Why Take Time To Establish An Accounting Process

An accounting firm must invest in an accounting workflow process. Why? Because workflows increase productivity by powering entire processes across your business.

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These are the five workflows that every accounting firm should focus on to deliver a better client experience:

  1. New client onboarding workflow
  2. Recurring tasks and accounting job workflow
  3. Sales qualification process
  4. Communication workflow
  5. Advisory services workflow

The Difference Between Workflow and Process

Although they appear similar, they are different. So let’s dive in.

What Is a Workflow?

Workflows are primarily designed to boost efficiency and productivity and are centered on a task or activity. Here’s how Wikipedia defines it;

“A workflow comprises an orchestrated and repeatable pattern of activity, enabled by the systematic organization of resources into processes that transform materials, provide services, or process information. It can be depicted as a sequence of operations, the work of a person or group, the work of an organization of staff, or one or more simple or complex mechanisms.”

So a workflow is:

  • A set of small repeatable steps and tasks
  • Related to your business activities
  • A way to help you organize resources, such as people, time, and budget, around each step to complete it effectively
  • Designed to give you a repeatable and predictable result
An example of an accounting firm's workflow would be a recurring job such as how a client is billed and invoiced.

What Is a Process?

Made up of several workflows, Wikipedia defines it as:

“A business process, business method or business function that is a collection of related, structured activities or tasks”

An example of an accounting firm process would be a new client onboarding. Here, several workflows are put together to create a master process that may include workflows that:

  • Send a proposal
  • Forward and sign contracts online
  • Invoice and set up monthly recurring payments
  • Send “Welcome pack” documentation

So, as you can see an accounting workflow and an accounting process are two sides of the same productivity coin.

Accounting Workflows: How To Design Them

Although this is a big subject and beyond the scope of this article, it’s important to get an overview of the method. However, this will change depending on what technique you use for workflow design.

For example, if you are using a system such as Agile for your project management process, your design will look different from another accounting firm that uses SCRUM or LEAN methods.

Some General Principles For Designing An Accounting Workflow Process

Whatever method you use, here are some things to remember. These may include improving your new product development, client onboarding, payroll, tax planning, or sales.

  • Stage #1: Establish what you currently have in terms of workflows and standard operating procedures around the process you want to improve. If you don’t have any documentation and just practically perform the tasks, then do a draft of what you usually do. Create a master task list and document it.
  • Stage #2: Identify where there are potential blocs in the flow of tasks that would influence the results you are setting out to achieve.
  • Stage #3: Identify workflow technology systems that will help remove or limit those blocks. It’s important to make the process faster and consistent. The goal of the technology is to improve how you are currently managing and make your workflows more efficient.
  • Stage #4: Build in a feedback loop to keep reviewing how well the process is performing so that you can constantly improve the user experience.

How Workflows Become An Entire Process

First, It’s important to start small.

  • Choose one part of the process
  • Get the workflows within that to run smoothly
  • Mover onto the next step and get that right
  • Then look at incorporating the smaller accounting workflows into a larger process.

It’s worth mentioning that there are some things often overlooked in the design stage, but are important. This is particularly so around the workflow technology you are going to use.

Some things to check, when selecting an accounting workflow process platform, include ensuring:

  • Communication is secure and flows effortlessly between internal and external team members and your clients
  • The user experience is exceptional and built-in to every step
  • The workflows are simple to create and easy to use
  • File sharing and storage are protected

Simply put, the workflow and processes have to make it easier for you to focus on the customer and for your client to have as much of a seamless experience as possible.

3 Workflows To Adopt For Your Accounting Firm

Accounting Workflow #1: Recurring Work

Your clients expect the work they do with you to be secure and consistent and as an accountant, you need to be productive and time-efficient.

