iLumen 10. Intacct

Selected Client-‐facing Products Available Today


1.  Quickbooks Online 2.  Bill.com 3.  NetSuite 4.   Wave 5.   Sure Payroll

6.   webKPI 7.  Accountants Relief 8.   Xero 9.   iLumen 10. Intacct

Selected Client-‐facing Products Available Today


1.  Mint.com 2.  Personal Capital 3.  ExpenseCloud 4.  BoardVantage 5.  Cortera

6.  SalesForce.com 7.  SuccessFactors 8.  FreshBooks 9.  Outright 10. Prosper.com

Selected General Financial Products Available Today


1.   Mint.com 2.   Personal Capital 3.   ExpenseCloud 4.  BoardVantage 5.  Cortera

6.  SalesForce.com 7.  SuccessFactors 8.   FreshBooks 9.  Outright 10.  Prosper.com

Selected General Financial Products Available Today


1.  Dropbox 2.  CPA.com Backup 3.  Google Apps 4.  MicroSom 365 5.  Find My Device(s)

Apple Others

6.  TripIt 7.  ShareFile 8.  LeapFile 9.  YouSendIt 10. SmartVault

Selected General Use Products Available Today


1.   Dropbox 2.   CPA.com Backup 3.  Google Apps 4.  MicroSom 365 5.   Find My Device(s)

Apple Others

6.   TripIt 7.  ShareFile 8.  LeapFile 9.  YouSendIt 10.  SmartVault

Selected General Use Products Available Today


Are You Losing the “Race to the Cloud?”

①  You are using ASP and calling it SaaS

②  You have no formal “digital branding”

strategy ③  You are operating your own Exchange server

④  You have not attended a leading accounting

technology conference in over a year.

⑤  Your members and/or your staff are

complaining about dealing with QuickBooks

files ⑥  You have no staff members under 30

⑦  You aren’t PERSONALLY using at least 3

SaaS services

7 Early Warning Signs


A Conference Sugges)on …

Erik Asgeirsson

Geoffrey Moore George Will

Barry Melancon

The first-ever, cloud user conference brought to you by the AICPA and our strategic business solutions partners, will help attendees embrace cloud technology as a strategic opportunity to start or evolve their client accounting services and tax practice into the digital firm of tomorrow.


The Digital CPA Cloud User Conference

Firm Technology Trends

Prac)ce Development

Tools

Hands-‐On User Training

Cloud Compu=ng, Mobile, Social Media, Change Management

Building a Virtual CFO Prac=ce…Pricing Services, Engagement LeQers, Staffing Models, Marke=ng Best Prac=ces

Accoun=ng Somware, Bill Management and Cash Flow, Tax, Accoun=ng & Audi=ng Workflow Automa=on

Oct 28 - Oct 30, 2012 Gaylord National, Washington, DC

Recommended CPE Credit: 19


Thank You

•  To learn more go to www.cpa.com • White papers, case studies, etc. •  Educa=onal webinars

•  We’re happy to speak to your membership – please contact us to discuss availability for 2013!


Ques=ons …..