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SponsorsJirav: www.jirav.comHi, this is Blake, and I just wanted to let you know that this episode of the Cloud Accounting Podcast is sponsored by Jirav, my employer. “Jirav” sounds a lot like “giraffe” — and that’s no accident. Giraffes are the tallest animal in the world. That gives them a great view. Our goal at Jirav is to give you a similarly great view of what’s going on with your business.We do that by helping you understand where your business has been, and most importantly, predict where it’s going. Jirav connects your cloud-based accounting, payroll, CRM, and billing data together to automatically update shareable online dashboards, monthly reporting packages, and sophisticated financial plans and budgets in real-time. If you’re using Excel for reporting and forecasting, you’ll save hours every month with Jirav.Learn how accounting firms are using Jirav to deliver connected insight, strategize growth, and help their clients make more profitable decisions. Visit jirav.com and start your 30 day free trial. That’s J-I-R-A-V dot com. See farther with Jirav.Show Notes 00:38 – Looking back - how many 2019 predictions came true?  03:17 – Blake's first prediction for 2020 comes true less than a minute later ... Well, sort of ...  03:38 – Culling All Accounting Conferences – less definitely may start to be more! | Accounting Today 05:33 – Is there any value in free?  09:01 – Duh ... Overstating the obvious isn't really making a prediction | E27 09:31 – Dynamic pricing is just not a thing, at least not for the smaller players 11:09 – Hmm - is "used" the new "new"?  11:28 – What's going to have the biggest short-term impact on accounting? One hint: it's not humans | Journal of Accountancy 13:25 – Blockchain in 2020 - boom or bust? | Enterprise Times  14:50 – Armanino releases blockchain-powered app for instant attestation | Accounting Today 16:49 – Government still says no to crypto | Real Daily 19:58 – Everybody’s losing their minds over 5G! But, why? | The Verge 21:14 – Blake takes issue with 2020 being the breakout year for 5G – lack of speed isn’t the problem; lack of use is  23:25 – 2020 just might be the year of foldy, rolly, hidey devices ... Maybe 25:12 – 2020 sees the hiring of non-accounting grads at CPA firms continue | Journal of Accountancy 26:25 – Blake says it's going to take a good decade to create and implement the changes needed in the CPA exam and curriculum  27:49 – Want to stay relevant, and innovate? Pull your head out of last year! | LinkedIn 29:33 – Millennials might be so 2019, but they still have some decent asks when it comes to employment | Boomer.com  31:31 – Open banking in the US? Maybe in 2030 ... | Accountancy Today 33:19 – What's the most important issue facing the accounting industry? Here are at least 100 | Accounting Today 35:30 – Things are different all over -  2020 Accounting Changes from Down Under | Accountants Daily  37:42 – Automation - great for those with actual skills; not great for the not-so-great ...  37:55 – What do accounting regulators actually DO? | CFO Dive 40:17 – For your reading pleasure - 120 AI Predictions For 2020 | Forbes 42:17 – Speaking of Voice AI – 46 industry pros share their 2020 Voice AI predictions | Voicebot.ai 45:01 – VR will continue to make people nauseous in 2020  45:08 – Four (just four?) Creepy Applications That Will Change Your Business In 2020 | Inc.com 47:36 – Is Netflix going to be your next bank? | Banking Innovation 49:24 – The moment we've all be waiting for - David and Blake offer up their 2020 predictions! 🎉 49:30 – Nobody's staying in their lane! David says watch out for blurred, crossed, and muddied lines more than ever.  50:59 – According to Blake, 2020 is the year that one of the GL players - think QuickBooks, Xero, et cetera - becomes a bank.  52:28 – David's no-brainer prediction - Xero and Sage will have to launch their own version of Live product to compete with QuickBooks Live. Mark his word! (For the record, Blake disagrees)  54:24 – Podunk is not the proper nomenclature, David ... 😁 Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram!   Limited edition shirts, stickers, and other necessities.TeePublic Store: http://cloudacctpod.link/merch Subscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast   TranscriptBlake Oliver: The accounting regulators aren't really doing all that much. It's not that significant. We talked about this last week. The big thing they're gonna be working on over the next six months is deciding whether or not to allow public companies to amortize goodwill. Blake Oliver: Welcome to The Cloud Accounting Podcast. I'm Blake Oliver. David Leary: And I'm David Leary. Blake Oliver: This is our special 2020 predictions episode. David Leary: Should we check back in on our predictions from 2019? [00:00:30] Do you remember yours? Blake Oliver: Oh, I don't. I hope you don't call me out for making some bad predictions. David Leary: I don't remember yours, but I remember mine. I predicted that it was gonna be the year of instant payments. We kind of saw that across the board. QuickBooks announced you could get paid within 24 hours. In many cases, you can get instant deposits now if you're … Instead of putting your bank routing numbers in, if you put your debit card number in, you can get an instant deposit, or instant payments back for vendors or customers. So, I think I'm gonna declare victory on instant payments. Blake Oliver: Yeah, I think you're right. David Leary: Okay, good [crosstalk] It’s a wrap.  Blake Oliver: No, it's great. [00:01:00] Zelle is actually working really well; Venmo, Apple Cash. I can pay, pretty much, anyone with any app, although I have to have a variety of apps because we're not all using one app. Actually, we'll get into that as one of my predictions regarding fintech for 2020, so that's a good lead in. David Leary: I think, actually, even the explosion of all these getting-paid-two days-early-type-payroll plays that are out there, right? Blake Oliver: Oh, yeah. David Leary: People are getting paid faster than instant; they're [00:01:30] getting paid early. So, I'm gonna declare that prediction as a win. I'm glad I only made one prediction. It's harder to be wrong, right? It's a numbers game. Cool.  Blake Oliver: Well, so I'm actually going back right now to our old show notes from 2019 and looking and seeing if I made any predictions that came true or didn't. Let's see. My big prediction back in 2019 was that firms are going to have to figure out how to communicate with their clients and deliver really good customer service mobily. That [00:02:00] means letting your clients text you and being more responsive in that way. I'm wondering, did that come true? I don't know. I haven't seen any surveys about that. I guess it's more of a long-term prediction, and it has to go with customer experience. Good CPAs, good accountants, bookkeepers have always focused on customer experience. The key now is just merging that responsiveness with technology moving forward. How can we meet our clients where they are? Whatever [00:02:30] tools they want to use, we need to be using. David Leary: I'm gonna give you that you're right because we talked about this over … It was a theme of many episodes, not specifically about texting, but how you're communicating with your clients; how you're engaging your clients. Blake Oliver: Yeah. Don't send them this giant email when they ask a question. Give them your opinion in one or two paragraphs. If you go beyond that- nobody reads long emails. That's why texting can actually be good if you have a way to do it without having to pull out your own phone. If you have some sort of service [00:03:00] that can pull those in to a support ticket desk kinda thing. I don't know. The way that we can communicate with software companies, we should be able to communicate with accounting firms. There's software to do it, so people are gonna figure it out. I do have one prediction for 2020 right off the bat, David. David Leary: What's that? Blake Oliver: Which is that we have just way too many accounting conferences. Everybody's doing one now, and some of them just aren't gonna survive. We're gonna have a culling of the conferences. David Leary: A culling? Blake Oliver: Yeah. David Leary: Of [00:03:30] multiple? Blake Oliver: Well, at least one. We're gonna lose at least one accounting conference this year, yep.  David Leary: All right, Blake. I'm gonna give you this one already. Blake Oliver: Oh, yeah? David Leary: Accountex USA sent out an email yesterday. I don't know if you've checked your email, or if it's in your spam folder, but you're right. An accounting conference, Accountex USA, is not gonna do their 2020 event here in the United States. They'll still have their UK event, but they're not gonna do their event in the States. Blake Oliver: That's crazy. I have to admit, I cheated. I saw that email before I made my prediction. Do you remember- [00:04:00] David Leary: You could edit this in a way so nobody will know that. Blake Oliver: Nobody will know, but I'm not gonna do that. I'm not that smart. So, credit where credit is due … It was surprising to me, although not so surprising, given the decline that that conference has had. It used to be SleeterCon. It was the Sleeter Group's conference, which was- my first conference was going to Sleeter, and it was great. It had some of the best content in the industry. David Leary: That same goes for me. SleeterCon 2007 or something. I don't even remember how long ago. It was 2007 or 2006, but yeah, it was [00:04:30] a long time ago, and it's an end of an era. Doug Sleeter sold SleeterCon three years ago to the Accountex Group? Blake Oliver: Diversified Communications. Yep. They're a giant company. They run a ton of conferences. He sold it to them, and they just destroyed it, it's sad to say. They ran it into the ground. David Leary: It was interesting because they filled it with sponsors, though. I mean, you and I were there in Boston. We did some of those interviews, those episodes, but the attendees … There was almost more sponsors than attendees, and that was the struggle. I think there's this big argument with the conferences, [00:05:00] like, do you charge people, or do you not charge people? Because, in theory, you're like, "Don't charge anybody. You'll have so many people go. The vendors will be happy,” and just charge vendors, but I feel like people don't have skin in the game, so they don't show up. Blake Oliver: No. Well, part of the problem is that XeroCon started, QuickBooks Connect started, and they made those conferences almost free; essentially, free, they're so cheap because they're marketing activities, in addition to being educational. Conferences at the level of a SleeterCon, or an Accountex just can't compete with that, so they had to go free as well, which then … [00:05:30] People don't value free, actually. They're more likely to go to a conference if you have to pay money because they know at least the sessions are gonna be educational and good, and it's not all pay to play by the vendors. David Leary: You're right. I wouldn't be surprised … I feel like we've gone to the other shows that used to be owned by [inaudible] Management. Now they're owned by- is it Turpatin? They put on the Accounting Show- Accounting Show LA [crosstalk]  Blake Oliver: Terrapinn. Terrapinn, yeah.  David Leary: Terrapinn. I think they do the New York City Technology Show and the [00:06:00] LA Technology Show, and those are not very well attended either. Blake Oliver: No, yeah.  David Leary: I wonder if they … They also do a Toronto one that, I guess, is decent, and I think they do one in Asia that has really good attendance. Maybe your prediction’s more of some of these shows are gonna pull out of the U.S.  Blake Oliver: What's happening is the best shows are becoming vendor-sponsored - XeroCon, QuickBooks Connect. The shows that used to be independent can't compete with that. People aren't gonna go to … People have limited time to go to conferences; most [00:06:30] small- especially smaller practitioners. You can't leave your business for more than one or two weeks a year to go to get CPE and go to these shows. So, who are you gonna go to, right? You're gonna go to the one- the GL tool that is doing the conference. Yeah, I think it'll just continue to happen. We're gonna have just vendor-specific events. David Leary: I think I saw, either on Twitter … I feel like I haven't seen any confirmation of it, but that QuickBooks is not going to do a QuickBooks Connect in Sydney this year. Blake Oliver: Yep.  David Leary: In lieu of that, apparently, [00:07:00] do more of the smaller roadshow-type events. You're right, maybe 2020's the year of … The way people think of conferences is being changed. Blake Oliver: I wouldn't say it's a bad thing. It's that a lot of the stuff that used to happen at these conferences is moving online. People are engaging in Facebook groups a lot. David Leary: You can get your CPE online now. Blake Oliver: Yeah. You’ve got CPA Academy giving you all your CPE online, and you can get as much of it as you want, whenever you want. You've got podcasts like ours. This is something that has [00:07:30] developed over the last 10 years. Used to be you had to go in person to get this stuff, and now you can go online. In a way, it's just much more convenient. David Leary: Yeah. I feel like the in-person part of it, the important part of this now of the conferences is not the training you go to get; it's just the connections, the physical- the hugs, and talking, and eating with somebody that you've chatted with every other day, virtually. Blake Oliver: Yep.  David Leary: I feel like the conferences are more important than ever, but what the business model is and what the purpose of the conference is, I think, is what's being reinvented here. Blake Oliver: I agree. David Leary: It may not be solved in 2020. [00:08:00] It could take two or three years before whatever this new model of bringing people together is. Good one, Blake! Good prediction! I went through one, two, three, four, five, six, seven- about seven to 10 prediction blog posts that are out there - e-commerce, blockchain, tech gadgets, accounting things, audit, AI … Like 150 things in AI.  I don't wanna bring everything to the table, but what I did with each article, I just kind of went through and I'm like, "Oh, here's the "duh", obviously; that's [00:08:30] not much of a prediction;" something that I completely have no faith in like, "Yeah, right. That's never happening;" and then something that I didn't even think of.  So, we can kind of go through some of these and talk about these predictions. I know you have a couple articles and predictions of your own. Then, I will have my own predictions at the end of the show, if people wanna stay tuned for that. No skipping! No skipping!  Blake Oliver: Yeah, let's go through it. Let's go through it sort of by topic. Then, if our articles overlap in terms of topics, we can have a discussion. David Leary: All right. Wanna tip-toe in the water [00:09:00] with an easy one for e-commerce? Blake Oliver: Yeah, sure. David Leary: All right. This is from a website called E27.co. It's “E-commerce trends: What to expect in 2020.” My "duh" one – one of their predictions is people will find your product and website via Google search. Blake Oliver: Wait, isn't that what- David Leary: That's one of the predictions. Blake Oliver: - that people are gonna find you via Google search. David Leary: Yes. Blake Oliver: Okay. All right. David Leary: That was a "duh", and then the "yeah, right" was dynamic pricing. [00:09:30] I just don't see dynamic pricing happening for most e-commerce players, right? It’s a bigger platform.  Blake Oliver: What do you mean by dynamic pricing? What is dynamic pricing? David Leary: When you go to buy airline tickets, or hotels, or you have to book a hotel room, or you, yourself, when you shop on Amazon … You might see dynamic prices depending on who you are. I think, at a big platform level, this is gonna happen, but I don't see somebody who has their own website set up for selling their product online is gonna dynamically price things real-time for their visitors to their website. I just don't buy [00:10:00] that. Blake Oliver: When you say dynamic pricing, you're saying that the price changes depending on who is going to the website and when they're going, right? Because I know that airlines have been doing this for a long time, where if you shop on the weekend for a ticket, you're gonna pay more than if you shop on a Wednesday in the middle of the day. David Leary: And if you've visited the site before and your cookies. There's all kinds of stuff. I don't think smaller players are gonna do that. I think big platforms are doing it, but I just don't see that coming down the pipe there. Blake Oliver: Yeah. Well, you know where it should happen and where it could easily happen is that [00:10:30] as busy season approaches, frickin' raise your prices. If somebody comes to you in March, they should be paying a lot more than somebody who comes to you in January to get their tax return done in April. Everybody should do that. David Leary: I think you're right, yeah. Then, the thing I didn't think of that I thought was interesting in this article was rental and "re-commerce" are gonna increase because there's so much sustainability push and then, ultimately, people just want lower prices. If you can get lower prices through buying something that's used, or possibly renting [00:11:00] something … I thought that was an interesting prediction that we're gonna see a big jump in used goods. Blake Oliver: Well, and a great example of that, which we've talked about before, is Rent The Runway, which is that company that lets you rent high-end fashion; you'll wear it for one night and then return it, and they can get 25 rentals out of a single item or something. David Leary: That was it for that article. That was my three things. Blake Oliver: Okay. David Leary: Do you wanna jump into one of yours? Blake Oliver: Yeah. Let's talk about RPA - robotic process automation - a [00:11:30] big term in corporate America. In small business, we don't use the acronym so much. We just call it automation. David Leary: Or we just call it Zapier. Blake Oliver: Yeah, Zapier. Donny Shimamoto, he's the founder and managing director of Enterprise Technologies, and he's been a guest on the show. He said, in an article in the Journal of Accountancy called “What to Expect in 2020,” that, “RPA is the technology that will have the greatest short-term impact on accounting,” and that's because it could be used by management accounting, by audit, and by tax. [00:12:00] I really respect Donnie's opinion, so I'm just gonna go with him on this one and say RPA is gonna be the big thing this year. It's gonna continue to grow the most, probably, and have the most impact of any technology. Like you said, for those who aren't familiar with RPA, Zapier is a great example of RPA connecting different systems and automating the flow of information; stuff that you might have had to key in manually before. There's also really sophisticated RPA software that are essentially like [00:12:30] macros that you would have in Excel but that can live outside of just a spreadsheet application. They can act like a person clicking a mouse and typing a keyboard, going in between apps. They use some artificial intelligence to be able to work like a human, follow detailed instructions, and kind of overcome some of the issues that an Excel macro couldn't. This is basically a more advanced version of that. David Leary: It's the ability for the common folk to do automation. Before, an engineer would have to do it, and I think it's coming down [00:13:00] to a level where an average accountant or bookkeeper can automate some tasks now. Blake Oliver: Oh, yeah. We're doing that right now in marketing at Jirav. We're connecting our Google ads to HubSpot, our CRM, and we're using Zapier to automatically create contacts. That's something that, in the past, I would have had to go and manually enter all of those, and we don't have to do that anymore; fewer entry level people needed. David Leary: Got it. Wanna talk blockchain? Blake Oliver: Oh, yeah, That was the big one for the past few years. It kind of hit the peak of the hype cycle, [00:13:30] and then it just fell off the radar, didn't it? David Leary: I feel like we talked about it all the time towards the end of 2018, and then we barely talked about blockchain for all of 2019. I feel like we barely spoke about it. This article is in the Enterprisetimes.co.uk, “Blockchain 2020 – thoughts, comments and the future.” Blake Oliver: What is gonna happen with blockchain because there was all this doom and gloom about how it was going to automate audit, and get rid of auditing, and all that stuff? Still gonna happen? David Leary: That [00:14:00] was my "yeah, right". One of the predictions was, over and over again, the predictions were talking about, "This is the year of enterprise adoption. Enterprise is gonna adopt the blockchain." The words ‘enterprise adoption’ just kept coming up over, and over, and over, and over again, but it was a little gray, right? It was almost like [crosstalk]  Blake Oliver: Yeah, what are the actual applications of this? David Leary: I don't know. It wasn't clear, but that was the safe prediction - enterprise adoption. If [00:14:30] any of the Fortune 500 use some sort of blockchain technology at all, people are gonna say they're right. That one, I was a little skeptical of because I feel like enterprise just takes so long to adopt anything. Blake Oliver: There was one story last year that did catch my eye about blockchain and suggests that there is some progress being made in real-world applications. My old firm, Armanino, they created a tool called Trust Explorer 2.0. This was reported back in the end of October in Accounting Today. It's [00:15:00] an app that uses blockchain technology to provide a secure downloadable report which Armanino backs with its opinion. The idea is that if you can put it on the blockchain, then you can get an audit opinion from Armanino in seconds. That's kind of a cool application, right? David Leary: Yeah. Blake Oliver: It's not eliminating audit because Armanino built this tool, and they are backing it. So, if anything, it's allowing them to do an audit on a blockchain more efficiently. David Leary: Then, [00:15:30] my "duh" was regarding currency. There's gonna be government regulation and pushback against it from governments. The governments are anti-coin. They really are, ultimately [crosstalk]  Blake Oliver: Yeah, because it's an existential threat to fiat currency. If people decide that Bitcoin, or whatever comes after Bitcoin, or some other cryptocurrency is safer than the U.S. dollar, the U.S. government loses a ton of power over the global economy. David Leary: The U.S. government should just make their own Bitcoin [00:16:00] and the whole world just adopt it as a standard; it would be like that. That would be the smartest. Blake Oliver: There was a great article last year that we never talked about suggesting exactly that, that if the Fed really wanted to be on the cutting edge, that they would create digital dollars, a cryptocurrency linked to the U.S. dollar that they controlled. It would give them amazing powers like the ability to infuse money, in a financial crisis; instead of loaning [00:16:30] tons of money to banks and hoping that banks loan money to businesses and stimulate the economy that way, they could actually create an account for every citizen- David Leary: That’s true.  Blake Oliver: -and then infuse money directly into our accounts that way and skip the banks entirely, make the banks obsolete in that regard. They have, so far, just rejected any possibility of pursuing something like that. David Leary: Then the thing in that article that I didn't think about or opened my eyes a little bit is this whole concept of Internet of Blockchain. Essentially, the Internet of Blockchain [00:17:00] communication - separate blockchains will start talking to each other. Blake Oliver: Mm-hmm. David Leary: That's something to think about. Blake Oliver: Well, and continuing along with blockchain- I don't know if this is gonna happen in 2020; probably not; maybe over the next 10-20 years, but blockchain has the potential to disrupt Google's monopoly over information and could basically do … What the internet did to Microsoft, cryptocurrencies or crypto networks could do to Google, in that you have [00:17:30] this open database of information that doesn't get controlled by one algorithm or one source, such as Google. That's the potential long term of blockchain, if we're storing information beyond just financial information on a blockchain. David Leary: Yeah, and I think that's one of the big problems with blockchain is this decentralized approach. The problem is we've grown … The whole history of the world is about centralizing power. The natural order of the world has never been about [00:18:00] equal distribution of power. Essentially, it's all centralized. Blake Oliver: The problem with this theory that you can create a completely decentralized blockchain and have it succeed is there's a lot of hubris involved in that because that means that you've written it perfectly. That would be like imagine if the founders of our country had said, when they wrote the Constitution, that, “This Constitution can never be changed, and you can never amend it because it's perfect the way it is.” [00:18:30] In a lot of ways, that's what a blockchain algorithm is like, if you don't have ways for people to change it. Currently, the only way to change Bitcoin is to break off from the network and split the chain, which has happened before- David Leary: Then, everybody wants people to use my Bitcoin; David's Bitcoin instead of Blake’s bitcoin, and it's like … Which is centralizing onto one chain. Blake Oliver: That would be like if the only way to change the U.S. Constitution was for us to split into two countries and then, people have to decide which one they're gonna join. [00:19:00] David Leary: That's what churches do, right? When churches wanna … They can't agree on a change, they just split the church [crosstalk]  Blake Oliver: Right!  David Leary: -believe the one set of beliefs, they go one way, and the other one … Yeah. Blake Oliver: Yeah. David Leary: Churches are blockchains. Blake Oliver: I don't know. You need some sort of authority to manage a blockchain, I think, in theory, because it's not perfect, and there's gonna be changes that need to happen. That's one of the big problems with blockchain right now, is that if- or Bitcoin in particular, is if you make a transaction, and you screwed [00:19:30] it up, and let's say you sent money to the wrong wallet, or somebody steals money from you, there's no way to reverse those transactions. There's gotta be some sort of balance here. Can you have the protections of fiat currency that the banking system provides, while also having the flexibility, and openness of a blockchain? I think that's enough about blockchain, right? Should we-  David Leary: Yeah. Blake Oliver: How about I pick the next one? David Leary: Okay. Blake Oliver: Let's talk about a trend that isn't going to impact us very much that … I don't know why people are talking about this so much - 5G. I keep hearing 5G, 5G [00:20:00] is the next big thing for mobile technology, right? We had 4G. I think everybody's on 4G right now, right? 5G is somehow gonna change the world with greater speed, and all this stuff. David Leary: The next article I was gonna go to about, “What's Next for Gadgets in 2020,” and that was one of my "duh" - 5G phones are everywhere, but 5G networks are nowhere. Blake Oliver: This, specifically, was called out as a big technology to expect in 2020 in the Journal of Accountancy. Rick Richardson was quoted, "2020 [00:20:30] will be a breakout year for 5G, as handset manufacturers begin to make a 5G chipset standard equipment."  Okay, so it's gonna make cellular data transfer as much as 100 times faster than current 4G networks, but how is that really gonna change accounting and auditing? I mean, my 4G phone is plenty fast to do what I need to do as an accountant, and I can do video chat and conferencing and all that stuff.  Here's another quote from the article, "Faster, more [00:21:00] efficient broadband connections are essential for the real-time data connections needed to power continuous auditing and KPI dashboards that provide live results and analysis." Tell me how 4G is not fast enough to do that right now. I mean, the problem isn't that we don't have enough speed; the problem is that people just aren't using the tools. David Leary: I read that you can do cloud accounting from an airplane now, so ... Blake Oliver: Right. Yeah, we've got satellite internet. When I fly Alaska Airlines going up to Seattle, I can get 20 megabits per second. That's plenty fast to do what I need to do. David Leary: As [00:21:30] an accountant [crosstalk] bookkeeping type stuff. Blake Oliver: Yeah, 5G has big potential for self-driving cars, and all that stuff, but we're talking about accounting, auditing, bookkeeping.Hi, this is Blake. This episode of The Cloud Accounting Podcast is sponsored by Jirav, my employer. Jirav sounds a lot like "giraffe" – and that's no accident. Giraffes are the tallest animal in the world. That gives them a great view. Our goal at Jirav is to give you a similarly great view of what's going on with your business.  We do that by helping you understand where your business has been and, most importantly, predict where it's going. Jirav connects your cloud-based accounting, payroll, CRM, and billing data together to automatically update sharable online dashboards, monthly reporting packages, and sophisticated financial plans and budgets in real time. If you're using Excel for reporting and forecasting, you'll save hours every month with Jirav.  Learn how accounting firms are using Jirav to deliver connected insight, strategize growth, and help their clients make more profitable decisions. Visit Jirav.com and start your 30-day free trial. That's J-I-R-A-V dot com. See farther with Jirav.David Leary: This is in the magazine called- or website called theverge.com. “Here's What's Next for Gadgets in 2020.” Yes, 5G phones is one of the "duh" that's everywhere. Then, somebody in that article predicted that the streaming TV wars are gonna be here. Come on, how hard was that? [00:23:00] Blake Oliver: It's already here. David Leary: It's so obvious. It's here. That was a really obvious one. The thing I didn't really think of a lot is – it's two words – folding and rolling. You're gonna see screens, phones, tablets, TVs- TVs that roll. Think about shutters. Blake Oliver: Roll up? David Leary: They'll go up out of a box on your table, or they'll pull out of your ceiling. Screens are gonna be folding and rolling this year. We’re gonna see that.  Blake Oliver: Okay. I mean, we had the whole folding [00:23:30] screen fiasco last year with that phone from- was it Samsung that tried to do the folding phone that didn't work? It kept breaking. David Leary: That was just one phone. Blake Oliver: Yeah. David Leary: We're gonna see hundreds; hundreds of devices that fold and roll this year. Blake Oliver: Interesting. David Leary: You’re gonna see … That's gonna be everywhere. That's gonna be a big one. Then, the "yeah, right," was a lot of predictions about this is the year of smart home security. My "yeah, right" about that is most- every time you turn around, those smart home security devices, [00:24:00] Ring doorbells, et cetera, are getting hacked. Blake Oliver: Oh. David Leary: It seems crazy. You're gonna bring in a "security device" that’s more hackable than any other device in your house. It's the most hackable device. Blake Oliver: Yeah. David Leary: Nobody can hack your toaster yet; nobody can hack your refrigerator; but they can hack your doorbell. Blake Oliver: I'm okay with having the doorbell; just don't be stupid and use a very hackable password on your doorbell. I would never put a smart security camera in my home, like a Ring security camera. I just … That's beyond … [00:24:30] I'll do a smart speaker, that's okay, but a security camera? No way. David Leary: Yeah, I just don't buy- I think the tech nerds are gonna buy that smart security stuff. There's gonna be enough hacks, but I think the average person's just gonna get creeped out by it and not do it. I just don't see the explosion of smart home security yet because there's a fundamental flaw that those devices need usernames and passwords; they're calling home on the internet; they're connected to Wi-Fi.  There has to be a smart home security that's not connected … Maybe that's where 5G comes in? I don't know, but they're fundamentally [00:25:00] flawed. A security device is fundamentally flawed if it's dependent on your username and password, which everybody knows your username and passwords suck.  Blake Oliver: Let's talk about practice management. That topic also covered in the Journal of Accountancy's 2020 predictions article. The trend toward hiring non-accounting graduates at CPA firms is expected to continue, as firms seek the expertise of technology specialists. We've discussed before how non-accounting graduates consisted approximately [00:25:30] of 31 percent of all new graduate hires in public accounting in 2018, which is an increase of 11 percentage points over 2016. Dramatic change there. That is expected to continue.  The CPA license exam curriculum in schools has not, thus far, adapted to the new reality of what it means to be a CPA firm, so non-accounting graduates are needed. We need skills beyond accounting. Now there is that cpaevolution.org project going on [00:26:00] at the AICPA to change the curriculum, but I am not predicting that's gonna happen any time soon. They're still collecting commentary. I don't think that's expected to complete …  The proposal- The draft proposal for the changes is gonna happen this year, but that's just the proposal. Then, there's the years and years of actually making the change happen with the exam, and then there's the years and years of actually making the curriculum change happen, so that might be a 10-year kinda thing. Expect to see more non-accounting graduates in CPA firms [00:26:30], and really good career opportunities if you are a CPA who learns those skills that are missing from the license right now.  There's a quote from a firm in Chicago, Lauterbach & Amen, LLP. It's a mid-sized firm. They have decided that one in every four new hires needs to come from outside the traditional recruiting target population of accountants and CPAs. The non-traditional recruits are sought for their technology and data analytics expertise and also for skills such as project management, financial services, [00:27:00] and forecasting. They have made that a deliberate recruiting goal is to make sure– David Leary: I am now the perfect accounting firm candidate. Blake Oliver: Oh, you are, yeah, if you wanted to go do that to yourself. David Leary: I am not from the traditional background in any way, shape or form, but I am the ideal candidate of 2020 for accounting firms. Blake Oliver: Yeah, exactly. Although, accounting firms are notoriously ageist when it comes to hiring staff, so you might be out there. They only want those fresh- David Leary: I'm too old? Blake Oliver: Yeah, basically. They want the fresh college graduates who [00:27:30] don't know any better and are willing to work 60 to- hours a week for no overtime. David Leary: Oh, all right. Well, all right. You smashed my dreams for 2020, I guess [crosstalk] I have an accounting-related one-   Blake Oliver: You don't wanna fill out a time sheet do you, David? David Leary: No [inaudible]  time clocks. I have an accounting-related one, as well. Blake Oliver: Okay. David Leary: This is a blog post on LinkedIn, “The Accounting Profession and Accelerating Technology - the End to Many Firms?” My "duh" of the article was "the profession does not like change". I [00:28:00] was like, "Really? That was kind of obvious." My "yeah, right", and I'm gonna read this straight out, "The combination of big data and machine learning is driving a plethora of new data analytics tools that, frankly, can be used by anyone. Therein the issue, the do-it-yourself threat.” I think that's "yeah, right" because the do-it-yourself threat's been there for 25 years already with QuickBooks, et cetera. I don’t-  Blake Oliver: And TurboTax, right? David Leary: This "used by anyone" is just crap. Blake Oliver: Yeah. David Leary: I just don't buy that. The [00:28:30] thing I liked about that article, though, is he used an acronym that I thought was really cool. It probably applies really well to accounting firms is see the risk of SALY - S-A-L-Y - mindset, and that's ‘same as last year.’ Blake Oliver: Yeah, well, because if you keep doing it the same as last year, you're never gonna change. David Leary: I've never really seen that referenced as a mindset- or as an acronym, so I kind of like that one, going forward. Blake Oliver: It's a great analogy, or acronym that represents the mindset of the profession because it's [00:29:00] how accountants learn to work. When they go into a firm, this is how you learn. You look at what happened last year, and you're instructed to copy it and only make changes if necessary because that's the easiest thing to do. That way … People don't learn. They keep repeating bad processes. It's endemic to the profession because that's the way we learn to learn. David Leary: Let's stay on accounting. I have one or two other articles we could jump in. I don't know if you have any more accounting predictions? Blake Oliver: I do have [00:29:30] some more predictions. Let's see here. Let's talk about millennials. There was a lot of chatter about millennials over the last couple years, and 2019. I think we have hit peak millennial content, or topic, or derision. It's kinda over, so hopefully this will be the last time we talk about this.  This was an article by Jim Boomer on the Boomer Consulting Blog, “Four Things Millennials Want From Your Firm.” I liked how he talked about flexibility. That was one of the things that he said millennials [00:30:00] want. In recent years, millennials have become the face of the shift toward remote work. In a survey from American Express, 70 percent of millennial workers in the U.S. indicated that they want their work environment to be "flexible and fluid" rather than enforcing a rigid structure on employees.  Flexibility offers several benefits for employers, blah, blah, blah. Basically, the 8 to 5 office hours don't work with millennial employees, and firms should be offering more flexibility. So, offer some core hours; don't [00:30:30] require people to be in 8 to 5; maybe you do 10 to 3; let them start later or leave earlier. Hey -  and I'm adding this -maybe don't even require them to come into the office every day. Don't focus on overtime hours, focus on results. That's gonna continue to be something that firms have to change. They have to become more flexible. David Leary: That makes sense. Blake Oliver: Maybe that's kind of a "duh" thing at this point, David. I felt like Jim Boomer [00:31:00] expressed this very well; in addition to some other things, like, we need more stimulating office space, a sense of community. The last thing is the ability to not have to wear a suit every day to the office; let them dress flexibly for their job. David Leary: Yeah, with their torn up jeans or their- what's it called? Fast fashion! Blake Oliver: Fast fashion? David Leary: Fast fashion is the … It's like fast food but clothes, right? Blake Oliver: Yeah, exactly. David Leary: This is an article from Xero that was in the accountancytoday.co.uk. It's, “Four Accounting [00:31:30] Trends That Will Shape 2020.” The "duh" was pesky data entry will be gone. I'm like, "Yeah, it kind of already is." You put everything through Receipt Bank, AutoEntry, or Hubdoc, and you're not actually doing-  Blake Oliver: You could do that five years ago. It's just getting better and better, yeah. David Leary: My "yeah, right" was open banking. Okay, I'll give it credit. Yes, open banking in the UK and AU, for sure, but in the U.S., we're not seeing open banking [00:32:00] in 2020. Blake Oliver: No. David Leary: If we see it by 2030 … We'll be celebrating if we see true open banking in this country. It's gonna take a long time to get here. Blake Oliver: It's gonna take legislation, and that's what they have in Europe. The EU has a law called PSD2, which is like GDPR for payment data. It forces banks- large banks have to make consumer data available to any fintech, which the consumer permissions.  That would be like Bank [00:32:30] of America- I, as a customer of Bank of America, could say, "Bank of America, you have to make all of my banking data available to Venmo." That's a big deal, and it would take a law here in the U.S. for that to happen. We can expect to see payments and banking get more and more advanced in Europe. Maybe that'll stimulate regulators here to make changes, or lawmakers, even. David Leary: That part of that post that I didn't really think of or I wasn't aware of - it's a little specific because it deals with Brexit – but it's Brexit will essentially cause cashflow pains [00:33:00] for small businesses and clients, and they're gonna need help to address that. If you have the opportunity to come in as the adviser and understand how to solve those problems … But there are gonna be new problems that didn't exist before strictly because of Brexit. Blake Oliver: This is sort of like a predictions article. It's about the critical issues facing the accounting profession. Accounting Today asked their Top 100 Most Influential People, including you and me, David-  David Leary: Oh!  Blake Oliver: What is the most important issue currently facing the accounting profession? [00:33:30] Then, they took all those responses, which I didn't realize were gonna become public - I thought that was just part of the application - and posted them for everyone to see on a blog, and it's a lot- David Leary: I hope I gave a good answer. Blake Oliver: Actually, yeah, I didn't read yours. Let me go check it out. Let's see what David wrote. You said, "The struggle to show clients the value that they, as professionals, provide. As more hourly billable work gets automated to the point in which there isn't much left to bill for, clients are gonna start asking, “What am I paying you to do if it's all being done automatically?" That [00:34:00] was your top critical issue facing the accounting profession.  I said- I just kept mine very short, "As with many jobs in America, and around the world, automation is the biggest threat." I didn't read every single response. It’s 100 responses. It's a giant article. So, to automate that, I made a word cloud of the keywords that people used in their responses to see if there are any trends. David Leary: You just created our cover art this week Blake Oliver: Yeah. David Leary: That's gonna save me some work [crosstalk]  Blake Oliver: I’m gonna save you some work here.  David Leary: I can just use that as our cover art.  Amazing. Perfect. [00:34:30] Blake Oliver: Here are the top words. Technology was the most frequent word; then change; then clients; then tax, audit, talent; and then a bunch of other ones – management, models, partner, processes, people, succession, value, future, compliance, consulting data, automation, advisory, adapt.  You get a feel there, though, especially with those top words - technology, [00:35:00] change, clients, tax, and audit … Technology is changing how we work with clients is how I would stitch those together, when it comes to the world of audit and tax, most specifically. That's the trend. It's not just us saying that, right? That's the Top 100 Most Influential, according to Accounting Today. David Leary: Good, good, good. I have two more accounting-related ones, and then we can get back into fun things like creepy applications, and the such. Blake Oliver: All right, cool. David Leary: This is out of theaccountantsdaily.com.au. It's an article from [00:35:30] Down Under. It's, “Further Changes Expected in Accounting in 2020.” My "duh" in that article was that accountants will have more available to them than ever before. My "yeah, right" was that clients want to be inspired and led by their accountant. Do you buy into that? Blake Oliver: Clients want to be inspired and led by their accountant? Uh, no … I think clients want an accountant who will be responsive, who will get them the information they need, give them the opinion [00:36:00] that they want. I don't want to be inspired and led by my doctor; I want my doctor to tell me what I need. That's different. I come to them with a problem, and I want them to give me the options, and tell me what they recommend. David Leary: Yeah. I felt like this would be the dream as an accountant, "All my clients come to me for inspiration," like that would be the … I just don't buy it, yeah.  Blake Oliver: That's not for accountants; that's for business coaches. That's the whole coaching industry. Accountants [00:36:30] should not be coaches. It's a totally different mentality and personality. It's not for us. If you're an accountant who likes to do coaching, you're in the wrong business. You should be doing something else. David Leary: One thing I liked about this article, it got really specific about how accountants will survive "the media extravaganza that AI and bots will replace your job," but really, the belief is while technology will do the heavy lifting, it doesn't mean that accountants will work less. The accountants will still have work to do, it's just the [00:37:00] heavy lifting's gonna be done by AI and bots, et cetera.  Blake Oliver: Well, it's like that Google algorithm that's now checking out mammograms and does a better job than doctors. It's going to allow radiologists, the good radiologists, like the top 50 percent, those above the average, to do more because now they can use the algorithm to check their work, and we can basically get rid of all the crappy radiologists, right?  Same thing with accounting. You can get rid of the crappy accountants, and the ones who are really good can do double the work, or triple the work … In my case, [00:37:30] it was four or five times the bookkeeping work that I could do before. David Leary: It’s amazing. Blake Oliver: Yeah, so it's really good for some people; the people who are listening to this podcast, most likely, right? But it's not gonna be good for the people who aren't. David Leary: I have one more last accounting one, then we'll get into some fun, crazy stuff like creepy applications, and AI, and voice, and all that type of stuff. This is an article in cfodive.com, and it's, “Regulators Eye Accounting, Audit Changes for 2020.” To be honest, Blake, I read this article, and I looked at it, and I looked at it, and there [00:38:00] was nothing I could form an opinion of like "duh," or "yeah, right," or "I didn't think of that." I was just … I'm not saying it was a pointless article, I just struggled with it. Blake Oliver: That makes sense to me because the accounting regulators aren't really doing all that much. It's not that significant. We talked about this last week - the big thing they're gonna be working on over the next six months is deciding whether or not to allow public companies to amortize goodwill on [00:38:30] their balance sheet over a period of time rather than having to do a valuation every single year, and then decide if goodwill is impaired. This is just not important stuff, if you ask me. I mean, hey, I'm not a Big Four accountant guy, and I've never audited big public companies, but it kinda seems like they could be working on some more important stuff. This is the reason why accounting has become less and less important, when it comes to investors. We've made accounting complex. [00:39:00] We've made GAAP four or five times more complex than it used to be over the last few decades, and it doesn't provide, really, that much more useful information. It's just all kind of meaningless. I feel like that feeling you got, when you read this article, is the feeling we should all get when we look at what FASB is doing. It's just a bunch of people who love GAAP making the rules more and more complex. I think the people at FASB are the people who like to play those really complicated strategy board games that take five hours to play. David Leary: Like the Settlers of [00:39:30] Catan and those types of games. Blake Oliver: Oh, Settlers of Catan is just entry level, man. We're talking Axis & Allies … These games with 10,000 pieces and stuff like that like; a giant rule book … That's the kind of people running FASB. David Leary: That sounds boring. Let's do some fun things. Blake Oliver: I hope I didn't piss off any of our listeners here, but if you disagree with me- if you think that the work that FASB is doing is valuable and is making a difference in the world, let me know. David Leary: All right. This is like a pick your poison - voice, virtual [00:40:00] reality, creepy applications, AI, fintech. What do you wanna jump into? Blake Oliver: What about AI? David Leary: AI, okay. Voice AI, or just AI, in general? Blake Oliver: Yeah, include voice in there; AI, in general,  yeah.  David Leary: All right. We'll try to jump on both. Okay, so I have an article from Forbes. This is, “120 AI Predictions for 2020.” So, 120 predictions, right? I kinda had to really summarize the theme of this article to some extent. Chatbots are everywhere; that's [00:40:30] the "duh". Yeah, duh - every website you go to there's a chatbot, these days.  The "yeah, right" - this one I thought was really interesting. In 2020, AI will dramatically improve the employee experience. The ability to automatically and instantly collect data from across multiple channels, analyze it, and provide actionable insight that will enable support agents to more quickly, easily, and accurately address customer inquiries that come to highly satisfactory issue resolution. Blake Oliver: That's a big, bold claim.  David Leary: The reason I think [00:41:00] it's "yeah, right" because if all of these things were working correctly, and collecting data, and speaking correctly, you, as the customer, wouldn't need to contact anybody because you'd have access to the data, and you'd get your answer already. Blake Oliver: Right. David Leary: Right? This is total crap, so that one I didn't buy. The thing I didn't think of, which I thought was interesting is, right now, we live in this world where – we talk about it all time – there's apps, right? People are buying apps, and software, but the prediction here is they'll just buy the AI - one small piece of software, or logic, [00:41:30] or AI that detects one small thing, like, maybe when a toaster's gonna break. You're just gonna buy that one teeny micro sliver; it's not even an app, it's just a piece of AI. I thought that was interesting that we're gonna start seeing AI for sale at that level. Blake Oliver: AI for niche applications versus some AI that's gonna be able to understand a million things? That actually goes to voice AI, right? Our smart speakers in our home … We've talked before about how they're really dumb, and people are just [00:42:00] using them for playing music and setting timers. It hasn't gotten good enough to where people can actually have a conversation. You have to know specific commands. It's gonna take longer than 2020 to make this work well. David Leary: Well, I have an article about, “Voice AI 2020 Predictions from 46 Voice Technology Experts.”  