Thinking Beyond Automating the Tax Preparation Process- How to Transform Your Final Review

Until now, the focus has largely been on automating the tax preparation process. Technology has given us the ability to scan in client documents and even auto populate parts of 1040 returns, saving time by automating the data entry. 

But, something has been missing.  For my firm, the bottleneck wasn’t at the preparation of the return- it was at the review.

A partner’s time is the most expensive in the firm, and he or she should not spend it reviewing inputs and catching mistakes. In reality, tax returns pile up as deadlines loom, and more and more evenings and weekends are spent in the office reviewing returns. Exhaustion sets in along with burnout and the goal quickly becomes to Just.Get.Done. As accountants, we are meticulous with details, but we are also human. We are problem solvers. Business experts. Advisors who make a difference in the financial health of individuals and businesses. So, why are we spending so many hours before every tax deadline manually reviewing inputs and fixing mistakes before moving on to the next return to do it all over again and again?

Seven years ago, I was one year into building my own firm, Roberts Accounting, CPAs. And I was the bottleneck. 

It wasn’t unusual for me to pull all nighters or be up working to review returns until 3 in the morning as deadlines approached. I couldn’t help but wonder what it would like to build some automation into my final review process.

After that first year, I knew I had to find a way to re-imagine the final review if I was to grow my firm and expand beyond providing commodity returns. Quite simply:

• It didn’t make sense for me to spend expensive review time checking inputs and correcting mistakes.
• I wanted my clients to get value from me and expand the business they did with my firm to other service areas.
• My reviews were defaulting to checking my team’s work for accuracy and simple tax treatment versus focusing on key indicators in the return that would drive new advisory opportunities and higher value conversations with clients.
• I needed a way to build knowledge with my staff naturally in order to develop them into reviewers who could also have higher value conversations and drive the same type of new advisory revenue that I was.
• I didn’t have the time to train less experienced CPAs, but I needed a way for them to learn the tax code and gain confidence.

Problem solved.

I built a tool for my firm that became the earliest version of TaxExact. It has evolved over the past 7 years into the cloud-based, easy to use tool that it is today. TaxExact has not only revolutionized our entire 1040 review process, but it has also given me my time back. It has shortened our entire review process, eliminating the bottleneck at the final review.  And, in that shortened final review cycle, it has also allowed us to immediately identify key risks and opportunities inside of a 1040. 

How we implemented TaxExact in Roberts Accounting, CPAs.

Once a return is prepared in our tax software and ready for the first review, that reviewer quickly creates a separate expectation of the return in TaxExact, which immediately isolates any errors or discrepancies. 

As a final reviewer, I log in to TaxExact and see a summary listing of the returns that are ready for my review. When I select a return, I immediately see everything that has been independently verified. This enables me to focus my time on the areas that do not have a green “verified” checkmark next to them. The unverified areas represent either something my team was unsure about or an area of opportunity for me to have a high value conversation with a client. 

Bottom line, my reviews are down to between 15 and 30 minutes per return, and I don’t invest expensive time tediously reviewing inputs.

By reducing my final review time, I am no longer the bottleneck in my firm, and I am now able to focus that time savings on building stronger relationships with my clients through advisory opportunities and consulting.  Using TaxExact allowed me to go from being a commodity tax preparer to a trusted advisory who delivers value.

When you deliver value, cost is not a factor.

In the 7 years of using TaxExact at Roberts Accounting CPAs, our revenue has grown from low six-figures to over seven-figures organically; all while our employee count has remained the same. Our average client, who used to pay a couple hundred dollars for their annual tax return, is now seeking us out for our advisory services. We’ve learned that cost is only relevant in the absence of value. And we’ve been able to deliver on that value. Every. Single. Time. 

By incorporating TaxExact into our workflow process, we have found the time to be strategic and re-invest that precious currency of saved time into new revenue streams.  Our bookkeeping and payroll services, as well as our outsourced CFO platform, have all grown rapidly. Most recently, we also launched a stand-alone certified valuation practice. 

By offering TaxExact to firms nationwide, my vision is for TaxExact to transform the final review process for firms across the country like it did ours. Our goal is to enable tax practices to evolve beyond offering a commodity into financial solution providers that modern accounting firms must become in order to thrive and compete. 

Join the TaxExact Beta Group

If you’re ready to shorten your review process and transform your tax practice, join the TaxExact Beta Group. Email us at beta@taxexact.com.  We are offering an exclusive early-adopter discount for firms in our Beta Group.  Beta testing will take place November and December of this year with plans to launch TaxExact nationwide in January 2021. 

Join us as we revolutionize the entire 1040 review process for firms across America!