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Reaching The Safe Harbor with Technology


Reaching the Safe Harbor with Technology

By Tasneem Esmael

Your future is a mirage but if there is one thing that is certain, it is called ‘Technology’. Technology is synonymous to money in a way. I am sure we all have heard the phrase, “Money is the root of all evils.” Technology can be used with the same reference by the orthodox, religious zealots. There is an Arabic verse, translation of which, says it for me, “Your deed is defined by your motive.”

So, what is your motive to invest in technology? Less carbon emission in the air will make our air cleaner. Therefore, investing in renewable energy is a good thing. Technology is bringing the world together, closer, more intimately intertwined. A friend in Pakistan recently remarked, “The world is a global village.” The days of segregated systems, departmental chaos, and information silos is over. Most of us in the industry are familiar with this phenomenon called ‘ERP.’ Enterprise Resource Planning. It is a system that helps small, medium and enterprise size businesses become leaner, smarter and agile by better managing company’s resources. ERP helps to achieve knowledge management in an organization. With ERP we integrate tax automation systems that help to simplify the world of taxation. Before we analyze how technology helps with KM, let’s first analyze what is knowledge management:

1) Data

An organization gathers data. Data can be static, factual, discrete, unprocessed and unorganized

2) Information

Refined form of data is information which is more meaningful

3) Knowledge

Knowledge is the acquired form of human learning and experience. It is not information and information is not data. But knowledge is acquired from information and information is acquired from data.

How ERPs and Tax Automation softwares help with Knowledge Management is by bringing people together from different departments on one platform, recognizes their intellectual capacities and leverages their wisdom in a company-wide system.

It is important to note that an ideal organization is one where a conducive and unpolitical environment is provided for a smoother exchange of knowledge across functional areas by using technology and established processes. A successful leadership knows how to manage the overlapping factors that is people, organizational processes and technology. None of the three areas can function independently of one another.

So, your motive to invest in technology was to manage your company’s knowledge by the use of ERP and/or a Tax Automation software. There are a few things to keep in mind that I encountered on my various ERP and Tax software implementations to be essential tools of investments for managing knowledge:

1) Change Management

Sounds pretty simple, doesn’t it. It sure is not. It involves letting everyone know who is going to be effected by the change; that you are going to make a change before you make it. No, you don’t pick up the mic and announce it. It is quite an involved system. It is a process. 1. First you propose in writing what the change is about. 2. You identify the right candidates of the change who will be affected by it. 3. Then you notify them about the change. 4. Explain them how they should effectively respond to accomplish this change 5. Keep them informed while you proceed to accomplish this change.

Two things are accomplished with utilizing this process:

a) Historical data of changing system processes is preserved

b) Leaves a trail of information for the new team or associates to act upon, saving time and company’s resources

2) Data Cleansing

It is one of the most relentless task at hand. Cleansing data is quintessential to a successful implementation, daily operation and error-free functioning of a system. A clean master data is important on the 1st day of go-live and few years down the road. Companies usually tend to forget with more important tasks at hand, they overlook the enormous data sitting in company’s systems taking space and creating clutter. It might be worthwhile to bring a fresh team on board just to clean and create a clutter-free environment if the task seems out of control for those who already have enough on their hand and there are only so many hours for the job. A re-engineering project team or consultants would make for a good investment.

3) Business Processes

Business Processes can become obsolete. A company needs to know when they should adapt to a newer version or newer and better technology. Some companies tend to keep legacy systems as it is for their strategic advantage or conform to the newer trends. Multinational and mid-sized companies tend to be more flexible with conforming to the newer trends to keep up with the industry’s ever-changing technology. It is the small to mid-size firms that tend to lag behind and overlook the necessity for change. If it makes for a good investment, it will be worthwhile to adapt to the changing world and become more techno prowess.

Investing in your future, may it be an individual, a group, a company or a nation is a worthy cause and a cause for much mind probing and thought provoking effort, an effort that should not be taken lightly but intelligently and with the right frame of mind will be a job well-done in the end.

Tasneem Esmael is the Principal Consultant at Taxnologi Solutions, LLC (“Taxnologi”). She has over 12 years of Financial Business, IT and Consulting experience helping clients with ERP implementations, re-engineering projects, sales and use tax and VAT automation.You can learn more about Tasneem on Firm’s Featured Tax Consultants page. Questions and comments can be submitted through the COMMENT feature following her posts – or by using the REQUEST link on the company’s Firm Profile.