Blake Oliver: Is it gonna get good? Is my Alexa actually gonna become smart? David Leary: Okay, so, I don't know. One of the things was voice will dominate search in the car. It's like, [00:42:30] "Yeah, of course," right? Blake Oliver: How else are you gonna search? David Leary: That wasn't much of a prediction, right? So, that was kind of an easy one. The "yeah, right", so do you know who Jony Ive is? Blake Oliver: Yeah, the former chief designer at Apple, right? David Leary: Legendary designer, now, right? In the grand history of the world designer, right? Designed the iPhone, designed the MacBook Pro, et cetera, et cetera, et cetera … Well, the prediction is that the Jony Ive of voice will emerge, and voice UI will be amazing this year. Blake Oliver: I think that is not gonna happen this year. [00:43:00] It's just too much of a [crosstalk] gap. That's the thing, for voice AI to get better … I mean, I can't even ask good follow-up questions of my Alexa. I had a conversation with her this morning. I think I asked her to repeat something that she had just said, and she couldn't do it. She's like, "I don't know what you're talking about … " Like, "You forgot the conversation we were just having?" David Leary: This is the prediction that could help you with this. There was one prediction that I saw that I was like, "This is genius. Why didn't I think of [00:43:30] that?" is you get to teach your own device. Instead of, right now - we talked about this in the past - recordings of what you ask Alexa are going off to India, the Philippines, or some other countries. Somebody's listening to that and then trying to teach the device what you tried to talk to the device about, Blake. What if you could just teach the device? Like you were talking about a couple weeks ago, you wanna turn the lights on in your hallway but not your living room. If you could just have some control and teach your own device about the context in your house- Blake Oliver: That would be great. David Leary: -that, I think, is a very interesting prediction in 2020 that we can actually teach [00:44:00] our stupid devices the things we need them to know because you really only need to teach them five or six things, and then you'll be super-happy with that device. Blake Oliver: Well, that would be a much more amazing experience because I've talked about … I control my lights with my Amazon Alexa in the house. I had to go and program every single light into my phone and then set specific names for every device in my phone before I could actually use any of the voice commands. I should be able to just set that up via voice. I should say, "Alexa, this light over here is called this," and [00:44:30] it should just walk me through it in a conversation. David Leary: Maybe that's something that these big companies are missing on, like people need to be able to … Maybe the pendulum's gonna swing back to you get to control your tech devices here a little bit more and not depend on these other companies to control your tech. Blake Oliver: We're running out of time here today. I think you said, David, that you had some predictions, in addition to what we just talked about? David Leary: Yeah. Let me just scan, really quickly, these last articles, and make sure there's nothing I don't wanna miss out on. Nothing exciting in VR, I don't think. Blake Oliver: No, continue to [00:45:00] make people throw up; that's what it will do … At least me, anyway. David Leary: Yeah. The one thing I liked- this was on Inc.com. This was an article from Gene Marks, “Four Creepy Applications That Will Change Your Business in 2020.” The "duh" was apps that track your field salespeople, and I'm like, "Yeah, of course. Field service apps have been out there tracking the field service people for years," right? Blake Oliver: Gene said that because his firm implements CRM systems. David Leary: The "yeah, right" is there's software [00:45:30] that watches how your employees are using apps, and that's gonna suggest better ways for them to use them. I just see a rebellion happening internally at companies; tracking every single click I'm doing in every single app and then reporting that up to management - that seems kind of ridiculous. Blake Oliver: With the new California privacy law, in California anyway, or if you have employees in California, you have to tell employees that you're tracking them and what you are tracking. David Leary: Yeah, we talked about that in the last episode. The thing I liked about this article, or that I didn't think of fully, is this concept of augmented writing, and [00:46:00] it really makes sense. If you think about it, first, we had spellcheck; then we had autocorrect; and now, keyboards are doing words suggestions; to the next level of communication suggestions … Like you start your paragraph, it knows where you're headed, and it just finishes the paragraph for you. It's augmented writing. Blake Oliver: This is one of the best AI implementations that has helped me in the last year. Do you use Gmail, David? David Leary: No, not regularly. Blake Oliver: Okay. This is now in Gmail. If I'm typing in Gmail and I've enabled this feature, it will, [00:46:30] as I'm typing, in a lighter gray text ahead of my cursor, suggests the end of my sentence. David Leary: Wow! Blake Oliver: More often than not, I can just hit tab and it finishes my sentence for me. The more that I do that, the more it learns how I like to finish my sentences. Often, I can just type a few words, especially if it's a welcome, or the beginning of the email, or the end of the email where it's pretty standard, and it just knows what I want to say, and I just hit tab.  On the mobile device, they've also got these quick responses. At [00:47:00] the bottom of every email, instead of having to hit reply and then type my response, I get three choices. I can say … It'll say like, "Okay, thanks, or I'll be right on that," stuff like that. Like short answers to questions. I can just hit that button, and it sends email without reply. Google's already doing this, and it's really good-  David Leary: So, we're gonna see this more mainstream this year. Blake Oliver: Yeah. David Leary: That's actually exciting. It's one of the more interesting things I saw. I have three more articles, but there's not really any major takeaways. The one that really made me say, "Hmm" and that probably affects our industry a lot is … [00:47:30] There's a [inaudible] talking about how about how big tech is coming for banking. Experts are predicting fintechs 2020. The interesting one I saw was this concept of other players getting into fintech that we would never think of. The example they brought up was Netflix. Blake Oliver: Netflix and fintech. David Leary: Netflix is already producing movies and television shows. They're writing big, huge checks for [00:48:00] $40-$50 million dollars for a movie or a TV show, whatever they're purchasing, right? They could just pay all the subcontractors. They could just create their own accounting and payroll system for subcontractors and manage the whole process. I was like, "Ohhhh … "  Yes, we're gonna see more players. I think we talked about that once this last year. Everybody wants to be a bank. That's another example of this. Netflix could actually just circumvent all these other players in the middle and just start paying. "Oh, you have actors. We're gonna pay your actors [00:48:30] and actresses, too, and the sound guy, and the editor, and everybody else down the whole chain." They'll build, and track, and they'll create some ecosystem-funnel app to do all this. Blake Oliver: Your average consumer doesn't want to have to open up a bunch of different apps to do finance activities. They want it in one place. They want consolidation. That's why you see Facebook trying to do Libra, and you see Apple doing Apple Cash.  We're gonna see more and more of our phones, the social media embedding [00:49:00] finance into those apps because that's where people wanna do it. I love it. If I need to send money to my father-in-law, I just open up a text message, and I send him the cash in the text message because we're both on Apple devices. It goes straight from my Apple Cash balance, or from my credit card, or bank account, to him. David Leary: That's a perfect transition into my prediction. I'm gonna give my prediction for this year. Blake Oliver: Okay. What's your prediction? David Leary: My prediction is the lines are going to get blurred [00:49:30] and crossed more than they ever have. Examples of this is, you have Bill.com, right? Bill.com, historically, has always been payments. Now they have some AR involved; but they've gone public. They gotta keep growing. So, maybe they have a Bill.com credit card come out. Receipt Bank; they have a Receipt Bank purchase card that comes out. Maybe QuickBooks launches a credit card; maybe Practice Ignition now gets into practice management. A lot of the credit card players, or spending [00:50:00] card type players, they're getting into bill payment now.  Everything's getting very gray, and I think you're gonna see this- more competition than ever because people aren't staying in their lanes anymore because they wanna keep growing, so they keep adding more features. I think, with that, you're gonna see more competition than ever. I don't think the competition's just gonna be for these apps. I think you're gonna see competition for QuickBooks and Xero at levels. I mean, we've talked about Square in the past … I think some of these other apps they're gonna … If you're owning the workflow of all the inbound payments, and [00:50:30] the expenses, well, just add GL, and now you're a competitor to QuickBooks. I think you're gonna see competition at a level we have not seen before, and it could actually help prices, right? Blake Oliver: Oh, yeah. David Leary: It could help drive prices down. I don't think it's gonna be a QuickBooks versus Xero world. It's going to be a QuickBooks and Xero versus everybody else world type of thing. I'm not saying that they'll be a team, but I think it's a different world. QuickBooks and Xero are gonna have to not focus on each other, and they're gonna have to focus on 40 other companies. Blake Oliver: Interesting. My prediction for this year is that either [00:51:00] QuickBooks or Xero, one of the GL apps - or maybe Square … I mean Square's essentially already done it - is gonna create a bank. They're gonna become a bank. I could totally see Intuit doing this, where when you sign up for QuickBooks, you get a bank account, and it's already integrated, and it's integrated to the point where it's just perfect. You get all the information you could possibly want out of that bank feed because it's integrated, and Intuit partnered [00:51:30] with a bank that does it, or it's gonna be Xero who does that or something. David Leary: Yeah, because then all the data just moves perfectly. Kind of like, right now, with QuickBooks Merchant Account Services, right? Blake Oliver: Right. David Leary: People like that and pay a little more for it than they do standard services because the data just gets in QuickBooks. You don't have to ever think about. It's perfect. Blake Oliver: Well, and QuickBooks is already offering loans, so why wouldn't they wanna have access to the data at an even more granular level? It's so sticky, too. Once you have somebody using your banking services … I don't know, [00:52:00] it just seems natural to me. I mean, if they're gonna go to the trouble of doing QuickBooks Live, it seems like a fintech partnership like that would be natural, too. David Leary: Yeah, and you're right. Maybe as more players try to become more like QuickBooks and Xero, QuickBooks and Xero are like, "Okay. That's fine, but we're gonna go play in a new pool. We're gonna go become banks too," right? To stay a step ahead of all this competition … That's true, that's coming on.  Then, the easy one, and you can title this to the episode if you want - Xero and [00:52:30] Sage will have to launch some sort of Xero Live or Sage Live type product to compete with QuickBooks Live. Mark my word - that will happen in 2020. It has to happen. Blake Oliver: I disagree with you on that one. We're gonna agree to disagree, I think. I feel like it's a competitive advantage now for Xero, and for Sage. Why would they then … If they can use this to peel off accountants from Intuit, use it. Don't become like Intuit then. It's a differentiator. David Leary: What if QuickBooks uses it as their differentiator against Xero in Australia? I mean, it's free, "Hey, you get [00:53:00] a free bookkeeper with your QuickBooks in Australia," to go after market share. Blake Oliver: They might. I mean, they did that whole, like, making QuickBooks almost free, it was so cheap, right? David Leary: Yeah, it's like 10 bucks or something, yeah. I think it's super-super-cheap there, yeah. Blake Oliver: That could be. I don't know. It's different. See, this is the thing that these big companies sometimes fail to understand is that these markets are very different. Australia and New Zealand, business owners are much more likely to go work with an accountant when they start their business; whereas here, entrepreneurs are [00:53:30] much more like go it yourself, do it alone, kind of do-it-yourselfers, and it's a very different mentality.  That's why the accountant channel in Australia and New Zealand is so important, and here, it's not, for selling software. Here, you can go direct, and that's what Intuit has done for a long time, and the ProAdvisor channel is really secondary to them. That's why they can do QuickBooks Live and not threaten their major business because their real customers are business owners, their major customers. I'm not saying that … Obviously, it's a huge [00:54:00] business, and accountants are important to that business, but not as important as the business owners. David Leary: In summary, I think our predictions are … Yours is one of the big GLs – Square, or QuickBooks, or Xero – is going to become a bank. Blake Oliver: Or maybe one of the banks buys one of the GLs and integrates it, right? We're gonna have that fusion of fintech and accounting software. David Leary: I mean, banks are buying some of these little podunk … Podunk's not the right word … Some of these cloud-accounting [crosstalk] that are out there, that-   Blake Oliver: Yeah, these are potential sponsors, David …  David Leary: But some of these ones [00:54:30] that nobody's heard of, right? Even you and I don't even know the names of some of these cloud-accounting packages that have been purchased by banks, so banks are doing that. I think that the prediction is a major thing's gonna go down; a very major shift in this will happen. Blake Oliver: I wouldn't be surprised. Awesome. Well, this was a really great, fun episode. If people wanna get in touch with us and complain, comment …  David Leary: Send us your predictions. Blake Oliver: Yeah, send us your predictions. You can reach me on Twitter. I'm @BlakeTOliver, or you're [00:55:00] welcome to email me at Blake@blakeoliver.com. David Leary: I'm on Twitter as well, @DavidLeary, and you always can email me, but Twitter's the best. People have to get to their point. Blake Oliver: That's right. If you want to do us a huge favor, leave a review. Where can people give us a review, David?  David Leary: If you're on Apple, you're an Apple person, you can go to Apple Podcasts and do reviews there. For everybody else who is not an Apple person, you can go to Podchaser.com and leave reviews there. Those Podchaser reviews start showing up in other players, so you [00:55:30] can leave your review in one spot, and it shows up on other sites. It’s great.  Blake Oliver: If you wanna combine your commentary with a review, you can leave a review, tell us what you think, and we will read it on the air. David Leary: Kill two birds with one stone. You could put your prediction in your reviews so the whole world will see it. Blake Oliver: I would love that. David Leary: That's a good idea. Blake Oliver: I would love that. David, until next week, it was great talking with you and have a great 2020. David Leary: And on to the future! 
Sponsors BQE CORE - http://cloudaccountingpodcast.promo/core  REWIND.io - http://cloudaccountingpodcast.promo/rewind  Show Notes 01:38 – Welcome Ben Wann, CMA, CPA, and MBA to the show! 02:39 – Notable industry departures: Matt Rissell exits TSheets amidst some corporate remodeling | BoiseDev Jennifer Warawa parts ways with Sage and the accounting industry | Accounting Today Blake Oliver departs FloQast | LinkedIn 07:46 – Seriously, you are not a tree. Move around! How career expectations have shifted from taking root in one job for decades to seeking new opportunities on the regular 11:08 – VC fundraising activity: FreshBooks raises "most significant investment so far" from JPMorgan Chase | BetaKit ScaleFactor continues to rake in some serious VC coin | Crunchbase 21:05 – Ben reads us a story: “Dear AICPA! I Wrote Your Concession Letter” and explains why he is bullish on the CMA versus the CPA after obtaining both 28:44 – Speaking of designations, where have all the CPA candidates gone? | CPA.com  33:53 – According to a June ADP survey, 25 percent of accounting professionals surveyed said they would not recommend young accountants get a CPA license, or seek some other credential or advanced degree 35:50 – Ben talks about cheese, business process improvement, finance business partnering, and how new technology drives him to educate and help people navigate the constantly shifting accounting landscape 39:00 – Yet another way to Crunch some numbers with the help of freelancers | SmallBusiness.co.uk  42:23 – Something’s phishy … More updates on the iNSYNQ ransomware snafu | Krebs on Security 47:41 – Armanino goes full crypto – first with a range of blockchain services, and now accepting payment via all forms of cryptocurrency | Armanino, LLP  Connect with Ben Website: The Numbers Guys Twitter: @BenWann_CMA LinkedIn: Ben Wann, CMA, MBA, CPA Udemy: Ben Wann | Process Improvement Specialist-Accounting/Finance YouTube: Ben Wann Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus. Subscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast Transcript Ben Wann: “To the esteemed finance and accounting community, after much consideration and deliberation, it is with a heavy heart and misty eyes that we are announcing that we are pulling the CGMA certification from the US market, effective immediately.” This episode of The Cloud Accounting Podcast is sponsored by BQE Core. As many of you know, I'm all about the niches and niche apps. Putting your business clients in the proper niche app is providing them with a 100-percent solution versus, at best, the 85-percent solution of a standalone accounting app. If you have clients that are architects, engineers, consultants, or lawyers, Core is the app for them to best manage their firm, increase their staff productivity, and ultimately increase their profits. You don't need to juggle between multiple apps. Core has it all in an easy-to-use, all-in-one app for project management, including time and expense tracking, budgets, forecasting, client billing, and accounting. Even though Core is an all-in-one platform, it still works nicely with the apps like Google Drive, Dropbox, OneDrive, QuickBooks, Xero, and AccountRight, offering you and your clients the maximum amount of flexibility. Core offers a full-function mobile app, and recently it launched a cutting-edge, voice-based assistant for your smart speaker of choice. To learn even more about BQE Core, head over to CloudAccountingPodcast.promo/core. That is Cloud Accounting Podcast dot promo forward slash C-O-R-E. Did I mention that BQE Core works great for bookkeepers, CPAs, and accounting firms, too? Blake Oliver: Welcome to the Cloud Accounting Podcast. I'm Blake Oliver- David Leary: And I'm David Leary- Ben Wann: And I am Ben Wann.  Blake Oliver: Ben, thanks for joining us. David Leary: And Ben, where are you joining us from? Ben Wann: I am over [00:01:30] here in sunny Pennsylvania. David Leary: Sunny Pennsylvania. Other side of the country here for us. Blake Oliver: It's Friday afternoon for us, Friday evening for you. I'm excited to have you on the show, because you are a CMA, you are a CPA, and you are an MBA. Did I get all three of those right? Ben Wann: Correct. Blake Oliver: And in what order did you do those? Ben Wann: I did the CPA first, because that's the one everyone knows. What the cool kids are doing. Did the CMA to try and elevate my level of accounting knowledge. Then, the MBA [00:02:00] to round it out. Blake Oliver: But you list them in a particular order on LinkedIn, right? Ben Wann: I do. Blake Oliver: You are a big advocate for the CMA. Ben Wann: Yes. Blake Oliver: I'm eager to talk to you about that and also some of your thoughts about the AICPA and the CPA, since you've got both. That's gonna be really interesting to talk with you about that. Ben Wann: Absolutely. Blake Oliver: What else do we have on the docket today, David? David Leary: So, money. Lots of big raises and money going to companies. That's on the docket today. More ransomware updates, as always. Departures. [00:02:30] We have a lot of departures that have happened this- well, not a lot, but notable departures this week. Blake Oliver: Notable departures of - David Leary: We could start there. Blake Oliver: Yeah. Let's talk about that. David Leary: Matt Rissell is leaving Intuit at the end of the year. Matt Rissell of TSheets. Blake Oliver: Right. So, TSheets was acquired by Intuit, and then Matt Rissell became what, a VP there? David Leary: That's correct. It's been three years already, apparently?  Blake Oliver: Apparently, yeah. I couldn't believe it. David Leary: That's super-fast. Then Sage had news, right? That's it. Blake Oliver: Before [00:03:00] we go into that; I’m reading this article now. Since their acquisition by Intuit ... They were acquired for $340 million. Based in Boise, right? That Boise TSheets office became an Intuit office. It says that it's grown by 160 employees to 400 employees, the majority of whom work in the company's Eagle office. David Leary: Yeah. That changed Boise. Blake Oliver: Yeah. David Leary: Intuit going to Boise was a significant economic impact on Boise. He changed it. Blake Oliver: And [00:03:30] the growth of the customer base ... It seems like this acquisition really worked out, right, because their customer base went from 36,000 to 82,000 customers. Yeah, they're the largest employer in Eagle. David Leary: Wow, congratulations, Matt. It was a good ride. Blake Oliver: I wonder what he's gonna do next. Maybe he'll come on the podcast. David Leary: He had the bout with cancer a few years back, so he's really ... He spends a lot of time with his family. He has his kids and his wife. Maybe ... I imagine he’ll probably take a lot of downtime. He definitely likes doing all that outdoorsy stuff in [00:04:00] Idaho, as well. Blake Oliver: So, who else is moving on? David Leary: I'm gonna let you say it, because I always mess up Jennifer's last name. It's bad, because I've been saying her last name for a decade, and I mess it up. Blake Oliver:  Jennifer Warawa. I think I got it right. She's leaving Sage. David Leary: She's leaving Sage. Blake Oliver: Yeah. That's a big deal, because she's been there for, what, 12 years? David Leary: 11 or 12 years, I think, the article said, yep. She took a job with ... She's getting out of the accounting industry. So, she took a job- she's relocating from Atlanta to Dallas to take a job in construction. Blake Oliver: [00:04:30] For those who don't know Jennifer, she ... What is her role there, or what has been her role at Sage? David Leary: She is an executive vice president, I want to say, of accountants at Sage? Is that the official title? Blake Oliver: I don't know the official title, but I know that she ran that channel program - the accountants channel program, meaning selling, through accountants, the Sage products. David Leary: If I was to say that Matt Rissell is the face of TSheets, could I say Jennifer was the face of Sage? Me being an Intuit person, [00:05:00] if I had to say, "Who do I know at Sage?" I'm gonna say Jennifer. Blake Oliver: Yeah. I would agree with you. She was the face of Sage. At all the conferences, she gave the keynote speaking sessions. She was the representative that everyone knew. David Leary: Was this true for Sage's small business level, all through their enterprise products, as well? Was she at the Intacct conference giving keynotes, as well, or is she just really just the true Sage-branded stuff? Blake Oliver: She was at the Intacct conference last year, and she's been at ... She [00:05:30] used to go to Sleeter Conference, right? [cross talk]  David Leary: -she was there forever, yep. Blake Oliver: Yeah, so she kind of did the whole thing. She's leaving accounting for something completely different- David Leary: Construction, yes. Blake Oliver: Gonna be an exec in a construction company. David Leary: So, the last departure … Blake, you are leaving FloQast. There was a LinkedIn post that went out today. Blake Oliver: Oh, yeah. I am leaving FloQast. That's right. I'm departing at the end of this month, and I'm gonna be doing my own thing for a while. So, I'm [00:06:00] open to helping people with marketing or CAS operations - I ran a client accounting services firm - and just seeing what's next. David Leary: So, VP of Sage? That’s available.  Blake Oliver: The timing is really remarkable. So, who knows? If you want to know why I left, I wrote a short post on LinkedIn that'll be in the show notes, so you can check that out. It’s all about ... Things change fast in a startup, right? We've gotta be agile, and our marketing focus has shifted. [00:06:30] I am not a guy who's gonna go put on a suit. I've spent, unfortunately, too much time in Southern California wearing sandals. David Leary: So, you're not headed to the Big Four? There’s nothing … [cross talk] Blake Oliver: No. David, I think we should make The Cloud Accounting Podcast … Look how far this show has come with just part-time effort. We could really make this thing great or, at least, not terrible. David Leary: You might have time- we could get our Instagram account set up finally. Blake Oliver: Yes! David Leary: We could have some time for that. Blake Oliver: It will be an Instagram account of me in my pajamas every day, working [00:07:00] on the podcast. I think that'd be really successful. David Leary: Who would not subscribe? Blake Oliver: I think actually, Ben, you had a great picture of you and ... You have a partner in your content creation efforts, and he was wearing shorts in front of the camera or something. Ben Wann: Yeah. Everyone thought he was wearing his underwear, but they were actually just normal shorts. So, from the top up, we were all formal, with our hair done, and our jackets, but, from the bottom down, it's all party. Blake Oliver: Yeah, exactly. That's the way to do it, right? We've all been guilty of it on Zoom meetings, and when [00:07:30] we work from home. You dress up, up top- Ben Wann: That's right. Blake Oliver: -where people can see you, and you're nice and cool down below. It's good. Ben Wann: We were talking a little bit before the show about how expected transitions should be. We’ve shifted in the world, from where you go into a job, and that's what you do for five or 10 years at a piece. Now, it should be expected that you go to a job, and you should already be planning to leave that job as soon as you start it. You’ve gotta plan out what you're gonna improve, how [00:08:00] you're gonna automate, optimize. You should have an end path planned out. You shouldn't plan to park yourself. Just seeing people like yourself being able to move to different opportunities strategically, it's just really smart, and it's the trend that's really going on right now. Blake Oliver: You actually wrote about this a while ago, and I remember reading your post about how that's ... That’s how you've thought of your career is that "I'm gonna go into a company, know what I want to achieve, and do my best to achieve that in one, two-" Ben Wann: Exactly. [00:08:30] Blake Oliver: Ideally in a couple of years, right? And then you move on. That's way better than staying someplace for 20 years and not really doing anything or changing anything, I guess. Ben Wann: Yeah. Yeah. I did the podcast with Phil Yaeger, and I talked about how I see myself as an internal consultant. I'm constantly trying to learn, and get better, and be at the top of my game. There's this divide still between what we expect from normal employees and consultants. To me, that's outrageous. Why should your employees [00:09:00] not be held to the same standards? Blake Oliver: Yeah. Ben Wann: If you can get there yourself, you can write your own ticket. I've been fortunate enough to do that, and you're doing it. I hope more people hear this, and they also wanna do that. The world's your oyster. Blake Oliver: It’s nice, too, because I think that's reducing the stigma of shorter-term employment, right? It used to be that if you jumped around every few years, people would look at you funny, but, now, if you do it smartly, and you have a reason for it- Ben Wann: That's right. [00:09:30] Blake Oliver: -and you can justify these changes, then it's ... I feel like at FloQast ... I came out of an accounting firm, doing client accounting services, to go to FloQast to do product marketing, which I'd never done before, never studied product marketing. I view it as I got an MBA in marketing, and I got paid to do it. Now, I can take that skill and go do that either at a firm, or at another software company, or as a consultant. David Leary: I don't think it has to be a jump from a company to a company. When I was at Intuit, I [00:10:00] pretty much, like every two or three years, was at a new job, right? It's about not being stuck in any role- Blake Oliver: Yeah. David Leary: -and constantly evolving and taking on new challenges. One thing you said, Ben, that was interesting is that thought process of thinking about what your exit is on day one. Blake and I did an interview, which we'll be dropping here soon, about selling your firm. That was one of the takeaways from that interview, I remember, was to have your plan for the exit … Don't think about selling your firm 25 years [00:10:30] in- Blake Oliver: Yes. David Leary: -when you're six months away from retiring. On day one of starting your firm, think about how you're gonna sell your firm. Blake Oliver: We talked about significant departures. Let's talk about the fund raising. The money, right? Ben Wann: The money. Blake Oliver: There were two big announcements that I saw this week. It was FreshBooks raised a bunch of money from Chase, and ScaleFactor raised another bunch of money. I don't remember who that was from. David Leary: Let's talk about FreshBooks first, because, I think there's less insanity- Blake Oliver: Yeah. [00:11:00] David Leary: -and discussion on that one. We might have a half hour of chatting about the ScaleFactor race, so, let's jump into the FreshBooks one. Blake Oliver: The story about FreshBooks is that they announced an undisclosed amount of fundraising from JP Morgan Chase. But given this is JP Morgan Chase, I imagine, it's pretty substantial. They had previously raised CA$40 million in Series A 'round in 2014, and $57 million in series B in 2017. [00:11:30] Here's the thing that stuck out for me is that- David Leary: This might be a $100 million race. Blake Oliver: It could be. I know that Chase put a ton of ... I think they put that amount to Bill.com recently, so, I wouldn't be surprised if they were making similar-sized investments, right? David Leary: And it was stated "most significant investment" so far, in quotes-  Blake Oliver: So, it has to be at least $57 million, right? David Leary: $57 million and one penny. Blake Oliver: As part of the new deal, a Chase representative will be joining FreshBooks' board of directors. FreshBooks said it will use the new funds [00:12:00] to continue to expand operations and its business reach. So, having a banker on the board is gonna be interesting at a software company like that. For those who aren't familiar with FreshBooks, they kind of go under the radar sometimes with accountants, because they don't market to accountants, really. It's to small business owners, like owners of micro-businesses, in particular, meaning sole proprietors and all that. They're not like Xero, or Intuit going [00:12:30] after those accounting firms. They are the largest accounting software company in North America, maybe even the world, just by volume of customers. David Leary: I think they count their customers a little differently. What I mean by that is QuickBooks, and Xero will count small business owners that are paying for the subscriptions. FreshBooks kind of ... I'm using QuickBooks. I invoice you through QuickBooks payments. You pay. Blake Oliver: Yeah. David Leary: You're a customer. Then you invoice the other guy, and [00:13:00] Ben pays me through QuickBooks - that's a customer. So, if Xero and QuickBooks counted similarly, in a way, the numbers would not ... It's just they count their numbers in kind of a different way. Blake Oliver: Got it, but it's still millions and millions. David Leary: Oh, yeah. This is how they get to that "We've served 20 million customers." Going by that, Intuit has served hundreds and -300, 400, 500 million, possibly, right? Blake Oliver: Mm-hmm. It's an interesting question - how do you count those? But they're big. Whatever [00:13:30] metric you use, they're big. Let's talk about the ScaleFactor money. David Leary: Yes. ScaleFactor took another $60 million. This, in just 2019 now, in one year, they've taken on $100 million of VC money. Blake Oliver: Wow. That's a lotta money. Just for perspective, I think, at FloQast - I don't know the exact number - we, in six years, raised half that. So, this is a lot of money for any company, [00:14:00] software or otherwise. David Leary: Absolutely. Blake Oliver: What's crazy about this is that ScaleFactor is not just doing software. They are heavy professional services. They are- David Leary: They are an accounting firm, or bookkeeping firm with engineers under roof. So, this is gonna be in that same vein of, arguably, you could say QuickBooks Live is dancing in that space. You got the Botkeepers, and Ceterus, and Pilot, and ScaleFactor, and Bench - these companies we've talked about before in the past. Blake Oliver: The thing that blows my mind about this is that they're raising money as if they are a [00:14:30] software company, which is something where you can scale that really quickly. It makes sense that companies can be valued at many times- many times … 10, 20 times, 30 times earnings. But it's not just a software company. They are providing a service with that software and, arguably, one that's far more important than the software. Accounting firms are typically valued at anywhere from 1 to 1.25 annual revenues. This company ... [00:15:00] ScaleFactor is being valued at ... Well, we don't know ... What do we know, actually, about how big they are? David Leary: Some of the numbers in the article … They don't have 1,000 customers yet. Blake Oliver: Right. David Leary: It's very clear in the article. They say they don't have 1,000 customers, and they recently crossed 200 headcount. So, if you back out that math- Blake Oliver: Yeah. David Leary: Let's say they have 1,000. What's the number of clients per body in the office there? Blake Oliver: They only have 30 CPAs, though, out of those 200 headcount. [00:15:30] So, they’ve got 30- David Leary: But they're not ... Yeah, 30 CPAs, but what about bookkeepers, and people doing the work? Blake Oliver: We don't know. How many of those 200 people are engineers building software is another-  David Leary: Even if they are. Let's just assume they're all ... It's just headcount, right. So [cross talk] 1,000 divided by- Blake Oliver: Just 200? David Leary: 200. So, we're- Blake Oliver: Five. David Leary: It's five. Five clients per employee [cross talk]  Blake Oliver: -right. David Leary: Yeah, five clients per employee. I've talked to accountants, and bookkeepers that have ... They're pushing ... One bookkeeper's [00:16:00] handling 50 clients. Blake Oliver: Right. David Leary: I think you said you had a bookkeeper, in the previous episode, that pushed almost 40 clients a month.  Blake Oliver: Yeah. That's an all-star bookkeeper. It also depends on the size of the clients. Let's give them the benefit of the doubt and say that it's five clients per employee. That would make these clients enormous. David Leary: But they're going after that $400 a month QuickBooks Live customer. Blake Oliver: Right. David Leary: It’s right on the website, their pricing. Blake Oliver: Do we know their average price? What do you think their most popular package is? David Leary: Let's give them the benefit- it’s $1,000. Let's say they're selling [00:16:30] payroll and some add-on things, and it's a higher-end package, and they're getting $1,000 a customer. Blake Oliver: Okay, and let's just assume they have 1,000 customers, right? So then, that's $1 million in recurring revenue. $1 million in recurring revenue makes you worth $100 million in investment. Here's the other thing that's crazy is they said that- this is in the Crunchbase article that you shared, David. It doesn't say what their revenues are, but it said that they have 700-percent ARR growth in 2018, which is just insane, even for a software company ... [00:17:00] For an accounting services business, it’s insane. There's actually a mention in here that the CEO admitted that it was from a very small base, because, of course, if you start small, you can have 700-percent growth. When I had my firm, I pulled this trick, too, right? It's the oldest marketing trick in the book. You start with 10 customers, and you grow to a hundred, and you’re like, "I had 10 time …1,000-percent growth." It’s [cross talk]  David Leary: Based on my knowledge of this space, of these accounting [00:17:30] firms with engineers under roof, they have the smallest number of customers and have raised the most money. Blake Oliver: Here's the thing that's interesting, too. It says they haven't hit ... They expect to hit the 1,000-customer mark this year by adding hundreds of new customers per month. It's August right now, and if they're gonna add hundreds of customers per month to get to 1,000, then let's say it's 200 customers per month. We've got August, September, October, November ... That's 1,000 customers right there. Five [00:18:00] months. David Leary: Which means they're also gonna have to add 20 employees a month to do that [crosstalk] based on their current ratios, which ... That's what's confusing, because the whole bet of doing this engineering-based work with the accounting firms is that you have these insanely awesome ratios. Blake Oliver: Yeah. David Leary: That is not an insanely awesome ratio. I actually really … Think about the money, right? If ScaleFactor is built on top of QuickBooks, and Xero ... It's right on the website, it's very clear. They fully disclosed, right? Blake Oliver: They don't have their own GL. They are using ... They are leveraging in QuickBooks [cross talk] [00:18:30] David Leary: Off the shelf. Pilot, I think, uses QuickBooks. I think there's another service that uses Xero. A lot of these guys are using off-the-shelf. Bench is the only one that, I think, is not using off-the-shelf. They're using their own GL that they've built in-house. If you have $50 million, you should just put $25 million on Intuit, $25 million on Xero, and just ride that out. That's a guaranteed victory. If you believe they're gonna win, you gotta …  Blake Oliver: None of this makes sense to me. Hey, Ben, are you still there? Ben Wann: Yep, I'm here. Blake Oliver: Here, David and I are amateur-analyzing this. David Leary: He's the credentialed guy, right? He's the credentialed guy. [00:19:00] Blake Oliver: You're the credentialed guy. You're a certified management accountant. I know that you had no idea we were gonna talk about this, but I'm just wondering does this any of this make sense to you, just looking at it right now? I don't get it. Ben Wann: It sounds a little unusual. Knowing nothing, just hearing you guys talk, sounds like something's missing, or we're not aware of some type of information. Blake Oliver: My guess is that you've got a bunch of VCs who are looking at ScaleFactor like it's a tech company and that they're applying those kind of metrics, and valuations to [00:19:30] it. Maybe they just don't realize ... Is it possible they just don't realize how heavy the human component is? And that it's not ... Nobody has ever scaled an accounting firm this quickly, or as quickly as you would need to, to justify that valuation. David Leary: And it may not be them scaling internal processes yet. What they've been doing really well is Facebook ads. Half of all VC money goes to Facebook, and Google, and Amazon. If you really watch ... I [00:20:00] see it in my feeds. ScaleFactor is at the top of everything that’s small business, or QuickBooks-related that I search for on Google, I see a ScaleFactor ad. Even other accounting firms … I searched for a different accounting firm that's not even a software-based one, I get a ScaleFactor ad. Everywhere on Facebook, I get ScaleFactor … Lots of this money is going to Facebook ads, which helps you get 700-percent growth, because ... So, they're playing the startup game. There's no doubt. Blake Oliver: You're getting that growth at very high cost, because you’re-. David Leary: The cost per customer has gotta be the highest in all-time [00:20:30] industry. Their probably spending $20,000 a customer right now. Blake Oliver: Well, hey, if any of our listeners have any more insight into ScaleFactor, or how this whole thing works, I would love to know. You can please tweet at me, tweet at David. Let's figure this out, because it's a mystery. David Leary: Even ScaleFactor, yourself. I've reached to ScaleFactor via email before. I've reached out to ScaleFactor on LinkedIn in the past. I've tweeted at ScaleFactor and included this article. I would love to hear from ScaleFactor on how ... Why they're different from these other players in this space. Blake Oliver: Let's get somebody on to talk about it, because maybe we're [00:21:00] wrong. Maybe we're just not understanding it. So, Ben …  Ben Wann: Yes. Blake Oliver: Let's talk about why we brought you on today. Ben Wann: All right. Blake Oliver: I saw a LinkedIn post that you made, a LinkedIn article that you wrote this week, that I just ... I loved it. It's called "Dear AICPA! I Wrote Your Concession Letter." Ben Wann: Correct. Blake Oliver: You published this on the 7th. Actually, so it was two days ago, and then I was like, “We gotta get you on to talk about this,” because this is near and dear to my heart. So, I [00:21:30] was wondering if you wouldn't mind just taking a moment and just reading this for our listeners, because I think it's great. Ben Wann: I'll give it my best shot here. I put myself in the head of the- into the mind of the AICPA.  To the esteemed finance and accounting community, after much consideration and deliberation, it is with a heavy heart, and misty eyes that we are announcing that we are pulling the CGMA certification from the US market, effective [00:22:00] immediately.  With profit on our minds and lust in our heart, we, unfortunately, had entered into a foray that was far beyond our core set of competencies. Our initial estimation of the willingness of people to first purchase a certification to artificially inflate our member count was our first downfall. We had assumed that, after reaching a critical mass of paper certificates, that thousands upon thousands of professionals in [00:22:30] the accounting and finance community would then eagerly clamor to then pay for the privilege of actually studying for and then passing our exam. In addition, we have failed to recognize that the name given to our brand-new certification was not an original idea. It was - how do you say - heavily-borrowed from.  We can now admit, looking back, that we were so hungry to emulate the success of the CMA and how they were, in [00:23:00] fact, the leading global certification that we just couldn't help ourselves. We wanted to build on their success and add our own special sauce by cramming an additional letter into the mix; a 25-percent increase in the value to our members. We want to recognize that we have also disrespected dual CPA and CMA holders by creating this confusion in the marketplace. You have to admit, though, it was amusing to see our [00:23:30] certification pop up on real job postings for a while. We jokingly suggested adding it to the list of key job skills and education, and no one thought that we were kidding. So, well, we just kept running with it. Finally, our biggest failure was to not recognize the innovativeness, the creativity, and the flexibility of our main competitor, the IMA, or the Institute of Management Accountants. Buttressed by a passionate network of [00:24:00] Net Promoter members and a high-performancing board of senior professionals, the organization has only become stronger, and faster over time. In recent years, we've been trounced by the IMA in every market; even the US, our home. It is now time to recognize the foolhardiness of our decision. Each month, we have had to agonize by reading through our competitor's publication, 'Strategic Finance,' to painfully bear [00:24:30] witness to an ever-growing, and truly international list of new members and certification holders that we simply cannot compete with. We recognize that we have a rare window of opportunity now to bow out with dignity, and honor before we are completely ushered into non-existence.  Going forward, I promise you that we here at the AICPA will focus on the things that make us special - creating new rules for auditing, advocating for state-specific CPE courses, [00:25:00] and creating special interest groups to protect entrenched interests. Regretfully yours, the AICPA. Blake Oliver: You include the disclaimer that this is a satire article that was not written by the AICPA. Ben Wann: Correct. Blake Oliver: And should not be ... What’s the legal disclaimer they have at the end of all their podcasts? It should not be relied upon for legal guidance or any of that. I love that. Thank you for reading that, Ben. This episode of The Cloud Accounting Podcast is sponsored by Rewind. For years, Rewind has been successfully backing up thousands of small businesses' data that is stored in cloud apps like Shopify, Big Commerce, and MailChimp, saving these small businesses from CSV importers, employee mistakes, and app integrations that didn't go as planned. Rewind has also been backing up QuickBooks Online company data, too. That's right, cloud accounting world. I did say "backup QuickBooks Online company data." It only takes seconds to install what is essentially an insurance policy against major disaster or just those small business owners that like to get "creative" in the accounting system. Rewind works automatically in the background, capturing all the changes to your QuickBooks Online in real time. If something does go wrong, Rewind is the only service that gives you 100-percent control over what you need to restore, be it one transaction, multiple transactions, or all the data. To learn even more about Rewind and access a special offer just for listeners of The Cloud Accounting Podcast, head over to CloudAccountingPodcast.promo/rewind. That is Cloud Accounting Podcast dot promo forward slash R-E-W-I-N-D. Blake Oliver: David, I think you may be a little confused by this. David Leary: Yeah. I am all for stirring the pot. I love this. I'm all ... And I love some good satire. Absolutely, 100 percent, but in actually reading this, I was smiling. I was like, "This is great. This is really, really great.” You hit a level. But, to be honest, I am a little confused. I'm not in the loop of the inside baseball of what happened, where are you coming from, why you [00:27:00] wrote this? Any of those types of questions, I'd like to understand. They copied a different certification test, and they wanted to try to rebrand it and confuse the market? Can you give me some background on this, Ben? Ben Wann: Yes. Yes. So, a couple of years ago, can’t be more than three or four, they ... The AICPA partnered with CIMA, the UK accountant association, [inaudible], to create this new certification, the CGMA. What they did is ... Initially, all you had to do was [00:27:30] send in a check, and say you had some type of certification in an industry, and you got a brand-new certification. This cheapens and discredits kind of the whole process of the CPA and the CMA. These things take months of effort, sometimes years of studying. Being able to buy a certification to try and win the market is a terrible tactic, and everyone saw right through it. Blake Oliver: Was this motivated by the success of the CMA, like the [00:28:00] CMA was growing, and started, and then the AICPA decided to come in and offer their own credential to compete with it? Was that how it happened? Ben Wann: Yeah, because I guess everyone's seen these numbers with the number of CPA candidates in the pipeline. It's going down. So, the AICPA is looking abroad, trying to strengthen their product and their pockets. They noticed that CMA has really expanded to every other country, except the US, initially, and it's double-digit [00:28:30] growth, 27 percent. Now, they're back in the US, with 20 percent growth here, as well. That’s what they were chasing. Blake Oliver: Speaking of the number of new CPA candidates, the numbers have dropped. I posted a chart that I spotted in a CPA.com white paper on LinkedIn this week that shows, from 2005 to 2010, the number of new CPA versus accounting grads was-that line was trending upward at the same rate. [00:29:00] Ben Wann: Yep.       Blake Oliver: Then, somehow, something happened; between 2009 and 2010, all of a sudden, that dropped, and now, there's a much larger gap. The number of new accounting grads has grown. Ben Wann: Yep.  Blake Oliver: But it looks like the new CPA candidates just continue to drop. Ben Wann: Yeah. There are several things going on here. Blake Oliver: Let's talk about that. What's going on? Ben Wann: The big thing that has a lot of people annoyed is this 150-credit requirement. Before, I guess, 2010-2012, you needed 120 [00:29:30] credits. That's what everyone usually graduates college with, and you had to have two years’ experience working with a CPA firm, and that was your education. Now, they are saying everyone needs 150 credits. For many people, this is a master's degree. It might cost $20,000- $30,000 to complete. There's other paths to get around this. It's just a lot more work, and for what result? It's very unclear to people. Blake Oliver: Yeah. I was joking online that when [00:30:00] I sent my application in for my license, I found out that I was nine credits short of the 150 requirement. So, I went online to the cheapest community college that I could find that had an online program. I think was Oxnard Community College here in LA, and I registered for Intro to Philosophy and Intro to Management. I really enjoyed my Intro to Management class, given that I've already owned and sold a business. That was really, really helpful to me. That's [00:30:30] the thing that's funny about this 150-hour requirement, right, is you can take any- Ben Wann: Correct. Blake Oliver: I don't even understand the original logic behind it. What was the ... David, it sounds like you have something to say?  David Leary: Yeah. It feels like ... One thing, the bell went off for me a couple weeks ago. You said that ... The Cal CPAs- if you're a CPA in California, you have to join that membership. Blake Oliver: Yeah, I think you … Well, I think you have to, right, in order to …? David Leary: But the AICPA is 100-percent optional. Blake Oliver: Yeah, you don't have to be a member the AICPA [00:31:00] to maintain your license, because it's state-certified. David Leary: Okay, and then I've seen people online say, "Hey. I'm probably not gonna renew my AICPA membership." People aren't finding value in this. Some of these things, like, "Hey, we're not getting the revenue we want, let's have another certification. Let's spin up a commercial site like CPA.com," is it something … Does the CPE credit stuff kind of all fall in under that, like they're getting some kickback from the colleges by requiring more credit hours? Is it a revenue game? Ben Wann: Yep.       Blake Oliver: Yeah. It has to be, right?  Ben Wann: With state-specific CPE, this is another issue where people are furious, right? Each state has their own rules. The state of Delaware, where I’m certified, they have their own ethics course. To get certified every two years, you have to do their course that costs money. They're gonna get a cut of that, the state society. What's different from one state to another? Nothing. So, to have these hoops you have to jump through in order to give money to a [00:32:00] state society is ... Everyone’s seeing through it, and we’re tired of it. Blake Oliver: Just to put some numbers behind this conversation, if you look at the chart that I'm ... Obviously, our listeners can't see this chart. In 2008-2009, it looks like about two-thirds of accounting grads were going for the CPA, right? If you just divide the number of new CPA candidates by the number of accounting grads, it was about two-thirds. If you look at the latest data, which is [00:32:30] from 2017, that number has dropped to half. So, that's a huge, huge change, right? Ben Wann: Oh, yeah. Blake Oliver: And if it continues to go down, if fewer than half of accounting grads are going for the CPA, I'm concerned about the CPA's future. As somebody who invested the time and money to get it, I'm disappointed in that trajectory. Ben Wann: Yeah.  