Sponsored by: AccountantsWorld · ADP · Paychex · SurePayroll
Payroll and human resources administration and management are natural extensions to a CPA firm’s business. Numerous accounting firms already extend these services, and many are weighing the pros and cons. No matter which model you choose, offering these services is a way to grow your business, increase revenue, and strengthen your relationship with your clients. In this special report, executives in the field of payroll and human resources administration solutions talk about workplace efficiencies; compliance with federal, state, and local laws; and emerging technologies.
Joining us are Michael Alter, president and CEO of SurePayroll, a Paychex company and a provider of online payroll services; Chandra Bhansali, president and co-founder of AccountantsWorld, a firm specializing in cloud-computing solutions for accountants; Andrew Childs, vice president of Marketing, Paychex Inc., a payroll and retirement plan services provider; and Anish Rajparia, president of Small Business Services, TotalSource, and Retirement Services for ADP, a human resources, payroll, and benefits solutions provider.
What criteria do you suggest accounting firms apply to decide
whether they want to offer clients payroll services? What reasons
would you give CPA firms to do so?
Michael Alter, SurePayroll: Running payroll is a complicated, time-consuming, burdensome process for many businesses. They often are eager to outsource, and it is a simple way to expand your services. Payroll solutions like SurePayroll make it easy for you and the client: It is a three-step process—enter hours/salary, review, and approve; you are done in minutes. You can also customize our system with your logo and color scheme, further establishing your firm’s brand.
Chandra Bhansali, AccountantsWorld: A CPA firm considering adding payroll services must first analyze its viability. Factors such as potential market, additional revenue, increases in operating costs, potential profit, and operational considerations are among those to consider. For example, nearly one-third of Payroll Relief users who switched from other solutions saw a 50% or greater improvement in their payroll services, because it let them process payrolls faster and typically cost them less.
Andrew Childs, Paychex: The decision to offer payroll requires many considerations. What is client demand, staff capacity, and is offering these services viable and potentially profitable? Will gaining payroll revenue offset possibly higher revenue from other CPA services? Will revenue gains offset the risk of losing the entire client engagement if there are payroll or compliance issues? And finally, do your clients require HR offerings including retirement, pre-tax benefits, and insurance?
Anish Rajparia, ADP: Our recent survey of accountants reveals that 89% are involved in their clients’ payroll processing in some way. Seventy-five percent believe it deepens client relationships, and 78% of their clients want them involved in their payroll processing. Among the criteria used to determine whether to offer payroll directly to clients or to outsource are the number and type of business clients and the ability to invest in support staff and technology to manage compliance.
How are today’s solutions helping accounting firms improve
workflow and efficiencies?
Michael Alter, SurePayroll: Our reseller program allows CPAs to profit from providing payroll services to their clients without assuming the time-consuming, burdensome task of payroll processing. Payroll calculation and deductions; federal, state, and local tax filing; and direct deposit are all done automatically online. This service enables accounting firms to build their business while saving time and money.
Chandra Bhansali, AccountantsWorld: Cloud-based payroll solutions have streamlined the workflow to an extent never before thought possible. Our Payroll Relief solution automatically makes electronic direct deposits, federal and state tax deposits, and files tax forms according to individual deadlines. Paycheck and payroll reports are automatically saved in clients’ portals to print in their offices; paystubs are available to employees through employee portals; and all payroll forms are automatically saved in client portals so clients can access them anytime from anywhere.
Andrew Childs, Paychex: Our solutions enable our CPA partners to take on the role of consultant to their clients—regardless of the level of payroll involvement they choose. Through our online applications, CPAs can provide significant value by helping clients with payroll, tax planning strategies, benefits assessments, and insurance evaluation. And our tools help CPAs demonstrate their interest in their clients.
Anish Rajparia, ADP: Our RUN Powered by ADP Payroll for Accountants solution is a payroll and HR service that helps improve cash flow and compliance with ever-changing regulations. CPAs can increase workflow efficiencies for those clients who process payroll directly with ADP by accessing their clients’ payroll reports anywhere they have internet access, or by interfacing payroll data to their general ledger. Our mobile solutions allow clients to update or enter payroll information on the run, thus enhancing overall performance.
Keeping up to date with changes in local, state, and federal
laws is a challenge. How does your solution help accountants stay in
compliance?
Michael Alter, SurePayroll: SurePayroll calculates, files, and pays federal, state, and local payroll taxes automatically. By doing so, we help clients stay compliant and avoid costly fines from the IRS.
Chandra Bhansali, AccountantsWorld: AccountantsWorld stays on top of all regulatory changes so Payroll Relief users do not have to worry about the details. Users just need a high-level understanding of the changes to process payrolls accurately. And because Payroll Relief is cloud-based, there is no need for software updates—unlike desktop-based programs. Users are assured they have the most compliant version for each payroll processed.
Andrew Childs, Paychex: With the election approaching and tax provisions looming, we foresee a future filled with regulatory changes. Paychex has an in-house team of compliance experts who spend countless hours monitoring the potential impacts of these changes—something most small employers don’t have the resources to do. This issue is one of the key reasons why so many employers outsource their payroll.
