Tag: Technology

Posted on by Vipul Sheth

In the second of AdvanceTrack’s FAQs, we ask our MD Vipul on your behalf: ‘How would my practice begin working with AdvanceTrack?’

Initially we have a fact-finding meeting. It’s effectively the first – and one of the most important – tasks. It’s vital for us at AdvanceTrack to know how your accounting practice works, and for whom. We are well-versed at getting down to the important details quickly! There are a whole host of questions but, essentially, we ask about the practice’s structure, processes and technology stack.

The next part of the fact-finding mission is also very important. We ask: “what problem do you think we’re going to solve for you?” This is all about getting to the heart of whatever issues or tactical aims the practice views us as being the solution for. Sometimes we can see a clear path for us to help, but on occasion, we might have to explain why another option may be best for the practice to pursue.

The issues we’re confronted with, though, usually fall into two buckets: your firm is either in the midst of having difficulties in maintaining service for the clients; or the firm has growth plans and require our flexible capacity to help them scale.

It’s ‘nicer’ to be able to methodically plan and support growth, but we understand that things aren’t always that straightforward.

If a firm’s processes and tech are in a sufficient place for us to be able to link well, then we look at the strategic needs and provide advice on whether we think an outsourcing or offshoring solution would work best. The former is structured around us completing a set amount of work on behalf of a firm in a set timeframe, whereas the latter is about the provision of dedicated offshore team members to work with that firm full-time. It is an important decision, and a decision made carefully between us and the firm’s leaders.

Whatever the route, we would always say that the next step is about communication between the firm, our technical team and us at head office. This would certainly be front-loaded to ensure that things are working smoothly.

How we manage and progress our relationship is a story for another day – but keep an eye on our blog for more FAQs. Our first FAQ, on client data and security, can be accessed by clicking here.

If you’d like to talk to us about your accounting firm, and how we could help, please get in touch.

Posted on by Vipul Sheth

Being ‘more valuable’ to clients can mean many different things, but all iterations involve understanding your people’s current skills, and how you work together to adapt and evolve both them and your practice

Technological advances in the accountancy space, whether it’s for your back office or client-facing, have been rapid in recent years. It does feel that anything is possible.

Despite these advances, coupled with the technical nature of accountants’ offering, it is still a ‘people game’. You must get to know and understand your clients’ requirements, and understand your own team members’ personalities and skills.

Therefore, using tech to automate your services and provide a broader and richer offering requires more than IT investment.

 

Where do you start? Is it the client, the tech or your people?

Paul Richmond, managing director of people consultants theGrogroup, says that you must first set out a vision and strategy to deliver future success. “An accountant in 2030 will need to be an adviser, tech-savvy and a change expert,” he explains. “They will need to be widely connected and know people who help clients. Key talents will need to be curiosity, adaptability, emotional intelligence and a growth mindset.”

But these skills and personality traits are
difficult to capture in one person. And from a cultural perspective, practices have focused on compliance services that are defined by collating historic data – which means forward-looking services will require a shift in culture.

“It’s not an overnight switch. You can’t just say your job is going to change now; it’s an impossible thing to do,” says Aynsley Damery, CEO of business advisory platform Clarity. “‘Historic’ is ingrained in accounting, the ethos of preparing things based on the last year, so there requires a shift into the unknown.”

A key skill for all client-facing staff is empathy, he explains, as it puts your people in a position to listen and understand what clients are going through. “Most employees don’t know what it’s like to understand what it’s like running a business… the fears, hopes and challenges – everything a client’s going through,” says Damery. “It’s incumbent on leaders to help staff understand this, so when clients are upset or cross they will turn to you to share with.

“It is about your people becoming sounding boards – not necessarily ‘business gurus’. They need to be open, help understand the issues and challenges, and to avoid asking ‘closed’ questions,” Damery adds.

 

Focus on the process

Beyond strategy and culture comes process, setting out what you will do and how you will bring your practice closer to defining who undertakes which tasks.

“I’d map out the functions of the firm as a whole,” says Accounts & Legal director Stuart Hurst. “Rather than individual job descriptions, I’d look at job processes and ask people how they get from A to B to C to D… then ask the best way of doing it and what the barriers are to it improving.”

Setting out this path encourages your people to change and mould according to your overall direction of travel, rather than a pre-defined job description. “This way you’re changing the day-to-day… otherwise you create resistance,” says Hurst.

Once you understand where your practice is and where it’s heading, alongside a broad definition of how your people need to work and communicate with clients, what is next?