David Leary: Shouldn't that be the role of the AICPA to encourage people that are graduating with accounting degrees to become CPAs? Shouldn't that be their number-one most [00:33:00] important function? Blake Oliver: Probably, to get more members, right? Somebody on LinkedIn said that the good thing about all this is that with fewer CPAs, it creates more demand for CPAs, right? Ben Wann: Yup. Blake Oliver: But I don't think that actually is true, because it could backfire in that fewer CPAs mean that people aren't as familiar with it, which means that demand drops, right? In economics, if you decrease supply, you may increase [00:33:30] prices, but you also decrease demand. I've got another chart here, kind of related to this whole discussion. This appeared in the June 2019 issue of "Accounting Today," and it's a survey that ADP did. The question they asked 1,500 accounting professionals. They asked 1,500 accounting professionals the question: "Would you recommend that young accountant get their CPA license?" A full quarter of those accounting professionals either said no, or that they would recommend [00:34:00] something else. Ben Wann: Yeah, I'm one of them. I'm dual-certified. I'm one of ... There's not that many people who can talk on both sides, kind of unbiased. People ask me- Blake Oliver: Yeah. Ben Wann: Unless you wanna do tax or audit your whole life, I'll say, "Go bananas. Do the CPA,” but, otherwise, the CMA is so much deeper. It just prepares you for the job. A lot of people have said this, "The CPA has helped me get my job, but the CMA helps me do my job." Blake Oliver: That, I think, ties in with what I have heard from the community, which is that fewer [00:34:30] and fewer accountants are going to school, and graduating, and thinking, "I'm gonna make partner at an accounting firm someday." That dream of making partner, people just aren't that interested in it anymore. If you aren't buying into that dream, then why would you necessarily need that CPA, if you think, "Well, I'm just gonna go into public for a few years and then leave." Ben Wann: Yeah, it used to be it was a one-stop shop. If you were smart and you went to accounting, you had to do public accounting. You worked a [00:35:00] ton of hours. You got a lot of experience. You were better than the industry peers after two to four years. Then you see all these smart, driven people with a CPA. It’s like, "Okay. They're doing so well, because they're CPAs,” kind of, you know?  Blake Oliver: Yeah.  Ben Wann: But now, there's all these alternative paths where you can be very successful without ever working in public accounting. I had never want to work in public accounting, and I haven't. I'm at the top my game, so I'm doing very well. There's so many opportunities out there. You don't have to do public [00:35:30] accounting to have a really strong career in accounting. Blake Oliver: Let's talk a little bit about your background and what you're up to, Ben. I'd love to hear ... I know that you are working on CPE courses. You may already have some available. You're a big advocate for the CMA. Tell us a little bit about what your projects are, and what you're up to, and where people can find out about that. Ben Wann: Talking about trends, technology is everywhere, and I don't think there's a discipline being more impacted right now than accounting by technology. What we do, how [00:36:00] we do it, where we do it is all changing. So, within 10 years, it's a complete shift. There’s a huge need for people to understand what skills they have to learn and to help people bridge that gap from where we've been to where we're going to go. In my career, I've seen so many people who are just stuck, and they're not gonna get it. What's driving me is I want to help fill those knowledge gaps between theory and practice. Right now, there's not that many sites [00:36:30] for information to understand, "Okay. If I wanna do this, how do I actually do it?" Not "I don't want to manufacturer widgets." That's what's kind of driven me. I'm really into the education side. In that regard, I have actually started producing courses on a site called Udemy.com last year, and now, I'm up to five courses. I have a YouTube channel. I have a website that I run with a team of people called The Numbers Guys. [00:37:00] The basis of that site is to provide the blogs, the really strong blogs that help people understand what a day in the life of an accounting professional- all these different avenues looks like, and how we get our jobs done, and what we're interested in.  I've also really focused on business process improvement, because if we're gonna go into the future, we've gotta get our houses in order. I see that to be a huge opportunity. Then there's also this shift in accountants transforming [00:37:30] from kind of like the stereotype of this boring, dull, introverted person to, now, someone who's not just reconciling accounts but working with the business to turn data into insights. There's a lot of communication. There's a lot of influencing going on. That's known as finance business partnering. My two big things right now are finance business partnering, and business process improvement. Blake Oliver: What's your day job? Because you do this ... You're a very busy guy. You're [00:38:00] doing this on the side at night- Ben Wann: Nights and weekends. Blake Oliver: Weekends. What do you do during the day? Ben Wann: Yeah, that's ... I do that, too. At my day job, I'm an operational controller for a company called Savencia. They make all sorts of cheeses. They're French-owned. We have four factories here in the US, and I run ... I'm in charge of the controlling department. I make sure that our cost accounting is strong, it's accurate, and we're getting good data out to help the [00:38:30] business know what they're doing to make good decisions. I report right into the CFO. Each day, what I love about this job is I'll go from working with the executive team to data entry clerks. I'm in the plant most of the time. It's a really boots-on-the-ground job. Blake Oliver: Sounds delicious, too. Ben Wann: Yeah. Blake Oliver: Hey, David, before we go, we got a little follow up on our ransomware stories over the last few weeks. You wanna touch on that? David Leary: Yeah. Before we jump into the ransomware one, there was the one that's kind of related to the ScaleFactor one. There's a British company called Crunch. It's [00:39:00] Crunch.co.uk. Crunch essentially, has - they're really going after the self-employed market, the freelancers - bookkeeping software. They have their own in-house bookkeepers, as well. So, it's a similar play, right? It's accountants with engineers under roof. But what they announced, they are now going to offer a freelance bookkeeping network – an Uber model – just like QuickBooks Live. This is the third week in a row now some other company is now gonna offer bookkeeping as part of their software package. Blake Oliver: It's gonna [00:39:30] be interesting reading all the reviews of these various services as they roll out. I don't know if anyone's really figured it out yet, right? David Leary: Do you think ... This is hypothetical, and Ben, please chime in on this, sometimes you get an Uber, and that guy's got an Uber light, and a Lyft light, and he's got both phones on his dashboard, or her - whoever's the driver … They're picking some ... One ride, they pick up a Lyft person. Next ride could be an Uber person. Do you think there's gonna be bookkeepers, and accountants out there that’ll, "Hey! I'm doing this …" Because chances are H&R Block’s gonna do this with Wave. [00:40:00] I'm gonna take a Wave customer this time, a QuickBooks Live customer, a Crunch customer. Is it just gonna be really like the gig accountants, or gig bookkeepers are just gonna work with all these services at the same time? Blake Oliver: Maybe, David, now that I'm gonna have some time on my hands, I should just sign up for all of these services and report back. David Leary: As a small business owner, or as a bookkeeper? Blake Oliver: As a bookkeeper. I could go be a QuickBooks Live bookkeeper. I could go be a Pilot bookkeeper. I could go be a ScaleFactor bookkeeper. Crunch bookkeeper. David Leary: It'd be an interesting [00:40:30] experiment. I'm sure there's people that have done driving for Uber, and Lyft and wrote a blog posts about that. Blake Oliver: Yeah, they have, and then they get banned for life, probably. Ben Wann: Blake, that's interesting [cross talk] in there. There's actually people who I talk with, who are making a business out of kind of doing what you just talked about. Trying to get a grasp for all of the apps and resources that are out there and then translate that into, "Okay. If I have this problem, what's really the best solution?" There's a need for that. Blake Oliver: Oh, [00:41:00] yeah, and not nearly enough people who are taking the time to build up that knowledge base. Even in specific industries, like manufacturing, knowing all the different tools available and going to different companies and modernizing their IT infrastructure from a financial accounting perspective. Really, really fascinating. David Leary: Or just cheese manufacturers. Blake Oliver: Just cheese. You could just specialize in cheese. I'm sure there's some very unique aspects to the manufacturing process that you have to track in your ERP, right, Ben?  Ben Wann: Correct. There is. The dairy industry. [00:41:30] Blake Oliver: Yep, dairy. Cool. David Leary: Let's talk ransomware again. Blake Oliver: Ransomware, yeah! Risks …  David Leary: The rewind ... It was yesterday or the day before, iNSYNQ ... Blake Oliver: Yesterday. David Leary: So, the CEO of iNSYNQ ... Remember we talked about it a lot on last week's episode that he was planning on joining us for an interview and then he canceled? We talked about that last week-  Blake Oliver: Yeah, he bailed on us, and now we know who he bailed on us for. David Leary: Then, I saw, two days later, an advertisement for him to go on the [00:42:00] Woodard, Joe Woodard's webinar. So, he was on the webinar and it was- Blake Oliver: Remember, it wasn't a webinar, it was a town hall. David Leary: Town hall. Okay. Yeah, it was a webinar platform, but it was a town hall for people to ask questions about the attack. He answered all the questions that came in. Some of the answers did feel a little prepared. It looks like Brian Krebs actually attended, and he has information. He really did a nice write up about it, and it looks like they [00:42:30] were in for almost 10 days, before they actually encrypted anything. Blake Oliver: Yeah, that's kinda scary that the attackers were in there for 10 days, and iNSYNQ didn't know until they unleashed their attack. By the way, for those who aren't familiar, Brian Krebs is a security researcher who has a blog called KrebsOnSecurity.com. Your entire goal as a software company should be to never show up on KrebsOnSecurity.com [cross talk]  David Leary: -on his blog- Ben Wann: -that’s the wall of shame …  Blake Oliver: Yeah, exactly. So, iNSYNQ, for [00:43:00] those who are not familiar with this whole saga, they were attacked in July 16th or something like that by a malware ransomware attack that shut down their QuickBooks and Sage hosting platform for two weeks. David Leary: My understanding, as of the thing yesterday, there are still some customers who are not 100-percent up. Blake Oliver: Yeah, it's only in the 90th percentile. It's 90 percent, in terms of customers who have access, which is kinda crazy. I know, David, you're gonna go through a [00:43:30] lot of this, but the thing that really stuck out to me is that the reason they couldn't give people backups quickly ... Think about this - if your network gets shut down and infected, that's fine. It can happen, but you should have backups of these QuickBooks files that you can just provide to the customers; but they couldn't do that, apparently, because the backups were not separated from that live environment. So, they could also have been infected with ransomware. I'm not clear on whether they were, but [00:44:00] it's possible that they were, which should never happen. David Leary: Some of this is the confusion caused by these hosting companies, right? With QuickBooks Online, or Xero, or true SaaS software, you don't have to make backups, right? Blake Oliver: Right. David Leary: You can backup … There's tools like Rewind, who's- actually, I think they're sponsoring this episode, right? There's tools like Rewind that will- for data entry errors, right? If you do data entry, and you need to rewind your data, and fix something, that happens. Fundamentally, you don't have to back up your data, [00:44:30] not in the same sense you used to have to … You go to a menu, "File Backup," and you make a true backup of your data on a removable drive. You take it somewhere else - network drive, or tape drive, whatever. These hosting providers, because it's in cloud, people kind of assume they don’t have to make that backup anymore. If people were making a backup and saving it to their own local hard drive, they could’ve just installed QuickBooks to a local computer, restored the backup, and moved on, and just wash their hands off this. Blake Oliver: Yeah. David Leary: There's [00:45:00] confusion on the marketing of this, which is really, really, really ... The worst part I hate about it all is just the confusion, and then the reluctance for them to not admit that the risk is higher on Windows-hosted machines of being ransomwared than a true SaaS play. Blake Oliver: Oh, yeah. Joe said something about how you're just as much at risk on a SaaS provider as a hosting provider, and that's just simply not true. David Leary: Not for ransomware. Now, there's been breaches. There are data breaches. There's no doubt. Breaches are at all-time highs, [00:45:30] but you could argue that those are ... They're getting either its names, socials, credit card numbers. It's marketing data that these huge companies have; it’s essentially, marketing data, but they’re not … If ADP got hacked, I can still run payroll tomorrow. I'm not locked out of my business files. That's the problem with iNSYNQ. Two other interesting [cross talk] Go ahead.  Blake Oliver: I was gonna say, the lesson here, for me, is go ahead and use hosting, but make [00:46:00] sure that you are managing your own backups in addition to whatever they are saying they're doing, so that if their backups fail, you've got your own local backups. David Leary: We went off on that last week, right? "You gotta backup. You gotta backup. You gotta backup." Two things that I thought Brian Krebs surfaced was, one, a Google ad from iNSYNQ. Blake Oliver: Oh, yeah. David Leary: It was pretty interesting. The Google ad says, "iNSYNQ, we're still standing." I'll read the text of the ad: "Competitors are offering empty promises about security to capitalize on the iNSYNQ attack. That [00:46:30] is not okay, but don't worry, we still are. Stick with the company who plays nice. Impacted by the attack? Call our hotline." Blake Oliver: I know why they're doing that, because I searched iNSYNQ on Google, and I saw ads from their competitors, saying, "Hey, affected by the iNSYNQ attack? Come to us, and we'll take care of you." Actually, I just searched, and I found one from TrapTechnology.com/iNSYNQ. "Impacted by the iNSYNQ attack? No contracts. Get a free trial." Ben Wann: Doesn’t hurt to try.  David Leary: And the other piece- Blake Oliver: Oh, NetSuite is doing it. "Affected [00:47:00] by the iNSYNQ attack? Switched to NetSuite today." David Leary: Switch off of hosting! Another thing he pointed out is that Alex Holden, the founder of Milwaukee-based cyber intelligence firm Hold Security, basically came out and pretty much said that if these companies can detect the infection before, they have some elbow room, because a lot of the times, these people will infect- they'll get on the network, and it'll be days before they do any encrypting of files. So, the key is to find the infection and stop it within seconds. Blake Oliver: Yeah. [00:47:30] David Leary: But you're right, if they've already started encrypting stuff by the time you discover it, obviously, we're seeing the repercussions of that. Blake Oliver: Well, speaking of encryption, I got one more story before we go. David Leary: Okay. Blake Oliver: From my old firm, Armanino: they are now accepting cryptocurrency payments. Press release came out yesterday, David, so you'll be happy to hear; that's another accounting firm that is modernizing their payments platform. Ben Wann: What is the angle there? Is that just marketing? I don't get it. Blake Oliver: Yeah. It's really great marketing, and I'm really confused why not every [00:48:00] big firm is doing this. They have ... Armanino started a blockchain cryptocurrency practice. Ben Wann: Okay. Blake Oliver: They've been promoting it, so, why not make an announcement? "We now accept every form of cryptocurrency. You can pay us with anything you want." Because, of course, the tech press are going to pick it up, right? [cross talk] David Leary: It's super-easy, right? It's just like getting QuickBooks merchant services. It's just you're adding a merchant service for 5,000 different wallets. [cross talk] Blake Oliver: -all you have to do is set up Coinbase or something, and [00:48:30] it just automatically converts whatever people pay you into US dollars, right? Just a great example of some easy accounting firm-type marketing stuff you could be doing. David Leary: I'm glad you brought that up, because it reminded me of a thought I had in the car, when I was driving earlier today, about ScaleFactor. I was like, "ScaleFactor's never once played the AI or blockchain card, and they're raising all this crazy money … They're not even playing the AI and blockchain card." Blake Oliver: That's true. Maybe that means they have some actual automation at work [cross talk] David Leary: -and on that note … [00:49:00] Blake Oliver: This was really fun. Thanks, Ben, for joining us. If people wanna follow you online, I know you mentioned that stuff before, but what's the best place for them to follow you personally, and then, your website for your project? Ben Wann: LinkedIn is the place to find me, and then The Numbers Guys is our website. David Leary: No Twitter for you, Ben? No Twitter? Ben Wann: I'm on Twitter. I don't know what I'm doing on Twitter. David Leary: Oh, we’ll have to get you on. We'll get you in the loop. Blake Oliver: That's good, because a [00:49:30] good rule of social media marketing is pick your platform and kinda own it, so you’re doing the right thing, Ben.  Ben Wann: Yep. Blake Oliver: David, where should people find you online? David Leary: I am on the Twitters- would be easy … It's @DavidLeary. Blake Oliver: I'm @BlakeTOliver. You can find me on both those places. David Leary: And, as always, please leave reviews on iTunes, but we have great news for all you not … All you iTunes, and Apple haters, like me, out there. You can finally write reviews somewhere else. There's a website called PodChaser.com. On there, [00:50:00] you can search for Cloud Accounting Podcast, or click the link in the show notes, and you can leave a review on Pod Chaser. What's nice about that is those reviews are starting to appear in other podcast players. It's one place to write a review, and in regards to the podcast player you use, it's going to populate across. Blake Oliver: They got some sort of API connection going on. That's cool. Ben Wann: I listen to a lot of podcasts, and I got turned on to you guys … In the last few days, I've just been listening to what you're up to. This podcast is really good. I've enjoyed it. You guys are doing really great work. David Leary: Oh, [00:50:30] thank you. Blake Oliver: Thanks so much, Ben. That's awesome. Really appreciate that. Now go write a review [cross talk] All right, that's it for me. Talk to you next week, David, and Ben, thanks for being on the show. Ben Wann: All right. See you later. David Leary: Bye, everybody. Blake Oliver: Bye.
SponsorLivePlan: http://cloudaccountingpodcast.promo/lpbootcamp Show Notes  00:31 – A personal word of thanks to our sponsors  01:00 – Sabrina and Kathy define advisory from their perspective   03:05 – Finding the why - Asking the right questions to help build a strong advisory service  07:01 – Another model of combining bookkeeping and advisory - former guest, Kenji Kuramoto  10:22 – Worth repeating: Bookkeeping is not what creates value in the mind of the business owner   11:37 – Adapt or die ... Stop fighting AI and get creative   13:29 – Sometimes Kool-Aid is good. Sabrina breaks down the myth that strategic planning is not a small-business imperative 15:14 – Want to take your client-advisory skills to the next level? The LivePlan Client Advisory Services Boot Camp is just what you need!   16:41 – For small businesses that don't have the budget for CFO-level help, there are endless opportunities for accountants skilled in strategic planning and advisory  19:10 – When you've got the 'who, what, where, and why,' LivePlan gives you the 'how'   19:53 – Kathy shares the inspiration behind LivePlan and describes some key features  22:08 – LivePlan is launching a new QuickBooks Desktop Beta. If you're interested in taking part, visit LivePlan.com/strategicadvisors to learn more 25:16 – LivePlan offers tools that remove the complications and make it easy for small business owners to work alongside their accountants  27:15 – Why Palo Alto transformed from desktop to cloud, and how they found the method to their madness within their own method - LivePlan   31:53 – How does Palo Alto Software stay profitable, and continue to reinvest in its own growth? Strategic planning   34:07 – Sabrina give a brief glimpse into her side gig - advocating for working moms and working families and how it took her to the White House more than once Connect with Sabrina and Kathy  Email: accountants@liveplan.com Website: LivePlan.com Twitter - LivePlan: @LivePlanSA Twitter - Sabrina: @mommyceo LinkedIn - Sabrina: https://www.linkedin.com/in/sabrinaparsons Twitter - Kathy: @KathyGregory1 LinkedIn - Kathy: https://www.linkedin.com/in/kathy-gregory-821525112/ Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus.  Subscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast TranscriptBlake Oliver: Welcome to The Cloud Accounting Podcast, I'm Blake Oliver. David Leary: I'm David Leary. Kathy Gregory: I'm Kathy Gregory. Sabrina Parsons: I'm Sabrina Parsons. David Leary: Sabrina and Kathy, where are you guys from? Sabrina Parsons: We are from Palo Alto Software, makers of LivePlan and also Outpost. But I think, for today, it's really makers of LivePlan, because we're here to talk to you guys about all kinds of things related to LivePlan and advisory. David Leary: There's the word - advisory. We're in the Summer [00:00:30] of Advisory. We were talking about this last night- Blake Oliver: Yes, yes ... Oh, and before we get into that, though, thank you so much for sponsoring and making this whole event possible for us. Sabrina Parsons: Oh, absolutely. Blake Oliver: We appreciate it!  Sabrina Parsons: We love Cloud Accounting Podcast. David Leary: Thank you. Blake Oliver: So, yeah, let's dive right into it. Let's do it. Advisory. David Leary: It's everywhere. We actually had an interview earlier today, where they're starting to ... People are getting scared by the word advisory, because it's like- Kathy Gregory: Being overused.  David Leary: Do advisory or die! What does it mean to you two? [00:01:00] Kathy Gregory: To me, you can't advise a small business or client. You can't advise your client unless you're doing strategic planning. For me, right away, you better be doing some planning, and broad-level strategic planning should be included and then the follow-up to the planning, but it can't be just ... I've heard people talk about advising on IT solutions, and advising, obviously, on tax. I completely understand that, and I think all of that can be included, but you're not gonna help a small business get [00:01:30] to where they wanna be - either grow or retain where they are, or even scale back ... Sometimes a business is trying to slow down, and a person's trying to retire out, or they're trying to just take it down and end it. Whatever it is, whatever the plan is, you're not gonna be able to do that unless there is strategic planning involved. David Leary: There's no plan, there's no map. What are you advising? Kathy Gregory: Right. Sabrina Parsons: Exactly, and I think that's ... I know, people get scared about it, and I think 'The Summer of Advisory' ... They're hearing all these things. There's a lot [00:02:00] going on right now, but I think the reason they get scared is because it is so undefined, and people define it in so many different ways, and it feels overwhelming. But, at the end of the day, really what you're doing ... What we all say by advisory, we all mean helping small businesses. That's what I like to kind of reframe and help people understand that it doesn't have to be this big, scary word that means 500 things. Really, what you're doing is helping a small business client. [00:02:30] How do you help a small business client without understanding their strategic roadmap, and where are they going, and really interpreting their financials for them? Because if they need IT help, maybe they'll come to you, but they're already there with you because you know numbers. If you're an accountant, that's why a small business client is with you. I think sometimes I see that disconnect, where, sure, you can learn IT, you can advise on IT, but your [00:03:00] strength as an accountant is your- the way you know numbers and embrace them. Blake Oliver: One thing I see, and I'm guilty of this, is people will ... When I was in practice, they'd come to me and they'd want a service. They'd say, "I need bookkeeping." Then I would just jump in and start doing that for them. Or maybe they would need some controller-type services. It was always best if I stopped for a moment, and I asked why. Not just "Why do you need my services?" Which I got better at asking that ... From a sales perspective, that's really important. But also, it's like, "Why are you in [00:03:30] business?" Sabrina Parsons: Yes.  Blake Oliver: We fail to stop and think about that. It could be, like you said, for strategic planning, Kathy. Maybe they wanna sell the business; they wanna retire, or I don't know, maybe it's just like they wanna quit their day job ... Everybody has a different reason, right? Financial independence- Kathy Gregory: I think, in the accounting industry, and in the public accounting industry, for so long, because of compliance-based services, a public accountant can literally sit back and wait for the client to come to them, because [00:04:00] they need whatever compliance-based service they need. But if you're going to work at a higher level with a client and help them grow their business, or help them achieve their goals, you have to lean forward, and you have to ask those questions that are different, and new, and more broad. Then, know how to apply that information. If the client tells you, "I'm trying to really just make enough money to send my kid to college," or, "I'm trying to purchase a new piece of capital [inaudible] company," or whatever it is, all of those are [00:04:30] business goals, and you have to be able to translate those into whatever financial plan that will help them achieve that. It's just it's a different type of work. Blake Oliver: Yeah. How do we get comfortable with that as accountants? Sabrina Parsons: You know, I think the first place is to also realize - and Blake, I don't know how much- whether you'll agree with me or not - but I feel like if you ask those questions to a small business, "Why do you need the bookkeeping?" I feel like we hear a lot from small businesses. We work directly with them. We started, and still [00:05:00] to this day, more than 80 percent of our revenue is direct from small businesses. We interact with millions of small businesses ... When they have the money to hire a bookkeeper, they don't understand what bookkeeping means. What they think to themselves is, "Whew ... I finally made it. I have enough money for somebody else to do the financials.". Blake Oliver: Right.  Sabrina Parsons: They don't understand that bookkeeping is literally compliance, and you're not helping [00:05:30] them analyze what's going on. You're just recording what happened. I think that's part of the disconnect. When accountants are afraid of advisory, because they don't know how to sell it, the biggest message I want them to hear is you don't have to sell it. You just have to do it, because that's why a small business owner is coming to you. I think it's a huge disconnect-. Kathy Gregory: And be able to know what the right price is for your firm and your ecosystem for that, too. Make sure you charge for it. But [00:06:00] yeah, just do it, because they expect that. Blake Oliver: Yeah, a lotta times, we give it away, right? Kathy Gregory: Yes!  Blake Oliver: We charge for a tax return, but we're doing a ton of advisory that's way more valuable to the owner. David Leary: And the owners will pay for it, because they'll understand the value- Kathy Gregory: If they understand it. Yeah, and I think that seems to be the next step for the accounting industry as a whole is to decide what it is, and then be comfortable with systematizing it, because I think it's ... I hear two things said a lot at conferences and at places, that advisory is knowledge [00:06:30] work. I hear that a lot. It's knowledge work ... It is, 100 percent, but you can still systematize knowledge work. You can still do that. You can set up for yourself a process and a system. Then, once you have that, then it's defined, and then you know what you're doing, and you can train your staff on it, and everybody knows what their piece of it is. Then, you can price it easier, and you can market it easier, and you know what that is. They need to embrace both - the fact that it's knowledge work, but that you can also make it a system. David Leary: Yeah. I think, this summer, a couple things I've [00:07:00] observed is Kenji ... Say Kenji's last name for me.  Blake Oliver: Kuramoto.  David Leary: Kuramoto ... Who was actually at The Accounting Salon. He was ... If you go back a couple episodes, listeners, you can listen to his interview. It was interesting, because he started 100-percent virtual CFO advising only. He's worked his way backwards into bookkeeping, because he realized he can't do any advising if their books aren't accurate-  Kathy Gregory: Oh, yeah. You've gotta have that.  David Leary: What's interesting, you guys have an app, LivePlan, and that connects to the accounting systems, but then also helps do the advising, right? There was a slide last week on Twitter. It was at the AICPA, and somebody was ... It was like, "Stop [00:07:30] doing bookkeeping and do advising!"  Kathy Gregory: Oh, boy.  Blake Oliver: Oh, yeah.  David Leary: How is that possible? Kathy Gregory: No, it's not possible.  David Leary: How do you do advising if you don't have good numbers? Kathy Gregory: No, no, you gotta have good numbers and a very clean month-end, or at least having it happen quickly. Sabrina Parsons: And if you can control that ... Kenji working his way to bookkeeping and understanding that, then your advising is gonna be better, because garbage in is garbage out. If you've got terrible charts of accounts and someone isn't doing the bookkeeping correctly, it's gonna be really, really difficult. But there's [00:08:00] an opportunity there, whether you wanna do all the bookkeeping or not. This is also where I think people have to not be afraid of what technology is bringing to the table.  I know a lotta people are afraid of all kinds of online services now, including Intuit, that are offering bookkeeping, right? I really want an accountant to look at that and say, "Okay, is that work that I wanna do - that work that's commoditized that I [00:08:30] can no longer charge as much for, because it's so easy for people to go online, and find services, and package services at ridiculous rates?" If it's well done, and you can then do the advisory, the value is not in the bookkeeping.  At some point, it's even gonna be ... I mean, technology, automation, IA, is gonna continue to work on the bookkeeping side and continue to make that an automated artificial-intelligence [00:09:00] process. That's fine. Let that happen, and use that, and then build your advisory services. Wouldn't you rather do super-interesting work, help a business grow, or sell, or add a partner, or add a location? Really be that entrepreneurial catalyst for your small business. That's so much more invigorating. You can bring passion to that. Don't be afraid of all the online services, because there's only gonna be more, and more, [00:09:30] and more of them, and that's okay. Kathy Gregory: You get to keep playing with numbers, too. It's not like you don't get to keep playing with numbers. You just do them in a different way; you analyze them in different way. Knowing that each metric that comes off of your standard P&L balance sheet and cash flow ties back to something going on in the operation that's working, either well or not well? That's a super-fun job. I nerd out over that all day. I think it's so fun to dig into those metrics and try to figure out [00:10:00] what's happening in a small business operation that's working, or not working, then asking the right questions of the business owner. There's nothing more fun than that, and there's nothing more fun than seeing their eyes light up, when you hit on something, you've uncovered something. They go, "Yeah ... Yes, that's not working right, and I don't understand it, but I didn't get the numbers to be able to know it." You know what I mean? It's like these two brains coming together. It's so fun. David Leary: Something you said, Sabrina, and I think this is the problem ... People hear some of the sentences, but maybe not the whole conversation. You said bookkeeping is not the value, but I [00:10:30] think people hear that, like, "Bookkeeping is not valuable," but you can't do the valuable stuff without solid bookkeeping. Nobody's saying bookkeeping is not valuable. Blake Oliver: Well, it's not what creates the value in the mind of the business owner. David Leary: Correct. Yes. Blake Oliver: It's essential to do the work, right? Sabrina Parsons: Exactly. Exactly. I think that's exactly right. Blake, you should repeat that again.  Blake Oliver: It is not what creates value in the mind of the business owner. Sabrina Parsons: Exactly. You also can't fight ... I believe you shouldn't [00:11:00] fight that technology battle. You should embrace it. I don't mean that bookkeepers aren't smart, that they aren't doing valuable work, that what they do today is somehow lesser. I just mean this is the reality. This is what's happening, and they can't stop that. Right? It's the same way where, if you're a taxi driver, at this point, you've probably stopped fighting rideshare, right?  Blake Oliver: Yeah, probably. Sabrina Parsons: Ten years ago, it didn't exist; five years ago, taxi [00:11:30] drivers fought it; at this point, they've given up fighting it and they've either joined or moved on to do something else-  David Leary: We've talked about that on the podcast, in the past. There were some articles, because we brought this up ... There's taxi drivers, and taxi associations, in taxi people that are doing very creative additional services. It's forced them to step up their game. Blake Oliver: Yellow Cab, I think, created their own app now. They are being forced to improve, I think, and the same thing's happening in our industry with these software plus a service type of offerings - the Botkeepers, the ScaleFactors, the- [00:12:00] David Leary: QuickBooks Live-  Blake Oliver: QuickBooks Lives. That's forcing us all to up our game, but it's also creating a bigger market for these services. Now, people are aware, "Hey, this is not just a niche thing. I can get this." Sabrina Parsons: The other part that I think, to Kathy's point of this can be exciting work, is that we've lived in an environment in the U.S., where small businesses understand they need bookkeeping. As soon as they can afford it, they want somebody else to do it. They've understood [00:12:30] that they can't run a business without bookkeeping software. That's why you've got all these big players and lots of players in this market. They embrace that. They know that. But they're still failing. If you start a business in five years, 70-percent chance that you're outta business. 60 percent of the ones that fail were actually profitable. They ran out of cash. They're not managing their business, and this has been for years, and years, and years. What I think is the super-exciting [00:13:00] opportunity is that if all of these services online and all of this technology really pushes bookkeepers and accountants to innovate and to be really thoughtful about what they bring to the table and bring real value with their experience, their knowledge, their human mind that technology can't do, we actually have a chance in the U.S. of changing the economy. Small businesses drive the economy, and a rising tide lifts all boats. I [00:13:30] know I sound like I'm dispensing Kool-Aid, but I find it to be super-intriguing to look at those numbers and think about could we really affect the economy by getting accountants to do this sort of advisory work? It is good for small businesses. Intuit does strategic planning. Xero does strategic planning. All public companies do. When we know and we see all those reports from Wall Street ... Did [00:14:00] Google make their numbers? How's Microsoft doing? How's Intuit doing? What they're talking about is their forecast, and what they're doing is saying, "Here's the forecast, here's the actual. Did they make their numbers?" Startups do strategic plans.  Small businesses are kinda told this myth that business planning is for startups only, and for raising capital, which is a total myth, because even large [00:14:30] private companies, they do planning, and they have a board, and the board has to approve the plans, and they look at it every month. It's almost this myth that small businesses have been told, and then accept, because strategic planning is hard, that they don't need it yet. Yet, everybody else that's successful and bigger does it. Kathy Gregory: Even without the board, even ... I spent years in a fairly large engineering firm, and we did it just for middle operational management, pulling data [00:15:00] out of the accounting system, because the accounting department wasn't doing that; massaging it in a way that made sense, building forecasts, so that operations managers could make decisions; could make strategic decisions. This episode of The Cloud Accounting Podcast is sponsored by LivePlan. This has been The Summer of Advisory. Everyone at every conference, and every session is telling you to become an advisor, but the fact is, a 50-minute CPE session at a conference does not make you an advisor. [00:15:30] Some of you even took to Twitter to vent about this fact. Well, I have some good news for you. Believe it or not, Twitter led to the creation of a three-day course, or should I say a boot camp on advisory? Yes, that is right. You can now really become an advisor by attending the LivePlan Client Advisory Services Boot Camp on October 2, 3, and 4, 2019. The three-day event in Eugene, Oregon, will include deep learning, and hands-on workshops to learn the LivePlan method for strategic advising, and how to market, sell and deliver this vital client [00:16:00] advisory service to your small business clients. To learn more about attending the LivePlan Advisory Bootcamp, head over to CloudAccountingPodcast.promo/lpbootcamp. That is Cloud Accounting Podcast dot promo forward slash L-P-B-O-O-T-C-A-M-P.  David Leary: I suspect small businesses do wanna make plans, but they get caught up running their business, and that's where partnering with somebody who could actually come in and just ... In a way, it's advising- just [00:16:30] holding them accountable a little bit is just gonna help them. Sabrina Parsons: Also, if the accountant does the advisory, because the small business owner is doing a million things ... Really, it's like Kenji being a CFO for hire. That's what they need. They just, they can't take on that role. They don't have that knowledge. They don't have the expertise. They need that value from somebody else, and they will welcome it. Once you do it correctly, they'll be addicted. They are not gonna drop you. Your [00:17:00] retention with that client is gonna be as long as they have their business. If you're charging them $2,000 a month, you're not getting a CFO for $24,000 a year. That is not happening. You can't get that sort of strategic level of experience for that sort of money. So, if an accountant can do that, there is room for thousands of dollars a month that are still completely doable [00:17:30] for a small business, and the value is there. Blake Oliver: So, I'm an accountant. I'm ready to make this leap. I want to get started in advisory, but I don't know where to get started - that's the classic problem. I wanna do it ...  David Leary: You just go to conference. There's lots of sessions. Blake Oliver: How does LivePlan create that starting point for me. How does it work?  Kathy Gregory: From soup to nuts, if you do it [00:18:00] all, you would start with a broad conversation with your client to understand their big goals and begin doing real strategic planning with them that would include everything from looking at their market, and looking at how they're selling, and who they're selling to, and why they're selling it, and having a fairly deep discussion with them about that. Then translating those things into a forecast. There are simpler ways to start, if that is work that is new to you. In our software, you can dive into those- yes, I'm sorry?  Blake Oliver: Sorry, I'm just trying [00:18:30] to picture it in my mind. I'm creating a strategic plan. It's like a business plan. Am I thinking the same terminology?  Kathy Gregory: Yeah, we call it a Lean Plan. Blake Oliver: Lean Plan, okay-  Sabrina Parsons: I will just interject, before Kathy describes it, because you asked how LivePlan helps. I think the number-one thing, to David's joke of just go to conferences, because they have all these sessions, is that I think part of the problem for accountants is they all get talked at about why, and they [00:19:00] don't need that. They already bought it. They know why-. Blake Oliver: This is the classic problem of conferences, all high level. Sabrina Parsons: Exactly.  Blake Oliver: "You need to do this." Then you go home, and you wonder like, "Well, how do I do it?" Sabrina Parsons: Exactly. Exactly. This is what we've learned over the years. Our tool is a tool for small business owners. It is a platform and a system for accountants, and it's two different things. What we've really understood that what accountants needed is not to be convinced. They're convinced. They buy it. They [00:19:30] nod their heads. Then they go home, and they don't know what to do. What Kathy's really built, and then I'll let her describe it, is the 'how,' and in a way that makes sense to someone who's been doing tax and compliance work. It is a system and a process with tasks that you can learn how to do. We've really gotten into the weeds to show accountants, and train them- Blake Oliver: Yeah, we like checklists, so this is-  Sabrina Parsons: Yes, yes-  Kathy Gregory: It is a checklist. Yeah, my background is in a lot of things, but business process design [00:20:00] is one big piece of it. So, it was realizing- it was coming to these conferences, when I first came to Palo Alto Software, and realizing, oh, this industry doesn't have a business process for this, and that really is what's needed. Then, once there is a master kind of business process, then firms can adopt that in whatever way makes sense depending on the things they focus on, or the skills they have. If they focus on only bookkeeping, there's pieces of it you can do. If you're sort of CFOs for hire, then it's different; but you have to have the master plan first and then be able to [00:20:30] pick apart pieces of it you like- Blake Oliver: Got it.  Kathy Gregory: -and deal with capacity planning, and resource allocation, and all of the things that you have to think about when you roll out a new service. Blake Oliver: So super-high level, just overview for those who are not familiar at all with LivePlan ... I think I used LivePlan actually, myself, as a business owner. Kathy Gregory: Great. Blake Oliver: I don't know if you know that. When I started my firm, I created my business plan, that one-page pitch to get an investor with LivePlan-. Sabrina Parsons: That's awesome. Blake Oliver: Now, of course, I was bad, and I didn't follow through with the forecasting, and the [00:21:00] budget-to-actuals, and any of that-. David Leary: That's because he was a bookkeeper, and he was too busy. Blake Oliver: I was too busy. So, that I'm familiar with. I could create that business plan and try to get investment or just really distill in my mind what it is I'm doing, which is actually just a great exercise. Can you explain your business in like-. Kathy Gregory: Isn't it great? Blake Oliver: -in one sentence? Kathy Gregory: And how it limits you to those characters? Blake Oliver: Yes!  Kathy Gregory: Because it seems like a nothing thing, but it's important, because you strip out all the words that don't matter, and you get down to the words that ... It really is powerful. Blake Oliver: So that part I did. Then, if I had actually continued, I would then [00:21:30] create a financial forecast? Kathy Gregory: Yeah. Blake Oliver: I wanna hire employees; I wanna expand ... It's building out a forecast. Kathy Gregory: Yeah, and then really thinking through the things to forecast. That's a critical piece of it. The software helps you think through that. If you already have maybe a chart of accounts with a ledger, you've got codes already, but the things you wanna forecast should be strategic to your business, and they should roll out of that Lean Plan. Blake Oliver: Got it. Then, once I've created that, I can pull in the actuals from my accounting software. What GLs do [00:22:00] you support? Xero, obviously, because you're here at Xerocon. You're also doing ...?  Kathy Gregory: And QuickBooks Online-  Blake Oliver: QuickBooks Online. I pull in those numbers ...  Sabrina Parsons: We are also going back to ... We used to support QuickBooks Desktop. The Sync Manager went away. We were hesitant to build our own sync manager, waiting to see what Intuit was gonna do; but it's clear that QuickBooks Desktop, at this point, still has a lotta usage, and it isn't [00:22:30] going away. So, we are launching our beta for accountants next week. If anyone is curious and they want to be part of the QuickBooks Desktop beta, they can contact us. If they just come to a LivePlan.com/strategicadvisors, they can find the information, but we are back to supporting QuickBooks Desktop.  Blake Oliver: All right. Well, the folks who are signing up for Right Networks, for their Always On feature, which claims to make QuickBooks Desktop just as good as QuickBooks Online, now [00:23:00] they've got LivePlan integrating with it, too. Sabrina Parsons: We are actually using Right Networks, their ...  Kathy Gregory: Autofy.  Sabrina Parsons: They just purchased Autofy, and-  David Leary: Yep, yep, that's what we were talking about [cross talk] Sabrina Parsons: Autofy is who's actually doing our Desktop integration-. Blake Oliver: You don't have to be logged into as a user, too, for the sync to work, all that stuff?  Sabrina Parsons: Exactly. Exactly.  Blake Oliver: We oughta talk about this more, David. I'm actually more bullish on hosting than you might think. Yeah, yeah. Well, that's great. Okay, now it's kind of making sense in my mind. Kathy Gregory: Yeah, so you [00:23:30] connect the accounting solution, and then LivePlan's dashboard is going to present you with the metrics - each individual metric. It was built, remember, for small businesses. That's the cool thing about it, for accountants, that they don't have to now reconstruct and build reports that makes sense to small businesses, because they're already built; they're already done. Blake Oliver: Got it. Kathy Gregory: Then it shows me very clearly the difference between plan and actual; really simply, like with green arrows up mean good, and red arrows down mean bad. [00:24:00] Again, it's cool for the accountant, because it's a talking point. Have you ever been in an advisory meeting or any a meeting with your client, maybe at month end, and you've got the talking points. You know what you're gonna tell them, but your brain just breaks down in the middle of the meeting, and you kind of forget the points? This is nice, because it helps guide you through- Blake Oliver: It's that agenda for that meeting.  Kathy Gregory: Yeah, it is. Then our business process that's outside of LivePlan comes with meeting agendas, and scripting, and all the other things that help you- that support you. Sabrina Parsons: Initially, if you're [00:24:30] afraid, or you don't know, the scripting is great, right? We kind of prompt you with, "Here's some questions you should be asking." When people actually start doing this, then they build their own questions. They get more comfortable. They understand their style and the style of the client. It goes back to that whole idea of everybody gets the why; How? How?  We've realized that getting down to even providing you with scripts really helps people get over that hurdle and that fear, because the other part that I think is really vital, and [00:25:00] I would say is a competitive differentiator for LivePlan versus other reporting analytics apps, is that we didn't build this first and only for accountants, who then put stuff together and presented to clients. That's fine, and other people have chosen to do that, but we built it so that the small business owner works with the accountant; so that the small business owner's also using the dashboard, and so that the reports make sense to the small business owner, because what we heard from accountants [00:25:30] is they stop using a lot of these other tools because they send stuff to their client, and the client never responds, doesn't look at it month, after month, after month. They don't, because it's too complicated, because it wasn't built for them.  David Leary: And essentially, because you guys have a 25-30 years’ experience servicing small businesses, and you attacked it from that direction. It reminds me of Intuit; years ago, in my career at Intuit, with TurboTax. They, at one time, hired an editor from People Magazine to basically go in and change all the text in TurboTax, because it [00:26:00] was easier to use then, because it was written with all this accounting language, and nobody could understand it. It's kinda the same thing. If people are coming from the accounting dashboard side, trying to push down the other direction, you're probably not gonna communicate to the small business owners. You guys already had that DNA in you, and then came the other direction. Sabrina Parsons: Exactly. We actually started working with the accountants because they came to us. We got to a point of critical mass of having LivePlan out there in the marketplace, that the small business owners were taking LivePlan to the accountants. We started hearing [00:26:30] from accountants saying, "What is this? Do you have trainings? How do I use it? My small business clients have it, and now I have to learn how to use it." We really were pulled by the accountants to come into this market because of our DNA with small business owners and the fact that the small businesses were already using it, which I think was appealing to accountants. They don't have to position, or sell, or market this other tool or these other reports. David Leary: Could you speak to ... It's [00:27:00] not really advisory related, but I think it's a cool story, because everybody's in this transition still, constantly - desktop to cloud. We just talked about desktop a couple seconds ago. But, tell the history of LivePlan, and Palo Alto software, because it was a desktop company, and now you've changed it into a SaaS cloud company. You've made the transition yourself. Sabrina Parsons: Yes, we have. I took over the business in 2007, and we were basically a Windows desktop company. Our flagship product was Business Plan Pro. A lot of people have used it; millions of entrepreneurs. [00:27:30] But the writing was on the wall, and we understood, as a software development firm, what the cloud had to offer in terms of usability, in terms of development, getting away from that Golden Master, and installations, and the support side; also, the ability to iterate more quickly and really bring customers what they want consistently and not once a year with this big release. We started, [00:28:00] at that point, planning. I think what is interesting to me is for people to understand that the way LivePlan was born was really saying, yes, we've gotta go in the cloud, but also recognizing that Business Plan Pro wasn't doing the ongoing management the small businesses needed. We were using Business Plan Pro. Every year, we'd create our strategic plan, and every month, we would compare plan, versus actual, versus previous period, versus previous [00:28:30] year, because those data points tell you a lot. If you're a retail store, and you're looking in January, you look at previous period December, and the numbers are not gonna look ... You're gonna look, like, "Oh, my God, I'm doing so much less ..." but that's obvious, right? Seasonality. You want previous period, but you also want same period last year, because that tells you even more. That was the way we managed Palo Alto Software every month, but it entailed exporting from Business Plan [00:29:00] Pro, exporting from Accounting Solution, massaging data, and so- David Leary: Because you were using your own product, you realized all the things it sucked at.  