Interesting CPA stories of how tech has transformed accounting

Today’s CPAs are immersed in a torrent of change so swift that it’s difficult to keep pace. Technology is drastically changing the way they crunch the numbers, analyze data, deal with clients — and spend their time.

We asked some technology-savvy accounting professionals to describe both their old and new ways of doing things, and the pros and cons of those changes. Here are their replies.

Charlie Metzig, CPA, a partner at Boyum Barenscheer in Bloomington, Minn., recalls carrying heavy three-ring binders — audit cases — to meet with clients more than 15 years ago. This was not only cumbersome but also tedious, as CPAs meticulously weeded through printed pages of data. Today, accountants carry just a laptop, and maybe a second portable monitor, when meeting with clients. In getting the work done, advances like email and services such as Thomson Reuters’s confirmation.com help speed communications and accounts receivable confirmations, allowing for “a more thorough audit in less time and for less cost to the customer,” Metzig said. His firm also uses artificial intelligence programs to reconstruct agings from general ledger data. (Note: Confirmation.com is a partner of CPA.com, the AICPA’s technology arm).  

Susan Landauer, CPA, co-founder and managing partner of Forensic Accounting Services Group LLC, in Albany, N.Y., remembers her first forensic case in 1989, when she looked for fictitious invoices. At that time, she used phone books and called companies directly to see if they existed. She also gathered viable evidence at various courthouses. Today, Landauer uses the internet and services such as LexisNexis to search for information. “You’re not trucking around to different courthouses to search for information,” she said about her current work.

Steven Rainey, CPA, partner, chief innovation officer, and national leader for data and analytics, tax, at KPMG in Tysons Corner, Va., said accountants at his firm previously spent weeks or months manually scouring files and documents to find projects that would qualify for research-and-development tax credits. Today, KPMG uses artificial intelligence, specifically IBM’s Watson, a question-and-answer tool that professionals train to scan documents. Watson looks for keywords and phrases “in contexts to mimic the way a tax professional would understand it,” Rainey said. The process takes minutes. In addition, CPAs can now reduce the number of interviews needed with scientists and engineers when discussing R&D, which in turn minimizes business disruption. Of course, to take advantage of all this new technology, training is required, and change can be difficult. “If you are somebody who likes to do the busy work, the technology is starting to eliminate that,” Rainey said. 

Joe Sullivan, CPA, tax partner at Delap LLP in Lake Oswego, Ore., recalls the days when CPAs used software tools that ran on in-house servers, tying them to the office to access work files. Today, many packages and tools, such as file storage systems and tax software, are cloud-based. “We aren’t tethered to our desktop computers in the office any longer,” he said. “This has created significantly more flexibility in our profession, allowing CPAs to work anywhere, anytime, and anyplace.” The only downside, he noted, is that many CPAs bring their laptops home as a result, “reducing their ability to disconnect from work.”  

Bernard Fish, management information systems manager at BrookWeiner in Chicago, said, “If it’s plugged in, I’m responsible for it.” He’s been with the firm for 26 years and remembers the days of key-punch operators entering tax return information. Today, his firm uses scanning software that automatically reads data and places it on the designated forms. “The CPA is the processor making the decision of where the information goes and how it is presented, without having to type in everything,” he noted. This helps his firm process more returns in less time.

Rekha Mehta, CPA, founder and president of public accounting firm RSMCPA Corp. in Colleyville, Texas, did financial ratios manually years ago. Today, software allows CPAs to feed profit-and-loss and income statements into spreadsheets. From there, CPAs can analyze that data, particularly historical data sets, and apply the proper ratios, Mehta said. These electronically generated historical datasets save time and allow CPAs to help clients improve the bottom line. However, she said, “there is always the fear of data being hacked, regardless of how many layers of security.”

James Bourke, CPA/CITP/CFF, CGMA, partner and managing director, advisory services, at WithumSmith+Brown in Red Bank, N.J., said years ago his firm maintained and generated financial statements for clients. Today, the firm’s clients use programs like QuickBooks, Intacct, and Xero to generate their financial statements internally — and this saves the clients money. But it also can give clients “a false sense of security because the information that they are generating may not necessarily be correct,” he noted. “Basically it puts us as CPAs in different roles of advising our clients on the accuracy of that information that they are generating.”

Sarah McEneaney, CPA, digital talent leader and partner at PwC in Chicago, said reports used to be generated and viewed manually, but “digital platforms now visualize data to better support decision-making, and can be refreshed real-time with updated client data”. Teams at PwC also use automation tools to help with controls testing, as opposed to doing this completely by hand as in the past. Investment in digital technology and the increased automation of more routine tasks are allowing CPAs to “deliver higher-value insights” to clients, she noted. 

Alison Houck, CPA, managing partner of Faw Casson in Rehoboth Beach, Del., and Ben Lagow, CPA, partner at Ragsdale, Curtis and Lagow, CPAs in Garland, Texas, remember the days when CPAs used green sheets of columned paper when doing bookkeeping, audit, and tax work. Now, they use software to maintain books and records, and software programs do the adding, connect to bank accounts, pull in transactions, and code these transactions automatically. QuickBooks, for example, “is including more AI features in its software that attempt to automatically categorize transactions,” Lagow said. And, he added, “remote-access software is constantly improving, making it less necessary to work on-site.” The cons? Software programs occasionally mess up (putting the wrong code on an item, for example), forcing CPAs to make manual corrections, Lagow noted. “And with technology,” Houck said, “we do lose face-to-face contact.”

Seth Pomeroy, CPA, partner in charge of CFO and accounting technology services at NDH Group Ltd., in Chicago, says clients rarely host their own application software in-house — as they did in years past — but instead use a cloud solution, as does NDH. While there is now a heightened need for security procedures, “the technology is allowing for greater mobility and far greater collaboration between various parties,” he said. “You can have multiple people doing different tasks within a single system.”

— Cheryl Meyer is a freelance writer based in California. To comment on this article or to suggest an idea for another article, contact Chris Baysden, a JofA associate director, at Chris.Baysden@aicpa-cima.com.