“I’m a big fan of really understanding what type of people you have in your team,” says Hurst. “Those that are more naturally extrovert will likely get more involved with clients and will be an easier conversion towards more proactive support.”

 

Ask the right questions

Clarity’s Damery believes a more nuanced approach is required, suggesting that extroverts aren’t always the best fit with certain clients. “It’s more about those that listen and ask the right questions,” he suggests.

“Remember that you’re not throwing people on stage and asking them to perform, and there isn’t ‘one way’ to train everybody – find methodologies that work for certain individuals. Build a culture of trust where people can fail safely, let them make mistakes in a controlled environment, and build trust and learn from it.”

You are looking to instil into your people that they need to open their mindset, that the firm is on a journey and you want them as part of that – though some things will change.

TheGrogroup’s Richmond poses an example of how the mindset and attitude must move. “One of the key frustrations we have is when accountants say: ‘We did a client survey and scored 8/10’. Well, you would because you asked the question: ‘Are we good accountants and do we give you enough help?’ To which the answer will be ‘yes’,” he says.

“However, what if you were bold and said: ‘To what extent do we help you with your strategy? Have we helped you grow your business this year? Do we enable you to grow your client base and suppliers?’ Ask that, and the response is likely to be 3/10.”

Damery suggests that taking such actions to change your firm’s direction doesn’t mean turning it upside down. Changes can be iterative and not necessarily revolutionary.

“There is still a place for people to do mainly technical work and a need for that,” he says. “Clients aren’t generally looking for anything mindblowing but focus, awareness and accountability – that shouldn’t be scary.

“Empower your team and give them the confidence to ask clients what you can help them with – ask the basic questions and respond in their language. They want help with the numbers, but also planning and the impact of the numbers and what different projections mean for them.”

 

Learn from each other

If you have junior team members that are more comfortable with using new apps, and some senior members very comfortable with having valuable conversations with clients, then there is the opportunity for both to learn from each other.

“Certainly, if you’re looking to upscale people in terms of facing clients, then you have to bring them along to the meetings; there needs to be a mindset of coaching staff,” says Stuart Hurst.

Paul Richmond also extols the virtues of training. “If your firm is becoming more adviser-led then training and recruitment must reflect that. You’re looking at relationship skills, EQ, influencing, persuasion and the ability to lead clients – ensuring your people want to know as much about clients as possible,” Richmond explains.

 

Be adaptable

As suggested earlier, adaptability is a key trait in a firm looking to support clients more proactively. And understanding your people’s ability to adapt may only come through experience. “While it’s trainable it’s much easier to recruit it,” says Richmond.

“You need to be having conversations with your individuals and using tools such as the nine-box grid to evaluate potential, and their appetite to adjust and develop. But people are either motivated by change and challenge or afraid of it.”

Hurst says: “The worst-case scenario is that someone doesn’t fit. Then it’s about reallocating – you need to have the right people in the right seat. That is not necessarily an easy or instant decision, so think carefully about performance management.

“Sometimes you have to nurture where you’re heading. With advisory it can be a bit more of an open conversation and by nature vary – certainly by client-by-client.”

Richmond asks you to consider which KPIs and metrics are being used to measure your firm’s success in operating with a different model.

“What do you want to hear back from a client?” he asks. “‘My accountant is always there for me and interested in how I do’. Then you must measure how often people contact clients or suggest ideas to them – what gets measured gets done. So, forget ‘who has hit budget’ and instead ask questions about client communication or adaptability.”

 

  • Kevin Reed is a freelance journalist and former editor of Accountancy Age.
Posted on by Vipul Sheth

AdvanceTrack has teamed up with business advisory platform Clarity to offer clients a way to understand and improve their business

We have exciting news of a new partnership, bringing together AdvanceTrack’s outsourcing capability with support to build and deliver a top-level advisory service. Clarity has partnered with us to provide an exclusive offer for AdvanceTrack’s clients.

Clarity is a business advisory platform harnessing AI, machine learning and blockchain, which uses the right combination of people, process and tech to transform the business advisory services of accounting firms worldwide.

Clarity’s offering helps practices support clients in understanding their numbers – and how to improve them. Accountants can help them create a step-by-step plan to build a better business and, through a structured online data room, help access the cash and investment to grow or exit. The Clarity platform empowers 100% of accounting teams to help 100% of their small business clients with business advisory.

Its founder and CEO is Aynsley Damery – a qualified accountant and former CEO of a multi-award winning niche advisory accounting firm for entrepreneurs in the UK.