Sabrina Parsons: Exactly. Exactly, and the ongoing small business management ... We built LivePlan, and the methodology that's behind that process and system that Kathy has built for accountants is what we used to build LivePlan. There is a management methodology to LivePlan. When you take a company and you switch it from Windows development [00:29:30] software to cloud, you have to have whole different developers. There's a lot of resources there, and there's a real big push on cash. All of a sudden, you need to hire all these other people for a product that's not bringing you revenue yet. We changed technologies. That's hard. It can be very difficult for a company. We also changed business models. We had a piece of software that we were selling, and it was more transactional. You bought it ... Yes, we got some upgrades, but you bought it, and you didn't [00:30:00] keep paying us, right? You bought it, and, on average, we were making 160 dollars from every user, because we had a couple of versions - $99, $199 - different things that you could buy, but we were getting all the money at once.  So, not only did we have to switch from a resource perspective and hire all these new developers, but we also, all of a sudden, were in a situation, where we were gonna be getting $20 a month ... We didn't know, were we only gonna get $20? Were we gonna get $300? Were we [00:30:30] gonna get $160? Were we gonna get more people but less money? That's kind of a scary thing and a huge cash flow implication, because all of a sudden, we're getting 20 bucks, and it's taking us over a year to get to that average transaction that we already had.  The only way we were able to do that is using the LivePlan method. That's exactly how we used it, right? We forecasted. We understood our cash. What [00:31:00] we did is that we saw our runway, and we slowly introduced LivePlan, while still selling Business Plan Pro, so that we were able to really strategically ... But there's no way we coulda done it without managing-. Blake Oliver: You did a cross fade. Sabrina Parsons: We did ... Obviously, I'm proud of it, because I love LivePlan, but I also want people to know it's how we manage the business. We are privately owned. No debt. Cash-flow [00:31:30] positive. We've never taken on an investment, and we continue to grow. We've done that, and we're able to do that because we eat our own dog food, because we do strategic planning, because we don't spend money we don't have. Blake Oliver: That's interesting. That's kind of a rarity. You are profitable, cash-flow positive, and not interested in taking on investment money?  Sabrina Parsons: No.  Blake Oliver: Are you planning to stay private, and just ...?  Sabrina Parsons: You never know what happens in the future, but it works for us, and we don't need it. We've built up cash that we can [00:32:00] reinvest. We've built up enough cash that we've launched a whole 'nother product. We've been able to invest in that product. We have a team of 20 people and that product is just barely launched. We've done that all with using our own revenue and profits from our existing product line, but it takes a lot of super-careful planning. Blake Oliver: That's very refreshing. David Leary: It's very hard for companies to get off the desktop model to a cloud model. We actually did an interview last week with Shafat from BQE- Blake Oliver: Similar [00:32:30] story. David Leary: Similar story. Instead of how you cross-faded it, to take Blake's term-  Blake Oliver: He did a hard cut off. David Leary: He just stopped. The second it was done, it was launched. You couldn't buy his desktop product anymore. He went for it. Maybe he didn't use LivePlan. He just jumped right in.  Sabrina Parsons: Maybe he had a credit line, or he had some investors. You have to have some cash to do that, right?  Blake Oliver: You've got to have a lotta cash to take that kinda risk. David Leary: I think it was private, but, see, they were an existing desktop app that had an established base for a long time. Blake Oliver: If people wanna find out more about LivePlan [00:33:00] and connect with you, and your company online, where can they do that? Kathy Gregory: If you're an accountant, the best way is you can email us at accountants@LivePlan.com. That's the first way. Our website is LivePlan.com. Then, in the upper right-hand corner, it'll say Solutions, and there's a dropdown, and you can pick Accountants. That'll get you to the site that has all the resources. There are tons of resources on our site. Blake Oliver: Are you two on the social medias? Do you like the Twitter- Kathy Gregory: Oh, yeah, I'm on the social medias. My Twitter handle, I'm supposed to know that, right? I think it's @KMGregory1. I [00:33:30] believe that's what it is. Yeah, that's what it is. I have fun on Twitter all the time with accountants, but I can't recall ... [cross talk]  Blake Oliver: It's like knowing my own phone number. Kathy Gregory: Yeah, right, but I do have-  Sabrina Parsons: Kathy also helps manage our LivePlan Strategic Advisor Twitter, and that's @LivePlanSA.  Kathy Gregory: Yeah, @LivePlanSA, and there's a blog that I think is fun and good on the site.  Blake Oliver: All right, great.  Sabrina Parsons: And my Twitter handle is @mommyceo Blake Oliver: I love that. And as always, I am @BlakeTOliver. [00:34:00] How about you, David? David Leary: I'm @David Leary. I think this is interesting, because I don't think we've had anybody on our podcast that has spoken to a president before. Sabrina Parsons: In my spare time, I do a lot of advocating for working moms and working families. I have been lucky enough to be invited to two summits during the Obama presidencies, and, yes, was able to have some really cool experiences because of that and speak at a White House summit-. Blake Oliver: Wow. [00:34:30] Sabrina Parsons: -and bring two of my three boys to come ... One of them was has been too young to also be able to experience that ... Being a CEO, woman, working mom in a technology software company, there's not a whole lot of us. I am hoping that 20 years from now, that's different, but I am definitely a big advocate of working parents, and working moms, and try to do a lot [00:35:00] of political advocacy to actually make change. David Leary: Nice.  Blake Oliver: Wonderful. Thanks so much for joining us [cross talk] Yeah, great to talk to you.  Sabrina Parsons: Thank you.  Kathy Gregory: Thanks so much. It was really fun.  David Leary: All right, bye.  
Sponsors  Halon Tax: http://cloudaccountingpodcast.promo/halontax TOA Global: http://cloudaccountingpodcast.promo/toaglobal LivePlan: http://cloudaccountingpodcast.promo/liveplan Shownotes 02:25 – Shawn explains the difference between a linear accountant and an exponential accountant 04:24 – Get stuff done! Embracing the gig economy with a Fiverr experiment 05:36 – Shawn shares some career background - from CPA to disruption strategist 07:37 – Accountants currently have a 94-percent chance of being automated  10:15 – Winter is coming! If your firm doesn’t get with the cloud, you may get left out in the cold 11:18 – According to Hinge Marketing, in accounting, 25 percent of firms are eating all the growth (https://hingemarketing.com/library/article/2018-high-growth-study-accounting-financial-services-edition-executive-summary) 13:45 – According to Shawn, the accounting firms that chase relevance and stay on the leading edge will win the race 14:26 – Blake and Shawn talk about how Xero is breathing some rock-star-level life into the accounting industry 16:31 – If accounting is on the cutting edge of disruption, why are so many firms still using Excel as their primary record-keeping system?   19:12 – How Intuit leveraged disruption to increase marketshare 21:16 – The Xero-Stripe Partnership (https://www.pymnts.com/news/partnerships-acquisitions/2019/xero-stripe-team-small-biz-payments/) 24:10 – The more you build out your ecosystem, through integrations and partnerships, the more value you bring to your clients 27:12 – Ball's in your court ... Are you brave enough to face an accounting world without billable hours?  30:03 – If you want to change the trajectory of your firm and move it towards the cloud, try taking a risk 32:40 – How can accounting bring its sexy back?   34:11 – Shawn shares some secrets to becoming a great storyteller and public speaker Connect with Shawn Website: https://www.shawnkanungo.com/ LinkedIn: https://www.linkedin.com/in/shawnkanungo Facebook: https://www.facebook.com/shawnkanungo Twitter: https://twitter.com/shawnkanungo Get in TouchThanks for listening! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, do us a favor and write a review on iTunes. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus.Subscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast TranscriptShawn Kanungo: Well, first of all, if you're a senior accountant, you're listening to this in your cubicle, or you're running on the treadmill, or you're doing the dishes at home, I would say tomorrow morning, or this morning when you're listening to this, walk into your office and try to get yourself fired. This episode of The Cloud Accounting Podcast is sponsored by LivePlan. Did you know that millions of small businesses use LivePlan products to start their business? Did you know that these small businesses prefer a cloud-based accounting solution two times more versus a desktop solution? Did you know that 89 percent of these small business owners prefer virtual advisory services? Did you know that the number-one thing they want from an expert advisor is strategic planning and review? This is even more than general-ledger accounting and bookkeeping services. Did you know that LivePlan has an expert advisory directory that you can join to gain access to these millions of small businesses? To learn more about becoming a LivePlan expert advisor, head over to CloudAccountingPodcast.promo/liveplan. That is Cloud Accounting Podcast dot promo forward slash L-I-V-E-P-L-A-N.  Blake Oliver: Welcome to The Cloud Accounting Podcast. I'm Blake Oliver. Shawn Kanungo: I'm Shawn Kanungo. I'm really excited to be on this podcast. We've fundamentally removed David from the podcast. He's not on the podcast anymore. Now, I am the Ka-new co-host- Blake Oliver: Oh ...  Shawn Kanungo: -and I think it's gonna be the Blake and Shawn Show. David, we miss you, we love you, but, I'm sorry ... I just wanna say I'm a big fan of this podcast. A big fan of the podcast. Before we start, I just wanna say to the audience, all the listeners there, if [00:01:30] you haven't put a rating and review into iTunes, or Spotify, Stitcher, wherever you can get this, do it now. It helps a lot for the show, because we've gotta get this thing up to like 10 million subscribers. We need to, because what these guys are doing is so fundamental to this cloud-accounting space. They're the only ones that are actually highlighting it. You guys are doing so much for the economy, and for the space. Appreciate it!  Blake Oliver: Well, thank you so much, Shawn. We're here at Xerocon in San Diego, and you just gave a fantastic keynote. Shawn Kanungo: Oh, wow. [00:02:00] Thank you. Blake Oliver: I mean, what, 800, maybe 1,000 people in that audience there. It was called "Strategy in a World of Disruption. Be Bold, Be Brave, Be Experimental: Why Build a Culture of Experimentation?" I loved ... You had this one slide in your presentation. I mean, there was a lot to talk about, but this one slide just is sticking in my mind - Linear Accountant- Shawn Kanungo: Yeah. Blake Oliver: -versus Exponential Accountant. What does that mean? Shawn Kanungo: Linear really means how do we think five [00:02:30] to 10 percent better within our organization? This idea of linear thinking has been literally ingrained - in our organization, in our leadership, in our systems, in our family, in society - that we need to think about things in a linear way. Exponential is actually about thinking differently about business, about processes. It's actually taking a different lens. What we've seen a hundred times out of a hundred ... If you can take an exponential lens, meaning take [00:03:00] a different approach to things, you can actually get a 5X to 10X improvement. I think, especially for accounting, you know this better than anybody, this idea of linear thinking, of risk [cross talk]  Blake Oliver: -risk aversion? Yeah.  Shawn Kanungo: -is literally ingrained in our DNA. The reason why I wanted to showcase the difference between a linear accounted versus an exponential account is ... There are some tenets to it, and I can get into what those tenets are, but I think this is what we need to move, especially now. We live in a world with [00:03:30] all these exponential technologies. We need an exponential mindset! Blake Oliver: That is such a different mindset than, like you said, what we are taught to think in the accounting world, where it's all about incremental improvement. Let's become three percent more efficient, five percent more efficient, and maybe this is ... The challenge I ran into in public accounting was trying to get people on board with disruptive change is really, really hard. You had a great tip for doing that. You ask people do [00:04:00] a small project, right? Shawn Kanungo: Exactly.  Blake Oliver: The example was like a Fiverr?  Shawn Kanungo: Yeah. So, a little bit of background - I spent 12 years at Deloitte, leading their Digital Innovation Group in western Canada. One of the things that we did was I really wanted people to embrace this whole idea of the open-talent economy, the gig economy, because it just makes sense for us not to do everything. There's an entire ecosystem of people that will do things for us. Talent is ubiquitous. So, what I wanted to do was say, "Listen, guys, I'm gonna give everybody five bucks, five bucks out of my own pocket. I'm gonna give [00:04:30] everybody five bucks across western Canada. What I want you to do with this five bucks is go on Fiverr, and just get something done. Whether it's a product, a service, a voice over ... Whatever it might be, just get it done. Then, send me back the product and then we'll talk about it." The difference between talking about all this change and talking about innovation is that when you actually go off and do something and actually get somebody else to maybe even do something - this is a small example, using a gig economy - you're actually doing something. You're like, "Wait a minute! Somebody [00:05:00] else is getting something done for us at a radically cheaper cost. I didn't have to do this."  Blake Oliver: Right.  Shawn Kanungo: It literally flips your brain to say there's an ecosystem of people will do stuff for us [cross talk]  Blake Oliver: What else can we do? Shawn Kanungo: Exactly. That is the whole idea of experimentation, which I try to hammer in. It's like starting with small teams, small problems, small sprints and seeing how we can move the needle ... I think this idea of experimentation is so foreign to accountants. We don't experiment. Blake Oliver: You're a CPA. Shawn Kanungo: Yep. Blake Oliver: Tell me [00:05:30] about your background. How did you get into talking- speaking about disruption? Shawn Kanungo: I started my career at a company called Singapore Press Holdings. I then actually moved into accounting. I worked for Deloitte for the first couple years, got my CEA. Moved into management consulting on the side. My friends and I, we were building apps, consumer-based apps. Some were complete flops; some were more like mediocre successes.  At the same time, I was getting into the Strategy and Innovation Group at Deloitte. We [00:06:00] were early in the game of working the organization when it comes to innovation. We were the first to try things around artificial intelligence, using the gig economy, using drones. We were the first to do all that stuff. Clients wanted to hear about the work that we were doing in digital transformation and innovation. After that, after 12 years at Deloitte, one of things that I really wanted to do was really take equity in organizations. Working for a public firm, you can't take equity in anything. For me, equity was a big deal - taking it in companies and scaling them up. We started a group called Queen & Rook. It's like a consulting [00:06:30] model, but instead of getting paid for fees, we actually get paid in equity. So, I started that. One of our companies as a voice-technology company. We're using artificial intelligence to solve [pre-need] problems. The speaking thing came naturally, because people want to hear about digital transformation and innovation, and here I was, talking about it. You get onto one conference, another conference, and just like the momentum builds. Now, I'm here talking to you and being on The Cloud Accounting Podcast. My life, it's done. This is it. This is the peak, right now!  Blake Oliver: Right now? This podcast is ...  [00:07:00] Shawn Kanungo: This podcast. This podcast is the peak. That's my journey. I've been obsessed about this idea of digital, and innovation, and disruption. For me to bring this message, especially here at Xerocon, to this audience, to the accounting profession, means a lot, because if you look everywhere, a lot of people are saying that automation is gonna take accountants' jobs, right?  Blake Oliver: I like that you talked about that, because at a lot of accounting technology conferences - maybe [00:07:30] they talk about it more at general tech conferences - but you showed a slide ... What was it? Accountants are- Shawn Kanungo: 94 percent-  Blake Oliver: 94-percent chance of being automated. You're not afraid to put that out there that this is a risk. Shawn Kanungo: Totally. Blake Oliver: This is- we need to be aware of this risk. Shawn Kanungo: Your audience knows this, as well. You're highlighting all the movers and shakers that are getting into the space; you highlight all the companies that are AI accounting practices, or they're incorporating [00:08:00] AI. I was listening to a really great episode with Rachel- Blake Oliver: Mm-hmm. Rachel Fisch, yeah.  Shawn Kanungo: -and you guys were talking about this idea of service and how service is still so important. Yeah, there's a lotta of this AI automation piece, but at the end of the day, there is a big piece to everybody's firms, where it's around customer service. There are certain pieces that will never be automated, so, although everybody's saying that automation is gonna take an accountant's job, let's be real. It's not. What I want is to tell people, listen, this is the greatest [00:08:30] time to be an accountant ever. Actually, it's gonna be the sexiest job ever, because- Blake Oliver: Yes, make accounting sexy! Shawn Kanungo: Yeah, because think about it ... If you have all these ecosystems and technologies doing some of the work that we used to do ... To be honest with you, listen, I'm a CPA. There's a lotta work that shouldn't be done by humans. If we can double down on things like storytelling and actual customer experience- Blake Oliver: Talking to our clients? Shawn Kanungo: Totally! That is what an accountant should be. [00:09:00] Blake Oliver: Well, but that's not what it ... I wonder if this is unique in some ways to the United States market. Cloud accounting has penetrated maybe 10 percent, here in the United States. That's just my rough feeling, having been doing it for 5-10 years. Whereas, in Australia and New Zealand, it's like 50 percent. We're way behind, and it's going slow. Shawn Kanungo: Why do you think that is? Blake Oliver: I know US regulations. I studied to be a CPA here in the US, and compliance is a big headache here, compared to Australia, compared [00:09:30] to Canada, compared to the UK, so we can make a lotta money on compliance. I think you mentioned something like this in your keynote - we get comfortable. We're nostalgic. Shawn Kanungo: Yeah. Blake Oliver: You mentioned nostalgia, and firms here ... How do you disrupt a firm where the partners are pulling in 20-percent profit margins off of tax compliance? There are firms in LA that are still doing bookkeeping for $85 an hour, [00:10:00] keying in transactions, and people are paying for it. Shawn Kanungo: Totally.  Blake Oliver: Maybe that will come to an end. Shawn Kanungo: Yeah. I think the organizations that are saying, "Listen, we're not gonna move to this new way of doing things. We're getting fat, rich and lazy doing it this way ...". Blake Oliver: Right.  Shawn Kanungo: The reckoning will come. You know, I started my thing talking about 'Winter is coming.' It is going to happen. People are going to start realizing that these organizations that have not moved to the cloud ... "Wait a minute! My apps are not integrated. [00:10:30] I can't use the ecosystems that these other guys are using." We're moving to a world where, if you're not on cloud, that means you're not actually on the foundation of using some of these innovative apps and services. Listen, all the startups and tech companies that are actually in this space, they're all designing for cloud. So, if you're not part of that, then you're gonna be left in the dust. Right now, it's working fine because of regulation and [00:11:00] all that kind of stuff, but we've seen this throughout history that the organizations to stay nostalgic, they're gonna end up losing-  Blake Oliver: It could be a very quick shift that happens- Shawn Kanungo: Absolutely. Blake Oliver: I see everything's going ... Everything's fine. Everything's fine. Then, like you said, winter is here, right?  Shawn Kanungo: Exactly. Totally! Blake Oliver: It's gonna be interesting to see when that happens. I don't know if you're aware of these stats. Hinge Marketing does some great surveys of professional services firms, and they released a study - I [00:11:30] think it may have been last year - showing that in accounting, it's about 25 percent of all the firms are eating all the growth. Shawn Kanungo: Yeah. Blake Oliver: Does that feel right to you? When you go out and speak, you must meet people from cloud firms- Shawn Kanungo: Sure.  Blake Oliver: -you meet people from traditional firms. What do you think's gonna happen to those traditional firms? Are they just gonna disappear? Shawn Kanungo: By traditional firms, you're talking about the big guys? Blake Oliver: Yeah, well, there are top 100 firms that are still doing things the same way they [00:12:00] used to do things. There's ones that are innovative, of course. Then there's also the small CPA shops. I feel like, at some point, these people are gonna want to retire, right? Shawn Kanungo: Totally. Blake Oliver: What are they gonna do? It's just close the doors, and that's it?  Shawn Kanungo: Listen, I'm not a futurist- Blake Oliver: But you talk a lot about the future. Shawn Kanungo: I do talk about the future. Don't take anything I say as a prediction about the future. I really do see myself as a practitioner and a tactician. This has been my work. [00:12:30] I really think that there's gonna be some firms that certainly win market share, because they always position themselves as leading edge; that they're getting into new spaces, whether it's artificial intelligence or block chain.  It's going to constantly shift. I don't know who's gonna win the game, but what I do know is that some of the savvy firms, some of the top accounting firms ... We could even mention the top four accounting firms - the Deloittes, KPMGs, PWCs, et [00:13:00] cetera. Because I worked at Deloitte for 12 years, I have a lot of love for Deloitte. One of things that I really love about Deloitte is they have this thing called Innovation Cloud; this is what I call it. They have been around for like 150-180 years. The reason why they've been around - they always try to position themselves as relevant. That's why, in Canada, we started in new AI shop called Omnia. To [00:13:30] be honest with you, not that many organizations across the country are adopting AI at scale. It's just not happening. But they always position themselves in this new forward-thinking, next-generation organization, because they're always chasing relevance, and I think that's important. The organizations that will continue to chase relevance, be on the leading edge, the market will see. The customers will see, because customers always, always, always wanna be with guys that were leading edge. They wanna be with the cool, modern [00:14:00] companies. I don't know where it's gonna go, who's gonna win the game, but I do know that the organizations that will win will be the ones that will always be relevant. They will be doing an amazing job at Xero. Here, listen, we're at Xero ... I know this podcast is technology agnostic, and I know David is an Intuit ... He was Intuit guy. He was like their main guy, right? What Xero has done really, really well is, you know, what they've done? They've turned accounting into like a concert. They've turned accounting [00:14:30] into like rock star status, and they've done an amazing job at chasing relevance. It's been a remarkable. Blake Oliver: "Beautiful business software," I think is the motto for Xero these days. Shawn Kanungo: Exactly.  Blake Oliver: "Beautiful business software." You can feel it when you walk into the convention center, and you walk into the Expo Hall. It doesn't feel like any other accounting conference, right?  Shawn Kanungo: Well, you've been to how many? You've went to six Xerocons now?  Blake Oliver: Six Xerocons since the original in San Francisco [cross talk] Shawn Kanungo: Yeah, a great sponsor of this podcast, by the way. Blake Oliver: Thank you, Xero. You can [00:15:00] tell when a company is design-led. That's the way it feels to me; just very thoughtful. Everything is very thoughtful with Xero - with the product, with the events, and the mission.  Shawn Kanungo: By the way, do we have to throw in a Xero ... Like the drop, the midroll? Because this is pretty much the midroll, right now, right? Blake Oliver: Yeah, no, we probably don't have to do a promo message for this episode.  Shawn Kanungo: I wanna get your perspective on this, because [00:15:30] you know this space way more than I do, in terms of the cloud-accounting space. Do you think that it will be a winner-take-all market? You look at other spaces, whether it's in CRM, or whether it's in HR. There's companies that always come up that basically win the game. Do you think that there will be a winner take all ...? You were talking about QBO; we're talking about Xero, Sage, whatever. What is your hot take on this?  Blake Oliver: David likes to [00:16:00] talk about this on the podcast, where, if you look at Intuit in the heyday of desktop accounting software, when it owned 80-90 percent of the US market and it was all desktop, the total addressable market for cloud accounting is 10 times greater than that. There were only something like a few million businesses in the United States using QuickBooks Desktop. There's like 30 or 40 million that could be using accounting software. It's amazing, actually, so [00:16:30] many businesses ... Here we are on the cutting edge of disruption, talking about cloud. There are so many businesses that are still using Excel to do their accounting.  Shawn Kanungo: Actually, every single business is still using Excel in some sort of way. Blake Oliver: Right, but as their primary system of recordkeeping. That is really what I see Xero and any other software developer competing against is that status quo. My hope, and this is why we try to keep the podcast [00:17:00] agnostic-  Shawn Kanungo: Exactly. Blake Oliver: -and independent is that the more voices there are, the more options there are, the better it is for the end customer, for the accountants, for the people working for these companies, when they're competing. We want a competitive marketplace. Shawn Kanungo: Totally. Blake Oliver: There's so much greenfield available. I think it was- Steve Amos was on stage earlier saying that Xero has penetrated three [00:17:30] percent of the total addressable market in the United States. Shawn Kanungo: That's crazy.  Blake Oliver: Right? It's not like Xero and QBO are competing for the same customers. They're actually competing for people switching off of desktop software. Shawn Kanungo: Do you think there'll be a winner? Blake Oliver: I hope that there are many winners. It's gonna be interesting. Now we're gonna get nerdy here. Intuit and Xero are very different companies with very different strategies. I'd love to hear your perspective on this. Xero has been in the United States market for 10 years now, probably, but they've struggled [00:18:00] to gain a toehold. Now, the growth is amazing. There are over 100,000 businesses in the U.S. using Xero; but compare that to 2-3 million on a QuickBooks Online type product. This episode of The Cloud Accounting Podcast is sponsored by TOA Global. As you know, most firms struggle with attracting, managing, and retaining staff, and finding staff is getting tougher every day. This is where TOA Global could help. TOA Global is the most professional outsourcing partner to help you build and manage a global accounting team. By building a global accounting team, you'll be able to take away the time-consuming, process-oriented work from your local team, while building a cost-effective team offshore. As people experts, TOA Global can help you select and develop your best team members easily, using their expert ecosystem of people, security, technology, and professional development tools. To learn how to build out your world-class team today, head over to CloudAccountingPodcast.promo/toaglobal. That its Cloud Accounting Podcast dot promo forward slash T-O-A-G-L-O-B-A-L.  Blake Oliver: How does Xero gain market share? How do they ... Because everyone knows what QuickBooks is, right? Shawn Kanungo: Totally. Blake Oliver: That's the barrier. Shawn Kanungo: Intuit, yeah ... They're not a laggard. They are innovative. Obviously, they have a bigger machine than Xero. Brad Smith, the ex-CEO of Intuit, made a critical decision, I think, when he first came on. QuickBooks, a lot of the products were just like shrink-wrapped [00:19:30] products that you could just get off the shelf. He had a pivotal point that changed the direction of Intuit. The reason why they're now continuously doing well in the States is that they changed their product into a platform, just like how Xero is, working with other developers. They actually opened up their platform, so other competitors- third parties, competitors could come onto their product. I mean, that's a very- that's [00:20:00] a fundamental shift around how you think about your organization bringing competitors into the mix. They're not an organization that has gotten nostalgic. In fact, they have disrupted themselves. If you look at some of the best organizations in the world ... Today, I brought up the story of Netflix and how they disrupted themselves. Intuit's not afraid of doing that. Obviously, you're seeing Xero come up. They're the upstart. They're the global upstarts coming in, trying to take a space out [00:20:30] of this company, but I don't see Intuit as ... They're the incumbent, but I don't see them as a laggard. I also see them as innovative. So, I think that the race is not necessarily gonna be about product. I think it's gonna be about ecosystem. I think it's gonna be about who can you add to your ecosystem faster than others? Whether it's Shopify ... Of course, all these guys you're gonna work with ... Probably both companies. But it's like who can integrate and make the ecosystem more seamless, so that if I'm a small business, and I say, "Well, I'm on Squarespace, and [00:21:00] I have Shopify, and I have Workday as HR ..." Who can actually integrate those pieces better? I think that's the game, because a software is a software; it should be seamless, it should be user-friendly. They're both getting to that point. But that's where I think the game is gonna be won. Blake Oliver: Well, we saw that with the Stripe announcement this morning. Shawn Kanungo: Totally. Blake Oliver: Deep Stripe integration into Xero. It's interesting, because it's something that I think business owners will be even more excited about than accountants. For accountants, [00:21:30] we're kind of used to already working around these issues, but for a business owner signing up today on Xero, the ability to just pair it with a mobile card reader and then do recurring payments with invoices and not have to do some other separate processing method, I think that's gonna make a big difference. Shawn Kanungo: It's funny, Tony, the new President for the Americas, came on stage, and he talked about the business owner not caring about the software. They don't. Ask any business owner who's starting a business. They [00:22:00] don't care about accounting. They don't want-  Blake Oliver: They just want a solution, which- Shawn Kanungo: They don't care about the software- Blake Oliver: -I think is a good lesson for all the accountants in the room, because a lot of the folks here, myself included, we make the mistake of talking, I think, too much about the software- Shawn Kanungo: Yes. Blake Oliver: -when we're talking to our clients. We get really nerdy about it. We're like, "Oh, there's this great solution, Xero. I'm gonna put you on it, and these integrations. We're gonna get Gusto for payroll. We're gonna do this with Bill ..." You can see the eyes glaze over. The business owner is ... We're looking at it from our perspective, because we love connecting these [00:22:30] apps. We have fun with it. The business owner, they just want a solution. Shawn Kanungo: Exactly. Blake Oliver: They just want you to take care of it. I learned, when I was in practice, to gradually not bring that out. If they wanna know how I'm doing it, that's great. I'll educate them. But I look at it more from their perspective. Your bills are gonna get paid. Your cash flow's gonna be monitored. Payroll's gonna be taken care of. Then, after that, talk about how we do it. Shawn Kanungo: Totally! Business owners don't go into business wanting to be in accounting or into software. They [00:23:00] go into business selling donuts. That's what they're in business for. This is why I think the game will be won with the people who can take all those ecosystems. You meet a business owner; they're like, "Yeah, our website's on this, and we're using this." I'm like, "Oh, yeah, we can integrate all that. It's all good." That's where the game will be won. I look at a great company like Slack. I don't know if you use Slack.  Blake Oliver: Oh, yeah.  Shawn Kanungo: I'm a big proponent. I love Slack. I mean, Slack is not crazy. It's like WhatsApp [00:23:30] or BBM for business [cross talk] Blake Oliver: We had IRC 20 years ago, right? Shawn Kanungo: Totally.  Blake Oliver: It's just chat. Shawn Kanungo: It's chat- Blake Oliver: But it's ... Something is different ... What do you think is different about Slack that makes it amazing?  Shawn Kanungo: What they've done is they have integrated- they've made it so easy for third-party developers to be on Slack. They've integrated things like ... I use Trello all the time. So, Trello's in there. Mailchimp. All these different things are integrated within Slack, so you don't have to leave the ecosystem. They've built it for it. I look at Shopify, as a [00:24:00] Canadian company, in Ottawa, they've done the same thing. They've done a great job at creating apps and ecosystems. This is ...  Blake Oliver: Well, you said this earlier. This is a theme here. The winners are the apps ... We could even probably put accountants in this group, too - the integrators. The more you connect with, the more valuable you are, as a company, as an app, probably as an individual, too. Shawn Kanungo: Exactly. No, 100 [00:24:30] percent. When I talked about ... Going back to this idea of a linear accountant versus an exponential accountant, things that I highlighted was, number one, focusing on capabilities; things like improvisation, and imagination, and creativity - all those things that build a culture of innovation are most important, as opposed to just jobs, and skills. I think reskilling is great, but we can reskill anybody, but actually having those capabilities will be competitive advantage. Number one's capabilities. Number two is actually automation; looking [00:25:00] at your entire business to say how can we make this easier? How can we automate it? By the way, there's technologies out there that could do that. Number three is ecosystems, which is very important. Number four is really around experimentation. We've been so engineered to think about efficiency - how do we make things better - as opposed to thinking how do we try something new and try something different? The last thing is really around unlearning. That, to me, is the most difficult part for accountants, because we've been ingrained in this idea of what accounting is and what should be - the debits and credits. When [00:25:30] all these technologies in an ecosystem come to play, the tools that you had, being an accountant and the things that you brought up with, with being an accountant, might actually disappear. We have to almost like let go of it. Blake Oliver: I wanna talk to you more about those last two points. You said experimentation and learning. Shawn Kanungo: Unlearning.  Blake Oliver: Unlearning. Unlearning! I love that. Let's talk about experimentation. This was my frustration, when I was at a large firm - there wasn't time for experimentation- [00:26:00] Shawn Kanungo: Okay, yeah.  Blake Oliver: -because I had to be billable. I wanna know what you think. You filled out a lotta time sheets, right? Shawn Kanungo: 100 percent. Blake Oliver: For 12 years at Deloitte. Shawn Kanungo: 100 percent. Blake Oliver: Do you think that is a barrier to innovation in accounting firms? Shawn Kanungo: Oh, my God. Well, don't get me started on billable hours. That's such an archaic way of managing your business. This is why the big firms and medium-sized firms ... I don't know who came up with this idea. The game has changed. Now it's about providing [00:26:30] value as opposed to like, "Oh, I spent eight hours on cash." How do you experiment when your performance management is not linked to experimentation? It's not linked. When do I have time? I'm working on this core stuff already. Blake Oliver: Yeah.  Shawn Kanungo: It's very difficult. I'm not saying it's easy to do, but experimentation ... The whole point of experimentation is that you take something very small - very small problem, very small sprint, very small team - and try to work on something that might [00:27:00] make the business better; it might make your life a little bit easier. It's hard to do. You need to get leadership on side to say, "Hey, listen, we're gonna try some new things. By the way, we're not gonna be billable when we do that." That takes a lot of balls to do and tell your leadership that "We need to go off and do that." The other piece is around performance management. You look at every single- every single firm, the metrics are designed to be around billable hours - maybe like engagement [00:27:30] surveys or whatever - but it's not getting engineered for experimentation. I think your performance management should also incorporate experimentation; meaning how many shots are you taking? How many failures have you tried? That is not engineered into performance management. There are some pieces to make that experimentation happen. Leadership is one and being accepting that people are gonna experiment. Number two is baking that into your performance management, which is really important. At [00:28:00] every single firm, we work in different silos. I was fortunate enough ... I'm from a small city, and we were able to experiment and try new things, because we got paid by clients. At the end of the day, they just care- they just want a solution. They just want value back. We'd get to take a little bit of our funding from our client and start innovating on their dime with things that they may need. Clients never know. I talked about this at the beginning of the conversation - clients [00:28:30] don't know what they need or want. They don't know how to innovate. They say, "We want we want X," but maybe they actually need X, and Y, and Z. I think accounting firms or consulting firms, they have such a great opportunity to innovate, because they're already getting paid, and the client doesn't give a ... They don't care how their value's gonna get delivered. So, I think even taking a small portion of your budget and saying how can we try a new way of doing this, making it faster? I've [00:29:00] noticed that every time we take this approach, we always become under budget. We always help open up their eyes about what possibilities could be, because we took some risk. It's hard. I'm not sitting here saying it's easy, but the organizations that value experimentation will be the ones that win. Blake Oliver: I'm sure some of our listeners are in firms that they are trying to internally disrupt, or they want to. They would love to see change happen, but they don't feel like they have the power to do so. What would you say to a [00:29:30] senior accountant or a manager who doesn't- that is not a partner; can't make that change happen? How do you get that maybe older generation, the generation of the partnership where people are really nostalgic ...? They're holding onto their tools. They don't wanna let go of what works. What advice would you have for me to start- get them on board? Shawn Kanungo: First of all, if you're a senior accountant, you're listening to this in your cubicle, or you're [00:30:00] running on the treadmill, or you're doing the dishes at home, I would say tomorrow morning, or this morning, when you're listening to this, walk into your office and try to get yourself fired ... Basically means try to take a risk that might change the trajectory of your organization or might change the trajectory of your career, because this is what's really on the line is your career. You'll find, 99.999 percent of the time, you're not gonna get fired. Blake Oliver: Right. Shawn Kanungo: You're actually gonna take a risk that [00:30:30] might change the trajectory. So, try to think about how to get fired. The second thing is, I think within ... I talked a little bit about this idea of innovation cloud. If you can show your leaders ... Not tell them something; not ask them to take an idea and do something differently. Don't do that. Actually show them something. Actually do something very small. Say, "Hey, by the way, we tried this ..." I did this on the weekend. I did this on weeknights. I did this with my own money. Listen, sometimes you gotta [00:31:00] put skin in the game. "We tried something very small, and it worked.". Instead of hypothesizing if an idea is gonna work or not, now the leaders are like, "Oh, my God, okay ..." [cross talk] You showed me something. I'm now experiencing a change." Now, you're like, "Okay, let me try more stuff." Now you're building your brand equity around innovation and cloud, and then you can take more shots. That's what happened to me. You start off small; try a little small experiment, and then ... This is what happened to me. I [00:31:30] was known as the innovation guy. I didn't term myself as the innovation guy. It's not something that happened, like somebody stamped it. It's because I took small experiments all the time, and I started to build my own innovation cloud. I think this is the way of doing it is also ... It's a faster way of getting your leaders to trust you. You've gotta take small shots. You do. Blake Oliver: Take risks with your own time. If I think back on it, all the successful stuff that I've managed to accomplish, it's doing it on the [00:32:00] side [cross talk]. Shawn Kanungo: Dude, you're doing this podcast ... Blake Oliver: Nights and weekends. Shawn Kanungo: Nights and weekends for your own passion. You're doing something different. You're doing something creative. You're bringing your community together. Nobody asked you to do this. You don't have to do this. But it's inspiring. I think more people should take this route to say, "Well, I'm an accountant, but I'm starting a podcast. I'm gonna get into the media game." More people should do this. Blake Oliver: You said [00:32:30] something about accounting, making accounting sexy, or accounting being sexy. Shawn Kanungo: Yeah. Blake Oliver: That is not exactly ... Those two words, they don't go together very often. What do you mean by that? Shawn Kanungo: Well, it makes sense, because when you remove all the things that we don't wanna do as accountants, whether it's like copying/pasting between systems, whether it's data entry, whether it's coming up with financial reports ... A lot of the systems are doing that, and there's lot of people that can help us out with that. I think, in the future, accounting is gonna be a lot more about [00:33:00] schmoozing your client; influencing, presenting, engaging, persuading your client to take a particular action. That means that we have to double down on being better storytellers. I believe that a base skill for accountants will be video; a base skill for accountants will be presentation styles and motion graphics. Blake Oliver: What you mean by video? Like being on video chat, or making videos, or-  Shawn Kanungo: Making videos; making videos for [00:33:30] presentations ... Listen, I do a lotta video. I post video every week. Video is the fastest way to gain trust with clients. Blake Oliver: A lot of accountants, you know, aren't comfortable necessarily with that. Did we get into accounting to-  Shawn Kanungo: I'm not saying you necessarily have to be on [cross talk] I agree [cross talk] Blake Oliver: Well, let me ask you this. We hear this a lot that we need to improve our presentation skills. We need to become better storytellers. What if I'm not a very good storyteller right now, but I know I need to do this? How do I learn to [00:34:00] do that? How do I get better at it? Shawn Kanungo: That's a great question. Blake Oliver: How did you get good at it? Because you're obviously a great storyteller. Shawn Kanungo: I appreciate that. I'm just gonna clip that out and put it somewhere ... I think it's just about starting with small projects. Again, it comes back to this idea of pairing something that you really love with the project that you have in mind. You're really great at audio. That is your jam. You can say that you're [00:34:30] one of the best accountants in the world, when it comes to this craft of using audio to tell stories. It's like what is your medium. I don't care if it's video ... I think video is important. I'm not necessarily saying that you have to be on camera, but using video to influence/persuade clients to take a particular path with stats, or facts, or whatever ... Maybe it's not video; maybe it's not audio; maybe it's writing; maybe it's graphics; maybe it's design. Whatever your skill set is, in terms of displaying pieces, just [00:35:00] connect that with your clients. I think everybody has some sort of skill in storytelling. Storytelling is not just speaking. It's not just video. It's not just ... Just find what you're good at and you're passionate about and connect it. I'm really good at connecting different things together. I'm really good at ... Speaking is definitely something I'm good at, but video is also something I'm really good at - not only from being on camera, but also creating graphics. If you watch my presentation, it's all motion graphics. It's all very visual-. [00:35:30] Blake Oliver: Did you create that yourself?  Shawn Kanungo: Myself and my team, yeah ... I try to use my skills, and these are the only skills that I have and apply it to storytelling. Blake Oliver: How did you get into public speaking? Have you always been comfortable with it? Because you seemed very comfortable on stage, and, as a CPA, that's a little bit unusual. Shawn Kanungo: Yep. The magic is that I was in management consulting for a very, very long time. Blake Oliver: That's getting up in front of very powerful, important people- Shawn Kanungo: It's just reps. You're [00:36:00] getting in front of executives - CEOs, leaders - talking about things that you probably just researched the night before. We used to play this game called PowerPoint Karaoke, where you would- and sometimes, we'd do this in front of my client, where you don't know what the next slide is, but you're trying to explain to a client what's happening, what's coming up next. You're building your improvisational skills just by doing that. I think it's a really great way of like ... Just playing PowerPoint Karaoke- Blake Oliver: I love that term.  Shawn Kanungo: -trying to explain things [00:36:30] and doing it in a convincing and a powerful way. I think it's just putting in the reps. For me, the reason why I got into public speaking is that a lot of people wanted to hear about the work that we were doing in innovation, and digital transformation, so we'd go get up and talk to clients. Then I'd get on to conferences; then I'd do keynotes ... The momentum has built. Blake Oliver: It sounds like the lesson is you really just gotta get up there and do it. Shawn Kanungo: 100 percent, 100 percent. A lotta people say, [00:37:00] "Well, how do I start? Where do I start?" You just ... Listen, I did a hundred talks for free, before anybody paid me to speak. You just build up the reps, and just get in front of anybody and speak. I think that's a really important skill set. I think it's ... Now, when everybody is on their phones, being able to articulate yourself and story-tell is gonna be such an important skill set, especially for accountants.  Blake Oliver: Shawn, thanks so much for speaking with me today. Shawn Kanungo: Man, this was crazy. What an amazing podcast. Blake Oliver: Thank you.  Shawn Kanungo: It's an honor. I messaged you ... This is how it happened. I [00:37:30] saw you. Blake Oliver: This is Twitter [cross talk]  Shawn Kanungo: I saw you in the conference. I recognized you from the pod. I said, "Hey, man, I just love your podcast. I'd love to catch up." I didn't have no idea that I would be on the pod. Then, just through Twitter, and then we got to meet up. You're doing so much for this community. It means a lot. I think the biggest favor that you could do is just like go rate, and review, and subscribe. Yeah, man, that's it.  Blake Oliver: So, Shawn, if people wanna connect with you online, find out what you're up to, where should they go? Shawn Kanungo: I [00:38:00] think the best thing is probably LinkedIn. That's my platform. You can connect with me there, Shawn Kanungo. I'm Shawn Kanungo everywhere - Insta, Twitter, Facebook. I have a public profile on Facebook. LinkedIn is probably the best way. Shoot me a note, and we can chat about innovation, disruption, technology, accounting. It's all good. Blake Oliver: Thanks so much for joining me and have a great flight home. Shawn Kanungo: Awesome. Thank you. This episode of The Cloud Accounting Podcast is sponsored by Halon Tax. As a new business owner and first-time tax filer, I needed the peace of mind knowing that my S-Corp return was done correctly. I signed up for Halon Tax, connected to my QuickBooks Online, filled out about four fields in a wizard, clarified two small items with the Halon Tax team. A few days later, I got a text telling me my return was finished. I launched Halon Tax and e-signed my return. The whole end-to-end process was painless and, frankly, kind of amazing. Now, Halon Tax is working with bookkeepers and accountants like yourself to offer the same amazing experience to your small business clients. They're even offering a one-year free trial to all your clients. This even includes your own dedicated tax CPA. To learn more about this exciting offer from Halon Tax, head over to CloudAccountingPodcast.promo/halontax. That is Cloud Accounting Podcast dot promo forward slash H-A-L-O-N-T-A-X. 