The Changing World of (Sales) Tax Technology

By: Joni Johnson-Powe JD, CPA

As I look back on my career over the past 16+ years, not only have tax technology services changed but the accounting industry is much different place. I actually started off doing tax software implementations of telecom tax software which generally spanned at least a year from project kick-off to go-live. My counterparts in the “Sales tax” practice usually had a 3-6 month implementation timeframe with tax research and taxability determination set up. However, telecom tax had a much more detailed project scope and timeline because the complexity involved not only sales tax but a wide array of regulatory surcharges, 911 fees and other gross receipts taxes that could apply to a single charge. There were only a few software vendors to choose from but usually it was narrowed down to 1 or maybe 2 depending on price point, industry, and ERP system. Our team usually worked with IT consulting firms such as Bearing Point and Accenture to assist with the “technical” aspects of the projects such as API (“Application Program Interface”) development.


Read the full article here!

Public Accounting: Advice to Young Women Professionals


I grew up in a pretty unconventional household for the ‘70’s in that both of my parents worked full-time, each had college degrees and separate bank accounts, my father cooked most meals, and eventually my mom’s salary outpaced my father’s. My father was a CPA and loved tax. But in retrospect, my mother had a lot of influence on who I am today with her drive, independence and strong sense of dignity.

That drive and confidence definitely influenced my early goals to be a partner in a Big 4 accounting firm. However, as a new tax staff consultant at a large global accounting firm, I quickly learned that simply being smart was not enough. It also required something that they didn’t teach you in Intermediate Accounting, FBLA or Beta Alpha Psi. Work was not divided up evenly amongst staff nor was it always given to the person most fit for the project. It wasn’t just whether you were smart and talented but there was something more that seemed to be required.

I was laid off from my first Big 4 public accounting job, although I did spend 7 years with Big 4 firms. Throughout my journey in accounting, I learned quite a bit along the way in particular as a professional woman in the industry.  Here are few tips for young women professionals maneuvering the public accounting highway whether you aspire for partnership status or not.

The Obvious – Work hard, produce good work deliverables & connect with your managers and clients.   But also:

  • Take initiative – Be as aggressive as our male counterparts in seeking out challenging projects and asking for work. Ask seniors, managers or project leads if they need assistance during downtimes or as your project nears an end. Get to know as many of your colleagues and managers as possible. Keep your options open and try different clients, industries and specialties whenever possible.
  • Find a Sponsor – Find someone you like working with who appreciates your work and who will have your back. Actually, find more than one because if that person leaves, you need to have someone vouch for your work, commitment to the firm, and dedication to great client service. It’s especially important during review time: if no one knows who you are and what you do, when the RIF (reduction in force) comes you will likely be on the list. And believe me the RIF’s come all too often.
  • Show-up – Firm Sponsored Activities – Even if you’ve had a long tiresome day, week or busy season, show up at firm events like happy hours, golf tournaments and charity events. No, you don’t need to be at each and every event, but schedule those you can around other commitments and family obligations. Also, don’t just be physically present but get to know your colleagues at all levels. Relationships build, grow and solidify at these events.    Side Bar: Golf is a frequent activity in our industry so consider lessons and learn the game. It’s not important to be a golf pro by any means, but knowing the basics goes a long way with connecting with managers and clients. 
  • When One Door Closes, YOU Open Another – When I was laid off from my first public accounting job, I called the partner who gave me the “bad” news and asked for a recommendation for an opening at another firm office. Two weeks later, I had a new the job with the same firm that had just laid me off.  As a new manager, my “Sponsor” moved to another group, and a second “Sponsor” decided to retire.  I evaluated my options and took advantage of an opportunity.   I started my own company and provided services to a spin-off practice of the firm. . Risky? Yes. Paid-off at the end? Yes.

Moral of the story:  Don’t just lean in or knock on the door, turn the handle and walk thru it.  Don’t get me wrong, do I think there’s still a gender gap in public accounting industry? Yes, more so than I would have expected 15 years after I started my career. No way should we represent more than 50% of new hires, but only 20% in the partner ranks. But I hope the younger generation of women accountants can use these tips that I wish I’d known starting off…and Kick that Door Wide Open!

Top 5 Things to Consider: Starting Your Own Accounting or Tax Practice

The first time I started my own company I was 32.  I was working in a Big 4 Accounting firm, my dad had passed away with cancer and his clients needed someone to prepare their tax returns.  I started the CPA firm in his name and never looked back.  I have taken a couple detours but landed right back to running my own company as it is ideal for my “work-4 kids-1 husband-life balance”.  And I love it!!