 

“Our world is now so connected – both people and devices, and the ability to reach customers is no longer restricted by borders,” said Aynsley. “The move to the cloud and the ability to analyse big data opens up incredible opportunities for many accounting firms. Harnessing the power of technology effectively has become critical to gain competitive advantage.”

 

 

 

 

AdvanceTrack founder and MD Vipul Sheth said that, by outsourcing, accountants should be freed to drive client value. “We want practices to break free from spending all their time on compliance work that can be managed and processed in a better way,” he said.

“And by freeing them from these bonds, they can make much better use of their time understanding and advising their clients on growth, or their longer-term aims.”

Get in touch with #TeamClarity on info@clarity-hq.com to find out how you can benefit from our partner programme, plus an advanced implementation plan to get your firm on track.

Posted on by Vipul Sheth

Security is a popular topic in the industry at the moment, and it’s come to be expected that updating your security protocols, implementing new systems and reviewing processes can be a massive time sink-hole for accountants. With everything you’re looking at, it ultimately ties back to the biggest question of all: How secure is your firm?

We’ve already talked about how you can improve security internally, by looking at everything from checking passwords, bringing phones to work, training and more. But what about external security?

This is an even bigger question to be asking when you’re looking at the security of your firm, because it’s become common practice for accountants to offload some of their work and outsource. Doesn’t that beg the question “How secure are they?” because depending on what you’re outsourcing, you might be sharing everything from passwords to your various marketing engines to databases of contact information, and if your outsourcers don’t look after this data properly, it still could be you and your firm at risk!

To conclude our mini blog series on security, let’s look at some of the top things accountants outsource and how that can impact your security.

1. Marketing

This is one of the top functions of an accountancy firm to outsource. Providers like The Profitable Firm have become a staple component in firms promoting themselves through blogs, website pages, social media and more. But with this relationship comes a caveat: sharing information.

It’s often overlooked when thinking about the “greater good” that is marketing, but when you are working with a marketing company, it becomes common practice to share access to everything, from your website, to marketing engines like MailChimp and even social media accounts.

By doing so, you’re effectively giving a third-party access to a hefty amount of data. Your website could store submissions from your various enquiry forms. Your MailChimp account could contain lists of client email addresses. And it all starts with handing over the passwords to those accounts. In a case like this, it’s important to double check what security protocols these third parties have in place so that your sensitive data is protected on their end too.

2. Website maintenance

It’s a well-known fact that your website is one of the biggest marketing components for any business, let alone accountants. It’s your marketing hub, which means it’s important to keep maintaining it on a regular basis.

One of the lesser known facts, however, is the importance of an SSL certificate for your site. These have become more popular in the past couple of years and have become the norm for any website to have. An SSL (or Secure Sockets Layer) certificate, is an extra layer of security that effectively encrypts your website and therefore safeguards any sensitive data that is being sent through the website. This means any data submitted, whether it be through a contact or payment form, isn’t at risk of being stolen by hackers.

You can tell when a site has an SSL certificate installed by looking at their URL; if it starts with “https” as opposed to “http”, the “s” signifies it’s a secure site. This is becoming more and more important as it has recently been announced that any sites that do not have an SSL certificate will automatically be flagged as unsecure by Google and also de-ranked in Google searches!

Think about your user experience: Would you want to visit your site and be met with a screen that says “This site might be trying to steal your information”? That wouldn’t fill you with confidence in your accountant, let alone how they handle the security of any of your data. But the solution isn’t too difficult. All that you have to do is purchase an SSL certificate, which is readily available through domain and hosting companies, and have that installed on your site. Once that’s done, you can rest easy knowing your site is much more secure than those without an SSL certificate in place.

3. Accounts production

One of the final avenues that is popular to outsource is the production of accounts and tax returns. As you know, that’s what we do here at AdvanceTrack, and we like to think we take security pretty seriously with our online system and protocols in place.

If you don’t use AdvanceTrack, but have been considering outsourcing compliance work, it’s an important question to ask any provider. After all, you’ll regularly be sending financial data belonging to your clients and their businesses, so you want to make sure that this is handled well and protected on their end so that the data isn’t at risk of being stolen.

Security is important, act now.

Security is something that shouldn’t be overlooked, whether it’s internal or external. You need to look at everything from your internal systems, to the processes your outsourcers use, to the training needed for your staff.

When all that is done, your firm will undoubtedly be in a much safer position, as you won’t be leaving the security of your clients’ data to chance!

Posted on by Vipul Sheth

When accountants come to us, one of the first questions we ask “is outsourcing the answer to your problems?”

Admittedly, it’s a rhetorical question, but it makes you pause and think. We’re always preaching that outsourcing isn’t just about handing over compliance work. It’s about changing the nature of the relationships with your clients, but you can’t do that if you don’t overcome the underlying problems your firm is facing.