Sponsors Synder: https://cloudaccountingpodcast.promo/synder ClockShark: https://cloudaccountingpodcast.promo/clockshark OnPay: https://cloudaccountingpodcast.promo/onpay Show NotesChris Macksey's "guide to making a dope cheeseboard to impress your friends... For accountants #taxtwitter" | Twitter https://twitter.com/CMacksey/status/1331758688411979778Amazon cloud-computing outage Wednesday triggered by effort to boost system’s capacity https://www.inquirer.com/business/technology/amazon-web-services-failure-added-capacity-20201128.htmlTurboTax maker Intuit wins U.S. antitrust nod for Credit Karmahttps://bankinnovation.net/allposts/focus/comp-reg/turbotax-maker-intuit-wins-u-s-antitrust-nod-for-credit-karma/Pentagon fails audit yet again, could pass around 2027, comptroller sayshttps://uk.reuters.com/article/us-usa-pentagon-auditor/pentagon-fails-audit-yet-again-could-pass-around-2027-comptroller-says-idUSKBN27X03PVirtual HQs race to win over a remote-work-fatigued markethttps://techcrunch.com/2020/11/18/virtual-hqs-race-to-win-over-a-remote-work-fatigued-market/Will Zoom Apps be the next hot startup platform?https://techcrunch.com/2020/11/18/will-zoom-apps-be-the-next-hot-startup-platform/Google's Super App Wakeup Callhttps://seekingalpha.com/article/4391656-googles-super-app-wakeup-callExpensify Surpasses $100 Million in Annual Recurring Revenuehttps://www.businesswire.com/news/home/20201123005455/en/Expensify-Surpasses-100-Million-in-Annual-Recurring-RevenueBiden confirms he wants Janet Yellen to be his Treasury secretary — what that means for cash-strapped American familieshttps://www.marketwatch.com/story/janet-yellen-is-poised-to-become-treasury-secretary-in-a-biden-cabinet-what-that-means-for-cash-strapped-american-families-2020-11-24New: Easily Manage Your Bills With Accounts Payablehttps://www.freshbooks.com/blog/accounts-payableWhat’s new in QuickBooks Online: November 2020https://quickbooks.intuit.com/blog/whats-new/whats-new-in-quickbooks-online-november-2020/Second Share Purchase Values Toast POS At $8Bhttps://www.pymnts.com/restaurant-technology/2020/second-share-purchase-deal-values-pos-startup-toast-at-8b/Tudor, the Virtual Accounting Robot, launched by Connectionshttps://business-review.eu/tech/tudor-the-virtual-accounting-robot-launched-by-connections-215189Xero's cash mountain suggests a major deal is on the horizonhttps://www.afr.com/technology/xero-s-cash-mountain-suggests-a-major-deal-is-on-the-horizon-20201125-p56hrnFinTech Stripe Eyes Funding Round, $100B Valuationhttps://www.pymnts.com/news/investment-tracker/2020/fintech-stripe-eyes-funding-round-that-could-put-valuation-at-100b/Crunch Free is a new online accounting platform aimed at the self-employedhttps://www.techradar.com/uk/news/crunch-free-is-a-new-online-accounting-platform-aimed-at-the-self-employedFreshBooks Ramps Up Its Focus on the UK Small Business Market, Announcing a Partnership with Barclays, and Launching a Suite of New Features https://www.globenewswire.com/news-release/2020/11/25/2133461/0/en/FreshBooks-Ramps-Up-Its-Focus-on-the-UK-Small-Business-Market-Announcing-a-Partnership-with-Barclays-and-Launching-a-Suite-of-New-Features.htmlSurge in interest temporarily overwhelms .cpa platformhttps://www.accountingtoday.com/news/surge-in-interest-temporarily-overwhelms-cpa-platformGet in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast Classifieds BaCo Tech: https://www.bacotech.com/ ClientHub: https://clienthub.app Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors Thomson Reuters: https://cloudaccountingpodcast.promo/trcloud ClockShark: https://cloudaccountingpodcast.promo/clockshark OnPay: https://cloudaccountingpodcast.promo/onpay Show Notes07:58 – 36% of Americans Won't Move to Rural Areas Due to Slow Internet Speeds https://smallbiztrends.com/2020/11/rural-internet-speeds-urban-sprawl.html11:09 – Women less likely to feel fairly comped for WFH expenses https://www.accountingtoday.com/news/women-less-likely-to-feel-fairly-compensated-for-work-from-home-expenses-during-pandemic17:01 – Congress blasts IRS for limits on forgiven PPP loan tax breaks https://www.accountingtoday.com/articles/congress-blasts-irs-for-limits-on-forgiven-ppp-loan-tax-breaks17:23 – IRS clarifies deductibility of PPP loan expenses, as AICPA criticizes forgiveness questionnaire https://www.accountingtoday.com/news/irs-and-treasury-clarify-deductibility-of-ppp-loan-expenses-as-aicpa-criticizes-forgiveness-questionnaire17:50 – IRS Crushes Hopes Of Deducting PPP-Paid Expenses Before Forgiveness Approval; But Questions Remainhttps://www.forbes.com/sites/anthonynitti/2020/11/19/irs-crushes-hopes-of-deducting-ppp-paid-expenses-before-forgiveness-approval-but-questions-remain/19:13 – Letters signed by AICPA raise concerns about PPP Loan Necessity Questionnaires https://www.journalofaccountancy.com/news/2020/nov/aicpa-signed-letters-raise-concerns-ppp-loan-necessity-questionnaires.html20:01 – PODCAST: How Fraud and Waste Seeped into a COVID Stimulus Program (WSJ’s The Journal) https://podcasts.apple.com/us/podcast/the-journal/id1469394914?i=100049927249523:22 – Evidence of PPP Fraud Mounts, Officials Say https://www.wsj.com/articles/ppp-was-a-fraudster-free-for-all-investigators-say-1160483207224:55 – Mnuchin pulls plug on some pandemic lending programs that Fed considers essential https://de.reuters.com/article/us-usa-fed-mnuchin-idUSKBN27Z34P25:54 – IRS plans a 50% ramp-up in small-biz audits next yearhttps://www.accountingtoday.com/articles/irs-plans-a-50-ramp-up-in-audits-of-small-businesses-next-year27:57 – AICPA disagrees with IRS commissioner Rettig on penalty relief https://www.accountingtoday.com/news/aicpa-disagrees-with-irs-commissioner-rettig-on-penalty-relief30:10 – IRS investigating fewer tax preparers https://www.accountingtoday.com/news/irs-investigating-fewer-tax-preparers31:35 – Top Challenges? Staffing, Staffing, Staffinghttps://cpatrendlines.com/2020/11/19/web-portals-are-here-to-stay/33:18 – PayPal Gives Employees Early Paycheck Accesshttps://www.pymnts.com/news/payments-innovation/2020/paypal-gives-employees-early-access-to-paychecks-though-evens-app/34:48 – QuickBooks Connect 2020 Hosts Thousands Virtuallyhttps://www.intuitiveaccountant.com/general-ledger/quickbooks-connect-2020-hosts-thousands-virtually/39:28 – QuickBooks Live Bookkeeping update: November 2020 https://www.firmofthefuture.com/content/quickbooks-live-bookkeeping-update-november-2020/41:36 – Intuit has Launched HubSpot for QuickBookshttps://www.intuitiveaccountant.com/general-ledger/intuit-has-launched-hubspot-for-quickbooks/47:28 – Intuit (INTU) Q1 Earnings & Revenues Top Estimates, Increase Y/Y https://finance.yahoo.com/news/intuit-intu-q1-earnings-revenues-131201694.html51:19 – Why Xero investors should forget the US markethttps://www.afr.com/technology/why-xero-investors-should-forget-the-us-market-20201110-p56d8y54:41 – A Review! Thank you, B Stoltzfus!  Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsBaCo Tech: https://www.bacotech.com/ClientHub: https://clienthub.appGo here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors Accountant Connect: https://cloudaccountingpodcast.promo/adp A2X: https://cloudaccountingpodcast.promo/a2x BQE CORE: http://cloudaccountingpodcast.promo/core Show Notes03:55 – It’s not too late to cancel Thanksgiving https://www.technologyreview.com/2020/11/14/1012128/its-not-too-late-to-cancel-thanksgiving/ 08:11 – Follow up on Leary's theory about Trump's Loss from last week's episodehttps://www.cloudaccountingpodcast.com/200 12:34 – Blake sheds some light on his discussion with David Barrett, CEO of Expensify 20:32 – The Time Has Come for a True Wealth Taxhttps://dvorak.substack.com/p/the-time-has-come-for-a-true-wealth 25:11 – Deutsche Bank calls for a 5 percent 'privilege' tax on peoplehttps://thehill.com/changing-america/respect/poverty/525480-deutsche-bank-calls-for-a-5-privilege-tax-on-people-choosing People Who Work from Home Should Pay a New Tax, Economists Suggesthttps://gizmodo.com/people-who-work-from-home-should-pay-a-new-tax-economi-1845646500 26:50 – Personal banking vs. business banking: Do you need separate bank accounts? | QuickBooks https://quickbooks.intuit.com/r/banking/personal-vs-business-banking/ 30:50 – Millennials & Your Firm [Xero Survey]: 11 Key Takeawayshttps://futurefirm.co/millennials-accounting-firm/ 33:28 – My Startup Story: How This Founder Uses Tech to Prove Work-Life Harmony Is Possible For Accountants » Dallas Innovates https://dallasinnovates.com/my-startup-story-how-this-founder-uses-tech-to-prove-work-life-harmony-is-possible-for-accountants/  35:57 – Microsoft now lets you bring your own data types to Excel – TechCrunchhttps://techcrunch.com/2020/10/29/microsoft-now-lets-you-bring-your-own-data-types-to-excel/38:26 – NetSuite debuts SuiteAccountants programhttps://www.accountingtoday.com/news/netsuite-debuts-suiteaccountants-program-to-help-accountants-elevate-service 41:20 – Xero's fast growth slows, but profits surgehttps://www.afr.com/technology/xero-s-fast-growth-slows-but-profits-surge-20201109-p56cul 43:19 – Receipt Bank now available for QuickBooks Desktop via Right Networks https://www.accountingtoday.com/news/receipt-bank-now-available-to-quickbooks-desktop-users-via-right-networks 46:13 – Avalara buys Businesses Licenses LLC for $97M https://www.accountingtoday.com/news/avalara-buys-businesses-licenses-llc-for-97m48:06 – Blake's tax discussion with CAP listener Juventino Gaytan (Tino) https://www.linkedin.com/in/tinogaytan/  60:05 – Reviews x 3! Thank you, Vcjgvjgbufbycjg (however you would pronounce that), Nonickname7395, and Jesse Gildesgame! Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsBaCo Tech: https://www.bacotech.com/ClientHub: https://clienthub.appGo here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors Financial Cents: https://cloudaccountingpodcast.promo/cents A2X: https://cloudaccountingpodcast.promo/a2x BQE CORE: http://cloudaccountingpodcast.promo/core Show Notes 07:37 – No, Biden did not receive thousands of mysteriously surfaced votes in Michiganhttps://www.politifact.com/factchecks/2020/nov/04/tweets/no-biden-did-not-receive-thousands-mysteriously-su/ 10:02 – Meet the Excel warriors saving the world from spreadsheet disasterhttps://www.wired.co.uk/article/spreadsheet-excel-errors11:20 – It's time for the Leary Theory on How Trump Lost13:46 – 691,145 Californians left last year: What state did they go to? – Orange County Registerhttps://www.ocregister.com/691145-californians-left-last-year-what-state-did-they-go-to13:54 – Where to Move from California in 2018: Top 10 Places Californians Move - TSI Movinghttps://www.tsishipping.com/blog/moving/top-10-places-californians-now-call-home-201816:20 – Judge orders Trump administration to reveal PPP loan data it sought to obscurehttps://www.nbcnews.com/business/business-news/judge-orders-trump-administration-reveal-ppp-loan-data-it-sought-n124679219:05 – Evidence of PPP Fraud Mounts, Officials Sayhttps://www.wsj.com/articles/ppp-was-a-fraudster-free-for-all-investigators-say-11604832072 20:33 – Walmart abandons shelf-scanning robots, lets humans do workhttps://www.foxbusiness.com/technology/walmart-abandons-shelf-scanning-robots-lets-humans-do-work22:28 –  If you worked remotely due to Covid-19, a state tax surprise could be cominghttps://www.cnbc.com/2020/11/06/if-you-worked-remotely-due-to-covid-19-a-state-tax-surprise-could-be-coming.html26:42 – How one simple Zapier workflow created a multimillion-dollar business https://zapier.com/blog/how-zapier-helped-create-bonjoro/28:14 – How to Get Accounting Clients in a Changing Worldhttps://futurefirm.co/how-to-get-accounting-clients/30:59 – Acuity Launches Accounts Receivable Services as Standalone Servicehttps://acuity.co/accounts-receivable-services/36:00 – California accounting board fines KPMG $1.3M for cheating scandalhttps://www.complianceweek.com/regulatory-enforcement/california-accounting-board-fines-kpmg-13m-for-cheating-scandal/29683.article38:16 – Bill.com tops earnings expectations as more small businesses get back to work, but stimulus questions lingerhttps://www.marketwatch.com/story/bill-com-tops-earnings-expectations-as-more-small-businesses-get-back-to-work-but-stimulus-questions-linger-11604628670 39:50 – Square stock soars after earnings 'beat by a mile,' analysts applaud growth in Cash App https://www.cnbc.com/2020/11/06/square-stock-soars-after-massive-earnings-beat-helped-by-cash-app-.html 45:13 – Customise your chart of accounts templates in Xero HQhttps://www.xero.com/blog/2020/11/customise-chart-of-accounts-templates-in-xero-hq/47:06 – Does Your Firm Have a Clear Vision for Hosting: Public Cloud, Private Cloud, SaaShttps://www.cpapracticeadvisor.com/firm-management/article/21157787/does-your-firm-have-a-clear-vision-for-hosting-public-cloud-private-cloud-saas 48:57 – Osome Banks On $3M For Accounting ‘Super App’ https://news.crunchbase.com/news/osome-banks-on-3m-for-accounting-super-app/ 52:40 – Lightspeed To Buy ShopKeep For $440Mhttps://www.pymnts.com/news/partnerships-acquisitions/2020/lightspeed-buy-shopkeep-advance-pos/ 54:00 – NerdWallet Acquires SMB Finance Platform Funderahttps://www.pymnts.com/news/partnerships-acquisitions/2020/nerdwallet-acquires-smb-finance-platform-fundera/ 55:25 – A Review! – Thank you, Joe Pavone! 57:09 – Last, but definitely not least, this is our 200th Episode!🎉👏😁Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsBaCo Tech: https://www.bacotech.com/ClientHub: https://clienthub.appGo here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors Thomson Reuters SYNERGY: https://cloudaccountingpodcast.promo/synergy ClockShark: https://cloudaccountingpodcast.promo/clockshark OnPay: https://cloudaccountingpodcast.promo/onpay Show Notes03:41 – Why political campaigns are sending 3 billion texts in this electionhttps://www.technologyreview.com/2020/10/28/1011301/why-political-campaigns-are-sending-3-billion-texts-in-this-election/07:43 – America’s Password Habits: 2020https://www.security.org/resources/online-password-strategies/   - 14% of Americans Using COVID in Online Passwords, New Survey Reveals      https://smallbiztrends.com/2020/10/americans-using-covid-online-passwords.html 09:34 – At the expense of its partners’ neutrality, Expensify boosts Bidenhttps://www.accountingtoday.com/opinion/at-the-expense-of-its-partners-neutrality-expensify-boosts-biden09:54 – Coinbase CEO discourages politics at work, offers generous severance to employees who want to quithttps://www.cnbc.com/2020/09/30/coinbase-ceo-offers-severance-to-employees-leaving-over-politics.html12:20 – SBA presses big businesses to justify aid, sparking uproarhttps://www.politico.com/news/2020/10/30/sba-big-businesses-ppp-loans-43373616:23 – Fed lowers minimum loan level for small business lending programhttps://www.cnbc.com/2020/10/30/fed-lowers-minimum-loan-level-for-small-business-lending-program.html17: 51 – An Avalanche of Fraud Buried a Small-Business Relief Programhttp://www.bnnbloomberg.ca/an-avalanche-of-fraud-buried-a-small-business-relief-program-1.151467423:00 – SEC awards record $114M to whistleblowerhttps://www.accountingtoday.com/news/sec-awards-record-114m-to-whistleblower24:49 – Employers refilling open accounting jobs amid pandemichttps://www.accountingtoday.com/news/employers-refilling-open-accounting-jobs-amid-pandemic25:55 – Number of the Day: 75%https://www.goingconcern.com/number-of-the-day-75/27:12 – More than Half of Small Businesses Say They're the Same or Better Than Before COVIDhttps://smallbiztrends.com/2020/10/capital-one-small-business-confidence-survey.html31:00 – More than Half of U.S. Companies Have Hired New Staff Remotelyhttps://www.cpapracticeadvisor.com/payroll/news/21159623/more-than-half-of-us-companies-have-hired-new-staff-remotely34:14 – Vast migration of over 14 million Americans coming due to rise in remote work, study showshttps://www.cnbc.com/2020/10/28/vast-migration-of-over-14-million-americans-coming-due-to-remote-work.html37:52 – 9Spokes signs new Bank of New Zealand contract for further two-year term https://www.proactiveinvestors.com.au/companies/news/932539/9spokes-signs-new-bank-of-new-zealand-contract-for-further-two-year-term-932539.html38:12 – BlueVine Takes Wraps Off Biz Banking Platform https://www.pymnts.com/news/banking/2020/bluevine-takes-wraps-off-small-biz-banking-platform/38:56 – Sunrise Bookkeeping, a Lendio Company, Releases Its First Mobile Apphttps://www.globenewswire.com/news-release/2020/10/29/2117108/0/en/Sunrise-Bookkeeping-a-Lendio-Company-Releases-Its-First-Mobile-App.html39:52 – QuickAccept First Step To Building SMB Ecosystemhttps://www.pymnts.com/news/b2b-payments/2020/chase-neukirchen-quickaccept-first-step-building-smb-ecosystem/40:41 – Stripe Expands Partnership With Mindbodyhttps://www.pymnts.com/news/payment-methods/2020/stripe-expands-partnership-with-mindbody-for-fitness-payments/42:01 – Credit Karma in Talks to Sell Tax-Preparation Business to Square https://www.wsj.com/articles/credit-karma-in-talks-to-sell-tax-preparation-business-to-square-1160406727443:59 – What’s new in QuickBooks Online: October 2020https://quickbooks.intuit.com/blog/whats-new/whats-new-in-quickbooks-online-october-2020/46:25 – Tech news: Wolters Kluwer adds eSignature to ATX, and morehttps://www.accountingtoday.com/list/tech-news-wolters-kluwer-adds-esignature-to-atx-and-more46:57 – Report: DOJ May Sue To Block Visa's Plaid Acquisitionhttps://www.pymnts.com/news/partnerships-acquisitions/2020/report-doj-could-soon-decide-if-it-will-try-to-block-visas-acquisition-of-plaid/Visa $5.3 billion Plaid deal triggers DOJ antitrust worries https://bankinnovation.net/allposts/focus/comp-reg/visa-5-3-billion-plaid-deal-triggers-doj-antitrust-worries/48:42 – New & Improved in FreshBooks: Invoice Attachments, Croatian Language, and Morehttps://www.freshbooks.com/blog/product-updates-october-202049:10 – ADP exec lays out payroll giant's plans for earned wage accesshttps://www.businessinsider.com/adp-earned-wage-access-product-payroll-processing-pilot-customers-2020-1050:00 – Workday Adds Data Management and Machine Learning Innovationshttps://www.cpapracticeadvisor.com/accounting-audit/news/21160701/workday-adds-data-management-and-machine-learning-innovations50:55 – Amazon Rolls Out SMB Inventory Solutionhttps://www.pymnts.com/amazon/2020/amazon-rolls-out-dash-smart-shelf-smb-inventory-solution/54:00 – VOICEMAIL!  Our favorite Australian correspondent Heather Smith answers a question! 56:10 – REVIEW! Thank you, Chan Collab! Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsBaCo Tech: https://www.bacotech.com/ClientHub: https://clienthub.appGo here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors ADP Marketplace: https://cloudaccountingpodcast.promo/adp ClockShark: https://cloudaccountingpodcast.promo/clockshark LivePlan: https://cloudaccountingpodcast.promo/liveplan Show Notes07:14 – Expensify’s CEO explains how he made the decision to tell all his customers to vote for Biden  https://www.protocol.com/expensify-email-biden-trump-david-barrett 20:34 – Expensify CEO Emails 10 Million Customers Urging Them to Vote for Bidenhttps://www.bloomberg.com/news/articles/2020-10-23/expensify-biden-email-goes-out-to-10-million-customers More Expensify Coverage:   CEO emails 10 million customers to tell them to vote for Biden https://www.cbsnews.com/news/expensify-ceo-david-barrett-emails-customers-vote-biden/ Expensify CEO Urges Customers to Vote Against Trump https://www.wsj.com/articles/expensify-ceo-urges-customers-to-vote-against-trump-11603489825 Expensify CEO implores customers to vote for Biden over Trump in an explosive mass email https://www.fastcompany.com/90567857/expensify-ceo-biden-trump-david-barrett  27:37 – The results are in from our own Expensify v. Democracy survey on Twitterhttps://twitter.com/CloudAcctPod/status/1319606666690580480 29:15 – Our discussion on which way accountants will vote in 2020https://www.cloudaccountingpodcast.com/194 35:48 – Jirav named CPA.com's preferred business planning software partner https://www.accountingtoday.com/news/jirav-is-now-cpa-coms-preferred-business-planning-software-partner  38:10 – JPMorgan Takes On Square, PayPal At Point Of Sale  https://www.pymnts.com/smbs/2020/jpmorgan-takes-on-square-and-paypal-at-the-point-of-sale/ 38:48 – JPMorgan Chase takes on Square and PayPal with smartphone card reader, faster deposits for merchantshttps://www.cnbc.com/2020/10/21/jpmorgan-takes-on-square-and-paypal-with-smartphone-card-reader-faster-deposits-for-merchants.html 39:47 – PayPal to open up network to cryptocurrencieshttps://www.reuters.com/article/paypal-cryptocurrency-int-idUSKBN2762D5 PayPal Eyes Buying Crypto Firm BitGo, Others  https://www.pymnts.com/cryptocurrency/2020/paypal-eyes-buying-crypto-firm-bitgo-others/ 42:17 – Intuit account – Why now for QuickBooks Desktop?https://quickbooks.intuit.com/blog/accountant-advice/intuit-account-why-now-for-quickbooks-desktop/ 43:27 – New: Track Your Inventory Directly in FreshBookshttps://www.freshbooks.com/blog/inventory 44:10 – Feature Release: Introducing Plan, the 1st Feature in the All-New Scale Tierhttps://jetpackworkflow.com/blog/scale-tier-plan-release/ 45:02 – As stimulus talks drag on in Washington, millions of small businesses await guidance on PPP loan forgiveness https://www.cnbc.com/2020/10/23/millistimulus-talks-drag-on-and-uncertainty-over-ppp-loan-forgiveness-hangs-in-the-balance.html 47:09 – Deer crashes through window into accounting office https://www.upi.com/Odd_News/2020/10/23/Deer-crashes-through-window-into-accounting-office/7171603475615/  47:42 – Accounting Seed Releases Downloadable Accounting Basics Board Game https://curated.tncontentexchange.com/states/maryland/accounting-seed-releases-downloadable-accounting-basics-board-game/article_869e752d-bbad-5927-ac13-ba0b64fc19f1.html 50:00 – Historic bookkeeping record suggests Washington's horse fell in water near iconic Bull's Covered Bridge https://connecticut.news12.com/historic-bookkeeping-record-suggests-washingtons-horse-fell-in-water-near-iconic-bulls-covered-bridge  52:02 – Another listener voicemail from Shane Mason, Brooklyn FI TaxGet in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsBaCo Tech: https://www.bacotech.com/ClientHub: https://clienthub.appGo here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors BQE CORE: http://cloudaccountingpodcast.promo/core ClockShark: https://cloudaccountingpodcast.promo/clockshark OnPay: https://cloudaccountingpodcast.promo/onpay Show Notes03:35 – Reviews from Julie Sigety, CPA, Angela, and MarieP86!  06:44 – String of Firms That Imploded Have Something in Common: Ernst & Young Audited Themhttps://www.wsj.com/articles/string-of-firms-that-imploded-have-something-in-common-ernst-young-audited-them-11602863319 13:12 – New Zoom Enhancements to Help Customers Re-Enter the Office & Enable Hybrid Workforceshttps://blog.zoom.us/new-zoom-enhancements-to-help-customers-re-enter-the-office-enable-hybrid-workforces/ 18:00 – Introducing Zapps, Bringing Best-of-Breed Apps Into the Zoom Experience https://blog.zoom.us/introducing-zapps-bringing-best-of-breed-apps-into-zoom/ 18:24 – Bring Zoom Into Your Apps With Our Customizable SDK https://blog.zoom.us/bring-zoom-into-your-apps-with-our-customizable-sdk/18:54 – From The Folks Who Brought You Boring Meetings: CEOs Want To Ditch Sterile Zoom Callshttps://www.npr.org/2020/10/14/923428794/from-the-folks-who-brought-you-boring-meetings-ceos-want-to-ditch-sterile-zoom-c 23:11 – It's Almost Impossible to Get COVID-19 on an Airplane, New Military Study Suggests https://www.military.com/daily-news/2020/10/15/its-almost-impossible-get-covid-19-airplane-new-military-study-suggests.html 26:53 – Report: Hackers Hit 2,000 Robinhood Accounts https://www.pymnts.com/news/security-and-risk/2020/report-hackers-hit-2000-robinhood-accounts/ 30:16 – What’s New in the Sage Intacct Release 3 https://www.accttwo.com/blog/whats-new-in-the-2020-sage-intacct-release-331:25 – BofA adds three new APIs to CashPro treasury producthttps://www.finextra.com/pressarticle/84422/bofa-adds-three-new-apis-to-cashpro-treasury-product33:46 – European fintech giant Revolut is close to applying for a bank charter in California, sources sayhttps://www.cnbc.com/2020/10/12/european-fintech-giant-revolut-is-close-to-applying-for-a-bank-charter-in-california.html 35:55 – Square Introduces Terminal API For Payments https://www.pymnts.com/api/2020/square-introduces-terminal-api-for-all-in-one-payments/ 38:33 – TD Bank files lawsuit against Plaid, accusing it of trying to 'dupe' consumers https://ca.finance.yahoo.com/news/td-bank-files-lawsuit-against-194530182.html41:24 – Intuit QuickBooks achieves open banking milestonehttps://www.accountantsdaily.com.au/technology/14942-intuit-quickbooks-achieves-open-banking-milestone42:51 – QR codes added to IRS balance-due noticeshttps://www.accountingtoday.com/news/irs-adds-qr-codes-to-balance-due-notices 44:31 – Starling Bank small business customers get PayStream accounting platform as an option https://www.techradar.com/uk/news/starling-bank-small-business-customers-get-paystream-accounting-platform-as-an-option 45:11 – Receipt Bank launches 'one place to pay' app https://www.finextra.com/pressarticle/84473/receipt-bank-launches-one-place-to-pay-app 46:34 – Treasury encouraged banks to prioritize PPP loans for existing clients, hurting minority- and women-owned small businesses, House report says https://www.cnbc.com/2020/10/16/treasury-encouraged-banks-to-prioritize-ppp-loans-for-existinG-clients.html 50:32 – Survey: Who’s Not Billing for PPP Services? https://cpatrendlines.com/2020/10/12/more-than-1-in-5-accountants-are-not-charging-for-ppp-services/ 53:19 – Wells Fargo terminates employees over potential COVID-19 relief fraud https://www.foxbusiness.com/economy/wells-fargo-fires-employees-over-potential-covid-19-relief-fraud55:01  – Voicemail!!  Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsBaCo Tech: https://www.bacotech.com/ClientHub: https://clienthub.appGo here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors DEAR Systems: https://cloudaccountingpodcast.promo/dear ClockShark: https://cloudaccountingpodcast.promo/clockshark BQE CORE: http://cloudaccountingpodcast.promo/core Show Notes07:15 – Microsoft will let employees work from home half the time https://www.cnbc.com/2020/10/09/microsoft-implements-new-hybrid-remote-work-policy.html 10:47 – SBA and Treasury simplify forgiveness of PPP loans under $50K+https://www.accountingtoday.com/news/sba-and-treasury-simplify-forgiveness-of-ppp-loans-under-50k 11:47 – PPP forgiveness simplified for loans of $50,000 or lesshttps://www.journalofaccountancy.com/news/2020/oct/ppp-forgiveness-simplified-for-loans-50000-less.html 14:21 – IRS Investigating NRA’s Wayne LaPierre for Possible Tax Fraudhttps://www.wsj.com/articles/irs-investigating-nras-wayne-lapierre-for-possible-tax-fraud-11601923467 15:46 – Software Pioneer John McAfee Indicted On Tax Charges https://www.forbes.com/sites/kellyphillipserb/2020/10/05/software-millionaire-john-mcafee-indicted-on-tax-charges/#65df8ef72672 19:00 – IRS: Sorry, but It’s Just Easier and Cheaper to Audit the Poorhttps://www.propublica.org/article/irs-sorry-but-its-just-easier-and-cheaper-to-audit-the-poor 21:20 – IRS Whittles Mail Backlog, Aims to Make Final Stimulus Paymentshttps://www.wsj.com/articles/irs-whittles-mail-backlog-aims-to-make-final-stimulus-payments-11602097587 23:20 – Robinhood Reports Potential Hacking Incidenthttps://www.pymnts.com/news/security-and-risk/2020/robinhood-reports-potential-hacking-incident/ 29:12 – BoA Goes Micro With Consumer Loan Up To $500https://www.pymnts.com/loans/2020/bank-of-america-goes-micro-with-consumer-loan-up-to-500-dollars/ 30:04 – Introducing New Modern Benefits that Expand Access to Affordable Health Coverage and Put an End to Predatory Banking Practiceshttps://gusto.com/company-news/introducing-gusto-benefits-for-all 32:20 – Expensify introduces free vendor bill-payhttps://www.accountingtoday.com/news/expensify-introduces-free-vendor-bill-pay 36:58 – Tipalti valued at $2B+ after raising $150M for its accounting automation platformhttps://siliconangle.com/2020/10/06/tipalti-valued-2b-raising-150m-accounting-automation-platform/ 38:20 – Avalara acquires Transaction Tax Resources for $377Mhttps://www.accountingtoday.com/news/avalara-acquires-transaction-tax-resources-for-377m 42:26 – Accounting error costs Georgia, tax collections stay strong https://www.thetelegraph.com/news/article/Accounting-error-costs-Georgia-tax-collections-15626264.php 44:02 – Spill some tea! If you know which software was involved in the Georgia tax fiasco, do tell. Hit us up on Twitter, or LinkedIn. Inquiring accountants want to know!  46:02 – Botched Excel import may have caused loss of 15,841 UK COVID-19 cases https://arstechnica.com/tech-policy/2020/10/excel-glitch-may-have-caused-uk-to-underreport-covid-19-cases-by-15841/ 48:41 – Introducing Client Hub Frictionless Workflowhttps://blog.clienthub.app/frictionlessworkflow/ 49:27 – This is Google's new plan to take on Microsoft Office - Latest Newshttps://timesofindia.indiatimes.com/gadgets-news/this-is-googles-new-plan-to-take-on-microsoft-office/articleshow/78533493.cms 52:08 – Japanese Startup Surges 300% on Demand for Cloud-Based Accountinghttps://finance.yahoo.com/news/japan-startup-surges-300-demand-200000131.html 54:10 – Square stock gains after company purchases $50 million in bitcoinhttps://www.marketwatch.com/story/square-stock-gains-after-company-purchases-50-million-in-bitcoin-11602164665 56:45 – EY Changes Its Vacation Policy, Oh and BTW They’re Not Paying Out Accrued PTO If You “Leave”https://www.goingconcern.com/ey-flexible-vacation-policy-pto/Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsBaCo Tech: https://www.bacotech.com/ClientHub: https://clienthub.appWant to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors OnPay - https://cloudaccountingpodcast.promo/onpay ClockShark: https://cloudaccountingpodcast.promo/clockshark BQE CORE: http://cloudaccountingpodcast.promo/core Show Notes04:17 – Happy Birthday, Microsoft Excel!https://www.goingconcern.com/happy-birthday-microsoft-excel/ 06:06 – Love them or hate them, spreadsheets are going 3D https://www.techradar.com/news/love-them-or-hate-them-spreadsheets-are-going-3d 07:50 – Updates on Scaling New Heights and announcing a new, ongoing strategic alliance with Woodard Institute https://www.firmofthefuture.com/content/updates-on-scaling-new-heights-and-announcing-a-new-ongoing-strategic-alliance-with-woodard-institute/ 11:13 – EisnerAmper releases return-to-office, social distancing apphttps://www.accountingtoday.com/news/eisneramper-releases-return-to-office-social-distancing-app 14:25 – Sage Launches AI-Powered Timesheets App Built Directly into the Sage Intacct Cloudhttps://www.accountingweb.com/technology/accounting-software-news/sage-launches-ai-powered-timesheets-app-built-directly-into-the 16:35 – Zapier Launches New Microsoft Teams Integration to Bolster Productivityhttps://www.prnewswire.com/news-releases/zapier-launches-new-microsoft-teams-integration-to-bolster-productivity-301138171.html 18:53 – Canopy Enhances PM and Tax Resolution Featureshttps://www.accountingweb.com/technology/accounting-software-news/canopy-releases-feature-updates-for-its-practice-management- and20:35 – Expert’s choice: Top accounting appshttps://www.accountingtoday.com/list/experts-choice-top-accounting-apps 26:48 – Apps Will Get You Paid Early, for a Pricehttps://www.nytimes.com/2020/10/02/your-money/cash-advance-apps-paychecks.html 30:57 – Banks Push Back On Possible Banking Chartershttps://www.pymnts.com/bank-regulation/2020/banks-push-back-on-possible-banking-charters-for-big-techs-like-amazon-and-facebook/32:36 – E.C.B. says it is considering issuing a digital euro.https://www.nytimes.com/live/2020/10/02/business/stock-market-today-coronavirus#ecb-says-it-is-considering-issuing-a-digital-euro 33:28 – IRS releases final rules on business meals and entertainmenthttps://www.journalofaccountancy.com/news/2020/oct/irs-rules-business-meals-entertainment.html 35:49 – IRS adds marijuana industry page to websitehttps://www.irs.gov/businesses/small-businesses-self-employed/marijuana-industry  37:14 – Apple’s credit card won’t make you question the existence of a 10-person Texas tax firm anymorehttps://www.theverge.com/2020/10/2/21498824/apple-credit-card-mislabeling-at-t-charges-transactions-waters-hardy-co 39:18 – COVID-19 has just turned your website into a rainmakerhttps://www.accountingtoday.com/list/COVID-19-has-just-turned-your-website-into-your-rainmaker 42:09 – Accountants are now 'key workers', say UK firmshttps://www.techradar.com/nz/news/accountants-are-now-key-workers-say-uk-firms 45:20 – Despite Billions in Fees, Banks Predict Meager Profits on PPP Loanshttps://www.nytimes.com/2020/10/01/business/ppp-loans-bank-profits.html 48:12 – Man tries to steal millions in PPP loans named after 'Game of Thrones'https://www.businessinsider.com/man-tries-to-steal-millions-ppp-loans-game-of-thrones-2020-10 49:51 – Reviews and Voicemail!  52:20 – Brave – A Chromium browser https://brave.com/?ref=tom660 53:56 – See Blake and David at the Accounting & Finance Show! https://cloudacctpod.link/AccountingShowUSA Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsClientHub: https://clienthub.appWant to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100. Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Sponsors ADP Marketplace: https://cloudaccountingpodcast.promo/adp ClockShark: https://cloudaccountingpodcast.promo/clockshark Smansha: https://cloudaccountingpodcast.promo/smansha Come See Us Here: The Accounting & Finance Show October 20-21 - https://cloudacctpod.link/AccountingShowUSA Show Notes05:23 - Reviews! 07:41 - No forgiveness: Small businesses still on hook for rescue loanshttps://www.politico.com/news/2020/09/27/no-forgiveness-small-businesses-still-on-hook-for-rescue-loans-421940Report: Not One PPP Loan Has Been Forgivenhttps://www.pymnts.com/loans/2020/report-not-one-ppp-loan-has-been-forgiven/08:17 - IRS says lenders don’t need to report PPP loan forgiveness https://www.accountingtoday.com/news/irs-says-lenders-dont-need-to-report-ppp-loan-forgiveness09:08 - Is It Insane to Start a Business During Coronavirus? Millions of Americans Don’t Think So. https://www.wsj.com/articles/is-it-insane-to-start-a-business-during-coronavirus-millions-of-americans-dont-think-so-1160109284112:36 - New Job Cuts at CPA Firmshttps://cpatrendlines.com/2020/09/21/covid-impact-32300-jobs-gone/14:31 - Trump’s Taxes Show Chronic Losses and Years of Income Tax Avoidancehttps://www.nytimes.com/interactive/2020/09/27/us/donald-trump-taxes.htmlTrump didn't pay income tax for 10 of 15 years before 2016 election: https://thehill.com/homenews/administration/518510-trump-paid-no-income-taxes-for-10-of-past-15-years-report17:42 - The Ordinary Taxpayer’s Guide To The Extraordinary Story Of Trump’s Tax Returns https://www.forbes.com/sites/kellyphillipserb/2020/09/28/the-ordinary-taxpayers-guide-to-the-extraordinary-story-of-trumps-tax-returns/18:56 - Accountants favor Trump in election by large marginhttps://www.accountingtoday.com/list/accountants-favor-trump-in-election-by-large-margin22:06 - If Your Small Business Died, Blame Trump  https://planningshop.com/2020/09/if-your-small-business-died-blame-trump/26:12 - Blackbaud Ransomware Breach Victims, Lawsuits Pile Uphttps://www.bankinfosecurity.com/blackbaud-ransomware-breach-victims-lawsuits-pile-up-a-1505328:03 - Shopify: 2 Employees Took Consumer Datahttps://www.pymnts.com/news/security-and-risk/2020/shopify-2-employees-took-consumer-data-from-merchant-sites/29:48 - Intuit launches new QuickBooks Commerce platformhttps://www.zdnet.com/article/intuit-launches-new-quickbooks-commerce-platform/32:10 - QuickBooks Recurring Transactions now available to third-party appshttps://blogs.intuit.com/blog/2020/09/22/quickbooks-recurring-transactions-now-available-to-third-party-apps/33:42 - Xero Business Community - Reporting: Insert page breaks https://community.xero.com/business/discussion/441431434:34 - FreshBooks Buys Mexico's Facturamahttps://www.pymnts.com/news/b2b-payments/2020/freshbooks-buys-mexico-based-digital-invoicing-firm-facturama/35:30 - Tech News: OnPay debuts customizable reports, and morehttps://www.accountingtoday.com/list/onpay-debuts-customizable-reports-and-more36:57 - 8 things to know about the audit evidence standardhttps://blog.aicpa.org/2020/08/8-things-to-know-about-the-audit-evidence-standard.html#sthash.8BCbEvgj.J65rwht5.dpbs37:32 - Avalara debuts suite for alcohol industry https://www.accountingtoday.com/news/avalara-debuts-compliance-product-suite-for-alcoholic-beverage-industry40:00 - Another satisfied listener - Thank you, Jackson Wilcox! 42:36 - Google launches a work-tracking tool and Airtable rival, Tables https://techcrunch.com/2020/09/22/google-launches-a-work-tracking-tool-and-airtable-rival-tables/Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsClientHub: https://clienthub.app Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  TranscriptADP has your back with ADP Marketplace, a digital HR storefront. Be a more trusted advisor to your clients by recommending apps to help streamline HR processes and free up time to focus on people. Stay tuned to hear more from our sponsor, ADP Marketplace, later in the episode. David Leary: [00:00:21] I think the accounting industry might skew a little toward Republican, a little, so I'm gonna say it's 58% Republican.  Blake Oliver: [00:00:30] Well, you're very close. 55% of accountants plan to vote for Donald Trump and 38% plan to vote for Joe Biden; 7% are voting for someone else — I assume that's gonna be somebody Libertarian ... ____________________   This episode of The Cloud Accounting Podcast is sponsored by ClockShark. ClockShark is the leading GPS, time-tracking, and scheduling system built for local construction and field-service companies that want a simpler way to track time, run payroll, and understand job costs. With the capabilities of crew tracking, scheduling, jobsite geofencing, teams, and project segmentation, automatic labor allocation, budgeting, and reporting, ClockShark has built a robust mobile time-tracking system to handle the unique challenges that face your clients.  With ClockShark, your clients can keep accurate records, like overtime, paid time off, unpaid time, hours per job, and tasks, as well as the crucial data needed for certified payroll. With the integrations ClockShark has, you'll be able to connect to one of many ADP payroll platforms through ADP Marketplace and process payroll in minutes with the click of a button. ClockShark's pricing starts at just $6 a month per employee. Head over to cloudaccountingpodcast.promo/clockshark.___________________ This episode of The Cloud Accounting Podcast is sponsored by Smansha. The line between a successful business and a bankrupt one is often how much cash they have in the bank and how long they are able to remain cashflow positive during challenging times. Keeping an eye on your clients' cashflow is now more important than ever. Smansha integrates with QuickBooks Online, and Xero to help put an end to cashflow problems.  By using daily, weekly, and monthly forecasts, cashflow calendars, and powerful, customized 'what-if' scenarios, you can visualize your clients' finances in clear, and intuitive ways, so you can take action and reshape their cashflow by getting them funding with one simple application. Smansha identifies when extra cash is needed and can match your clients with multiple financing options via more than 50 screened lenders, and you can advise on the best offer suited to your clients' needs. Just for the listeners of The Cloud Accounting Podcast, Smansha is offering its fully functional unlimited-companies license for free until August 31, 2020. Head over to cloudaccountingpodcast.promo/smansha.____________________ Blake Oliver: [00:03:03] Welcome to The Cloud Accounting Podcast. I'm Blake Oliver.  David Leary: [00:03:06] I'm David Leary.  Blake Oliver: [00:03:07] David, what were you up to this weekend that we are recording on Monday morning?  David Leary: [00:03:10] I went up to Phoenix from my sister's 40th birthday party and, obviously, you're in Phoenix, I'm in Phoenix ... But for those of you that aren't familiar with Phoenix, I was still like 55 miles away from Blake even though we were in the same city. Blake Oliver: [00:03:24] Phoenix is like the state. It feels like it just goes forever. I still haven't explored even a tiny fraction of it. David Leary: [00:03:31] Yeah, and to try to ... "Oh, yeah, sure, Blake. Let's try to connect and record in person ..." It just wasn't logistically gonna happen, so that completely got scrapped, and here we are, Monday morning.  Blake Oliver: [00:03:41]  I am really excited because I have some good news — a good news story this week to share with you — which is all about the new businesses that are starting up amidst all the shutdowns that are happening. Creative destruction is something that happens in a downturn, where businesses that can't survive go out of business, which creates opportunities for new ones to spring up. We can talk about that. I don't know? What's on your plate, David? David Leary: [00:04:05] We could try to touch the New York Times article that came out about Trump's taxes, but it literally took 50 minutes to read the article. I don't even know how to ... I don't even know where to start digesting it. It's a gigantic article that came out- Blake Oliver: [00:04:19] To be honest, I haven't read the article, but I could give you my hot take on it without having read it. We'll pretend that we're on Twitter, and people don't read the articles [crosstalk] just the headlines. I'll give you that. I have a survey of accountants and who they plan to vote for. Since we're talking politics, and we're getting close to the election, maybe we can successfully do that without alienating our entire listener base. A ransomware attack, big ransomware attack against Blackbaud; possibly one of the biggest ransomware attacks that we've ever talked about. Then I've got a just a ton of updates. I know that QuickBooks released their new e-commerce solution that's built into QuickBooks Online. That's a pretty big deal. What else? You posted something about an API that is a really interesting change to QuickBooks with recurring transactions. David Leary: [00:05:05] All right. Thank you for reminding me about it. I totally forgot I did that. That's the way this week's gone-  Blake Oliver: [00:05:08] Yeah, well, I've been following you. I've been trying to keep up with all your happenings. You're a busy guy. We have some reviews, right? We got a couple of voicemails that we gotta get to, and we got some reviews. David Leary: [00:05:20] Let's knock out the reviews really quick because one was pretty funny.  Blake Oliver: [00:05:22] Okay, let's do it. David Leary: [00:05:23] This is a five-star review from Daniel Sears. This is on Podchaser. "Not a bot, but my twin brother is totally a bot. Very smart commentary." That's his review. Simple as that.  Blake Oliver: [00:05:33] I love it. Short and sweet. Thanks, Daniel — if that is your real name. Our second review is from Tyler Trenda; five stars "New to the field — I'm just starting out in the Accounting/Bookkeeping field and looking to start my own small bookkeeping business. The Cloud Accounting Podcast has been a great way to get up to speed with the current events happening in the Accounting space. I've sent a couple of emails out to Blake directly and he has responded promptly and provided invaluable knowledge to me. Love the show and I'm always listening at work." Awesome. Thank you, Tyler!  [00:06:04] I've actually saved a couple of emails from Tyler, just in case we needed something to talk about. I think those were some great questions. Tyler was asking if there are any certifications he should look into getting, beyond the QuickBooks ProAdvisor program should he having an associate degree in accounting and being a certified QuickBooks ProAdvisor program. Should he, having an associate's degree in accounting and being a certified QuickBooks ProAdvisor, should he look into getting the certified bookkeeper license?  [00:06:30] Now, I'm aware of that license and I actually, at the very beginning of my bookkeeping career, considered doing that. I did not because then I ended up taking that long arduous path to the CPA, but I'm curious to know if anyone out there is a certified public bookkeeper who's listening, and if you have any thoughts on that. If you do, maybe you could give Tyler some advice. So, if you wanna call and let us know what you think, we have a voice mail number. It's a Google Voice number. It goes straight to voicemail; you can call it. That number is (202) 695-1040. Give us a call. We'll take a listen, and we might even play it on the air. David Leary: [00:07:08] Do you wanna talk PPP really, really quickly? Blake Oliver: [00:07:10] Yeah, I saw there was a few updates.  David Leary: [00:07:14] So, let's quiz you, Blake.  Blake Oliver: [00:07:15] Uh-oh ...  David Leary: [00:07:15] How many PPP loans have been forgiven to date? Blake Oliver: [00:07:18] Probably not many, right? I think most people are holding off on forgiveness. David Leary: [00:07:23] What'd be your guess? Because there's been millions of loans, right?  Blake Oliver: [00:07:25] Yeah.  David Leary: [00:07:25] What's your guess? Blake Oliver: [00:07:27] Maybe a few hundred thousand? David Leary: [00:07:30] Zero? How does zero sound?  Blake Oliver: [00:07:33] I filled out my paperwork, and I still haven't heard back, so I guess I'm not the only one? What's going on? David Leary: [00:07:41] Some lenders are accepting people's applications, but the Treasury Department and the SBA, they're just not ... None of them have officially been forgiven yet. I think they're in one of those stalls. I think we're gonna see this automatic rubber-stamp forgiveness because they obviously don't have the program and procedures to do it. The reality is, if you think about it, if there's gonna be some ... There's gonna be another round of stimulus.  Blake Oliver:[00:08:03] Right.  David Leary: [00:08:03] It might be- It'll probably be post-election, but there's gonna be another round of stimulus, and they'll have to deal with that. They're not gonna be able to have time to deal with the forgiveness application. I just don't see it happening. Blake Oliver: [00:08:12] Yeah, that makes a lot of sense to me. One more small update about PPP. The IRS has notified lenders that they should not file cancelation of debt information returns, or furnish pay statements to report the amount of qualifying forgiveness with respect to covered loans made under the Paycheck Protection Program; which in plain English means that you are not going to get a 1099-C for the forgiven PPP loans because that could cause people to report that as income, and we all know that the PPP forgiveness is not taxable. Although they still have not addressed the taxability of the expenses or the deductibility of the expenses yet, I don't believe. That'll probably be another thing in that stimulus package that will someday arrive.  [00:09:00] Let's talk about good news. Is it insane to start a business during coronavirus? Millions of Americans don't think so. That is the headline in a Wall Street Journal article that made me feel good, for once, talking about the economy. Apparently, the data shows that Americans are starting new businesses at the fastest rate in more than a decade, seizing on pent-up demand and new opportunities after the pandemic shut down and reshaped the economy. We know this because applications for EIN, the employer identification numbers that you need if you want to start a business and pay people– David Leary: [00:09:37] Or a file for a PPP loan.  Blake Oliver: [00:09:38] Or get a PPP loan [crosstalk] Yeah, that could be distorting things. I don't know. But let's keep it positive here. We have passed 3.2 million, so far this year, compared with 2.7 million at the same point in 2019, according to the U.S. Census Bureau. More businesses are being started. Now, admittedly, small business revenue overall is down. It's down 21% as of mid-September versus January levels. There are people who are figuring out how to navigate this new economy and new buying behaviors.  [00:10:08] There's a baker who looked into buying a bakery and couldn't afford it; didn't have the capital and, due to the coronavirus, was able to lease commercial space for just $350 a month; started her own bakery; bought an espresso machine. Place is packed every day. There is a fitness founder who had a publicity business. She was a publicist and started an online fitness studio that holds classes, attracts instructors that were holding free classes on Instagram Live. It's now a platform- has created a platform for online workouts. There's a guy who was a personal trainer, a fitness trainer, who realized that his business was not going to survive if the gyms closed, so he started a bike repair business. Now he's busy every single day going out and fixing bikes, which we know are much more popular now because people don't wanna take public transit [crosstalk] David Leary: [00:11:02] Super demand for bikes. Yeah, you can't get bikes anywhere. Obviously, if you can't buy new bikes, there's totally a business market for fixing old bikes. Blake Oliver: [00:11:10] Yep. The last one, which is one of my favorites, is a woman who had a job as a school-based therapist in Chattanooga, Tennessee, and that looked uncertain as the schools started to close. She created a plan in April, and May, and then by June had completed the requirements to become a licensed clinical social worker and pivoted to doing telehealth, which is growing. People don't wanna go to people in person. They wanna do it on Zoom, or the HIPAA-compliant version of that. She has a thriving telehealth practice, consulting with people as a clinical social worker.  [00:11:42] My takeaway from this is it's not just great for the economy. I think there's gonna be a lot of accounting firms that serve these new small businesses and those are gonna be the ones that really take off, as the virus recedes in the next two years. I just think that's something positive. If we can support those new business models – the e-commerce-type business models, the telehealth business models – this is all innovative, and it's all happening very quickly. It's all– David Leary: [00:12:07] This is why I've always felt like Intuit, historically, has been recession proof. So, what we'll probably see is, in Intuit's numbers, and in Xero's numbers, and probably FreshBooks' numbers, all these entry-level accounting-package numbers, you're gonna probably see a bump in the numbers because when people can't get jobs, they start businesses because you have no other option. Blake Oliver: [00:12:27] Actually, it's why the accounting profession, as a whole – the service providers – are very recession-proof, too. There's some new numbers courtesy of CPA Trendlines about job levels in the accounting world broken down by different types of firms. Overall, the accounting profession is down 2% for the year, which that's a lot of jobs, but way better than the overall economy. Staff employment is down 4.7%.  [00:12:55] If you have a CPA- they call them accounting professionals, but given it's CPA Trendlines, I think that means, in this survey, that you have a CPA license. It's not quite clear to me. Anyway, if you have a CPA license, you're pretty insulated from this. Employment at CPA firms is only down 1.2%. Tax prep services down 1.4%. Now, payroll services, they took a big hit. They are down 13.5% for the year. They went up a bit in August, almost 2% in August, but still, down 13.5% for the year. That makes sense, right? A lot of businesses closing; not running payroll- David Leary: [00:13:28] A lot less volume.  