More CPA Firms Move Rapidly to a Paperless Technology 

The Association for Accounting Administration  polls its members every other year on technology-related practices. This year's survey asked members to provide information about paperless office technologies and their use.

With busy season now starting to go into full swing, highlights from this year's research will help you see where your firm stands in the move of the professional overall to a digital environment. Comparisons of the level of use of paperless systems now with two years ago show how quickly CPA firms are adding digital technologies and related practices.

Survey highlights. Here are key findings from the research:

• Tax. Several areas showed significant changes in tax practices between the 2005 survey and the new 2007 survey. For instance, three quarters (75%) of respondents to this year's survey said their firm is scanning client-supplied information for storage of tax return supporting documentation. That percentage was just 56% two years ago.

Another change is that more firms are using e-mail as a primary means for communication with tax clients when additional information is needed: 54% are doing so now, compared to just 37% in 2005. Nearly half (45%) of respondents now have a policy to deliver electronic tax information to clients in a secure, password-protected or encrypted way, compared to only 14% two years ago.

Several new questions were added for this year's survey. First, a question about the number of monitors used by tax staff and partners reveals that 10% of responding firms have at least one person using three monitors or more! Also new was a question about the use of intelligent scanning to organize scanned documents or to input them in tax returns: 29% of respondents are doing so.

• Audit. This practice area saw few changes from two years ago, except when it comes to having all audit work papers stored in a paperless audit application: 71% of respondents are following this practice today, compared with 59% in 2005. A new question asked about whether staff and partners working outside of the firm are accessing firm applications and information via a virtual private network (VPN) or a Citrix/WTS more than half of the time. Slightly more than half (54%) responded yes to this query.

• Administration. Document management programs throughout CPA firms are becoming more common: 55% of respondents have a document program to archive all final tax returns, financial reports, and firm correspondence, compared to 43% in 2005. For the first time the survey this year asked if firms primarily use a centralized scanning process to capture document images, instead of having individual preparers scanning documents: 67% of respondents are doing so.

• Other findings. Of particular note is that more firms are preparing the majority of invoices onscreen, instead of using billing sheets: 51% this year compared to 45% in 2005. However, little billing is being done electronically yet: only 13% are delivering client invoices by e-mail or digital fax (30% of the respondents two years ago reported they were following this practice).