On the surface, outsourcing might seem like the answer, but we wanted to take the opportunity to address those issues and how to overcome them, and also how outsourcing might play a part in that.

1. Delivering to deadlines without overworking

Your accountancy firm should be 100% focused around client service delivery, otherwise chances are you won’t be in business for very long. So, what’s changed?

Well, for one, there used to be some downtime between the different projects. This allowed an opportunity to reflect on the project, evaluate the time put in, regroup and plan for the next project. But instead, you’re finishing one project and immediately diving into another!

It’s in large part due to technology. With the advent of Xero and QuickBooks, coupled with receipt scanning apps and reporting tools, your clients have more data than they know what to do with, and it’s your job to handle that.

Because of these increasing changes in the industry, the volume of work is naturally growing, meaning there’s no longer any downtime. You’re doing the work yourself because you don’t have a choice. Sure, you could outsource the day-to-day bookkeeping to free up your time, but deep down that’s not the solution. It’s time management. You need the right tools and people in place to handle projects better, which leads us nicely to problem #2.

2. Implementing new tech

Xero published a report in 2017 that revealed that more than three-quarters of firms still use spreadsheets with their clients. Even more alarmingly, 18% of firms are still working on paper ledgers.

We couldn’t agree more with Xero’s comment that “old methods continue to strangle practice efficiency”. Technology has evolved massively over the past couple of years, but the challenge for accountants is the implementation.

Which software do you choose? Which apps do you offer alongside it? What systems do we need internally? Is this going to improve our speed? What if our clients don’t go along with it?

Those are some of the questions that you’re most likely pondering and rightly so. It’s no small feat implementing new systems, and that’s often the reason most firms hold back. They’re scared of things going wrong, of systems not working, of clients disengaging.

For you to overcome these problems, you’ve got to go beyond your comfort zone and be willing to embrace the change and try new systems. You’ve got to be ready to test and learn and ultimately fail. If you’re not willing to do that yourself, what chance do you have of your clients being willing to try new tech?

It’s about that long-term goal of development and building a better, scalable firm, and it starts with taking that first step of trying something new.

3. Finding the right team

All of the issues mentioned so far come back to your team. A lack of downtime or a lack of systems affects them too, or they’re part of the problem.

If you’re the director of a firm, you could be doing a lot of the work yourself, because you haven’t got the right team members in place to support you. Likewise, you might be hesitant to implement new systems because you’re not sure if your team would be on board as well.

A lot of it comes down to how you recruit. You’re not just recruiting for another person, you’re recruiting for someone who’ll embrace the changing environment. It’s about skill set, engagement, motivation, meaning you’re ultimately looking for someone who is resilient and willing to adapt. That’s the kind of team member that will stick by you, rather than hopping from one firm to the next and leaving you to pick up the pieces.

What’s wrong with this picture?

 It’s a vicious cycle: You’re not delivering to deadlines and/or you have no downtime. That’s caused by not having the right systems in place. This can be the case if you don’t have a willing team or the right team to support you, or even if you’re not delegating enough to them.

So, to go back to our opening question “is outsourcing the answer to your problems”, the answer would be “it depends!”

Outsourcing only truly works when you have addressed the problems we’ve talked about, or you’ve at least started addressing them. As we said at the start, outsourcing is really about changing how you work and interact with your clients, and you can only really do that when you’ve begun to work on the problems with time, technology and your team.

But when you’ve mastered that, and once you go on to building incredible relationships, you’ve got the key to success, and you’re no doubt on track to build a firm poised for amazing things.

Posted on by Vipul Sheth

 

With such complexities that come with running an accountancy practice, the option is always there to outsource some elements. But as Kevin Reed finds, what works for one practitioner might not for another.

The running of an accountancy practice, like any type of business, can be frustrating. Trying to offer your core, valuable, services to a client at an optimal level feels impossible as administration, production work and of course red tape, bog you down.

Having all that ‘just dealt with’, leaving practice owners to get on with the job, is the ideal scenario for many. What, then, can be outsourced… handed to someone else to deal with? Are there any limits? If so, how are they defined?

What can be outsourced – and how – requires practitioners to step back and think about the way their business operates.

For instance, there are administrative responsibilities for a practice to consider. These can include HR, health & safety, technology – and their own Companies House filing requirements. As with any deep back-office responsibilities, they will not bring fee income into the practice. Practitioners would be strongly advised to use outside help on these matters.