Blake Oliver: [00:13:28] Right, restaurants, all that stuff. Bookkeeping down 1.2% for the year; the same as CPA firms. They broke out this by women – just women in accounting – overall, jobs are down 2.2% for the year, so a little bit, 10%, worse than the overall profession. Now, in CPA firms, it's only 0.5%, so they've actually ... Women in accounting have weathered the storm better, if I'm reading this survey correctly; assuming they're working in a CPA firm. That's my economic news of the week. We can talk politics. We can talk this survey about accountants before we jump in app news. If you don't think it's too hot-button- I don't know. Maybe we shouldn't touch it. Maybe we should avoid it. I don't have anyone to talk politics with. David Leary: [00:14:16] I know I sent you the text of the article yesterday, but as soon as I saw it on social media start coming through, everybody started posting it on Facebook; all the accountants and bookkeepers. It started showing up in all the groups, and I was like, "Oh, this is gonna be a big deal." Then, I was like, "All right, let's go see what this is." I didn't realize that it's a New York Times story that, for 45 minutes on your phone, you keep scrolling. The same story. It's not- it's not TikTok, where you just scroll and it's 15 seconds; you move on to the next thing.  [00:14:42] It is a gigantic four-year investigation by The New York Times looking at 15 years of Trump's tax returns from ... Some of them, they actually have the real returns; some of them are working backwards from other public information that's out there ... Almost like a forensic-type experience – they're recreating all the data. The article's actually super-super-hard to completely understand. The gist of it is there's many years he did not pay any income tax because it's the way [you play] the game a little bit, right? I'll take out a $100 million loan; spend the whole thing on a building. Well, now, it's $100 million of expenses. Some of the things I saw that've been trending was that, in about three years, he has a lot of mortgages that are come due for these golf courses and stuff that are not making money still.  Blake Oliver: [00:15:29]  I think that's the thing that's most interesting to me that got buried in all this because the top-level conversation, which is not productive or helpful, is on the left, criticism: Donald Trump paid 40 times less taxes than I did as a contestant on Jeopardy. He paid $750 in taxes the year that he won the presidency. Now, on the other side, it's actually a lot of tax preparers, a lot of experts saying, "Well, yes, of course, because you are allowed to offset your income with losses." [00:16:01] This is how the system works. He's not doing anything wrong. Everybody does this. People who support Donald Trump are saying this is what an intelligent person should do. Then, of course, what is missing in all this is what you pointed out,       which is the reason he has the losses is because he has the hundreds of millions of dollars of debt that are coming due.  [00:16:20] I don't care about the tax situation. The tax system is the way it is – avoid taxes if you can. There's nothing wrong with that. We shouldn't go back to what happened in the Great Depression, when FDR and his cronies went after all of the wealthy people in the country, saying that tax avoidance was unethical. This has happened before, by the way. Anyway, it's the fact that there's all those millions of dollars of loans that are coming due that concern me a little bit because- David Leary: [00:16:47] I think was in the article- I think that it's like he's more of a tax genius and 'how to play the tax game' genius maybe, and less of a businessman genius. Blake Oliver: [00:16:56] Well, it's not that Donald Trump's a tax genius; it's he has a really good accountants. He pays for really good advice. They minimize his tax liability. They help him avoid, legally, all the taxes that he's entitled to avoid. David Leary: [00:17:09] He's not hiding behind this either. He said that in the debate, I think, with Hillary Clinton that, "I'm very proud that I maximize my tax burden or lack of tax burden."   Blake Oliver: [00:17:20] As he should be. Don't hate the player, hate the game. Fix the tax code if you've got a problem with it. Don't go after high earners for taking advantage of the situation. That's just my hot take. Of course, I haven't read the article, so I could be completely off base here. David Leary: [00:17:35] This is gonna be the news all week. This is a gigantic story. Kelly Phillips Erb, @taxgirl on Twitter. She wrote a Forbes article: "The Ordinary Taxpayer's Guide to the Extraordinary Story of Trump's Tax Returns." She breaks it down a little bit more in laymen's terms, so if you don't have time to read the 45-minute article, I'd say go to her article and look at that. Even with reading that, it's still all over the place. The nice thing is she shows other historical stories or articles she wrote in the past; links to those. At the bottom, I liked her little summary here. "I'm reminded of something that departing IRS-CI Chief Don Fort used to stress - voluntary compliance is the basis of our tax system, and no one is above the law."  Blake Oliver: [00:18:20] David, this might be a good chance to transition into who we plan to vote for, or maybe – if we don't wanna discuss that – who accountants plan to vote for. Do you have any idea what the polls say, if you haven't peeked at my notes yet?  David Leary: [00:18:37] I have not peeked. Who the accountants plan to vote for? In theory, right now, the country's very, very- we've been very split for a long time. I think the accounting industry might skew a little toward Republican, a little, so I'm gonna say it's 58% Republican.  Blake Oliver: [00:18:54] Well, you're very close. 55% of accountants plan to vote for Donald Trump and 38% plan to vote for Joe Biden; 7% are voting for someone else — I assume that's gonna be somebody Libertarian. That is according to a survey by the parent company of Accounting Today – survey of over 400 accountants. Doesn't surprise me because we know that accountants tend to be more conservative – at least that's my experience. Why wouldn't we be, given that the Republican Party has branded itself, and policy wise, is the party of small businesses, and accountants generally serve small businesses? What's interesting about this is ... Let's see, party registration is 48% Republican among accountants; 23% Democrat, and 27% Independent. That is different than the national because national is very split. National, it's more like 40–40. David Leary: [00:19:51] I question the logic in this. If we vote in Donald Trump, chances are, taxes aren't gonna change too much- tax policies, which means less work for you, as a tax professional. If you vote in Biden, he's gonna reverse things that Trump did; there's gonna be a new tax code; there's gonna be new laws to learn, which means it's more engagements from your clients. You're gonna make more money. It seems like accountants are not being very logical with their wallet. They should always vote for the other person, every single time. Blake Oliver: [00:20:20] Well, yeah, if you're being completely opportunistic about it, right? But this is something that, as a CPA, I find interesting is that people don't go into accounting because they're looking for the easiest job. They get into it for very different reasons. I think that the Republican support, and the support for Trump, as you pointed out, a lot of it is to do with taxes. Many people are concerned that if Joe Biden wins that he's gonna raise taxes, and that's gonna be bad for business.  [00:20:51] Although it might be good for accountants to have changing laws, I think they're really voting in sympathy with their clients and with the businesses that they work for, in that I think Trump is gonna be better for small businesses, excluding the whole coronavirus thing, which ... That's the thing that's dominated my vote. I've said this before, I believe, on the show – I'm a Republican. I started the Young Republicans Club at my high school. It's kinda like I was born into it. My parents were Neocons, and Clinton were a bad word in our house when I was growing up.  [00:21:28] It's tough for me, personally, as a Republican, because I've never been a Trump supporter. I think the whole coronavirus response has been just awful. That is worse for small business, I think, than the potential tax increases. It's like with the whole discussion around the tax return, I feel like the whole conversation in this country, at the top level, is on all the wrong things. It's possible, for instance, that we can have a virus that is deadly that we need to control, but also that lockdowns- Draconian lockdowns that I fled in California are not effective. Both can be true, but there is no party for that. Right? It's like we're so extreme, there's no compromise. I find that frustrating. David Leary: [00:22:06] Rhonda Abrams wrote an op-ed article for USA Today. She's USA Today columnist; she has her own company called The Planning Shop. She's all about business plans, business planning, that type of stuff. She's been around a long time. I think she has a column inside the Costco magazine, as well, if you get that magazine. She does a small business column in there. She wrote an op-ed about – if your small business died, blame Trump.  [00:22:28] She really breaks down every one of the policies. You have the PPP, and you have the loan programs because they weren't grants. She breaks down every one of these and makes an argument how that plan wasn't focused on small business – that plan; that part of the stimulus – was not focused on small business.         She really breaks down – everything that's been done so far truly has not been set up to help the smallest businesses. Then, she points back to the latest numbers from Yelp that we talked about last week, or the week before that 73,000 businesses are gonna be closed for good. Blake Oliver: [00:23:02] The stimulus bill, if we go to that, that was a collaboration between Pelosi and Mnuchin. That was a bipartisan thing. Now, they may be deadlocked on the next step, but if there are problems with the stimulus bill, both parties deserve the blame for that. I do believe that the biggest problem for small businesses in the biggest states, like New York and California, is due to shutdowns; being unable and prevented from making a living by the government. This has never happened before in the history of our country where we have simply said to businesses, "You must stay closed. You cannot go to work. You cannot earn a living."  [00:23:36] I personally – I'm not a constitutional lawyer, but I feel like this should be unconstitutional. You can't just have an ongoing pandemic that just goes on for months and months and months, maybe years, and prevent people from earning a living. One of the reasons I left California – you mentioned that Yelp data; one in six restaurants are gonna close and not reopen. In California, it's double. They're predicting one in three restaurants will close and not be able to reopen. Why is that? Because of the different measures that are being taken, the controls. It's horrific. There's no party for me. David Leary: [00:24:09] You can join the largest party in Arizona, which is the Independent party. Blake Oliver: [00:24:12] I think I might have to. Are you an Independent party guy? David Leary: [00:24:16] Yes.  Blake Oliver: [00:24:17] You are? Okay.  David Leary: [00:24:18] Yes.  Blake Oliver: [00:24:18] I feel like it is the small businesses that get caught in the middle of all this, right? Anyway, I was trying to start this whole show with a positive story, but ...  David Leary: [00:24:26] Positive spin [crosstalk] open our reviews, again.  Blake Oliver: [00:24:31] Let us know what you think. We try to be reasonable here. Wanna hear your feedback. You wanna talk about ransomware since we're in this world?  David Leary: [00:24:39] Yeah, let's jump on that.____________________   This episode of The Cloud Accounting Podcast is sponsored by ADP Marketplace. How can you be a more trusted advisor for your clients as they face new challenges? By recommending solutions from ADP Marketplace, ADP's digital HR storefront. With ADP Marketplace, clients can try, buy, and implement highly rated HR apps that can share data with ADP. With secured data integrations, it's easy to streamline HR processes and adapt to new business needs. Help your clients discover new ways to recruit and onboard employees, boost performance, offer unique financial-wellness benefits, and much more.  With integrations for popular business software, like Expensify, PayActiv, Slack, and ClockShark, clients can add value to the tools they already use by simply and securely connecting them to ADP. Have clients in field service, or construction? ClockShark can help them track time to quickly and accurately run payroll, all integrated with ADP. Visit ADP Marketplace at apps.ADP.com, or right from your Accountant Connect dashboard. Not set up with Accountant Connect? Sign up today. It's free. Head over to cloudaccountingpodcast.promo/ADP. ADP has your back with ADP Marketplace  ____________________  Blake Oliver: [00:25:58] There are worse things that could happen to you, as a business, I suppose, than even a lockdown. It is a massive ransomware attack. Blackbaud, which is a maker of cloud software for not for profits – they don't use this term, but I would consider them to be like an ERP provider. They provide full comprehensive cloud solutions – fundraising, financial management, all that stuff to not for profits.  [00:26:25] As of Thursday, more than three dozen Blackbaud-related health data breaches affecting about 6 million individuals had been posted to the Department of Health and Human Services' HIPAA Breach Reporting Tool website. It is commonly referred to as the "Wall of Shame." Businesses are required to list health-data breaches that are impacting 500 or more individuals.  [00:26:47]  Why is this happening? It's because Blackbaud, back in May, suffered a ransomware attack where their database was hacked and stolen. They started notifying their customers in June and July which actually was late. Now there are 10 lawsuits against Blackbaud. It's significant because there's a lot of hospitals and healthcare providers that use their software. Interestingly, a little detail in here, it was a ransomware attack – apparently, Blackbaud paid the ransom but they have no proof that the data was actually deleted. They're just believing that the hackers deleted the data after they paid the ransom. David Leary: [00:27:22] You can't trust them. You can't trust the hackers. This is that fine line of – dd you just always refuse to pay the ransom because you can't trust that they're gonna get rid of the data, but if you're locked, and you can't access the data yourself ... It goes back to that having backups – offsite backups, multiple backups.  Blake Oliver: [00:27:41] Yep, and this is why it's so lucrative to do ransomware, right? Because companies have to do it. They'd go out of business if they didn't. They have to get their data back. That is, I think, maybe a good point to kick off app news?  David Leary: [00:27:55] Yeah, I can transition this, as well, because I have a fraud story that's related to app news. Shopify, they had a blog post and they stated that two "rogue employees" have stolen data for – and they say – less than 200 merchants. They've launched an investigation. They've contacted the FBI. Two members of their support team apparently were involved in a scheme to take transactional records from individual customers, which would be small businesses that sell on the Shopify platform. Who knows what they were doing with this data – if they were selling it to somebody: was Amazon buying it? – nobody knows. It's being investigated.  [00:28:38]  I was actually surprised that Shopify- how upfront they were about it, and they just put it out there. It's not even a blog post. It feels like this is a community board of Shopify, and the Shopify staff put it out there, and they talked about this. Now, there's not a lot of clarity as far as have they told everybody about this; if they have to buy GDPR, and some of those other policies that are out there, but the fact that they communicated it  ...  [00:29:03]  The thing is, remember, one of the things that people are accusing Amazon of- let's say you sell hip pouches on Amazon; they see your sales of hip pouches; they know all about how many hip pouches you sell a week, blah-dee-blah, blah-dee-blah, blah-dee-blah ... Then, Amazon, all of a sudden, starts Amazon Basics, and they're selling a hip pouch.  Blake Oliver: [00:29:19]  And it looks just like yours.  David Leary: [00:29:20] It looks just like yours. They control the search words, and you're just done. Obviously, this data, at the merchant level, is super-super-valuable. Now, who they were stealing this for, or what they planned on doing ... Maybe they were just targeting yoga-mat sellers, and they're gonna open up a yoga-mat business, but nobody ... There's no details at any level. But this is a little scary, right? Everybody's worried about hackers but what about the internal employees?  Blake Oliver: [00:29:43] Yeah, that's a good point. Well, you mentioned Shopify. Let's talk about QuickBooks Commerce. David Leary: [00:29:48] Remember Intuit, six weeks ago ... Was it eight weeks ago, they acquired TradeGecko. TradeGecko is an e-commerce omnicommerce automation platform for inventory management, and e-commerce sellers. They've rebranded it. If you go to TradeGecko.com, today, it immediately flips and has a banner that says TradeGecko is now QuickBooks Commerce. It's completely rebranded. Not only is it rebranded, the marketing pages, the whole product has been reskinned. I've never seen a rebrand at Intuit happen this fast. Blake Oliver: [00:30:22] Yeah, I was surprised because the acquisition was announced and then, like you said, six weeks later, we've got the product integrated in the app, so obviously this was going on behind the scenes. David Leary: [00:30:32] Yeah, and it's not integrated into QuickBooks. It's still a standalone product, but they skinned it. It looks and tastes like QuickBooks Online. Blake Oliver: [00:30:41] Do you access it though inside of-  you don't access it inside of QuickBooks Online? David Leary: [00:30:45] There might be a launch point, possibly. That, I'm not clear on, but it's still a separate ... It's just been rebranded and reskinned, so it looks and tastes like QuickBooks Online. Like I said, I've never seen this happen so quickly with an acquisition like this. It was so good that the vast majority of people out there on the interwebs thought Intuit launched a brand-new product. Blake Oliver: [00:31:09] Wow. That's good marketing there. David Leary: [00:31:11] They've done a very good job about this launch and release, and we'll see where it goes next. It's a good sign, though, that they redid this. I remember years ago, I was at Intuit, and there was Digital Insight, which was ... It was a company that Intuit bought, and that company actually provides software for banks, and credit unions, and smaller FIs. Intuit bought that company, and five years later, they still didn't have their email addresses working with us, with Intuit. It's amazing when you see an integration take place like this.  [00:31:40] The other thing I thought was really interesting ... I was thinking about this TradeGecko thing. TradeGecko is based in Singapore, and my understanding is that's the next battleground for cloud accounting. Xero's doubling down there ... I wonder how much of this acquisition- just how Xero acquired Hubdoc because it gave them a good foothold in the North American market, I wonder how much of this is also a way for Intuit to get a foothold in Asia?  Blake Oliver: [00:32:06] Well, one more quick QuickBooks update. They've made recurring transactions now available to third-party apps in the API. David, you got really excited about this on Twitter. Explain why.  David Leary: [00:32:18] It's a personal reason ... A lot of developers want this. If your app – for example, Melio ... Melio will let you create recurring payments. If I have to pay somebody every single month, you wanna create that bill payment and have it sync to QuickBooks. It doesn't sync too well, and the reason why is QuickBooks never had the API calls available for a developer to write that. Now, a developer can go and create recurring transactions right inside of QuickBooks, instead of you having to manually create them outside of the app you're using. It's just a super-huge thing that developers have asked for, for a very long time, so it's good to see developers get support to make their apps better because that saves everybody time. Blake Oliver: [00:32:58] I could see this being super-helpful because one of my biggest problems was exactly that, what you mentioned, having to manage the recurring transactions outside of the GL. I would always have my clients' regular payments, when I managed their bill pay, entered as a recurring bill because if the bill didn't come in, in the mail, then I wanted to make sure we still paid it; we didn't get a late notice, or if something happened ... We were using Earth Class Mail to scan the mail, and there can be issues. It doesn't get scanned, yada yada. We always had problems because we were managing the recurring transactions outside of QuickBooks or Xero, and now, you can actually just manage that inside. It'll just be more efficient. It'll be more foolproof. That's great.  [00:33:41]  Let's talk about Xero. Some quick updates from Xero. You now get page breaks in reporting in Xero, and this is global. This is one of those little things that I think has annoyed folks for a long time, not being able to control page breaks in reports. I remember people in QuickBooks complaining about this, as well. Now you can do that on your layouts. You can get the reports looking exactly how you want when they go to PDF.  [00:34:05]  You can also now use e-signature on documents in Xero HQ. You can assemble a package of documents and upload a bunch PDFs into Xero HQ, which is their client management that's built into Xero. Then, you can send those to your clients and get them e-signed. It could be perhaps a set of financial statements, a tax return, whatever you want. That's now built in ... That's been available to Xero Tax users in Australia; now going global.  David Leary: [00:34:34] FreshBooks buys Mexico-based digital invoicing firm Facturama. I don't know if you understand how invoices work in Mexico. Blake Oliver: [00:34:44] I know that they have to go through the government. They get stamped or something? David Leary: [00:34:49] They have a special QR code, basically, in the corner of all these, and both the person sending in the request, and then the person paying ... Then, when it's paid, you have to include the same barcode. It's super-super-complicated. I know that, in the past, Intuit's partnered with somebody to work on QuickBooks Online, so their invoices are compliant. It looks like, now, FreshBooks is making a jump down into Mexico.  Blake Oliver: [00:35:12]  Interesting.  David Leary: [00:35:12]  The fact that they purchased a firm, they're serious. You're not gonna do that, unless you've already made the decision – we are going after that market. That's gonna be another battleground, here, is in Mexico. Yeah, FreshBooks has jumped down there. Blake Oliver: [00:35:27] Some quick payroll updates. OnPay has released a custom report builder, where you can build a custom payroll report using up to 50 data points from your payroll and HR data. I love this, when developers do this, because the stock reports are inevitably not exactly what you need, and you end up having to export to Excel. Any time you can do a custom report, this should be default. Everybody should have this. Please, if you're a developer, and you're listening, allow for us to build custom reports. David Leary: [00:35:56] Especially for payroll because, by default, the payroll reports are great for the payroll clerk, who's allowed to see all that data, but as soon as you need to run a report for some department head, or a department, or maybe for the board, or somebody else, there's a lot of details in payroll you don't want in the report. Blake Oliver:[00:36:12] Exactly.  David Leary: [00:36:12] If you don't have control over that ... What are you gonna have? You take a black marker and black out ... Probably what you do, right? You're like, "Okay, they're not allowed to see this data. I'll just scratch that off the report and just give them this."  Blake Oliver: [00:36:23] Continuing on with payroll, Wagepoint, another payroll provider in the cloud, has taken on $10 million in new capital from Providence Strategic Growth. Inflo, a data analytics company, has introduced Workpapers, a new audit module for end-to-end external digital audits, which I am sure are growing when you can't go to the office.  David Leary: [00:36:44]  Digital audits.  Blake Oliver:[00:36:45] Yes, and actually I have a story. I don't know if we'll get to it this week – it's been buried in my notes – all about the new audit evidence standard. I know this is riveting to you David, but it's a story from the AICPA about how they have created a new audit evidence standard for private companies that allows for non-human evidence collection. [00:37:07] They are specifically saying it is okay to collect data using bots, or robots, or Ais, or whatever it is. or just systems. The PCAOB, which regulates the audits of public companies, is considering revising their audit evidence rule, as well, to do the same. This is stuff that should have happened a long time ago, but Coronavirus is now putting that into the forefront and making it finally happened. David Leary: [00:37:32] Avalara has some alcohol-related news. Avalara, who's the sales tax compliance ... They're in the compliance game, but then, Avalara also has ... I don't know if you ever have heard about Avalara's corporate headquarters. They have a tiki bar right inside the facility. Avalara has some- they have double expertise here. They have expertise in alcohol, and they have expertise in the compliance.  [00:37:56] They've released a new product called AvaTax Beverage Alcohol, and it basically has compliance solutions for wineries, distilleries, breweries, importers, retailers. Not only does it keep track of all the sales tax and use case and all that ... Because now, with COVID, shipping alcohol has been a little bit easier. Moving alcohol's a little bit easier. They've lowered some restrictions, but you still have to comply. [00:38:19] It's interesting because they've released this, but it's not just the tracking from the sales tax tape, and the reporting. From day one, how to properly even register and maintain your state license. They assist you with that. Registering all your products because maybe your product has to be labeled properly, or it has to have the- in some states, you have to ... I think in the state of California, they always have that- there's a separate warning you always see on products, and maybe you don't see this on the East Coast, but I definitely see it in Arizona; it has a special California warning. Blake Oliver: [00:38:46] Oh, the cancer warning that's on everything in the state? Literally everything in California gives you cancer – every parking garage, every product ... Yeah.  David Leary: [00:38:55] What I like about this strategy is, yes, their expertise, and ultimately, their goal, was to get you to do tax remittances, correct reporting, and all that, but the fact that they're helping you get your business license set up properly, your labeling – they're keeping you in compliance across all three things instead of just the tax compliance. [00:39:14] This goes back to what we talk about with QuickBooks and having a small business bank account. Getting people going correctly from day one is what these apps have to do, and these companies have to do. Don't let people start a QuickBooks business without a business bank account. It's just better for everybody. It's better for them. It's better for the accountants and bookkeepers. Make them create a small business account for free; a checking account for free. It's just kind of that same thing. Don't just help people file their taxes, if they haven't labeled their alcohol correctly, and they haven't even gotten their license set up correctly. Blake Oliver: [00:39:46] David, we've got five minutes left. I wanna make sure we get to at least one of these voicemails.  David Leary: [00:39:51] Okay.  Blake Oliver: [00:39:51] This is app-news-related. We'll end with this, and we'll get to the next one next time. This is from Jackson Wilcox. Jackson Wilcox: [00:40:00] Hey, Blake and David, this is Jackson Wilcox. I'm a financial advisor in Franklin, Tennessee, but I used to be a tax accountant, and I still hold my CPA license. I found your guys' podcast recently. I've been really enjoying it. I feel so caught up on the tech and what's happening that I feel like I could almost go out and start my own consulting business.  [00:40:18] I just wanted to comment on something you guys shared in the last podcast about Noko Tools. I don't know if you've ever talked about it, but there's one out there called Knowtion, and it's really taking the world by storm. I recently used it for a problem that my team was having. We were just really surprised with how easy it was to get everyone an account, and everyone on the same page, and having the document update simultaneously on a desktop platform, an Android app, and an Apple app. It's pretty cool. I think they're pretty large, but I do think they are privately held. Just wanted to throw that out there. Thanks so much. Appreciate what you guys do. Blake Oliver: [00:40:57] David, have you ever used Knowtion?  David Leary: [00:40:59] Melio just adopted it. I will be using Knowtion this week for the first time, so I can report back out on that. Blake Oliver: [00:41:05] That's awesome. I tried to get my last firm to use Knowtion for our CaaS practice as a way to create an internal wiki. I could not, unfortunately, do that. It's part of one of the reasons I'm no longer in public accounting was my frustration with that. The way I would describe it is like a Google doc on steroids. It's a bunch of documents that are collaborative, where everyone can edit, but you can also hook in Zapier type of activities. There's automation; there's different types of data. It's all these sheets tied together, so you can create ... If you ever used an internal intranet, think of that, but it's much easier for everyone to collaborate and update, and it's not a static thing.  David Leary: [00:41:46] It's a consolidation of tools, it looks like Knowtion is. it has a little bit of a Trello killer; it's attacking that. It's attacking the typical media wiki. You just have a wiki ... In a way, it's what's ... What was that Microsoft thing that Microsoft constantly pushed for years, and everybody hated it? Blake Oliver: [00:42:10] Not OneNote.  David Leary: [00:42:10] No, not OneNote. They had ... Anybody who used, you had to host it yourself-  Blake Oliver: [00:42:16] SharePoint?  David Leary: [00:42:17] SharePoint. It's like everything that, on paper, SharePoint should have been, but it just never worked; it looks like Knowtion is. There's other products like this. I even think the 37Signals, the Basecamp guys, have something  along the lines of this. It's very interesting. Going back to no-code, remember last week, we talked about Airtable's big raise?  Blake Oliver: [00:42:36]  Yes.  David Leary: [00:42:36]  And we talked about, oh, yeah, there's a rumor Google is gonna have something to launch, too. Well, they launched a new product called Tables, which is very similar. No code. It's like, you're right, a spreadsheet on steroids. A lot of accountants like to- a lot of people use spreadsheets like a database, but they don't connect very well to each other. They do on a formula level, but not in that more of a database conceptual level. I think over the next year, I predict that accountants and bookkeepers are gonna start loving Airtable; this product from Google. Microsoft has a product. There's a lot of these that are out there, these- they're just super-super-powerful spreadsheets.  Blake Oliver: [00:43:12] Comparing Airtable and Knowtion, they're basically solving similar problems but they're approaching it from different lenses. Knowtion goes through the lens of the document. Think of you start with a Word document, and you go from there to extend its functionality; whereas something er table starts with Excel and goes from there from that spreadsheet. Main view but you can dig down into fields and then you have a document, and with Knowtion, you can dig down from a document into a sheet.  [00:43:39] It'll be interesting to see where they end up meeting in the middle and what wins. I like the idea of starting with the document, just from a visual presentation standpoint. I can really organize my thoughts like it's a notebook I think, for a lot of us, that's why OneNote is so powerful because you think of it like a notebook, and it's something familiar to us, and we can all understand that concept. Spreadsheets work really well for some people, too. anyway, David if people wanna touch base with you online, in the meantime, between episodes, where is the best place for them to do that? David Leary: [00:44:10] Easiest way is on Twitter. I'm @DavidLeary; also, on LinkedIn, @DavidLeary. And Blake, don't forget, on October 20, we are going to be joining the Accounting and Finance Show Virtual Conference. It's October 20–21. We'll have a link in the show notes to register, but we are going to be doing a keynote on October 20, and we'd love for all of you to join us. Blake Oliver: [00:44:29] A live episode, so you can type at us as we speak. That should be really cool. Maybe we'll do some polls, too. You can catch me on Twitter. I'm @BlakeTOliver. If you connect with me on LinkedIn, just let me know you're not a bot. David, until next time, don't let those Zoom calls get you down.  David Leary: [00:44:45] Bye, everybody.  Blake Oliver: [00:44:46]  Bye.____________________   ClassifiedsStill sending spreadsheets of unclassified expenses to clients? With ClientHub, automate this process and get client answers instantly. ClientHub is a client-communication platform that helps you consolidate client communication, securely share files, and instantly get answers, and much, much more. Get started today with a free trial at ClientHub.app and enter promo code "CAP25" for 25 percent off your first three months. ClientHub - frictionless client communication.____________________ Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? 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Sponsors OnPay - https://cloudaccountingpodcast.promo/onpay ClockShark: https://cloudaccountingpodcast.promo/clockshark A2X: https://cloudaccountingpodcast.promo/a2x Show Notes 03:40 – TikTok Bid Highlights Oracle’s Public Embrace of Trump– New York Times  08:41 – The Oracle of National ID Cards – Wired 09:15 – Mnuchin Mum On Oracle, TikTok Deal  – PYMNTS.com  13:07 – Senate, Supreme Court opt out of Trump payroll tax deferral– Accounting Today  14:15 – House Republicans push to reopen Paycheck Protection Program amid coronavirus relief gridlock 15:53 – Yelp data shows 60% of business closures due to the coronavirus pandemic are now permanent – CNBC 17:20 – This tweak to the PPP could save small businesses $7 billion 18:55 – America’s Offices Sit Half-Empty Six Months Into the Covid-19 Pandemic – Wall Street Journal        US Offices Only At 50 Pct Capacity In August – PYMNTS.com 20:31 – Survey Says: Fintech On The Rise During COVID – Crunchbase 21:44 – CCH Axcess e-filing goes down on tax deadline – Accounting Today         E-filing problems plague some Sept. 15 tax returns – Journal of Accountancy 24:56 – Penalty relief may be available to those who miss Sept. 15 deadline due to COVID-19 – Accounting Today  26:05 – IRS set to begin rolling out new case management system – Accounting Today   29:45 – Square launches payroll feature that could boost its banking business through the Cash App –CNBC 35:12 – Square Sees Hike In Cashless Transactions – PYMNTS.com 36:10 – What’s new in QuickBooks Online: September 2020 – QuickBooks 40:44 – QuickBooks Desktop 2021 updates respond to new COVID realities – Accounting Today  43:00 – Xero revamps Early U.S. plans, debuts ‘Xero on Air’– Accounting Today  44:10 – A refreshed Xero plan to support small businesses during COVID-19 – Xero Blog    50:14 – TD Rolls Out Online Accounting In Bid For Small Biz Accounts – PYMNTS.com 52:53 – Chime is now worth $14.5 billion, surging past Robinhood as the most valuable U.S. consumer fintech –– CNBC   54:47 – Klarna Valued At $10.65B After $650M Fundraise – PYMNTS.com  56:03 – Wolters Kluwer Acquires XCM – CPA Practice Advisor    57:30 – KKR to sell Epicor Software in $4.7 billion deal, 4 years after buying the company – MarketWatch 57:58 – Acumatica update focuses on COVID-19 challenges– Accounting Today  59:02 – Cloud Startup Airtable Raises $185 Million At $2.5 Billion Valuation And Launches API For Outside Coders – Forbes   1:01:02 – Bookkeeper360 Launches App That Integrates with Xero to Provide Real-Time Business Insights –Yahoo! Finance   1:02:32 – Saasable - Recurring Revenue Simplified – Intuit QuickBooks Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Join us at the Accounting and Finance Show: https://cloudacctpod.link/AccountingShowUSANeed Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsClientHub: https://clienthub.app Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  TranscriptMany times, when choosing a payroll service, you have to choose between a new startup with a great app or an established company whose tech may feel behind the times. With OnPay, you get the best of both worlds – a great app from an established company that's been providing payroll services for over 30 years in all 50 states. Stay tuned to hear more from our sponsor, OnPay, later in the episode.____________________  David Leary: [00:00:25] It's great that this is a feature, but at the same time, in the world of cloud, it's dumb or maddening. They have a new troubleshooting hub to help you address common problems and errors such as installation, file, network, and password issues. Blake Oliver: [00:00:39] Oh, man. David Leary: [00:00:40] Three of those are because you're not in the cloud – installation, file, and network. Why ... They're building a tool to encourage people to have headaches. Blake Oliver: [00:00:50] You just gave me memories of the times when I was on a desktop and I had file corruption issues and I lost a day of work or more and ... Oh, God. I wouldn't ever go back to that by choice.____________________This episode of The Cloud Accounting Podcast is sponsored by ClockShark. Back in October of 2013, I became ClockShark's first Twitter follower. Today, ClockShark has grown into a highly rated and very-much-loved time-tracking app that is now used by over 5,000 small businesses globally. With features like crew tracking, scheduling, overtime notifications, routes, geofencing locations, job costing, budgeting, and reporting, ClockShark has built a robust mobile time-tracking app to handle the unique challenges that face your mobile workforce clients.   Their technology has been helpful as their clients work through the COVID-19 pandemic. Your clients will need accurate records of their expenses, and losses, and technology like ClockShark helps. With ClockShark, your clients can keep accurate records, like paid time off, and other important data to provide the necessary proof for CARES, and FFCRA Acts' benefits. This lets them get straight back to work without too much disruption after the pandemic has passed. ClockShark's standard plan is just $6 a month per employee. Head over to cloudaccountingpodcast.promo/clockshark. ____________________This episode of The Cloud Accounting Podcast is sponsored by A2X. Blake and I have talked to plenty about the massive shift to online shopping during the time of COVID-19. This means that e-commerce sellers are dealing with massive amounts of transactions that need to appear in the general ledger correctly so that you can easily reconcile these transactions with a bank statement. A2X will give your Shopify and Amazon clients confidence in their financials because A2X was created with a focus on the importance of the reconciliation process. A2X posts tidy summaries of sales, returns, and fees from Shopify and Amazon directly into QuickBooks, or Xero that will exactly match the deposits that appear in your bank account. A2X has won the support of Amazon, Intuit, and has hundreds of five-star reviews by accountants and bookkeepers in both the QuickBooks and Xero app stores. Cloud Accounting Podcast listener and expert, Scott Sharp said that A2X is the gold standard in e-commerce accounting. To learn more about using A2X and get 20% off your subscription by using code "CAP20," head over to cloudaccountingpodcast.promo/a2x.____________________Blake Oliver: [00:03:22] Welcome to The Cloud Accounting Podcast, I'm Blake Oliver. David Leary: [00:03:24] I'm David Leary. Blake, this morning, I was thinking, "Oh, what's a small kick-off thing I can mention personally or something exciting that happened this week in my life?" I've nothing. Nothing. Blake Oliver: [00:03:35] We're stuck at home here pretty much; it's same old, same old, but the news is quite varied this week. I think we have to talk about the strangest story of 2020. 2020 has been a crazy year, but the fact that TikTok, Oracle, and Donald Trump are in an entire news narrative that has spanned weeks and possibly months- David Leary: [00:04:00] And Mnuchin. Blake Oliver: [00:04:01] Along with China and Mnuchin. I don't know if it could get any stranger, other than the fact that there might be life on Venus. It's Saturday and I think tomorrow, TikTok is gonna be taken off of the app stores in the United States because Donald Trump has banned TikTok for security reasons, as we discussed. Oracle has proposed a- well, originally, it was gonna be an acquisition, but now it's more like a strategic partnership. We can talk about that later, it's very strange. The fact that Oracle and TikTok might be teaming up ... Oracle, the enterprise software ERP developer, the owner of NetSuite? I just never thought- although I follow accountants on TikTok like Lorilyn Wilson, I never thought that Oracle, an enterprise software, and accounting software would end up- I never thought we would actually be talking about TikTok. David Leary: [00:04:53] I'd fully agree. When Treasury Secretary Steven Mnuchin's going on CNBC to discuss this, it still blows my mind, like, "The head of the IRS is talking about this," we're gonna have to. It looks like Oracle is getting a sweetheart deal here. They're gonna host the data, and this is being spun up. This is gonna create TikTok Global. It's a U.S. company; it's gonna add 20,000 new jobs. Blake Oliver: [00:05:15] Well, that's what they're saying, but this still has to be approved by the Justice Department or it's the Treasury that has to approve this, I think. The deal is strange. Originally, it was gonna be an acquisition and Microsoft was trying to get TikTok. David Leary: [00:05:32] Walmart. Blake Oliver: [00:05:32] Walmart. Now, it's like an Oracle partnership where, like you said, they're going to host the data, but ByteDance, the parent of TikTok, in China, will continue to be TikTok's majority shareholder. That might be a deal breaker for the Trump administration, which is why it's getting banned at this point. I'm not even sure how that would work because ... Oracle is hosting the data in the U.S., and that might do more to secure United States data, but if ByteDance still controls the code, how does Oracle, then, know that user data isn't being siphoned off for malicious purposes by the Chinese communist government? Just because you host data in the United States doesn't mean that it's secure. Maybe the administration doesn't really understand this, or maybe Oracle's trying to pull a fast one on this. I don't know what's going on here, but- David Leary: [00:06:25] Because like with most apps you use, they're sending 40 pieces of data out to other apps and other internet services that they partnered with or they're connected to an ad service they're using or whatever it might be. It's just not the app the data has on you, it's all the other apps that have access to your behaviors when you're using that app. Blake Oliver: [00:06:44] It's where the data is being siphoned off to, like you said. If you don't control the code; if you're unable to see where all this data is flowing through the code, then ... Anyway, maybe Oracle can basically provide that assurance. We'll see. Interesting fact about all of this – it has really put Oracle in the spotlight in a way that I'm not sure it wants to be. I'm not sure people realize this, but Larry Ellison, the founder and chairman of Oracle, he is a Trump supporter, which is unusual in Silicon Valley and in the tech world. Oracle has been a prominent ally of the president and the administration. Larry Ellison hosted a fundraiser for Donald Trump's reelection this year. He has spoken to President Trump about the possible use of hydroxy- let me see if I can get this right, hydroxychloroquine to treat COVID-19. David Leary: [00:07:35] This episode's gonna get banned; we're never gonna be able ... They're gonna kick us off of every platform. You're talking about stuff that gets you banned. We're not gonna be able to publish this on Facebook.  Blake Oliver: [00:07:43] Our Facebook ads constantly get taken down because we talk about this kind of stuff. Yeah, apparently the president specifically requested the FDA use an Oracle database for a study of hydroxychloroquine. That's the study that never happened because we found out that the drug is not actually a net benefit. This is so strange because it's one of those things where it's almost like the president's on a phone call with Larry Ellison, and Oracle is in his mind. Then, the TikTok thing is happening and he just connects those two. Then all of a sudden, those two are now connected in the national narrative. David Leary: [00:08:17] I think, like I said weeks ago, Ellison, and Oracle, he's been on- ever since 9/11, he's been on a kick for the government to build the database of every American and everybody get a special ID card that Oracle runs the database. He's been on this anti-privacy of Americans kick for a long time. He's like, "People should not have privacy." He's not a good dude. Blake Oliver: [00:08:39] Well, I don't know about that. David Leary: [00:08:41] I put the link in our episode, a few episodes ago. Blake Oliver: [00:08:45] Well, okay, but just because you wanna create a national ID doesn't mean that you are anti-freedom or anything like that. There's a lot of reasons why you might not wanna have that, but-  David Leary: [00:08:55] I'll tell you the opposite of that – I have no problem saying Larry Ellison is anti-freedom and anti-privacy. What's weird about this whole TikTok thing and with the IRS is you know how everybody talks about the algorithm. TikTok has this amazing algorithm that services the right videos to people on their first use and knows what to do. They're actually asking for Mnuchin to comment about it, and he refused to talk about it. It's just very, very interesting and he goes on to say, and I'll quote him. "I would just say, we will need to make sure that the code is secure, Americans' data is secure, and phones are secure," Mnuchin said. "We'll be looking to have discussions with Oracle over the next few days with our technical teams." Mind you, this is the person who runs the IRS computer systems that are how old now? 35? 36? Blake Oliver: [00:09:41] They date back to the Kennedy administration. They're now finally modernizing it; we can talk about that later. That's one of my app updates, or one of my IRS updates.  David Leary: [00:09:53] The algorithm's complete bullshit anyways, I think [crosstalk]  Have you signed up and ever used it, TikTok? Blake Oliver: [00:09:59] Yeah. Here's how I understand it very, very broadly. You know how we talked about Facebook's algorithm and how it prioritizes engagement?  David Leary: [00:10:08] Yeah. Blake Oliver: [00:10:08] And that can have a negative impact because really controversial stuff gets high engagement and that gets surfaced into your feed, so it creates this cycle of everybody starting to hate each other and becoming polarized. TikTok is different in that what it does is, when somebody creates a video, it packages up all the recent videos into a small set of videos. Then it sends all those videos out to a sample size of the population that's using TikTok. Then, depending on which ones that you watch all the way through and like, and which ones that you skip through, it ranks the videos, and then sends the best performing videos out to a broader group, and then does it again, and again and again. So, it's like focus-group-testing the videos, instantly, so that-  David Leary: [00:10:50] Except for, the results are this. You're making this sound very technical and highly amazing, and the results are this. If you're a dude, and you sign up to TikTok, you instantly get girls in bathing suits dancing, and if you're a female and you sign up for TikTok, you get guys with their six packs showing- Blake Oliver: [00:11:06] Well, that's 'cause that's what people watch. David Leary: [00:11:08] That's the algorithm, that's the whole algorithm. They can play it up to be some proprietary, amazing system but that's the results of it; that's the algorithm. Blake Oliver: [00:11:17] It's actually a very simple algorithm, but yes, it has a negative impact, which is that what do people watch? They watch hot people. That's what you get; you get a lot of hot people doing stupid shit on TikTok. David Leary: [00:11:28] And people with really nice kitchens [crosstalk] amazing kitchens people have in these videos. Blake Oliver: [00:11:35] Yeah, well, that's 'cause that's what people wanna watch.  David Leary: [00:11:35] We've talked about this for too much. It just seems like of all the stuff the IRS needs to be worrying about and Mnuchin should be worrying about, he's involved in this silliness.  Blake Oliver: [00:11:45] It's very strange. It's the strangest thing of 2020, if you ask me. Let's move on. We have lots and lots of app news this week. Many, many updates from Xero and QuickBooks, and Square, and TD, the bank. We've got Chime, Wolters Kluwer. Oh, and we cannot forget the CCH outage on September 15. David Leary: [00:12:11] Which felt like a redo of May of 2019.  Blake Oliver: [00:12:11] Yeah. Then we've got some updates on PPP, on the payroll tax deferral, and if we can get to it, I've got some updates on the Wirecard, and EY, and whatnot. Perhaps, we start with a little bit of PPP news and payroll tax deferral news? David Leary: [00:12:32] Yes, we can talk tax deferral, just an update on that. I know last week we talked a little bit about, "Oh, well, technically, if Trump loses the election, he won't have to pay it back." Now, we were technically wrong because he makes more than the wage limit on this, but it's the spirit of the thing, like his staffers, possibly. Blake Oliver: [00:12:46] The small details, right? This is why I'm not in tax. You have to make about $104,000 a year; you have to make under about $104,000 a year, 'cause it's $4,000 every two weeks. And so, yes, the president and most of our elected officials make more than that with their official salaries. David Leary: [00:13:07] There's an article in Accounting Today; the U.S. Senate, the Supreme Court, and the House are not gonna implement this order. Blake Oliver: [00:13:14] It's funny. You would expect the House, of course, to not do it because they're the opposition party, but you would expect the Senate to do it. Missouri Senator Roy Blunt, said that, apparently, a contributing factor was technical issues with the Senate's payroll processing systems. I guess they couldn't change the systems, or they weren't willing to make the effort to change the systems to do this deferral. David Leary: [00:13:36] Well, they should use Oracle, and Oracle could focus on building a newer payroll system for them instead of buying TikTok. Blake Oliver: [00:13:44] That's interesting. So, yes, nobody's doing the payroll tax deferral except the executive branch of the federal government. We actually had a listener send us his pay stub showing that the 6.2% Social Security had been not taken out that pay period and was annoyed at it. We have a sample size of one saying that they don't like it. 100% of Cloud Accounting Podcast listeners that we know are participating in this are unhappy.  [00:14:15] We also have the PPP; PPP has stopped, but there's still lots of money left. There's $138 billion remaining in the Paycheck Protection Program. I spotted two bills that have been introduced into the House to make these funds available. There's a Republican effort to expand the program or to reopen the program so that small businesses can get a second PPP loan if they have fewer than 300 workers and have seen their gross revenue plummet by at least 25% as a result of the virus-induced crisis. The bill would also set aside $25 billion for small businesses with fewer than 10 workers.  [00:14:54] That is being sponsored by Steve Chabot, of Ohio, and Jaime Herrera Beutler of Washington. That was introduced on Wednesday of this week. Interestingly, they're trying to force this bill, this targeted bill, to a floor vote because the leadership, Nancy Pelosi, has said, "We're not gonna do any piecemeal stimulus. We're only gonna do a big stimulus bill." They're using a seldom-used method called a discharge petition, where they can force a floor vote on the legislation by gathering a simple majority of signatures. They need 218 signatures to move to a vote, and Republicans control 198 seats in the House, so they only have to get 20 Democrats to sign this petition. I would be interested to see if they accomplish that.  David Leary: [00:15:36] My understanding is, this is the only part of the stimulus that almost both sides of the aisle are in agreement on. I could see this easily getting signed and pushed through as a whole separate thing because the money is already available; the decision's made, but I wonder if anybody is actually gonna take advantage of it. Did you see Yelp had some survey results, or state-of-economy-type results, and right now, they're looking at 60% of businesses that had closed, they're now permanent. They just haven't reopened. Blake Oliver: [00:16:05] Of the businesses that closed as a result of the pandemic, 60% of those are permanent closures. David Leary: [00:16:11] Yeah. I feel like even, anecdotally, as I drive around Tucson, I'm starting to really notice, I'm like, "Oh, yeah, they didn't make it. Oh, they didn't make it." I'm starting to see it more and more. What's interesting, this is like proof PPP worked and didn't work. They've seen a 23% increase since mid-July. When did PPP run out? If you got your loan, you're probably looking at somewhere between mid-June to mid-July, when you ran out the money, if you got the loan in the first tranche.  Blake Oliver: [00:16:38] Probably, yeah, because you were spending it thinking of an eight-week period. It was two months, essentially. David Leary: [00:16:43] People that got those loans, it delayed them closing, but it didn't save them. These businesses still closed. Now, without having new funding that's available differently, these people aren't gonna reopen. This is game over already, so who's actually gonna take out these additional loans? Because if you haven't taken the loan yet, is it because you think you're gonna close? It just doesn't ... There's $130 billion just sitting there still, right? Blake Oliver: [00:17:12] $138 billion, yeah. The bill sponsored by House Republicans, would allow those who have already taken a loan to take a second one. There's also a bill sponsored by a Democrat, Chrissy Houlahan, and I believe it has bipartisan support. It would streamline the forgiveness process. That might encourage more people to take out loans if they knew that they didn't have to do complicated paperwork. The proposal is that loans of less than $150,000 could have their debt forgiven with a one-page form and simply saying that the funds were used in accordance with PPP guidelines, without having to provide a detailed accounting of how the money was spent. I think a lot of small businesses are not taking the money because they're afraid of having to do that themselves and they don't have an accountant who's gonna do that for them. David Leary: [00:18:01] I also think it's ... Remember how when the housing crisis happened before, people were ... Their interest rates and their loans- because everybody had those balloon mortgages. Right? Blake Oliver: [00:18:09] Yeah, yeah. David Leary: [00:18:09] When that became due, their house wasn't worth anything and they just walked away from the loan. They just lived in the house until they finally took the keys away and stopped paying their mortgage. I wonder if this that same thing, people are just gonna be like, "Screw it. I'll just shut down the business. I'm not paying my PPP loan back." Then, you just start a new company; you just start a new entity, and never pay the loan back. In a way, everybody's gonna get forgiveness.  Blake Oliver: [00:18:34] One way or another.  David Leary: [00:18:35] One way or another, it's gonna happen because if you're struggling to keep your doors open and there's a pretty good chance you're not gonna be open three months from now, why would you fill out forgiveness paperwork and start paying back a loan or ask for forgiveness? Just screw it. That mindset, or that attitude could take place easily. There's just a little bit more economic news out there. Six months in, now, most office buildings are still dark. People are not going back. Blake Oliver: [00:19:01] It's over half, right? David Leary: [00:19:03] Yeah. There's a lot of data on this. So, there's a company called Brivo, I guess; you have those door badges where you buzz in and buzz out of a door to unlock it type of a thing. Then, a lot of workplaces have that, and that unlocks the doors at offices, and they track when people go in and go out of businesses. Traffic is down 51% in August versus February; so basically, half of everybody are not going back to the office- Blake Oliver: [00:19:27] That means nobody is in that office; it's completely dark. David Leary: [00:19:31] Yeah. You either probably have some offices where maybe they're at half capacity, but there's probably a lot more offices that are below that, if not not being used at all. It all ties back to this PPP and stimulus and all that, and now they're saying there's not gonna be stimulus until after the election. It's starting to get tough, which doesn't reconcile with the whole ... We'll get into this, I guess, with app news because we'll probably talk about these raises in the evaluations of these companies in the stock market; these companies going public. The realities of the economy are not reconciling with the market, but I get the market because you can't get any interest rate if you have cash. You've gotta invest in the market. Blake Oliver: [00:20:09] It's fascinating what is happening. The explosion of e-commerce, of digital banking, of these challenger banks. They've just taken off. Anything that allows you to continue to do your work remotely, or to pay people remotely. As you were talking about, you guys are doing fantastic over at Melio because people don't wanna use paper checks anymore, because they don't wanna go into that office just to print paper checks. As we discussed previously, that is one of the only reasons that finance professionals are going to the office; it was specifically called out in a survey of finance teams. David Leary: [00:20:42] I just talked to a friend in New York City. He's an internal controller at a company, and he drives all ... He has to commute over to New Jersey one day a week to cut 50 checks because they have no other way to do it. Blake Oliver: [00:20:54] Amazing. This is gonna be the thing that finally kills paper checks. David, I listened to you on the Cloud Stories podcast with Heather Smith. You had a great interview with her. David Leary: [00:21:04] Oh, thanks. She's awesome. It's all her; she is a great interviewer. Blake Oliver: [00:21:10] You were a great interviewee, and you said that. You said this pandemic, the silver lining of it is we could finally, in the United States, eliminate paper checks and move to digital payments. That will change the lives of finance pros and controllers who go to the office only for that purpose. David Leary: [00:21:26] Half of those people that are clocking in and out of the office are the controllers going into print checks? Blake Oliver: [00:21:32] That's right.  David Leary: [00:21:33] Those are the only ones going into the office right now. Blake Oliver: [00:21:34] Exactly. App news — the big story this week is CCH. CCH is in the news because on September 15, which is the deadline for 1120-S S-Corp, and 1065 partnership returns, they went down. Their e-filing system was not working, and so this impacted a lot of large accounting firms all over the nation. I think this is the filing system that is used for CCH Axcess, and there's one other of their systems that was impacted by this. A lot of large firms use CCH. I was chatting with a colleague of mine, a former colleague, who works at a very large accounting firm. She said that in her office they had 200 of these S Corp or partnership returns that could not be filed on time and were technically late as a result of CCH.  [00:22:37] There's some good news, which is that the penalty, if there is one, will not be humongous because these entities generally do not have taxable income as they're pass-through entities, but there is a late filing penalty, which could be $200 or something. If you think 200 returns times $200, that could be a $40,000 penalty for a single office; and multiply that by all the different offices, all around the country, of this kind of size. So, it's a lot. The good news is that CCH is working with the IRS and has pledged on its support website to work with its customers to address potential impact from the fees or penalties.  [00:23:17] The AICPA has contacted the IRS to discuss penalty relief. Given how generous the IRS is being now with penalty relief, so it sounds, hopefully this will not cause a giant headache for all of these tax practitioners. It's not just the fine, itself, and getting that waived, it's all the paperwork that could result, and having to deal with all these penalty notices, and the clients calling, and then trying to get them waived, and all that. That could be a huge waste of time, right? David Leary: [00:23:47] Yeah, it's just a headache. Have they announced why it was down? Because I think last May of 2019, they had an outage, and I think that was ransomware, correct-  Blake Oliver: [00:23:57] Yeah.  David Leary: [00:23:57] - was their hosting situation? That's funny because the article that I'm looking at here in the Accounting Today says that some people received a message that said it was down for scheduled maintenance, like they pre-planned to pull it down on the tax deadline day. Blake Oliver: [00:24:11] No, it was not a hack. There's no indication that it was a hack; it was a technical glitch. They had it up and running early morning on September 16. No indication right now what it was. I know you hate the word glitch, David, but I think that's  ...  David Leary: [00:24:27] Glitch is a lame excuse of, "We don't wanna tell you what really happened and you're dumb, so just trust us. It was a glitch." Blake Oliver: [00:24:35] Well, it was probably something technical, right? [crosstalk]  David Leary: [00:24:36] Well, then tell us what it was. Did a switch go bad? Tell us. What happened? A hard drive crashed? What happened? Blake Oliver: [00:24:43] Speaking of penalty abatement, there is penalty relief available to those who missed the September 15th deadline, not specifically yet because of CCH, but because of COVID-19. Apparently, according to an article in Accounting Today, the AICPA has been having conversations with IRS officials about penalty relief and have been told informally that practitioners who have made a good faith effort to meet the filing deadlines on behalf of their clients but are unable to do so because of the coronavirus pandemic, can write, "COVID-19 at the top of the tax return to indicate the need for penalty relief." David Leary: [00:25:19] You mean just scribbled across the top?  Blake Oliver: [00:25:21] I guess. Just write a big COVID-19 at the top of the tax return, and then that's your get-out-of-jail-free card. I just think that's really funny. David Leary: [00:25:30] Well, I think it's something you would just try. I'm just gonna write this on the top and see what happens. Now, they've made it an official procedure. Blake Oliver: [00:25:35] I think I'm just gonna start doing that for everything that I do; if I'm late with anything, I'm just gonna write COVID-19. If I send a birthday card to somebody late, I'm just gonna write COVID-19 at the top of the card and then they'll forgive me. I don't have to send in ... David Leary: [00:25:50] It's like when you were a kid ... Little Johnny- his homework, and he didn't get it done properly, or he didn't finish it. The mom writes across the top, "He had a fever last night," across the top of the homework when he turns it in the next day. It's the same thing. Blake Oliver: [00:26:03] Well, we're on the IRS, so let's continue with this. The IRS is rolling out a new case management system. Do you remember talking about the Taxpayer First Act last year, David, and the IRS's ancient systems? David Leary: [00:26:14] I think so, yes.  Blake Oliver: [00:26:14] They have systems at the IRS that date back to the Kennedy administration, the oldest systems in use in the federal government, other than the ones that launch our nuclear missiles. Not so great for the IRS, which has been struggling during COVID-19 because everything is super-paper-based. That's because they have these ancient systems that aren't connected to the internet and all this stuff. As part of this Taxpayer First Act, we're seeing the fruits of that, a system developed by a Cambridge, Massachusetts-based technology company called Pegasystems is going to be implemented at the Tax Exempt and Government Entities Division.  [00:26:51] The customer support part of that division is going to start using this new software, which I didn't see a name for it, but they're calling it their case management system. The initial release of this will enable this customer support division to scan and copy documents, research case records, send requests for publicly available documents, such as applications for tax exempt status and exemption letters, and resolve problems, including determination requests for tax exempt status.  Now, what does this mean for the customers of the IRS – the tax pros who are contacting the IRS? Well, taxpayers are going to have a digital option to send their requests for copies of determination letters and applications online, finally. You're not gonna have to fax or mail that to this division to get that information. If this goes well, they're going to roll out similar solutions across the IRS. The difference is, now, you're going to be able to have correspondence with the IRS not using fax or mail. You will actually be able to digitally make these requests; and they will be able to digitally respond to them. The silence is deafening. David Leary: [00:27:57] I was trying to decide if I should say wow or- I was trying to gauge my amazement level, and I just couldn't find it. I couldn't find it to pull it out. Blake Oliver: [00:28:07] Well, we're eliminating paper checks. Maybe next, coronavirus is going to finally get us to eliminate paper correspondence with our tax authority. David Leary: [00:28:17] I did call the IRS this week.  Blake Oliver: [00:28:20] About what?  David Leary: [00:28:21] I wanted to find out where my stimulus payment was.  Blake Oliver: [00:28:21] Did you find out anything? David Leary: [00:28:25] Well, first, they route you to a bunch of people that, basically, just tell you, "Don't give me your Social Security number, don't do this. Go to the website." The first person hung up on me, so I called back, and I get a second person that did that. So, I escalated up the ladder. I finally talked to a real IRS person. I did not know this ... With all the communication about this stuff that's been happening, I always thought this was just like- remember the olden days after 9/11, when George Bush just sent everybody checks? You Just got them? Blake Oliver: [00:28:52] Yeah.  David Leary: [00:28:52] This is really more like earned income tax credit. Essentially, they sent people checks, but it's like an advance that's gonna- you'll have to reconcile through on your tax return. In my case, because I didn't qualify my 2018 income, but I did for my 2019 income, when I do my 2020 taxes, I will be able to calculate the difference for my stimulus payment that I did not receive in this year's taxes.  Blake Oliver: [00:29:17] And take a credit?  David Leary: [00:29:18] And take a credit. These checks they've been mailing, they're like an advance on a credit for your taxes. They are not just like, "Here's checks." Which I did not know. In all the communications about this that we've seen over the last six months, I had no idea [crosstalk] completely did not understand that. Blake Oliver: [00:29:34] If you're not a tax person, would the general public understand this? Probably not. Well, what should we move on to next? We've got Square. How about Square? Square, they have done really, really well during the pandemic, and I did not expect them to do well. I actually expected Square to have massive problems because so much of their business is point-of-sale terminals in small businesses. [crosstalk]. David Leary: [00:29:58] -they did, within the first three weeks ... It was insane how everything dropped. They were able to recover because of- Blake Oliver: [00:30:08] Their Cash app. The Square Cash app, which is that app on your phone that lets you send money to people and receive it from people without exchanging physical cash or checks, has seen incredible growth, and has saved them. It was the star of their last quarter, gross profit for the app rose 167%, year over year, to $281 million. Square is doubling down on this Cash app, and they have released a payroll feature that integrates Square Payroll with the Cash app.  [00:30:40] Employees now can request $200 of a paycheck in advance of their normal biweekly schedule. If you're running Square Payroll, employees can now request that money in advance and Square will handle all of it, the employer's not at risk. The funds are funneled directly into the Cash app. By doing this, Square is going to increase usage and adoption of the Cash app because they have linked payroll advances to the Cash app.  [00:31:05] Now, on the business side, they're going to let businesses fund payroll immediately, using the money in their Square balance instead of waiting to pay through their external bank accounts. The money is going to stay in that Square ecosystem and it's going to improve cash flow because now businesses don't have to interact with their bank in order to run payroll. They just use the money that they've received from their customers that's in their Square balance from the credit card payments. This is genius. David Leary: [00:31:31] I have a prediction that this goes one step further. Payroll will be free. We are in a march to see Payroll be free. I'm going back, my career, 10, 11, 12 years ago, and I tried to talk to the people on the Payroll team about this, like, "There's a way to do this." You think about a high school kid. They get their paycheck, old school paycheck. They take it to the bank, they cash it. What are they doing? They're taking that, they're putting some of it to their Xbox Live account, some of it in their Amazon account, some of it in their Apple iTunes account at the time, so you could buy music on iTunes. It's being shoved in all these companies, these cloud companies, so you can spend the money. That's where their money- nobody was getting actual cash.  [00:32:12] I always thought you could create a payroll product that would be offset, like, "Hey, Apple ..." Instead of me, like right now when I get paid, I can specify what accounts I want my direct deposit to go to – my bank accounts. I've seen some payroll services where you can actually even specify, like, "Oh, I'd like to do a donation to some charity," and you could actually have that automatically withdrawn from your paycheck, too. Now, imagine if, in the same place, you could say, "I want this much to go to my iTunes account, this much to my Amazon, this much to my Starbucks card, this much ..." I could easily see Square, if you're paying your employees to their Cash app card directly, no fee to use Square Payroll. Blake Oliver: [00:32:46] It's brilliant because then Square, when you make that payment, Square's the processor, but they are also the payer, so they can make a greater margin on those transactions [crosstalk] because they're not paying a bank interchange fee or something like that. I imagine there's some-  David Leary: [00:33:02] This is a direct attack on the banks because their argument is you don't have to go and get your account numbers and routing numbers from your employees. You just, boom, and you're done. Blake Oliver: [00:33:12] You said this last week or the week before, that every payroll processor should just automatically give every employee what is essentially a bank account. It can be through the Cash app, or it could be through a debit card, or whatever, but don't make that be an issue. Just automatically give them an account and let them transfer the money wherever they wanna take it or keep it there, which a lot of people will do.  David Leary: [00:33:12] Intuit should do this. Everybody who files their taxes with TurboTax, "Would you like a bank account and have your deposit go there today?" Blake Oliver: [00:33:38] Yeah.  David Leary: [00:33:39] Like, boom, they set up a bank account, they get their deposit there today. "Oh, by the way, we noticed you have a bank with Intuit, your employer pays you with QuickBooks Payroll ..." Boom, instant pay with ... Intuit could build this system very easily. Anybody who has both sides of the equation, businesses, and the consumers, that's the situation they're in. Square also had- I don't know if you wanna talk more about Square Cash, but Square had some news come out about their actual retailers, as well. [00:34:03] Let's hear that. I'm done with the app update.____________________This of episode of The Cloud Accounting Podcast is sponsored by OnPay. OnPay is an easy-to-use, full-service payroll, and HR software that is the right fit for all your clients, whether they have just one or 500 employees, to stay organized, save time, and get compliant. OnPay includes the best-in-class integrations to benefit providers, workers' comp plans, QuickBooks, and Xero. They also handle all the complicated stuff that other payroll providers don't, like agricultural payrolls, including Form 943, multistate payrolls, and employees with H2-A visas.  With OnPay's newly released Report Designer, you can use enterprise-level data, and over 50 data points to create multiple report views for all your clients' stakeholders, be it the C-suite, departments, or HR. Right now, Cloud Accounting Podcast listeners can get three free months of top-rated OnPay payroll, and HR service. To learn more, head over to cloudaccountingpodcast.promo/onpay. ____________________David Leary: [00:35:12] Because of COVID-19, people are starting to go cashless. For Square, in February, only 5.4% of Square sellers were cashless. By mid-April, it jumped up to 23% were cashless. Now things are trying to- now that physical locations are starting to open up, it's falling back down, but it's now stabilized at about 13.4%. Blake Oliver: [00:35:35] Well, that's a huge increase. Remember all that legislation earlier in the year to ban cashless stores? I wonder what's gonna happen with that; that's gone away. David Leary: [00:35:43] COVID's changed everything. It's accelerating all of this stuff that wasn't accelerated before. When you see their numbers go up like this, and we'll talk about some other numbers that have gone up, it explains why the stock market, and the valuations for these companies are insane. Blake Oliver: [00:35:59] Well, you mentioned Intuit. Let's talk about QuickBooks Online and what's going on there. Then you have some updates about QuickBooks Desktop as a result of the pandemic. David Leary: [00:36:08] I have Desktop updates, yes.  Blake Oliver: [00:36:08] I'll do the Online ones. This is from the September 2020, "What's new in QuickBooks Online?" update. QuickBooks Online now connects to Amazon Business. If you're an Amazon Business customer, you have the ability to seamlessly sync expenses with QuickBooks to review or categorize transactions, and then add them to your books. This integration will bring in-line level detail, such as product descriptions, item costs, and fee breakdowns for each transaction. You can categorize each item you purchase separately and match them with bank transactions. [00:36:42] This is my favorite feature that I've seen enter QuickBooks in a super-long time. When I was doing bookkeeping for a lot of clients, my biggest pain was Amazon; because I didn't get detail on the bank statement, so I couldn't easily set up a rule. If I wanted to do good bookkeeping, I'd have to actually go get all of the emails, have my clients send me all those emails, or do it into a Hubdoc, or one of those- Receipt Bank, one of the receipt ... I tried a bunch of them. Then, we'd have to go and look at the actual Amazon receipt and code it properly, as to what it is. Is it computer equipment, is it office supplies, is it blah, blah, blah? Because a lot of businesses, they buy everything on Amazon, so you can't just categorize it to a single account; it's meaningless. This is really cool. David Leary: [00:37:29] I've used it. It's been in QuickBooks Labs for almost easily over a year. Maybe a year and a half, it's been in QuickBooks Labs. Then there's another app out there called Greenback, and they do it really, really well. That way, if half the transaction's there, they put all the line item details from your receipt. The only flaw in both of these — you don't get to specify anywhere like, "Oh, only do this for purchases on this credit card," like the business credit card. Now, you can just pick the transactions you wanna sync to QuickBooks, or match, but all of your personal transactions in Amazon are on there, unless you set up a whole different user ID and password for Amazon, and only use your business ones through there.  [00:38:08] If you're like most entrepreneurs, all you're doing is changing the payment method and what you're buying. All my normal- the other junk coming into my house are all in this feed, and that's a little annoying. It is convenient, though, when I wanna have the documentation, because, frankly, the receipt Amazon sends you doesn't have good details in it. If you send that to AutoEntry, or one of the receipt-scanning people, it doesn't come in very well. Services like this, pulling it through the API of Amazon, are definitely way better, but they're not- they need to take that next step to where they're smarter, where it just pulls in the ones on the one credit card. I don't need to see my water filter I bought for my refrigerator in my QuickBooks.  Blake Oliver: [00:38:47] Also new in QuickBooks Online Advanced is industry benchmarks in the performance center. Now you will see industry benchmarks for net profit margin and gross profit margin on those KPIs. I feel like this is of somewhat limited use, given that you don't really know what is the quality of the data? Where are they getting this information from? It is cool, though, to see the industry benchmarks come back after going away for a long time. This is one of those things that Intuit has added in, and then taken away, and added in, and taken away for years.  [00:39:18] We also have QuickBooks Payments Instant Deposit automation. This is coming soon. Instant Deposit is where you can pay a small fee, and you can have your credit card receipts deposited instantly, basically advanced to you, into your account. Now, you don't have to go and do that manually. You can specify the days of the week where you want those automatic instant deposits. You can say, "I want them on Mondays only." Maybe you only want it on the day when you're gonna run payroll or something like that. David Leary: [00:39:46] Maybe you're a restaurant or a bar, and your busier on Fridays, so you wanna instantly put in on that day only. That makes sense, because I think that, right now, even the next-day deposits, you opted in on QuickBooks, and you opted in for all of them. Even though it's made out to seem like, "Yeah, just pay 10 bucks for this one deposit," and I opted into all of them. Blake Oliver: [00:40:03] Also new, Guideline is now built into QuickBooks, so you can get a 401(K) plan for your business and you can sign up your employees. I have been a Guideline user for, I guess, a few years now. My previous company used it, and I think it's great. That's really cool because, I don't have it on hand, but I saw a stat that a really depressing number of small businesses offer retirement plans to their employees. I think a big reason is that it's just so hard to administer. That'll hopefully make more businesses do that and people will be saving for retirement. That's all the QuickBooks news I've got.  David Leary: [00:40:41] I get QuickBooks Desktop updates. Blake Oliver: [00:40:43] Oh, yeah, let's talk about Desktop. David Leary: [00:40:44] Essentially, the gist of this is they're putting changes in because all the QuickBooks Desktop users had to do what? Work from home.  Blake Oliver: [00:40:53] Hosting, go to the cloud. David Leary: [00:40:54] They're getting tons of requests, so this is a product manager at QuickBooks Desktop Enterprise, Rachna Arya. Hopefully, I'm saying her name right. She said that there's been a rise in customer requests for remote hosting solutions. Blake Oliver: [00:41:10] No surprise there. David Leary: [00:41:11] One of the things they've done is they've created- of course, this is the Intuit way, create another sales level of QuickBooks. You could buy QuickBooks Desktop Plus, and then it gives you a discount on some hosting options that are available. That's not really what was interesting to me. Reading these notes, did you know they have a Desktop mobile app? Blake Oliver: [00:41:29] I had no idea. How does that even work? David Leary: [00:41:32] There's a QuickBooks Desktop mobile app and you can actually use that now to photograph receipts and categorize expenses out in the field, which I did not know existed before. Then, they've released a bunch of tools to help you install QuickBooks – to install the Desktop products from one management tool. Then they also have a secondary tools hub, which I think is ... It's great that this is a feature, but at the same time, in the world of cloud, it's dumb or maddening. They have a new troubleshooting hub to help you address common problems and errors, such as installation, file, network, and password issues.  Blake Oliver: Oh, man!  David Leary: Three of those are because you're not on the cloud – installation, file, and network. They're building a tool to encourage people to have headaches. Blake Oliver: [00:42:19] You just gave me memories of the times when I was on Desktop and I had file corruption issues, and I lost a day of work or more. Oh, God. I wouldn't ever go back to that by choice. David Leary: [00:42:32] Then because of COVID, people need loans, so QuickBooks Capital's coming down into QuickBooks Desktop now, so they can apply for it right inside of QuickBooks Desktop. The gist of it is a lot of this is working remotely, administering this remotely, installing it remotely, and- it's just, switch to QuickBooks Online. That's what every one of those phone calls ... "How do I host my QuickBooks?" Just switch to QuickBooks Online. It would probably be the easier phone call ... So, a lot of changes for QuickBooks Desktop announced there. Blake Oliver: [00:43:00] Well, let's talk about Xero. Xero has revamped its U.S. plans. The starter plan, I believe it was called the starter plan, is now called Early. That's the one that's $9 per month. That's the list price they usually have discount- David Leary: [00:43:17] I'm just thinking out loud. Simple Start from QuickBooks is $10 a month; this is $9 a month. It's falling into that. I'm just getting going ...  Blake Oliver: [00:43:24] That's the equivalent. It's always sucked, in my opinion. I never had anyone who used it. It was really just, I think, an inbound funnel tool; a lead-gen tool for Xero on the direct side for small businesses that are just getting started. Accountants would never use it. I never had a client that could use it. David Leary: [00:43:43] It was super-limited before. You could only do one invoice a month or something. It was super-limited, right? Blake Oliver: [00:43:49] Right. Actually, I'm glad you're calling this out, because the most annoying part was that they had a limit on the number of transactions you could reconcile every month, and it was really low. It was 20 lines or something. David Leary: [00:44:01] That you could reconcile? Blake Oliver: [00:44:02] Yes. They would just sit there until the next month, and then you could reconcile 20 more. David Leary: [00:44:06] I'm sure accountants love that. Blake Oliver: [00:44:10] It was so painful. They removed the limit on bank rec. You can reconcile, I think, it sounds like an unlimited number of transactions, which is great, because now it's more equivalent to that cash version of Xero; Cashbook, I think, is what they called it, where it was 12 bucks a month; only available to accountants. I think they still have a version of that. That allowed for unlimited bank recs, but didn't have invoicing or bills, but it was good for write-up work. Actually, that's one of the things that drew me to Xero from QuickBooks originally was the fact that they had that affordable, basically, 'bookkeeping for accountants' version where I paid 12 bucks a month, and I could do all the bookkeeping, even if my clients are using some other invoicing solution. I could do my write-up-type work [crosstalk]  David Leary: [00:44:57] The write work, yeah. Blake Oliver: [00:44:10] Now, Early is more like that. No limit on bank recs and they've expanded the number of invoices you can send from five to 20, and it includes Hubdoc. This is, I think, a very appropriate and aggressive move to attack Intuit on the direct side, and honestly, on the accountant side because, for 9 bucks a month, you can do a lot. You can [inaudible] customers; you can send 20 invoices; you get the receipt processing with Hubdoc, and you get unlimited bank reconciliation. This is a good value. David Leary: [00:45:28] If you get on this and you grow, you just basically unlock the different Xero plan, and you get more features. You're not stuck, and that's the one issue I always think with Intuit- they have their Self Employed, but you're stuck. You can't migrate to a different QuickBooks product if you're on that. If you mess up and you choose that because it's five bucks a month, instead of choosing Simple Start, you're set up for a wrong path if you choose the wrong one. Yes, I get it. For Self Employed, it's really targeted at Uber drivers, true gig workers. Gig workers are never gonna turn their business from being a gig worker into a real business. There's no path for that, but I think a lot of people will opt into that because it's cheap and then they outgrow it, and then now, they have to change their data and start over. It sounds like this is gonna be- it's the same product. Blake Oliver: [00:46:15] Then just, for the folks who are not familiar with Xero's pricing, you can then move up from this $9/month one to their standard plan, which is called Growing Now that's 30 bucks a month that includes the bills. Actually, the Early one includes up to five bills; Growing is unlimited. Now you can do all your unlimited invoicing bills, et cetera. Then they have this Established plan, which I think is- there's a QuickBooks that's 70 bucks a month, and this Established plan is $60 per month, so that's the equivalent. That one adds multi-currency, expenses, and projects.  [00:46:46] Speaking of projects, Xero has released a new profitability dashboard in Xero Projects where you can see the total profit margin, all work invoiced, costs associated with the project, a highlight of outstanding invoices, as well as how the project is tracking against estimates. The idea is to make it easier to identify which projects are the most profitable and which need tweaking. That's interesting. Is there something like that on the QuickBooks side where you can do this project costing inside of QuickBooks? David Leary: [00:47:15] Yes, there is, because you can track to classes, and locations, and jobs. There is some levels of job costing, and project costing inside, but it's where it's just good enough. I think if you are a small contractor, you wanna look at an add-on app, like , you can add an app like Knowify; if you're maybe professional services, BQE Core. There's add-ons to QuickBooks that are that next level deeper. I think in a way, Xero's catching up to QuickBooks on this projects-type stuff right now. Blake Oliver: [00:47:44] Last update is their enhancement to short-term cash flow and business snapshot tools. Xero has this new short-term cash flow tool where it will forecast your bank balance for the next 30 days based on your bills and invoices in the system. That was originally made available to customers during COVID-19, and they were going to charge more for it; it was gonna be an add-on thing. They've decided to make that an ongoing feature in the platform. Now that's going to be part of the solution, just built in. They're gonna enhance it and make that an optional add-on price. David Leary: [00:48:21] That's not included in the Starter plan? Blake Oliver: [00:48:24] I actually am not clear on that, whether or not this- well, I don't think it could be because Starter limits you to five bills ... Well, I guess it could be, but you're gonna be limited in the number of bills you can enter. If you've got more than five bills, you're not gonna get a clear view of your cash flow. David Leary: [00:48:41] At this point in the game, why even have a plan that's $9 a month or $10 a month, and this is for Xero, and Intuit, especially Intuit. Intuit has all these things, these add-on services that they can sell you. You can open a bank account now with Intuit, the payroll and all these other things. Obviously, the banks are coming. The banks are adding in GL services. We've talked about it before, Square's gonna add a GL. Any day now, that'll be the biggest story of the week. They'll just open up a GL. It's going to happen, there's no doubt ... Isn't it in Xero's, and Intuit's best interest right now to offer their cheapest plan free forever? "Hey, you wanna do 20 invoices a month on Xero? It's free forever." Just get people locked into the ... Because it's hard to switch once you're on the platform. Blake Oliver: [00:49:29] Well, I think we'll eventually get there. That's probably where it's heading. At nine bucks a month, all they're doing is covering their hosting costs. That's just their cost of goods sold at that point- David Leary: [00:49:42] Think about the logic. When you're still brand new, starting, even nine bucks a month, you're like, "Oh, it's a little much," when you're just starting your business. Blake Oliver: [00:49:50] I'm thinking maybe it's just, if somebody's not willing to pay you that much, they're just gonna suck your support team's time. David Leary: [00:49:56] That's possible, too.  Blake Oliver: [00:49:57] You got to have some barrier to entry, or it's gonna cost you. Let's talk about the world outside of QuickBooks, and Xero, because there is one on the small business side. Let's talk about banks that are becoming GLs. We've been talking about GLs that are becoming banks. TD Ameritrade has rolled out online accounting, integrated with their banking, for small business clients. It's using tech developed by a Detroit-based company called Autobooks. Autobooks describes itself as an integrated accounting and receivables platform.  [00:50:31] I went to the website, and this is fascinating. They are selling to banks. They don't sell this software, or they're not trying to, anyway, sell this software to end customers, it sounds like. They are building an accounting software that is designed for banks to use for their customers, to integrate into their platform. What does Autobooks include with TD? You can send invoices electronically, accept payments digitally, automatically reconcile your statements, create financial reports, and access dashboards with real-time data and insights. David Leary: [00:51:06] I think we've talked about Autobooks a long time ago. It looks like they've pivoted to go straight to banks. That makes sense because banks are desperate to have GLs. It's a smart pivot, instead of trying to compete with Intuit, compete a different way. That ties in really well. Blake Oliver: [00:51:22] It's so fascinating. This is the big battle that is going to occur. It's already started. Banks are going to have accounting; QuickBooks and Xero are going to become banks. You even have payment processors who are becoming banks. Then, you called it David, we're gonna see Square, I think, add a GL option at some point in the next few years. David Leary: [00:51:42] Then, this shift to cloud is happening, and now cloud finance is happening. Everybody's seeing this shift, and so we're starting to see this in the data from Plaid. Remember Plaid? Plaid powers most of these apps we're using. Blake Oliver: [00:51:57] All the bank integrations, a lot of that is Plaid.  David Leary: [00:52:01] Plaid, it wasn't even a year ago. Yeah, less than a year ago, Visa bought Plaid for $5.3 billion, and I'm starting to think Visa got the deal of a lifetime because what they're seeing is, now that the pandemic is here, 59% of respondents in their survey are using apps to manage their money than they ever did pre-pandemic. There's a whole shift from physical banks and banks and paper checks. It's kind of the theme of the show this week is the shift of what's happening. Plaid's starting to see data on this that it's just- it's through the roof. Not only that, now banks are becoming more and more interested in utilizing Plaid; how do I get a mobile app? How do I offer my customers access to the bank feeds and to my data? Basically, they're seeing, across their customer base, 70% increase in usage. Blake Oliver: [00:52:50] Well, speaking of banks and digital banks, Chime, the challenger bank, an app-based bank, is now worth $14.5 billion, which puts it beyond Robinhood as the most valuable U.S. consumer fintech. Chime was founded in 2013 and in their latest fundraising round – it's a Series F; you don't get that far in the alphabet, too often – they raised $485 million, which doubles its valuation from December and makes it worth 900% more than just 18 months ago when it hit a $1.5 billion valuation. They went from being worth $1.5 Billion to $14.5 Billion in a year and a half. They are planning to be IPO-ready within the next 12 months, according to the CEO. Although they said they're not gonna lock themselves into that, they're not gonna necessarily commit to that, only if it's the right timing.  David Leary: [00:53:45] We've talked about Revolut out of Europe. Revolut has launched their whole business; Revolut bank business. Chime has not said anything about business yet. Blake Oliver: [00:53:56] It's interesting, the CEO, Chris Britt, he said, "We're more like a consumer software company than a bank." They really view themselves as consumer-centric, and I don't imagine they will be trying to target anyone else in the near term, because why would you when you see growth like that? Stick with what you're doing if it's working. He said that they're adding hundreds of thousands of accounts a month, hundreds of thousands. Although he wouldn't say just how many users they have. After this fundraising round, they now have almost $1 billion in cash in the bank. David Leary: [00:54:31] They could buy a cloud accounting app and jump right in, if they wanted to.  Blake Oliver: [00:54:36] They could. They probably could; one of these smaller ones. David Leary: [00:54:39] Do you wanna jump overseas and talk about now Europe's highest value private fintech company? Blake Oliver: [00:54:44] What is that?  David Leary: [00:54:45] We talked about them a couple of weeks ago; Klarna, K-L-A-R-N-A. They're one of the buy-now-pay-later apps, like Afterpay, we talked about these companies. Well, they took $650 billion investment. David Leary: [00:55:01] $650 million or billion?  David Leary: [00:55:03] Oh, the article says billion, but it's got to be million. Blake Oliver: [00:55:07] Is that what they're valued at or is that what they took? David Leary: [00:55:09] No, that's gonna now value them at $10.65 billion. Blake Oliver: [00:55:13] Wait, how can they take $650 billion [crosstalk]  David Leary: [00:55:15] I think there's a typo in the article. They took $650 million, and that now their valuations is $10.65 billion, which makes them Europe's highest-valued private fintech company. All these fintech companies, these "new banks," they're taking off. Those are the companies that are gonna win in the stock market, and that's why they all wanna IPO soon. They're boasting that they have a billion in annual sales now with over 3,500 global employees. These services, and these new banks, and these online ways to move money around through apps and this new- which just used to be a hashtag, #fintech, five years ago; nobody was really in it. Now, it's leading everything because of the pandemic. Blake Oliver: [00:55:59] Amazing. Well, I have one last app story in acquisition. Wolters Kluwer has bought XCM Solutions. XCM is a cloud-based workflow solutions provider for professional tax and accounting firms. I've used it in my professional career, really popular in tax as a way to route tax returns. They have about 440 employees located in the U.S. and India.  [00:56:24] Something interesting I did not know until I read this article is that they actually were spun out of an accounting firm in Massachusetts in 2002. An accounting firm building software for itself creates workflow software that it then sells to the world. The deal values XCM at $161.4 million. They recorded revenues of $22.5 million in 2019, and three quarters of that came from cloud-based software. [00:56:49] I did the math on this, and if you divide their valuation by the revenue from cloud, it's about 10X earnings. That's a standard in tech valuation there. Multiply your annual earnings by 10 times. XCM and Wolters Kluwer have been working together since 2006, so this is not a surprise. They've had [crosstalk]. David Leary: [00:57:09] -when this was announced, and I was like, "They don't already own them?" I had no idea. My entire career, I had no idea that they weren't already owned by them. Blake Oliver: [00:57:18] Now, it's official. Last bit- actually, I lied; I got one more. Epicor software, the maker of ERP software that is very popular in manufacturing, they have been sold. They were owned by KKR, a private equity firm, which bought them in 2016 for $3.3 billion, and they have now turned around and sold them four years later to a private equity firm called Clayton, Dubilier & Rice for $4.7 billion. That's it for me. David Leary: [00:57:50] I have a one, two, three, four, five more app stories. We can just [crosstalk]  Blake Oliver: [00:57:54] You've got to run through them quickly because we're almost out of time. David Leary: [00:57:58] Acumatica, which is basically higher-end ERP software, they've really changed- because of COVID, they've changed where they're headed now. They have a heavy integration now, deep integration with Shopify. They now have advanced expense management, and they also have bank feeds now they've added, and they've actually added a point of sale for people that are doing omnicommerce. They're shifting because of people having to work at home. Airtable, I don't know. Have you ever used Airtable, Blake? Blake Oliver: [00:58:24] I don't think so.  David Leary: [00:58:24] We use Airtable to run the podcast, so you are using it.  Blake Oliver: [00:58:30] I have used it, okay. That's what you use for the sponsorship slots. David Leary: [00:58:33] Sponsorship slots. Essentially, when I discovered Airtable six years ago, and I remember talking to people at Airtable, I was like, "One day, accountants are gonna discover you and they're gonna love you." Airtable falls into that ... You've probably heard of the term; we've talked about "no code." Blake Oliver: [00:58:48] Right. David Leary: [00:58:48] It's like a spreadsheet that you can- but it's really a database, and you can connect things to it; you can connect Zapier to it; you can build out basically, miniature apps. It works out really, really well. They just raised $185 million, and their CEO was just brutally honest about it, which I think is really cool. He just said, "We didn't need the money," but he said once COVID hit, they wanted to seize the opportunity and not have to worry about the economy; if there's a little waves of this. They just want to have a long-term funding, so they can just not be distracted by the market and just continue to push forward.  [00:59:22] The other reason is they have a lot of competition now. In June, I don't even know how we missed this, but Amazon launched something called the Honeycode in June. Basically, it's a spreadsheet program that you create the spreadsheet and you magically build an app to host on Amazon Web Services. Microsoft released something called Microsoft List, which is a similar product. Rumor has it Google's making a product.  [00:59:46] These no-code platforms, I think accountants are gonna love these, because I think a lot of accountants have programmer minds, but they just don't know how to write code. No-code platforms are really like big, huge Excel formulas. I think these no-code tools are gonna be super-popular with accountants and bookkeepers, so it's good to see that they have another round, and they're gonna keep growing and improving that platform [crosstalk]  Blake Oliver: [01:00:10] 100% on that, just before you finish – defining your workflow is the number-one trick to making a cloud-based firm work. It's having a really, really solid workflow. I did something similar; I wish these tools had been available when I had my firm, but I used a tool from Citrix called Podio, which was similar, where it's a-  David Leary: [01:00:31] I remember that app. David Leary: [01:00:32] It's a custom database with a communications layer on top of it, but it's basically a spreadsheet with automation built in. You can connect different columns; you can create formulas, essentially; create workflows, and automation. This sort of thing is not new, but the fact that there are now so many options and different styles of it is really exciting. David Leary: [01:00:53] Maybe finally Excel has met its match. [crosstalk]. Blake Oliver: [01:00:56] Maybe.  David Leary: [01:00:56] I have two other teeny app news, because I always love it when accountants build apps. One of them is Bookkeeper360. Blake Oliver: [01:01:05] Oh, yeah. I saw this.  David Leary: [01:01:05] They launched an app, and basically what this app does, it integrates with Xero. I think Bookkeeper360 also, they have a lot of expertise in Salesforce, so I imagine this integrates in. Nick Pasquarosa, he's the founder and CEO – he's actually our listener, I think. He's on our home page. He left us a great review once [crosstalk] podcast.  [01:01:26] This, basically, will create performance dashboards, cash flow dashboards, real-time metrics, and on-demand access to your bookkeepers. In a weird way, it's not really a QuickBooks Live model, but imagine if this app is now your middleman between your Xero data and the bookkeeper you're working with at Bookkeeper360? Blake Oliver: [01:01:48] Well, and just from a marketing standpoint, man, what a great way to get your firm, your bookkeeping service visible, is to be listed as an app in the Xero marketplace? Now, you're surfacing to all those Xero users in a way that none of your competitors are? This is pretty awesome. David Leary: [01:02:04] It's almost like it's a real app, because I know there's these companies that will help accounting firms create these apps, and then it's just- Blake Oliver: [01:02:09] It's a glorified crappy portal, most of the time.  David Leary: [01:02:13] -or business card, or portal, yeah. It looks like everybody else's, and it's just not great. This looks like it's a true- this looks like a standalone separate product, so if people are searching in the market, this is gonna be a way for them to get new customers. Blake Oliver: [01:02:25] That's awesome. David Leary: [01:02:25] Because it looks like a standalone product. The last one is, Michael Lee, who's a listener, as well; a fan of the podcast, his product, Saasable, that he launched, now integrates with QuickBooks and is now in the QuickBooks Apps Store, which is a huge milestone to get to.  Blake Oliver: [01:02:41] That's really cool. David Leary: [01:02:41] The app basically helps automate the recurring revenue metrics in a real-time dashboard.  Blake Oliver: [01:02:47] For software as a service?  David Leary: [01:02:48] Software as a service companies, yeah. Blake Oliver: [01:02:49] Very nice. Well, that is all the time we have today, David, because it's Saturday, and my kid wants to go to the pool. I gotta go do something else other than just talk about accounting and apps, although I would love to do this all day long. If we wanna continue the conversation, where's the best place for people to do that with us? David Leary: [01:03:09] Definitely, you can reach me on Twitter, I'm @DavidLeary, and on LinkedIn, I'm @DavidLeary. Also, Blake, just so we don't forget, we're gonna be appearing and doing a keynote at the Accounting Finance Show Virtual Conference on October 20. Blake Oliver: [01:03:22] Oh yeah, that's gonna be really cool. David Leary: [01:03:23] We'll have links to that in the show notes. Hopefully, the plan is to have a cool survey, and then we'll talk about the results.  Blake Oliver: [01:03:29] We're gonna record it and release it as an episode. It'll be a live recording, right? David Leary: [01:03:33] Yes, yes. Blake Oliver: [01:03:34] You can reach me on Twitter, I'm at @BlakeTOliver, and on LinkedIn, as well. If you do connect with me, please say that you're a listener, or you can say, "I'm not a bot," that's how I know. If you want to leave us a message, you can call our listener voicemail line. What is that number, David? David Leary: [01:03:52] It's (202) 695-1040.  Blake Oliver: [01:03:56] Let us know what you think – (202) 695-1040 – about any of the topics we have discussed or anything that's top of mind for you. You could call in anonymously and tell us about how that CCH outage went for your firm. I'd love to hear more stories beyond my own personal network. David Leary: [01:04:13] I think that's it. It's interesting that phone number you picked ... I said I called the IRS this week, and I noticed, I was like, "Oh, their phone number's 1040 as well."  Blake Oliver: [01:04:20] Until next week, David, have a great whatever it is you have.  David Leary: [01:04:20] It's another week, another week of Zoom calls. Blake Oliver: [01:04:30] That's right. Another week of Zoom calls. Take care. David Leary: [01:04:33] Bye. ____________________ClassifiedsStill sending spreadsheets of unclassified expenses to clients? With ClientHub, automate this process and get client answers instantly. ClientHub is a client-communication platform that helps you consolidate client communication, securely share files, and instantly get answers, and much, much more. Get started today with a free trial at ClientHub.app and enter promo code "CAP25" for 25 percent off your first three months. ClientHub - frictionless client communication.____________________Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100.  
