To help your accounting firm make sure what you are building is totally modern and innovative, today on the Rules of Thumb blog from MoneyThumb we are going to share what several experts have to say about what it takes to build the modern accounting firm.

This article from Karbon titled, Structuring a Modern Accounting Firm, states that "The way most accounting firms have been run for decades isn’t right for the modern practice. Yet, many firms are still proportioning their managers and staff and structuring their teams based on guidelines that included desktop systems, yearly meetings with clients (and charging calls by 15-minute increments), and services that could achieve differentiation by simply being done right.

In the early 2000s, an efficient firm commonly had a ratio of 5:1 (5 accountants to 1 partner/manager), in the same office. Today, the modern accounting firm’s ratio is anywhere from 7:1 to 15:1, and often includes multiple locations.

Along the road, you have probably made reactionary changes to your team structure to improve efficiency, cut costs, or cope with personnel changes. But this type of minor tweaking can do more harm than good and negatively affect the way your team works together. If your strategies, goals, processes, or services change, your structure needs to keep pace. This requires more than a casual readjustment—you need to redesign how the roles and functions integrate within your team to suit your new direction.

This article on LinkedIn from Jamie Shulman, co-founder of Hubdoc, titled Building the Modern Accounting Practice: Hiring a Technology Lead, states that 'the foundation of every modern accounting firm is technology," and goes on to offer 5 core responsibilities of the person or team in charge of your technology. To drive efficiency and volume (the keys to a firm’s profitability and revenue), it’s a combination of leveraging technology as a foundation and inputting smart people to operationalize it into a technology-based workflow.

Ace Cloud Hosting has this great post on their blog, What Does it Mean to Become a Modern Accounting Firm? The article has been made into a video as well if you'd prefer watching a video to learn what Ace Accounting has to say about becoming a modern accounting firm. We have included that video below:

Last but certainly not least, CPA Practice Advisor is offering this free ebook written by Rootworks titled The Modern Firm, and they actually have a trademark on that title. It is described as "a succinct guide on what it takes to build an agile, sustainable, and highly profitable accounting firm that delivers an exceptional client experience."

The Rootworks Performance Model brings structure and clarity to the processes and the steps required to build a firm for the modern era. The Modern Firm eBook will stimulate your thinking like an entrepreneur and leader, rather than just an accountant.

The team at MoneyThumb hopes the above information will help your firm get on the road to make sure you are totally modern. We would appreciate it if you could share this Rules of Thumb blog post on your social media page so your accounting peers can benefit from it.

The post What It Takes to Build The Modern Accounting Firm appeared first on MoneyThumb.

In India, Chanakya wrote a manuscript similar to a financial management book, during the period of the Mauryan Empire. His book "Arthashasthra" contains few detailed aspects of maintaining books of accounts for a Sovereign State. The Italian Luca Pacioli, recognized as The Father of accounting and bookkeeping was the first person to publish a work on double-entry bookkeeping and introduced the field in Italy.

The modern profession of the chartered accountant originated in Scotland in the nineteenth century. Accountants often belonged to the same associations as solicitors, who often offered accounting services to their clients. Early modern accounting had similarities to today's forensic accounting. Accounting began to transition into an organized profession in the nineteenth century, with local professional bodies in England merging to form the Institute of Chartered Accountants in England and Wales in 1880.

Over the decades accounting has changed dramatically, especially with the advent of the internet. Now, most accountants are very tech-savvy and use the cloud as much as possible to handle accounting tasks.

Some differences between the old and new

Despite the advancements, there are major differences between modern, techie entrepreneurial accountants and old-fashioned accountants. Some of the differences are as follows:

• ‘Old-fashioned’ accountants tend to work in a traditional office during normal business hours. They are usually employees of another company or accounting firm. Modern ‘techie’ accountants can work in the office or at home. They made be employed by one or multiple companies. They set their own pace and working hours.
• Modern accountants are not limited by physical and geographical boundaries. They are able to work remotely and offer their services to foreign-based companies through their use of modern technology. They are less susceptible to a particular country’s recession than old fashioned accountants. An accountant who is based in South Africa can provide accounting services for a company in Bermuda.
• Old fashioned accountants do not work online nearly as much as the ‘new breed’. They have accounting systems that are on their desktops and laptops. Once they leave the office they leave their work. Modern accountants are able to work online through internet-based accounting systems like Quickbooks online. They are able to use their accounting systems in their offices and at home.
• Modern accountants are entrepreneurial. They offer their services and get paid for the job done. They run businesses in which they are the employee(s). They might also subcontract the work or employ other accountants. Their employees may also be located in other parts of the world. The employees may work from the office or their home.
• Modern techie accountants are always in touch with changes in the global world as they tend to manage their business from a global perspective. Old fashioned accountants usually look at things from their country’s perspective. Changes in the global world, as long as they don’t affect their country, do not concern them. They usually change things when it is a legal requirement or when it is too outdated.
• Modern accountants are able to advise their clients from global business trends and perspectives. They have a thorough knowledge of how the global business community operates and behaves. Old fashioned are not well versed with the global business community as they’ve not needed to be, in general.
• Modern accountants offer business owners a wide variety of service providers to choose from. This is because when a business owner is located in a country where the cost of accounting services is very high, they can get services from another country where the cost is reasonable.

As the provider of the best selling PDF financial file converters on the market, MoneyThumb would like to add that accountants who want to stay modern and on the cutting edge use our proprietary software to make their jobs much easier by quickly converting the financial information of clients as a way to provide the best service.

The post Old School vs. Modern Day Accountants: Which One Are You? appeared first on MoneyThumb.