Making the right choice, or choices, as to who helps you manage the back office is important, but doesn’t need a grand strategy. Other outsourcing decisions, however, require practitioners to really think deeply about how their practice makes money, and how it wants to achieve that in the longer term.

There are two other key areas in which outsourcing can be leveraged. The first is in the production and management of compliance and accounting information on behalf of their clients. This could include calculating and filing of tax returns, formulating annual accounts, or other types of reporting.

Second, there is an option to outsource front-line services and management to other providers (see blue box). For example, this could include wealth management services or complex tax advice such as R&D claims.

For Della Hudson, a business consultant who recently sold her eight-staff accounting firm, her efforts at outsourcing met with mixed results. She envisaged a practice, aimed at corporate services, where customer service would be retained in-house, while everything else was outsourced.

“The idea was around having a one-man band, but with hundreds of clients,” says Hudson.

In reality, she was already down the track with her practice, but that didn’t mean maintaining the status quo. First, Hudson tried out a virtual PA, but found the role was too complex for it to be managed out-of-house. “That process gave me a good understanding of what could, and couldn’t, be outsourced,” says Hudson. “Standard, repetitive things can, but anything that requires deeper thinking cannot.”

She then outsourced some accounting work to another practice. It “wasn’t a money-saving exercise” in itself, but enabled her and her staff to concentrate on higher-value advisory work for clients.

Going deeper

Other practices have moved much more deeply into the outsourcing of compliance work. And as previously stated, such a move requires careful thinking.

For Brendon Howlett, operations director at practice Wood & Disney, the last 18 months have seen outsourcing become key to its business – while also witnessing it impacting other practices, “and we see that trend continuing”.

From a strategic point of view, the practice is aligning towards high-value advisory services. The outsourcing of compliance work has enabled team members to take a more consultative approach with clients.

“As well as an improvement in our own numbers, outsourcing has had a positive impact in freeing up capacity in the team, allowing them to provide advice and assistance our clients really value,” says Howlett.

Outsourcing doesn’t abdicate a practitioners’ responsibility for the work undertaken, or how it is managed. Another practitioner we spoke to said that it is vital that your own processes and approach to work is systemised. “This gives you a platform to work with an outsourcing provider – but at this point it’s crucial that a good workflow will be set up between the two parties, or any value from the project will be eroded,” says the practitioner.

Again, how the re-engineered processes will work is crucial. For Wood & Disney, the practice is exploring outsourcing more tax compliance work in light of the extra strain it will face with Making Tax Digital’s (MTD) requirements for more client information. But a lack of clarity in MTD’s workings means Howlett is circumspect: “Until the government provides more clarity about the mechanics of MTD, where the devil will inevitably be in the detail, we remain unsure of exactly how any outsourcing will work.” A key concern voiced about the direction of the accounting profession is that automation and artificial intelligence will render accountants useless.

This doesn’t mean the end of the accounting practice. It actually aligns with shifting process-oriented tasks away from the key advisers, and enabling them to provide the more valuable service.

The problem comes when the makeup of these ‘key advisers’ is considered. Do they need to have the technical accounting and finance skills to back up their communication and analysis abilities? And if so, how will they attain them if the work is dealt with by outsourcers?

This is a concern for Della Hudson. In her former practice she considered the impact of outsourcing all the ‘straightforward’ accounts work, keeping more problematic client returns in-house. This model would have made it difficult for apprentices to see a cross-section of work, she feels. “I hadn’t got my head around that,” Hudson admits.

Wood & Disney’s Howlett says: “Technical skills will still be relevant, and you will need to be good with the numbers as we will be acting as a conduit for the financial information.” The next generation of accountants will need to develop that broad skillset from the get-go, he believes.

“In the past it may have been enough for an accountant to be a technical guru but AI has this side of things sewn up. Accountants will need to be much more ‘agile’ in terms of business advice and focused on people.”

Posted on by Vipul Sheth

This year is going to be a very busy, but very exciting, time for AdvanceTrack – and we’d like you to join us

While companies that provide technology-driven solutions have a reputation for not always engaging with their customers, we put customer service and understanding your requirements as top priority.

We’re delighted, therefore, to be able to announce two opportunities for you to meet with us and discuss where you’re heading, and hopefully how we can help you on that journey.

First off, we have the Quickbooks Connect show, held across 27 and 28 February in London’s Printworks.

This year’s agenda covers the most relevant issues facing practices: from marketing (harnessing social media and building a digital brand) through to moving your practice and clients to the cloud.