That means having a dedicated cloud-based workflow to manage your activities is essential. Some of the key components that will make this a great process include having:

  • Secure communication that not only eliminates email silos but also manages all client and team communication in one place. It can’t be emphasized enough but it’s vital to have a secure communication channel.
  • A central place for the team to organize and store their work.
  • A system that automates the creation of tasks. We’ll discuss this in more detail in workflow #2.
  • A way of integrating with a client’s accountancy software so you can create client tasks directly in it. For example, integrating with Quickbooks.
  • A dashboard to manage your workflows and support your decision-making. Knowing what needs to be done and when is a must-have in any recurring workflow.

Accounting Workflow #2: Task Pipelines

As an accounting firm, your day-to-day activities contain lots of repetitive tasks. From compliance considerations and preparing financial statements to the client’s payroll and reconciliations.

To complete each step, you can automate the setting up of repeatable task lists. You can attach “how-to guides” showing the steps to carry out each element of the workflow. A great resource for new staff or for tasks that are not done regularly.

Automatic task pipeline elements include:

  • Allocation of tasks to team members
  • Setting up of recurring tasks in a workflow
  • Scheduling of activities on a daily, weekly, monthly, or annual basis

Creating automation is essential to take the stress out of your task pipelines.

Accounting Workflow #3: File Sharing

Gone are the days of putting files in shared Dropbox folders. Secure file sharing is an essential part of any communication workflow.

Keeping them protected and organized will help with productivity and help you as an accounting firm be more responsive to client demands.

From a risk and compliance view, files must be hackproof. Therefore, using a secure client portal gives you the security you need.

When designing a file-sharing workflow, it’s important to remember that clients are on the go and teams are working more remotely.

This means the process needs to enable the exchange of files via mobile helping you to organize client-facing and internal folders.

Turn Your Accounting Workflows Into Profits

This summarized how to streamline your accounting workflow process which will improve efficiency and productivity of your firm.

We covered:

  • The difference between a workflow, a set of small steps, and processes, which are a string of workflows working together as a whole.
  • How to design an accounting workflow process in 4 stages.
  • 3 critical accounting firm workflow processes, including recurring work, task pipelines, and secure file sharing.

Something worth mentioning is just how implementing a cloud based accounting workflow process will help increase your firm’s profits by:

  • Increasing productivity
  • Boosting customer service
  • Reducing costs
  • Creating time savings

This is why in a recent SAGE report, they found that:

“57% of accountants find technology literacy to be the most critical additional skill for future employees in the field.” Sage Practice of Now.

If you are considering implementing an accounting workflow process, why not try out Client Hub free for 14 days to see how it can significantly help your accounting firm.

Originally published Aug 30 2021

new accounting firm client onboarding checklist

Frequently Asked Questions

What is accounting workflow?

  • A set of small repeatable steps and tasks.
  • It’s related to your business activities.
  • You organize resources, such as people, time, and budget, around each step to complete it effectively.
  • It will give you a repeatable and predictable result.

An example of an accounting firm's workflow would be a recurring job such as how a client is billed and invoiced.

What are workflow processes?

They comprise a number of smaller workflows that are put together to create solutions for more sophisticated and longer processes.

An example of an accounting firm process would be new client onboarding. Here, several workflows are put together to create a master process that may include workflows that:

  • Send a proposal to a prospect.
  • Forward and sign contracts online.
  • Assign a metric to your client funnels and dashboards for reporting purposes.
  • Invoice and set up monthly recurring payments.
  • Send “Welcome pack” documentation.

What is the order of the flow of accounting?

There are 8 parts to an accounting flow:

  1. Identifying transactions
  2. Recording the transactions in the journal
  3. Posting journal entries to the general ledger
  4. Creating an unadjusted trial balance
  5. Preparing and adjusting entries
  6. Creating an adjusted trial balance
  7. Preparing financial statements
  8. Closing the books

What are accounting processes?

They can be small step workflows such as invoicing a client, or multiple large-scale processes that incorporate a number of smaller workflows such as client onboarding.