Here are some things I have learned along the way:

  1. Choose a Legal Entity – I know that it’s common knowledge that you should form some type of entity in which to operate your business.  However, I can’t tell how you many times I meet entrepreneurs and business owners that “haven’t gotten around to it”.  An LLC or other legal entity provides it owners with so many benefits besides just limited liability protection.  From a practical standpoint, a legal entity makes it easier to run and grow your business.  Obtaining a bank account, liability insurance, and executing agreements with clients is much easier if you have a corporate structure.  Some clients will not hire independent contractors who are individuals or sole proprietors due to liability concerns.
  2. Sign-up for Insurance – Not only will you need malpractice insurance but you also need general liability insurance, auto insurance and potentially worker’s compensation insurance.  I can’t recall any agreements that I have recently executed for projects or new clients where I didn’t have to acknowledge that I would maintain each of the above for at least $1 million of coverage per occurrence.  Even to qualify to lease my office space, I had to have a least $1 million dollars in general liability coverage.  (They actually asked from $3 million but I negotiated it down.)  So don’t put off getting insurance as it can seriously affect your ability to grow your business or obtain new clients.
  3. Start with Sufficient Savings – You really should have 9-12 months of savings available.  When I started my first company after my father died, I would say I had insufficient savings.  I consider myself lucky that I was able to secure a couple of really big projects from referrals from my old firm.  Plus, working in tax technology, my projects for software implementations tend to run 9 to 18 months long which helped with a continuous cash flow as I grew my client base.  It takes a lot of investment to grow your business as well as lot of hard work.  Living paycheck to paycheck during this start-up stage will complicate your journey and bring added stress…so plan accordingly.
  4. Business Plan, Mission Statement, & Employee Manual – I know, I know..duh right?  But sometimes we get so focused on getting started that we don’t take the time to lay the foundation we need to grow our business.  My first company grew so fast that I hired 5 employees within the 1st year and a half of starting.  While I was busy getting new clients and work, I hadn’t created an environment where my employees shared my vision of who we were, how we treated clients, and how we respected one another.  As a result, I had clients who were unhappy with services from my staff and staff who did not know how to conduct themselves in a client service environment.  Inter-office drama, poor client delivery, and a sense of loss of control caused me stress and uncertainty.  At 32, I had no idea how to motivate my staff and handle daily HR issues that they don’t teach you in law school or business classes.

So my advice is to define in writing what services you will provide and what clients you plan serve.  Define your market, service offerings, and expected revenues and expenses.  Document and share your vision and mission with your employees.  How will you be different than all the other service providers out there?  Sure accounting, audit or tax services are not the sexiest, most innovative services offerings but they are broad with a number of specialties that can provide you with a niche or means of distinguishing your firm from others.  I recently used LivePlan.com to create a business plan for my most recent endeavor and found it invaluable.  There are other great tools available on the web that can assist with the process.

Even if you don’t plan on hiring help right away, get an employee manual in place as soon as possible.  You never know when your next big project or client will fall your way, requiring you to hire help.  I learned the hard way.  I hired a former staff member who I worked with at my old firm.  We got along great and worked well together on clients.  Then suddenly he was taking paid time-off in the middle of tax return crunch deadlines without much more than a day or two’s notice.  He felt that his time-off was his to take whenever he wanted.  I expected to be given sufficient notice and an approval as client deliverables took precedent.  But he never knew of my expectations as I had not provided him with any prior notice or employee manual that defined how paid-time off worked.  This disagreement eventually lead to the demise of our working relationship.

Lesson learned: Take the time (and spend the money) to have your company policies documented.  Have each employee and contractor sign-off that he or she has read and understands the policies outlined, therein.

  1. Invest in Software Tools – Research the types of software applications you will need to support and grow your practice.  Accounting applications or cloud-based solutions such as QuickBooks, Xero or FreshBooks are a no-brainer.  However, there are a lot of choices, so do your research and find the one that will be right for your needs.  Time tracking applications are also a good idea to look into even if you start out as the only employee.  As you gain more clients and hire associates whether contract or employee, time tracking software saves time and helps you bill clients more efficiently.  Some of the cloud-based accounting applications have time and expense billing as a feature including FreshBooks and Sage.  There is also BigTime, Tsheets and many others that can integrate with your accounting software application.

It goes without saying that Microsoft Office or other applications like Google Docs are necessary for any practice.  I currently use Office 365 as it gives me all I need and then some to run all aspects of my company including Outlook, Skype for Business(fka Lync), PowerPoint, Excel, Word, Publisher..you name it.  I hope to give up my side job of IT manager soon but Office 365 provides the tools I need until I outsource the function in the very near future.

Training applications or webinars are also important as running your own practice takes time…a lot of time.  There are a number of training and CPE offerings out there, too many to mention here.  I found the video based training where you can start, stop and re-start again most helpful as it was difficult to find 2-3 hours of uninterrupted time from client calls and emails.  Making time for the training is extremely valuable.  I took for granted how important and convenient all those “firm sponsored” training sessions that I could no longer access were to my practice and clients.

Whew…well, I hope that helps. I could go on and on with lessons learned but the above should get your started.  Good luck!!