“We’re taking part to meet with forward-thinking practices, many of whom will already be clients of ours and hopefully some new faces as well,” says Vipul Sheth, founder and MD of AdvanceTrack. Sheth expects conversations to revolve around Making Tax Digital (see this month’s feature spread for more). He foresees many practices wanting a ‘solution’ to MTD, and a big part of that will involve the use of efficient cloud-based bookkeeping among other things.

More importantly, making this transition will put client information into practices’ hands that they can leverage to provide a better service. “The truth is that we speak about this a lot,” says Sheth. “If practices see this as ‘stopping clients getting tax penalties’ then it’s a client/adviser conversation about price. But good conversations with clients is about helping them run their business. Then clients look at the price and say ‘this is what I pay my accountant for’.”

Next we have AdvanceTrack’s own conference, following on from last year’s successful inaugural event at America Square with 70 people in attendance. The invitation-only event will see respected consultant Paul Shrimpling set out the process by which you deliver higher-value services to clients. The conference will then follow workshop-style sessions that provide more detail and insight into making that transition.

The conference will take place a few days after GDPR comes into effect – and AdvanceTrack will outline what we’ve done to make sure we are a compliant organisation.

Posted on by Vipul Sheth

Paul Barnes is the managing director of My Accountancy Place, which provides accounting and finance services to digital agencies. The practice, which operates with two directors and 15 staff, uses AdvanceTrack® to free up its team to provide deeper and more valuable services to clients. He explains the practice’s strategy, and development beyond compliance work.

Paul, tell us about your practice

We are a niche firm based in Manchester. We only service one industry: digital agencies providing marketing, creative and digital services, predominantly in the North West. We turn away those that don’t fit that. Our practice works using Xero technology.We have moved from being a ‘good, proactive firm of accountants’ to a full finance outsourced function. Rather than clients building their own finance team, we provide the full finance function. This encompasses strategy, financial control, making sure their systems run smoothly, and bookkeeping. My team works across clients (from our office), but spend a lot of their time with those clients in their offices.We can do just compliance, but we can do the whole lot. We bring industry expertise and systems expertise to the table as well.

When did you start using AdvanceTrack®, and why?

We started My Accountancy Place in 2014, and began using AdvanceTrack® in mid-2015. For the compliance function and historical accounting services that we provide, these are becoming more and more commoditised. It was an opportunity for us – we have real skills to grow and improve our clients’ businesses but were restricted by the amount of compliance and bookkeeping work.So, we streamlined that offering and outsourced, allowing our team to spend more time on the more rewarding and challenging work that truly makes a difference to our client’s businesses. For the value provided by AdvanceTrack® in terms of cost and service level, it was a complete no-brainer. It has removed the headache of managing that service, and we can use highly-qualified accountants from the start with our clients.

What impact has AdvanceTrack® had on the running of your practice?

Everyone in the practice has moved up a gear or two in terms of what they can give clients. When you sign up new customers, the on-boarding process can be challenging and you’re under pressure to provide value straight away. Now we can map out clients’ processes straight away – then that becomes an ongoing task run through AdvanceTrack® and it just repeats.We then get on with our job of advising clients. Anything non-client-facing goes to AdvanceTrack®; some of that is complex work but AdvanceTrack® can do it. Straight away we can start improving the clients’ business.

What is the future for your practice? What are you looking to achieve, and how?

There is still a lot of confusion in the accountancy market around what ‘advisory’ is all about. For us it’s about simplifying the journey the business goes on. We want to illustrate that journey through our own IP, delivered through workbooks, guides and workshops… moving the client away from the office and allowing them to focus on strategy and growth and to help them short-cut the mistakes and bad investments. We’re seeing small businesses now starting to expect what big businesses expect from their professional advisers, and they have every right to. Speak to AdvanceTrack® about helping you create a modern and pro table practice. Call us on +44(0)24 7601 6308 or email advice@advancetrack.com.

Posted on by Vipul Sheth

This will become law regardless of the UK’s continuing membership of the EU. It is also likely that to trade with individuals and organisations within the EU, post Brexit, UK businesses will need to be compliant with these regulations. The GDPR will apply in the UK from 25 May 2018.

Should we be scared by the new regulations?