Anish Rajparia, ADP: ADP has a large, dedicated team whose sole responsibility is to constantly monitor regulatory changes and promptly assess how those changes may impact businesses and the accounting rules that govern them. We have a specialized team of tax, policy, legal, and product development experts who assess, modify, and improve the systems and processes that help our clients remain compliant. Our Accountant Portal, Accountant Connections e-newsletter, and Eye on Washington alerts are just a few of the many ways we help keep accountants current on regulatory changes.
Protecting employees’ financial and medical information from
fraudsters is essential. How do today’s solutions ensure this
information is secure?
Michael Alter, SurePayroll: We know how sensitive payroll data is, so security is a priority for us. We use multiple layers of security, including encrypted Social Security and account numbers, firewalls, and third-party experts to monitor security 24/7.
Chandra Bhansali, AccountantsWorld: Protecting employees’ confidential information is a priority for us. All crucial data is encrypted while stored on our servers and transmitted over the internet. We host all our solutions at amazon.com—one of the most secure service providers—and we use state-of-the-art security measures to prevent intrusion. Our staff does not have access to clients’ confidential information.
Andrew Childs, Paychex: We use advanced technologies for backup and recovery of customer information, encryption, virus detection and prevention, firewalls, and for other hardware and software to protect data against unauthorized access or alteration. In addition, we use internal policies, safeguards, and training to help keep customer data secure.
Anish Rajparia, ADP: We have rigorous monitoring systems, policies, and processes that govern the use and handling of client data. Our security policies and processes are regularly audited by external audit companies. We have data security safeguards in place that help protect personal information from loss, misuse, or unauthorized access and alteration.
No two accounting firms are alike. How should a firm go about
choosing a vendor and a solution that meets its specific needs?
Michael Alter, SurePayroll: While some large corporations need a vast array of services, many small businesses just want to run payroll. If your practice is primarily with small business clients, you want something that’s going to take care of a very specific need—payroll—and make it accessible and easy. SurePayroll, for example, is a great fit for small businesses with one to 10 employees.
Chandra Bhansali, AccountantsWorld: Regardless of the size of the firm, the firm should look for solutions that perform all compliance automatically, streamline the entire workflow, and process payroll efficiently and cost-effectively.
Andrew Childs, Paychex: As trusted advisers to their clients, CPAs should only partner with highly reputable, financially solid industry leaders whose offerings can be adapted to meet the needs of individual clients. Paychex is the payroll and HR services provider for the AICPA’s Trusted Business Advisor Program.
Anish Rajparia, ADP: When you choose a vendor for mission-critical applications, you want a financially secure, established partner that is recognized for excellence by the financial and business communities. Your partner must also continuously invest in its people, services, and technology to ensure best-in-class solutions are in place across all aspects of the practice, including compliance tools for payroll, tax administration, and data integrity.
What trends are you seeing in new technologies and workflows?
Michael Alter, SurePayroll: The paperless trend
continues to accelerate. Software-as-a-service (SaaS) solutions and/or
cloud solutions—such as online payroll—will continue to drive the
trend. The big change will be the emphasis from software to service.
To date, the emphasis on SaaS and also cloud has been on the software
side of things, with many companies putting legacy software online.
Chandra Bhansali, AccountantsWorld: The most important trends are the use of mobile technology to process payroll and the use of client portals to distribute paychecks, payroll forms, and reports to the clients. Using employee portals to distribute paystubs and W-2s is becoming a necessity. Payroll Relief offers these features.
Anish Rajparia, ADP: Transitioning toward more cloud-based information exchange and the expanding use of mobile technologies have recently taken center stage, particularly as they relate to improving workflow efficiencies and anytime, anywhere service. Innovative products have been instrumental in this transformation.
What’s on the horizon for new laws affecting payroll and HR practices?
Chandra Bhansali, AccountantsWorld: Implementing the provisions of the Patient Protection and Affordable Care Act (PPACA) is a major consideration for payroll solution providers.
Andrew Childs, Paychex: During an election year and
with a slow economic recovery, we can expect changes. Many tax
provisions are set to expire. And the recent ruling concerning the
Patient Protection and Affordable Care Act did not clarify how small
businesses are to implement the next set of provisions to take effect.
Business owners are typically not inclined to manage continuous
regulatory change, which makes this an opportune time for CPAs and
business service providers to demonstrate their regulatory
expertise.
Anish Rajparia, ADP: The Patient Protection and
Affordable Care Act, the subject of a closely watched Supreme Court
case, was decided on June 28. The majority opinion decided in favor of
the constitutionality of the individual mandate of the act. Numerous
provisions take effect in the next couple of years. Starting in 2014,
under the PPACA’s definition of “full time”—30 hours a week on
average—all large employers are required to track, record, and report
to the IRS annually whether each employee worked full time each month.
This data determines which employees must be offered health benefits
to avoid an IRS employer shared responsibility penalty. There are new
automatic enrollment requirements and waiting period limitations. Keep
an eye on how “full time” will be defined, and how the new IRS
proposed guidance defines the different ways employers will track the
full-time status of each employee.
