Achieving Accounting Modernization — Without Disruption

The accounting profession is not necessarily known for being technologically savvy. On the contrary, it’s an industry that can often rely upon outdated processes and paper, as it has for decades.

But like so many other sectors, the accounting space can no longer afford not to modernize as the pandemic forces organizations to shift online in a remote work setting.

As Carl Coe, CEO of ImagineTime, told PYMNTS, in addition to the friction of migrating away from legacy processes, certified public accountants (CPAs) have another challenge ahead as they strive for digitization: Often, their own clients can be resistant to change, too. He spoke with PYMNTS about ImagineTime’s own strategy to upgrade systems and drive modernization not only for its accountant customers, but its customers’ customers as well.

Letting Go of Old Ways

In order to help accountants let go of their old processes, ImagineTime itself had to modernize. That was the motivation behind a recently-announced partnership with Mango Billing, a solution that Coe explained was launched by a former customer of ImagineTime that had the vision of having the same functionality, but on a modern platform. By joining with Mango Billing, he explained, ImagineTime was able to migrate away from outdated infrastructure.

“ImagineTime works exceptionally well, but it’s an older app with an old database,” Coe said. “It needed to be modernized because accounting firms of today want [Software-as-a-Service (SaaS)], hosted solutions and a modern interface designed for the web in mind.”

One of the biggest challenges that accounting practices face today in their own modernization journeys is having to stitch together an array of disparate apps and systems in order to work with digital technologies that meet their workflow needs. Coe mentioned they may adopt a single time tracking solution, a separate billing tool, and another siloed payment processor.

ImagineTime aims to bring all of those processes together in a single, integrated solution in order to manage the entire customer interaction. Doing so now in a digital setting is more imperative than ever before as accountants and their clients adhere to social distancing requirements.

At the same time, accountants themselves sometimes struggle to embrace new tools, according to Coe.

“Accountants, by their nature, are conservative people, so they tend to be laggards in technology,” he said. “For years, we heard, ‘I know I need to have a mobile, web-based product, offer electronic signatures, share sensitive files securely — I’ll get to it.’ Well, the reality is now, if you don’t have those things in place, you can’t serve your clients.”

As a result, in ImagineTime’s own modernization journey, it was vital to ease disruption as much as possible for its accountant users by maintaining many of the same nomenclature and processes that clients used in the original design of the solution.

Easing Customer Migration

As CPAs and accounting practices upgrade their own back offices, it will be key to minimize disruption for their own clients, too, including small businesses and individuals. And, just as the accounting process can be slow to embrace technological innovation, accountants’ clients can also face challenges when adopting digital tools.

As Coe explained, the core of CPAs’ client base is often older individuals or small business owners that are not necessarily technologically savvy. That can weigh heavily on accounting firms’ back offices, particularly when it comes to accounts receivable (AR) and accepting payments.

“We find ourselves evangelizing a lot on the concept of taking electronic payments, and the opportunity of fully integrated electronic payments where accountants don’t have any AR,” said Coe. “That’s versus today, where traditionally they have a very large AR balance they’re carrying all the time because their customers are mailing and dropping of checks more than most industries.”

This is, in part, due to the generational gap of accountants’ typical client. But it is quickly changing, said Coe, thanks to a variety of market shifts that include the rising demand for secure workflows that can support safe payments and exchange of sensitive data — a requirement that has only accelerated as a result of the pandemic.

Coe admitted that the accounting industry will continue to face resistance on multiple fronts when it comes to embracing the change of digitization, like the migration away from paper checks. But with FinTech solutions not only helping to modernize the accounting profession but mitigate the friction of adopting those solutions — for both accountants and their own clients — progress is being made.

“I would submit that accountants and their clients will be the last [to ditch the paper check] because they’re very dug in their ways,” Coe said. “But it’s moving and changing very quick. It won’t be that far off where you won’t have anyone taking checks anymore.”