With a potential fine of 4% of global turnover or €20m we need to ensure that we understand how it impacts on us as professional rms. If you outsource, you need to consider carefully if your outsourcing supplier is able to allow you to remain compliant. Article 5 of the GDPR requires that personal data shall be:

  1. processed lawfully, fairly and in a transparent manner in relation to individuals;
  2. collected for specified, explicit and legitimate purposes and not further processed in a manner that is incompatible with those purposes; further processing for archiving purposes in the public interest, scientific or historical research purposes or statistical purposes shall not be considered to be incompatible with the initial purposes;
  3. adequate, relevant and limited to what is necessary in relation to the purposes for which they are processed;
  4. accurate and, where necessary, kept up to date; every reasonable step must be taken to ensure that personal data that are inaccurate, having regard to the purposes for which they are processed, are erased or rectified without delay;
  5. kept in a form which permits identification of data subjects for no longer than is necessary for the purposes for which the personal data are processed; personal data may be stored for longer periods in so far as the personal data will be processed solely for archiving purposes in the public interest, scientific or historical research purposes or statistical purposes subject to implementation of the appropriate technical and organisational measures required by the GDPR in order to safeguard the rights and freedoms of individuals;
  6. processed in a manner that ensures appropriate security of the personal data, including protection against unauthorised or unlawful processing and against accidental loss, destruction or damage, using appropriate technical or organisational measures.

Article 5(2) requires that “the controller shall be responsible for, and be able to demonstrate, compliance with the principles.”

Do we know what actions to take? Let’s see what you need to know.

Data Protection Officer

Accountability is a key component of the new regulation. In certain circumstances, data controllers and processors must appoint a Data Protection Officer (“DPO”) as part of the organisation’s accountability.

The following are circumstances where an organisation needs to have a designated DPO:

  1. Processing carried out by a public authority;
  2. The core activities of the controller or processor consist of processing requires regular and systematic monitoring of data subjects on a large scale; or
  3. The core activities consist of large scale processing of special categories of data.

The DPO may be employed or on a service contract, but is required to have enough expert knowledge, dependent on the activities for which they are responsible. This DPO may act for a number of undertakings.

Territorial Reach

The GDPR also impacts on processors of data outside the EU, so this will impact on all outsourcers in popular locations outside the EU such as India. Processing activities relating to the offering of goods and services (even if free) or monitoring the behaviour of EU data subjects (within the EU). Many will need to appoint a representative in the EU.

Most outsourcers will for example, have no presence in the EU. In such circumstances, firms using a provider that is not compliant could be breaching the regulations. Companies outside the EU targeting customers within the EU will be subject to the GDPR, which is not the case currently.

The Role of the Data Processor

The GDPR requires data processors to have direct obligations for the first time. This includes an obligation to maintain a written record of processing activities carried out on behalf of the data controller, appoint a DPO where required and notify the Data Controller of a personal data breach without an undue delay. Provisions related to cross border transfers will also apply to processors.

Supply and commercial agreements will need to be reviewed to accommodate the new regulations.

Accountability

The Data Controller has onerous obligations to demonstrate compliance. This can include:

  1. Maintain documentation.
  2. Carry out a data protection impact assessment for more risky processing.
  3. Put in place data protection by design and default.

Fair Processing Notices

When personal data is obtained, the Data Controllers must provide transparent information to data subjects. Existing forms of fair processing notice will need to be reviewed as the GDPR is more detailed than currently in place. Information to be given to the data subject is more comprehensive than is currently the case (including for example, the ability to withdraw consent) and the period for which data is stored.

Data Controllers will need to provide information in a clearly accessible format in a clear way with the new GDPR obligations in mind.

Consent

It needs to be as easy for a data subject’s consent for processing to be withdrawn as it is to obtain consent. The data controller will be mandated to demonstrate that consent was given and whilst existing consents may work, they need to meet the new conditions.

There are areas concerning personal data used for direct marketing and also the age of parental consent where there is no clarity on whether the age is 16. Some member states can lower this to 13. We will look at this further in a future newsletter or on our website in the coming months.

Fines

There will be a tiered approach to the way penalties for breaches are imposed. This will enable DPAs to impose fines of up to the higher of 4% of global revenue and €20m (for example, breaching the requirements relating to international transfers or basic principles for processing, such as conditions for consent).

There are other specified infringements which attract fines up to the higher of 2% of global revenue and €10m. These fines apply to an “undertaking” and this was clarified in Articles 101 and 102 of the TFEU.

“The One-Stop Shop

A company operating in many EU countries would generally only deal with one lead DPA. There has been a degree of criticism. In order to address some of this criticism, the GDPR allows individuals to have their cases dealt with locally, with the Lead Authority and Concerned Authorities working together. It is to be hoped that when in place, that it does not lead to forum shopping.

Removing a Notification Requirement

There will no longer be a requirement for a data controller to notify or seek approval from the DPA in some circumstances. Whilst this may reduce a financial and administrative burden, this may lead to some DPAs seeking alternative funding. The policy now is for Data Controllers to put in place effective procedures and mechanisms to focus on higher risk operations
and undertake a data protection impact assessment.

This should consider severity and likelihood of risk, especially with large scale processing. A lot of effort is required and the potential fines are such, that they may outweigh the benefits. Also, a new requirement to consult the DPA in advance where the data impact assessment may indicate high risk if measures are not taken. If the DPA considered the processing may breach the GDPR, they could give written advice or use their enforcement powers may have multiple impacts, either nothing is high impact(!) If your outsourcer, for example uses e-mail and tools such as Dropbox to exchange confidential data, you may need to consider if that places your firm at risk of fines were there to then be a data breach.

European Data Protection Board (”EDPB”)

The independent EDPB will comprise of the EDP supervisor and senior representatives of the national DPAs. Its role will be to issue guidance and opinions, reporting the EU Commission and applying the GDPR consistently across the EU.

International Transfers

The way that consent is dealt with for data exporters has changed. Moving data outside the EU now requires subjects to have sufficient information on the risks of data transfer outside the EU. This, in the context of outsourcing will require you to ensure that any outsourcer has strong protocols to be able to satisfy yourself of the risks. Consider, for example if an outsourcer using e-mail or Dropbox to transfer confidential information is able to satisfy the new requirements.

Data Subjects’ Rights

The rights of individuals being strengthened was one of the main aims of this new regulation. This includes, for example, a right to require information about data being processed about then, being able to access such data in some circumstances and correction of data where incorrect. There will also be rights relating to data used for direct marketing purposes. The concept more complex requests allowing this to be extended. Clear processes will need to be in place to meet such obligations and provided free of charge unless the request is “manifestly unfounded or excessive”.

Six Things you should do now to be ready for GDPR

  1. Embrace Privacy by design -When a new process or product is deployed, ensure that privacy is embedded into the process. Considering the process early on will enable this to be both structured and validation checks to be put in place.
  2. Understand the legal basis on which you use personal data • Consider engagement letters and contracts as this may often be your form of consent
    for processing if withdrawn. The documents should demonstrate that the consent is given freely, is specific and informed and the burden of proof will be on the data controller, for example, the accounting rm. Obtain legal advice on how you would deal with any withdrawal of consent.
  3. Review your privacy notices and policies • Policies need to be transparent and easily accessible. Information provided need to be in clear and plain language.
  4. Accountability framework • Clear policies need to be in place to meet the standards.
  5. Review the data subjects’ rights • Data subjects may exercise their rights such as data portability or the right to erasure. If personal data is retained, consider what legitimate grounds there are to retain this. The burden of proof to demonstrate your legitimate grounds for retention override the interests of data subjects.
  6. Prepare for data security breaches • Clear policies and practised processes need to be in place in order to react quickly to any data breach to ensure that timely notification is made where required.
Posted on by Vipul Sheth

We asked this two office partnership for some feedback on their reasons to outsource and why they selected AdvanceTrack®.

1. Why did you decide to outsource?

The decision to outsource was made primarily as a result of a lot of maternity leave hitting us at the same time, together with our historic curiosity surrounding outsourcing as a potential option for our practice that had never been acted upon.

The time seemed right therefore to give it a go.  The advancement in scanning technology was also instrumental in making the decision as this was no longer the administrative burden that it was previously.

2. Reasons why you hadn’t tried it before.

We had heard some good stories but also many bad experiences from other companies who had used outsourcing.

3. The reservations you had before trying it

The quality of the work which would be returned, the administration burden of scanning documents, the unknown, we are accountants and we don’t deal with change very well

4. What made you overcome those reservations and why AdvanceTrack®?

Having known Vipul for a few years made the decision to outsource a little easier. AdvanceTrack® using the same accounting packages that we used also helped make the decision easier as we would not have to load the returned data onto our system ourselves.

The trial jobs went very well and the quality of the work exceeded our initial expectations.

5. How have the staff taken to outsourcing and where next in the development of outsourcing with your practice?

Initially there was a mixed reception amongst our staff as some obviously feared for their own job security, however once it was explained the reason why this decision was taken and the change in their roles to one of more value added work rather than pure compliance their opinions quickly changed.

Our next steps are therefore to utilise our own staff more efficiently on client work and look to outsource the pure compliance function wherever possible allowing us to become a more profitable firm.

6. What’s the greatest benefit you have got from using AdvanceTrack®?

The obvious answer would be the cost benefit which is of significant importance, however by outsourcing the compliance function, it is now allowing us the opportunity to give our existing staff more exciting work on clients allowing them to personally develop and maximise our return on our existing client base.

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