Sponsors ADP Marketplace: https://cloudaccountingpodcast.promo/adp ClockShark: https://cloudaccountingpodcast.promo/clockshark BQE CORE: http://cloudaccountingpodcast.promo/core Show Notes 05:46 – Melio Raises $144M to keep Small Businesses in Business by Simplifying their B2B Payments – Silicon Valley Daily           Melio Payments: Out of stealth with $144 million – Bessemer Venture Partners   06:53 – Is Working Remotely the Future of Finance? – CFO 07:41 – Auditors Struggle to Access Data, Count Inventory During Remote Work – Wall Street Journal 07:47 – 8 things to know about the audit evidence standard – AICPA 09:17 – DOJ: 57 Charged With Alleged PPP Fraud – PYMNTS.com   10:10 – More on Liar Loans – Wikipedia  11:52 – Quickie lender Kabbage doled out billions in PPP loans. A number of borrowers raised red flags. – Miami Herald  15:42 – SBA Loan Program Contractor and Rocket Loans Face Scrutiny – Wall Street Journal  18:26 – The FTC Is Investigating Intuit Over TurboTax Practices – ProPublica 20:39 – IRS Wants to Break Privacy on Monero and Bitcoin’s Lightning Network – News Break 22:48 – SaaS Firm CEO Resigns; Layoffs, Probe Follow – PYMNTS.com           CEO of cyber fraud startup NS8 arrested for defrauding investors in $123m scheme –ZDNet 25:44 – Major companies reject Trump’s payroll tax deferral – Accounting Today 28:09 – Employers added 1.4M jobs in August, but subtracted 1.6K in accounting – Accounting Today  29:16 – Millions of U.S. jobs to be lost for years, IRS projections show – Accounting Today 31:50 – Sage and Revolut partner to hand back three weeks of admin time to small business owners – Sage UK  33:20 – Deel Lands $30M For Workforce Payroll – PYMNTS.com 35:50 – How Do You Know a Human Wrote This? – New York Times        OpenAI’s new language generator GPT-3 is shockingly good—and completely mindless – MIT Technology Review 36:21 – GPT-3 bot that lets people with no accounting knowledge generate financial statements – Twitter  41:13 – The majority of workers use automation software at work—here's why – Zapier  48:12 – Time for REVIEWS!!!  Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsClientHub: https://clienthub.app Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  TranscriptADP has your back with ADP Marketplace, a digital HR storefront. Be a more trusted advisor to your clients by recommending apps to help streamline HR processes and free up time to focus on people. Stay tuned to hear more from our sponsor, ADP Marketplace, later in the episode. David Leary: [00:00:20] It's basically, President Trump's gonna get his next paycheck because he works for the federal government. There won't be Social Security taken out. Blake Oliver: [00:00:27] The 6.2% is not gonna be taken out, but then it's gonna get paid back next year, but I guess, if Trump isn't president next year, then he won't be paying back the Social Security. It'll be the White House that owes it, right? David Leary: [00:00:44] This is the perfect ... How come nobody's presenting it that way, Blake? This is genius. You should tweet this; it summarizes it perfectly. Blake Oliver: [00:00:48] I hadn't even thought of that until now. That's pretty funny, right?____________________ClockShark is the leading GPS, time-tracking, and scheduling system built for local construction and field-service companies that want a simpler way to track time, run payroll, and understand job costs. With the capabilities of crew tracking, scheduling, jobsite geofencing, teams, and project segmentation, automatic labor allocation, budgeting, and reporting, ClockShark has built a robust mobile time-tracking system to handle the unique challenges that face your clients.  With ClockShark, your clients can keep accurate records, like overtime, paid time off, unpaid time, hours per job, and tasks, as well as the crucial data needed for certified payroll. With the integrations ClockShark has, you'll be able to connect to one of many ADP payroll platforms through ADP Marketplace  and process payroll in minutes with the click of a button. ClockShark's pricing starts at just $6 a month per employee. Head over to cloudaccountingpodcast.promo/clockshark.____________________  This episode of The Cloud Accounting Podcast is sponsored by BQE Core. As firms everywhere are positioning themselves to work remotely, BQE Software is committed to supporting you and your employees during this critical time. BQE's Core products operate 100 percent on a native cloud platform that's uniquely able to help you in your efforts to embrace remote work while maintaining your productivity.In response to the impact that COVID-19 has had on your firm and your clients' businesses, the team at BQE has let us know that Cloud Accounting Podcast listeners will now receive three months of BQE Core for free with an annual subscription package purchased on or before September 30, 2020. To learn more, head over to cloudaccountingpodcast.promo/core. ____________________Blake Oliver: [00:02:57] Welcome to The Cloud Accounting Podcast, I'm Blake Oliver. David Leary: [00:03:00] I'm David Leary. Blake Oliver: [00:03:01] It is Sunday, September 13, after, what did we just have? Labor Day? We had Labor Day. David Leary: [00:03:07] All your trash, you have your trash out the wrong day, and your recycling out the wrong day. Blake Oliver: [00:03:12] Yes, that's right. Well, I wasn't here. I was in South Lake Tahoe doing a leadership retreat for Jirav because we have raised $8.3 million this fall and we haven't been able to see each other to figure out, what are we gonna do? How are we gonna grow this company? It was critical that we get together, so we finally decided, we have to do it. We're just gonna, the six of us, get in a room together. Yeah, I was traveling for the first time since the pandemic. David Leary: [00:03:46] I was just gonna say ... Wow. Blake Oliver: [00:03:49] Yes. That was interesting. I have to say, the airports are set up very well to social distance, because there's not a ton of air travel. It's not like you're crammed together in the terminal. You can definitely social distance; through security, as well. Not a huge line. I flew Southwest, which is keeping the middle seats empty on planes, which made me feel very comfortable. I just sat near the window and kept my airflow going and wore my mask, and everybody was wearing masks. Compliance on that was super-high. I would say 98% of the people I saw were wearing them properly, over their nose and their mouth. So, I felt comfortable. I actually felt more comfortable in the airport and on the plane, than in many restaurants that I've seen, so ...  David Leary: [00:04:28] That's because you're in non-compliant Phoenix area. I'm starting to get the itch to travel. I wanna travel to New York City. I'd like to travel to Tel Aviv, where Melio was founded. Blake Oliver: [00:04:38] You were going to- David Leary: [00:04:39] They're in the news this week. Blake Oliver: [00:04:39] You've never been there to headquarters since you started, right? David Leary: [00:04:43] No, I was literally- I started at Melio and I was five minutes from the airport in Tucson here, and the COO called me on the cell phone and he's like, "Don't come, they're locking everything down." Then two days later, we locked everything down in The States. I literally have- Blake Oliver: [00:04:57] You had your bags packed. David Leary: [00:04:59] I still have clothes folded that I just took out of my suitcase and put back on the shelf, and never put away properly. Actually, I finally picked up my backpack because Starbucks ... You can go to Starbucks and work again. So, I did that one day this week. If you think about it, my backpack just sat there for eight months, or whatever this is now. Are we eight months into this now? Blake Oliver: [00:05:18] March, April, May, June, July, August, September. Yeah, past six months, seven months for some parts of the country. David Leary: [00:05:26] Because it started right after first week, second week of February. Blake Oliver: [00:05:30] In L.A., it started first week of March, was when people started to realize what was gonna happen. They- David Leary: [00:05:36] Taking it seriously. Anyways, the reason I wanna go is Melio was in the news this week. I don't know if you saw on Tuesday morning? Melio announced their Series B and their Series C rounds. Blake Oliver: [00:05:45] How much money? Are you rolling in dough now? David Leary: [00:05:50] Yeah, I'm rolling ... We've gotta hire a lot of bodies, right? This is a big job here, but they had a $48 million raise, and then an $80 million raise.  Blake Oliver: [00:05:58] Wow. David Leary: [00:05:58] For a total, with the Series A raise, it's a total of $144 million that has been raised now. Blake Oliver: [00:06:04] Were both announced at the same time because the first one wasn't previously announced, or did they both happen at the same time? David Leary: [00:06:10] The other one was previously announced. Blake Oliver: [00:06:12] Got it. David Leary: [00:06:14] Both announcements were at the same time on Tuesday and then, in COVID, a lot of it is just about how to double down and grow more during COVID times. Melio, basically, we had 700% growth, which makes sense, because I've talked to a lot of accountants and bookkeepers that are like-  they have small business clients; they can't use paper checks. Or the bookkeeper took the paper checks home, but they don't work on her printer or his printer, and then the business owner has to drive over there twice a week to sign the paper checks. It's just, there's a lot of things going against using paper checks right now, and Melio solves that, ultimately. Blake Oliver: [00:06:49] It's not just small businesses that feel that pain. I was just reading an article in CFO, talking about the future of finance in mid-sized to large organizations. One of the quotes was from Steven Horowitz, the CFO at CareCentrix, and he said, "The only time finance staff had to go to the office, was to scan physical mail and bills into their smartphones to process accounts payable." Isn't that amazing? That's the only time. So, you guys are doing good work. It's very, very timely. David Leary: [00:07:17] The fact that people have to take photos of the bills, it reminds me of a feature and a request that I need to work on for Melio, because we don't let people email the bills in yet. Blake Oliver: [00:07:25] Oh yes, I really want that. I got some more remote stories. Like I mentioned, finance teams are moving remotely, with a lot of success. There was a story in the Wall Street Journal about how auditors are struggling to work remotely, which doesn't surprise me given the reliance on paper for a lot of auditing and in-person interviews. [00:07:46] There's some good news; the AICPA issued a new audit evidence standard that allows for non-human evidence collection. The PCAOB, which regulates public companies on that end, is also considering revising their audit evidence rule, bringing some potential relief to teams that are working remotely on the audit and on the finance side. David Leary: [00:08:11] I got a survey from Zapier on the state of automation software and lots of cool data and things in that to look at. TurboTax, the FTC is investigating now on the whole Intuit deceptive marketing stuff, where Intuit employees are gonna be called in to testify. Blake Oliver: [00:08:28] That'll be interesting. Like public testimony? David Leary: [00:08:31] Yeah. Intuit handed over millions of pages of documents. It's almost like that overwhelm disclosure. "All right, here. Here's 500 million pages of emails you can go through. Build your case." Blake Oliver: [00:08:43] Well, speaking of investigations, Intuit's not the only tech company under investigation. Kabbage is under investigation for its PPP loan program, which we've discussed. David Leary: [00:08:53] Really? Blake Oliver: [00:08:53] Yes, they were very successful, but now, that has attracted attention. Rocket Loans, and the contractor associated with Rocket Loans that helped them get all that work for the EIDL program, they're also under investigation-  David Leary: [00:09:09] Why don't we jump into people that are under investigation, as a category today? I have- it talks about PPP fraud. Apparently, 57 total people have been charged as of now. Blake Oliver: [00:09:21] Only 57? That's sounds low. David Leary: [00:09:23] That was my thought as well. I saw just 57. If they said there's been 2 billion dollars in fraud, which I think was some of the reports a couple of weeks ago- Blake Oliver: [00:09:30] That's the estimate, right? David Leary: [00:09:31] -and only 57 charged. How long is this going to- it's like getting audited by the IRS. The odds are on your side. Blake Oliver: [00:09:39] Very much so. David Leary: [00:09:41] If you committed a PPP fraud, the chance of you getting caught is very low, actually. Blake Oliver: [00:09:44] It's really easy to commit PPP fraud, or it was, I guess, because you can't do it anymore. It was very easy because you just had to self-certify to the payroll, to the need, and it was up to the banks to do a little bit of due diligence on that, but not much, because the law insulates them from having to do an audit, and to have to actually verify this information. [00:10:10] People are talking about this is very similar to the Liar Loans of the 2008-2009 mortgage crisis, where you had banks issuing mortgages without any documentation at all, of people's income and stuff like that. As far as Kabbage goes, this is really interesting to me because we talked about how Kabbage got acquired by Amex, back in August. They were one of the first companies to jump on PPP. For our listeners who are not familiar with Kabbage, they are a digital lender to small businesses. Connect to your QuickBooks file, and Kabbage will tell you how much you can borrow, and then you can borrow online. It's very streamlined. You don't have to go to a bank. [00:10:56] That was Kabbage's main business, was just making these relatively small loans to small businesses. When coronavirus hit, that business went away. They shut that down, and they pivoted very, very quickly to processing PPP loans. By the end of August, they were number two for issuing PPP loans. They got very quickly up and running; an amazing pivot. That is what caught the attention of Amex, American Express, which agreed to acquire substantial parts of the business and- David Leary: [00:11:26] But didn't Amex not get the PPP part? Blake Oliver: [00:11:29] Right.  David Leary: [00:11:29] That's what was very confusing about the whole acquisition. Blake Oliver: [00:11:31] They are acquiring the technology platform, which makes a lot of sense, because if the tech platform is so good that they were able to go from doing micro loans to PPP loans that fast, as a tech company ...? David Leary: [00:11:42] Because they have all the pipes. They have all the pipes built. Blake Oliver: [00:11:45] Right. Amex is buying that for- it's billions, right? It's a lot of money. David Leary: [00:11:50] It was a good $800 million or something. Blake Oliver: [00:11:52] Here's the thing about this - did Kabbage, in rushing to process all those loans, not do enough checking of the people who were going through their platform? Well, a joint investigation by the Miami Herald/McClatchy DC and Anti-Corruption Data Collective flagged more than 75 companies that received loans of at least $150,000 from the coronavirus Small Business Relief Program, but didn't appear to have existed before the spring, or to have met other eligibility criteria for the program. Now, of those 75 companies, one in five got their loans from Kabbage, so that's quite a good chunk considering the- Kabbage [crosstalk]  David Leary: [00:12:34] So, they identified 75 potential frauds and one out of every ...? Blake Oliver: [00:12:38] Five, yeah.  David Leary: [00:12:38] -five of those 75 just coincidentally went through Kabbage. Blake Oliver: [00:12:44] Kabbage processed fewer than 1% of all PPP loans. Really, you would expect maybe one of those companies to be Kabbage, given the total volume of loans. If Kabbage processed 1% of PPP loans, then maybe, one company on that list of 75 would be a Kabbage company, but it was one in five of those companies, so 15 of the 75, right? David Leary: [00:13:10] Yeah. Blake Oliver: [00:13:13] That indicates maybe that something might not have been right there. David Leary: [00:13:18] Then why is Kabbage under investigation then? Is it because they think Kabbage did something to enable this on purpose or to push the loans through prematurely or without due diligence or is it just criminals found a hole- they figured out that they were the easiest to push loans through, so they attracted more criminals? Blake Oliver: [00:13:37] I'm not totally clear on that. There is some requirement on these lenders to do something to ensure that the loans are not fraudulent. It's not very much, but the question is, were they just pushing through these without even checking the documentation at all? David Leary: [00:13:55] It feels like it's just easy to solve because that's the same thing with this article that I have, which was in PYMNTS. They have businesses that basically said they had dozens of employees in four different businesses, but they actually didn't have any employees at all - zero employees. [00:14:12] The thing is, you're the bank; you're giving the money. The SBA doesn't give you the money. You don't get the money from the SBA first and then use that to put out loans. You're giving a loan of your money and then you're going to the SBA and saying, "Hey, I gave out this loan. Here's why it's a qualified loan, please reimburse me." Really, is there even a crime committed here? Ultimately, the bank made a bad loan, or Kabbage made a bad loan. They gotta eat it. Blake Oliver: [00:14:36] I don't know what's gonna happen with this, but I think it all boils down to the forgiveness process. If forgiveness is rubber stamped, like you have said it's going to be, or you've predicted it's going to be, then none of this will ever matter because most of these loans will just get forgiven. If they were fraudulent, oh, well. [00:14:56] In the case of those businesses that didn't have any payroll at all and then they claimed to have all these employees, what were they uploading as evidence of their payroll? You had to include some evidence, some documentation. Were the lending platforms even requiring it? That's my question. Maybe they were just- David Leary: [00:15:15] You're just creating a PDF. I just printed a report from OnPay and just uploaded it. Somebody could have- it's probably not hard to figure out what the report looks like in something like ADP, and just fake it and create a fake PDF and upload it. Blake Oliver: [00:15:29] I don't know. We'll see, right? David Leary: [00:15:32] It's like the coffee guys, they were uploading those, and the Wirecard guys. They were just creating fake bank statements. Blake Oliver: [00:15:40] I've got one more fraud story here that I mentioned. The EIDL program, the Economic Injury Disaster Loan program, which has, itself, been kind of a disaster because, unlike the PPP program, EIDL loans did not get out very quickly. It has been plagued by delays and also plagued by pervasive fraudulent activity. Over 5,000 cases identified by the SBA Inspector General and an estimated $250 million in fraud, so far.  [00:16:09] Lawmakers are drilling down on this one relationship that the SBA has with a contractor that is helping with the EIDL program. Get this, the SBA awarded a $770 million contract, actually, at least $770 million. We don't know the total amount. They awarded at least $770 million to a contractor called RER Solutions Inc., in Virginia, to process EIDL loans and grants to help get them up and running faster; moving those loans through faster. [00:16:42] They got a $770 million contract. They only have 40 employees. The last contract they got from the SBA was for $10 million in 2018. So, they went from doing a $10 million contract, to doing a $770 million contract with only 40 employees. The whole point was to help the SBA accelerate EIDL. There was no competitive bidding on this. This was something the SBA just did very quickly. Now, RER, with only 40 employees, obviously, could not help that much, so they subcontracted the bulk of the work to Rocket Loans. The parent company of Rocket Loans also owns Quicken Loans. You've seen their ads everywhere, I'm sure. [00:17:19] Now, Rocket Loans hasn't said how much it made as a subcontractor, but just think about this. You've got $770 million going to this 40-person company to process EIDL loans and they just turn around and subcontract to Rocket Loans. How much are they skimming off of this? How much money is this little consulting agency making as a result of its political connection to the SBA? Why didn't the SBA just go and contract with Rocket Loans directly? This is the kind of skimming and grift and graft in the ... This is the swamp. David Leary: [00:17:50] This is politics. Blake Oliver: [00:17:51] Just think about this. That's one contract. How much of this stimulus money is actually just being eaten up by fees to banks, fees to contractors? A lot of it could be not getting to the small businesses because of that. David Leary: [00:18:08] Yeah, and I think we're gonna- we'll jump into Intuit's thing, but I have two more articles that are fraud-related, too. Blake Oliver: [00:18:15] Well, let's talk about that. I'm curious to hear about Intuit. What's the ...?  David Leary: [00:18:18] We can jump over to that one. This is the whole Intuit-TurboTax Free File. ProPublica has covered it extensively; they exposed it. They are now covering the fact that the FTC is investigating Intuit over these practices. The investigation has been under way for more than a year. Intuit produced a half-a-million pages of documents in response to the FTC's first civil investigative demands. It's almost like a subpoena, but essentially, they're just starting to subpoena and get the records ... A million pages of documents. Blake Oliver: [00:18:51] The FTC is investigating now. What were the investigations that were happening before? Was that Congress? Was that ...? David Leary: [00:18:56] It was Congress. That's what really drove this. There was demands by- it was a bipartisan order. There was demands ... Elizabeth Warren. She was one of the people driving this. They demanded this investigation. Then, it moved from a high-level investigation to now, they're getting into the weeds, right? Blake Oliver: [00:19:15] Got it.  David Leary: [00:19:15] Essentially, there was just fights about the company records and the conduct of Intuit. Now, what's happening is they're actually bringing in- they're gonna have a hearing with at least eight different Intuit employees. They're gonna require at least five Intuit employees to testify over several days. Blake Oliver: [00:19:32] Wow. I'm gonna have my TV on, watching C-SPAN, and I'm gonna get to see Intuit getting grilled [crosstalk]  David Leary: [00:19:39] Well, it doesn't say if that's in a Congress-type thing, but- so, this has crossed a whole new line from being very political grandstanding. "Oh, bad Intuit, they did this," to there's real legal things happening here. There's a couple of outcomes they're suggesting that could happen,  [00:19:54] Previous FTC investigations in the past have led to large cash settlements and refunds for customers. Some have agreements by companies just to stop the practices, and then they could also just conclude Intuit did nothing and just drop the whole thing. It'll be interesting to see where this goes next. This is just taking another escalating turn. [00:20:13] In the meantime, Intuit out there claiming they filed more free returns than any other software product on the market, combined. Maybe Intuit's not even successful at this, of getting people to upgrade and not use the free product. It'll be interesting where this goes, but it's basically in to that next level. Blake Oliver: [00:20:32] Well, we're talking about politics. We could talk about the payroll tax deferral unless you've got some more fraud stories. David Leary: [00:20:37] I got two more fraud-related type things. The IRS is now offering ... They have a request for proposals for people to help crack two different types of Bitcoin products, Monero, and Lightning. They're two different protocols ... Remember we talked about ransomware as a service? Blake Oliver: [00:20:55] Mm-hmm. David Leary: [00:20:55] These people that are hacking and doing ransomware, they don't want Bitcoin anymore because people can- it's not private. The IRS can track it. Now, basically, they're looking for people- the IRS is looking for people to help crack these two other protocols that are super-secure and private. Blake Oliver: [00:21:10] A cryptocurrency is where you can't easily trace the wallets and where the money's gone. David Leary: [00:21:15] It's interesting that the IRS wants to crack this, because if somebody's doing ransomware as a service, I don't think the IRS cares if it's legal or not legal. They just need to make sure taxes are being paid on it. If you have a ransomware as a service business, you've gotta pay your income taxes [inaudible]  Blake Oliver: [00:21:32] This is one of the interesting things about cryptocurrency. Often, the analogy is that Bitcoin is like digital cash, but it's not really, because cash, you can't track it very easily. If I hand you a million in cash, David, it's very difficult for somebody to track that money back to me after you've spent it, but with Bitcoin, every single person in that transaction history has a unique identifier. You can trace the movement of Bitcoin through all time, back to its inception. It's more like credit cards, in that way, than it is like cash. David Leary: [00:22:10] There's a  trail, right? Blake Oliver: [00:22:12] Right. David Leary: [00:22:12] It's all connected down the line. Blake Oliver: [00:22:15] What these other services do is that they obfuscate the trail, so that it is more like digital cash. That's really scary for the IRS and for all tax authorities because cash is a big problem when it comes to collecting taxes. Imagine if it was easy- if we had digital cash, you didn't have to carry around in briefcases and smuggle across borders and whatnot, it'd be almost impossible to tax [crosstalk]  David Leary: [00:22:40] Well, you know what'd be great for small businesses? If there was some software that helped you detect online fraud. Blake Oliver: [00:22:45] Oh, yeah. David Leary: [00:22:45] Though, there is. There's software called NS8. It's a Las Vegas-based online fraud prevention and detection software maker for small businesses, small to medium businesses, and also, they had a bunch of abrupt layoffs and their CEO resigned. It's turning out, it's looking- there's a Securities and Exchange Commission investigation. The company that specializes in fraud prevention and detection, basically has frauds happening at the company. Blake Oliver: [00:23:16] Financial fraud going on there? David Leary: [00:23:18] Yes, yes. Blake Oliver: [00:23:18] Oh, boy. David Leary: [00:23:19] The quote from the CEO that just resigned in response to Forbes, via LinkedIn, he said, "I did not walk away with the company's money." Blake Oliver: [00:23:28] Where did it go? What's the scope of this fraud? David Leary: [00:23:33] They were founded in 2012 with 50 employees. They grew to over 200 in the last year. In June, they closed a Series A with Lightspeed Venture Partners for $123 million in June. That's what, three months ago? They're burning $4-$6 million a month, and they're gonna run out, but there's ... This has just happened very quickly. All the sudden, they're laying people off. CEO resigned. The investigation has popped up. It's a story that basically just broke. Maybe we'll have more news on this next week. [crosstalk] I find it very ironic that here's a company that specializes in fraud detection who has people working there committing possible fraud.____________________ This episode of The Cloud Accounting Podcast is sponsored by ADP Marketplace. How can you be a more trusted advisor for your clients as they face new challenges? By recommending solutions from ADP Marketplace, ADP's digital HR storefront. With ADP Marketplace, clients can try, buy, and implement highly rated HR apps that can share data with ADP. With secured data integrations, it's easy to streamline HR processes and adapt to new business needs. Help your clients discover new ways to recruit and onboard employees, boost performance, offer unique financial-wellness benefits, and much more.   With integrations for popular business software, like Expensify, PayActiv, Slack, and ClockShark, clients can add value to the tools they already use by simply and securely connecting them to ADP. Have clients in field service, or construction? ClockShark can help them track time to quickly and accurately run payroll, all integrated with ADP. Visit ADP Marketplace at apps.ADP.com, or right from your Accountant Connect dashboard. Not set up with Accountant Connect? Sign up today. It's free. Head over to cloudaccountingpodcast.promo/ADP. ADP has your back with ADP Marketplace.____________________Blake Oliver: [00:25:29] Well let's talk about the payroll tax deferral. One of our- David Leary: [00:25:32] Speaking of other possible frauds. Blake Oliver: [00:25:35] One of our previous top stories, as listeners will recall, the Trump administration was not able to reach a compromise with Congress to extend stimulus, still has not, and unilaterally declared a payroll tax deferral starting September 1, that would go through the end of the year. Then the amounts would, if not forgiven by Congress, then be collected in the first four months of 2021. Now, there was a lot of discussion as to whether or not companies would actually participate in this program, because the IRS said that employers are on the hook for the payroll tax, that they aren't able to collect from employees who leave before January or sometime in between. If there's any issues, it's on the employer and ... David Leary: [00:26:27] Ultimately, it's optional. As an employer, it's optional. Blake Oliver: [00:26:29] It's optional as an employer, yeah. We were saying on the show, at least I was saying I don't think anybody is gonna do this because it's stupid. I would not do it as an employer. This is a risk to me. It's extra headache work and it doesn't really, in the end, help my employees because they're gonna end up paying the same amount. It's just shifting the burden and could even make it harder for them to manage their cash flow because now, suddenly, their paychecks will be smaller in 2021. That's what happened. No major private employer has stepped forward with plans to forgo withholding. Costco said they're not gonna do it. UPS is saying no; FedEx, no; Walmart, Macy's, Procter & Gamble have said no comment. [00:27:07] The only large employer that is proceeding with its workers is the federal government because the administration can make that happen. Ironically, the federal government was late getting started. The withholding didn't start on September 1 because the regulations or the guidance just came out on the day before. They are starting the withholding in mid-September, so, I'm gonna guess this week's paychecks probably will have- David Leary: [00:27:33] Basically, President Trump's gonna get his next paycheck because he works for the federal government. There won't be Social Security taken out. Blake Oliver: [00:27:40] The 6.2% is not gonna be taken out, but then it's gonna get paid back next year. I guess if Trump isn't president next year, then he won't be paying back the Social Security. It'll be the White House that owes it, right? David Leary: [00:27:56] This is the perfect- how come nobody's presenting it that way, Blake? This is genius. You should tweet this; it summarizes it perfectly. Blake Oliver: [00:28:02] I hadn't even thought of that until now. That's pretty funny. Speaking of jobs, August was a pretty decent month for jobs. Employers added 1.4 million jobs in August, but we subtracted 1,600 accounting jobs. This doesn't surprise me, though, because there's a lag in the accounting world where the economy takes a hit. A lot of these engagements, a lot of this work that we're doing, it has to get finished before firms and businesses do any layoffs in the accounting and finance teams. We're so insulated in that way. Then the job losses are never as bad as they are in the overall economy, just because it's not like you can stop doing accounting and tax and finance and stuff. David Leary: [00:28:44] Somebody has to count up the beans to figure out who to lay off, right? Blake Oliver: [00:28:47] Exactly [crosstalk] Pretty much a wash for accounting in August, if you think about it in the big scheme of things. The unemployment rate fell to 8.4% from 10.2% in July, but before you take this as great news - the economy's recovering, we're all- this is the bottom, and now, we're gonna the top - the IRS has projections that it has to do to estimate tax collections in future years. [00:29:16] They have released information saying they are projecting lower levels of employment in the U.S. that will persist for years as the results of the economic fallout of the coronavirus pandemic. The IRS is forecasting that there will be about 229 million employee-classified jobs in 2021. That is 37 million fewer than it had estimated last year. That's an estimate of the number of W-2s, so it doesn't totally fit the number of jobs, but it's a pretty good approximation of that. [00:29:47] They are also estimating, and this is where it gets  scary, the lower rates of W-2 filings are gonna persist through at least 2027, with about 15.9 million fewer forms filed that year compared with prior estimates. We're in 2020, and they're projecting forward to 2027, and although we're 37 million fewer W-2s next year, we're not gonna get all those 37 million back, even in six years. It might be half, or 60%, or something like that. Yeah, it's gonna be a long recovery, and I don't see this as being politically motivated, in that this is the IRS doing projections for its own purposes. It's not typically politically-motivated here. [00:30:36] We all hope that this is a quick recovery, but I would temper that expectation. I've heard stuff from experts saying even if we have a vaccine this year, then it's gonna take a year to roll it out and for things to go back to normal. 2021, not necessarily gonna be normal again. I know you don't like hearing that, David, because you really wanna get back to in-person events, and I do, too. David Leary: [00:31:03] It's gonna be slow. Blake Oliver: [00:31:03] Slow. David Leary: [00:31:03] Football starts today, so ... Blake Oliver: [00:31:06] That's good. David Leary: [00:31:07] I think we're slowly getting back in there. I have two small app news, and then I just have one ... I do definitely wanna talk about that survey. What else do you have on your plate? Blake Oliver: [00:31:15] Let's see here. I have an AI story. That is really the one thing I wanna talk about, because it's super-cool. So, why don't you hit your stuff and we'll finish out with AI? Then I think we got some listener-  we got a listener voicemail and maybe a review or two. David Leary: [00:31:31] Yeah, we got four reviews. It's amazing! Let me knock out some quick, small app news. So, Sage and Revolut- remember, we talked about Revolut? They are that neobank, new bank in Europe and they're now coming to the States. I think, I saw this week, they've launched in Japan now, but they also have their Revolut business customers; they've rolled that out. [00:31:50] They had a press release with Sage that they're- reading the press release, the summary is, its bank feeds. Revolut's  gonna basically be integrated with Sage and come down in the bank feed, which I think- actually, I don't think these announcements, when a bank announces they're integrated, and they just have a bank feed is really news. [00:32:08] I feel like what's news about this is usually these neobanks get neglected or these newer- a credit card product like a Brex or a Divvy, don't get bank feeds into QuickBooks, and that makes them harder to use those products- these newer banks, these newer products that are out there. The fact that Revolut is now getting "into Sage" probably by bank feed is a big deal. It speaks well for these smaller banks. They're getting noticed. [00:32:35] From a priority standpoint, it was very easy, I think, for a company like Intuit to be like, "We'll just take care of the Sages and the American Expresses of the world, and all these big companies," and they ignored these newer banks. Obviously, there's enough- these new banks now are getting used by enough small businesses, where the accounting software packages have to integrate them properly into the bank feeds. Blake Oliver: [00:32:55] Well, that's great, because without that bank feed, you can't support clients on those banks. It's like, remember the new Apple credit card? David Leary: [00:33:05] Oh, yeah. The Quicken integration we talked about. Blake Oliver: [00:33:07] I still don't think there's a QuickBooks integration, so if you've got customers using that, it's got to be a disaster. I wouldn't wanna support that. David Leary: [00:33:15] It's gonna be tough. We talked about this company Deel before. They took a Series B investment of $30 million. Their software- basically, they are global payroll. The theory is, it's one software package. You can hire your employees anywhere in the globe, and you have one package to do staff, contractors, compliance, payroll, all in one package. Now, I don't know how they're building this. I don't know how they're able to keep track of all the localized compliance and automating the payments through this, but they're going for it. They just took another round to keep pushing down this path.  [00:33:57] I've seen companies like this before. This is the same- Xero's probably tried to deal with it. Intuit's tried to deal with it. This is why you have QuickBooks Payroll here in the States. They partnered with Wagepoint, and QuickBooks does in Canada. I forgot who the partner was in the UK. Then in Australia, it's KeyPay ... Same thing with Xero, right? Xero, here in the States, partners with Gusto. Xero tried to build their own payroll here in the States and wasn't successful at it. I even think Intuit purchased a global payroll provider company five years ago and just nothing ever seemed to happen from that. I think this is a very, very, very tough thing to solve, but these guys, it looks like these guys are just only trying to do this. They're not like, "Hey, we're gonna build payroll for one country and then try to figure out a second country." There's not many people that have done it successfully. I know Wagepoint is able to do U.S. in Canada, and that's one of the few exceptions. Blake Oliver: [00:34:54] Well, this is really interesting to hear. I'd be curious to know what their market target is. Is it midsized businesses, large businesses? Because, like you said, doing this is insanely difficult, but if they can, they could own this category of global payroll. Really cool. David Leary: [00:35:09] It doesn't really say what size businesses they're going for. It's just, they're- This is that startup, loosey-goosey, very inspirational, "We wanna just help people hire people everywhere. You can have a global workforce ... You can get the best talent wherever they are." Blake Oliver: [00:35:27] Interesting. Well, I've got an app story. It's not specifically accounting, it's artificial intelligence. You know I am a skeptic of artificial intelligence in the accounting profession. I think it's been overblown for years, but I saw something this last few weeks that blew my mind, and I think it really will make a humongous difference. [00:35:50] The new technology is called GPT-3. GPT-3 is what you should search for if you wanna find out about this on Google. It's created by Open AI, an artificial intelligence research lab based in SF. It is a machine learning, natural language-processing artificial intelligence. [00:36:11] It can do some really, really interesting things with that. For instance, somebody built- on Twitter, there's a video by @itsyashdani, who built a bot plugging into this AI that lets people with no accounting knowledge generate financial statements. It really does that. He set up a balance sheet template in a Google Sheet with assets, current assets, non-current assets, liabilities, owner's equities. [00:36:39] He laid out all the sections and the different accounts, and then, in his Python script that's connected to GPT-3, he types in transactions such as, "I put $20,000 in cash into the business." Then, you can see on the other side of the screen, the cash amount getting added onto the balance sheet, into current assets in the cash line. Then he types, "I prepaid $900 for the rent for the next three months," and the AI puts the $900 in the right spot on the balance sheet. David Leary: [00:37:11] Now, is this really AI or is this- because this is the same kind of things I saw built at the hackathons on QuickBooks that people would build with Amazon Alexa, or a Google Voice thing, where they basically have to program all those phrases in. Is this one of those you- it's like Microsoft DOS, you've gotta type it or say it the right way, or it's not getting on that balance sheet? Blake Oliver: [00:37:31] No, that's what's miraculous about this. GPT-3 is a general AI. Nobody programmed these financial statement phrases into it. What it does is it goes into its database and then it parses that sentence and tries to figure out what you want it to do, and it does it. It can actually- this is the sort of AI, where it could really look at a bank statement line and know how to categorize it in the GL. We have seen some companies doing that in our space. David Leary: [00:38:00] It has billions of pieces of data, and some of that data that it has refers to how to properly track an owner's investment in the business. Then it's extrapolating that out into a journal entry and sticking it into that Google Sheet, basically. Blake Oliver: [00:38:17] Yeah, it does it by best fit. It doesn't actually understand what you wanna do. It just looks through the massive database of information and tries to figure out, "Well, of all the accounts that are in the spreadsheet, when he says that, 'I put $20,000 into the business,' what does that most likely mean?" Based on all of the data it has, it says, "Oh, it must be cash because that's what other people do. That's what has been done in the past." This is actually not the most common use case for this AI. The stuff that you actually see that's really cool is somebody wrote an email plugin for Gmail where you write a bullet list of stuff you want it to say, and then it goes and takes those bullet points and turns it into a full email, and paragraphs in prose. David Leary: [00:39:10] It's like having a ghostwriter. Blake Oliver: [00:39:11] Yes. it's able to do that very well because it can look at all the emails you've ever written and then take that list of bullets and get that information into text that looks and sounds like you, based on what you've done in the past. That actually is a really cool application for this, and I hope somebody really writes that. I hope Google uses that because how great would it be if you could just write a bullet point of things that you want your email to say, and then it goes and adds the nice greeting like, "Hey, how are you doing today? Just wanted to let you know that blah, blah, blah," and then, puts all that in there?  David Leary: [00:39:46] Or you could just be a better service to the person you're emailing, and just send them the bulleted list. That's the whole point of this. Just send them the bullets, don't send them all the extra text. Nobody wants to see that. Actually, you know what I want? I want AI that strips all the other shit out of somebody's email and just gives me the points. Blake Oliver: [00:40:02] You could do it with that; you could do that with this, probably. David Leary: [00:40:06] That would be useful. [crosstalk] That would be really useful. Yes, I get an email and there's three sentences, and it's the only three I need to read, and all the other crap is gone. Actually, the whole internet should act like that. There should be some browser plugin that just strips off everything. Blake Oliver: [00:40:21] I don't know if I've done a great job explaining what this thing does. I think seeing the examples is really cool. Check out our show notes, but if the link isn't in there yet, when you listen, just search GPT-3 Beta, and see what people are doing with it, because it is amazing, and super-cool, and powerful. I think this will have a big impact on accounting and finance, especially when it comes to writing executive summary reports of what happened in the financial statements. There's apps that do that now, but they're limited because they had to be preprogrammed by the programmers to always say, "Our current ratio is this, and the cash in the bank is this." That may not be actually what's the most interesting.  David Leary: [00:41:08] Got it. Speaking of this AI, you'd use it as a tool to automate your work. Blake Oliver: [00:41:11] Yeah. Yeah. David Leary: [00:41:13] Zapier released their State of Automation at Work survey. There's some cool data in this. Start at a very high level. Now, two-thirds of knowledge workers currently use automation software at work. Another 18% intend to use it in the future. Blake Oliver: [00:41:29] It's not replacing us so much as super-charging what we can do. David Leary: [00:41:34] Yeah, and there's tons of stats on this, but they basically- these are employees, right? These are people that are knowledge workers. They're saying, "Automation software improves the way I work." 38% of people agree with that. Blake Oliver: [00:41:46] How many people? What percent? David Leary: [00:41:47] 38%. Blake Oliver: [00:41:48] Only 38%? David Leary: [00:41:50] Only 38%. "Automation software helps me be more organized at work." 40% of people agree with that statement. 43%, "It helps me complete tasks faster." Almost everybody in the survey, 96%, so they get a benefit from it of some type. Some of the highlights on that is that it reduces the number of errors, 38%. They say they get more done, 37%. It makes me better at my job, overall, 36%, which I think that's a really, really interesting one, because I think that gets lost in the shuffle when you- if you're automating some of your work, Blake, in theory, it's not so you can go to the bar and drink. You're doing that because you're trying to accomplish bigger company goals, and that's a really big one that helps you more, overall.  [00:42:39] Saving time, that comes in here. Saving money, doing things I value or enjoy more. Another one that really caught my eye is automation software prevents work from falling through the cracks. That's where I think I find a lot of benefit of it. I'm using it for some lead capture. I did a webinar with QBO Chat. If somebody watches that webinar, it automatically puts the email address into a Google Sheet. I'll forget to go get them and move them over to our lead sheet, but I just have it automated and it just goes from the Google Sheet Kathy Iconis made with QBO chat and gets it over into the Google Sheet, I need it in.  Blake Oliver: [00:43:12] Yeah, I would agree with that. The confidence that you can have with automation versus having to run the business from your email inbox and try to remember to do everything is super-powerful. David Leary: [00:43:23] Then, so there was a survey about- and you can take a guess on this. What stops people from using automation? What do you think one of the reasons are? Blake Oliver: [00:43:32] Lack of knowledge of how to set it up, maybe? Some sort of fear of it? David Leary: [00:43:38] Yeah, I think there's little of that. About 17% of the people say that their workplace isn't tech savvy. 23% didn't even know it was an option. Blake Oliver: [00:43:47] Or lack of knowledge there, yeah. David Leary: [00:43:48] Lack of knowledge. Then, some aren't sure how it could be useful for the job they're doing right now. They're almost mentally blocked. They're like, "Oh yeah, I'm sure, but that's just for other guys in the other department." They're not seeing how can be specific to them. Then, like you said, some people are afraid of using it. They think it'll change their role or their responsibilities. Then, there's the straight-out, plain, straight-up, "I am afraid of using automation software," 40%. Just, it's not even like, "I'm afraid to learn it," just "I'm afraid of it." It was a good survey. This is about 1,800 U.S.-employed adults ages 18, and older. Of those 1,100, 900 were knowledge workers, specifically sitting at a computer all day. That was their job. Blake Oliver: [00:44:34] Interesting. Well, in the short amount of time we've got left, I wanna make sure that we hear the voice mail that we got. We got another voice mail, and then, we've got one review, and then we'll take it out. Here we go. Mary: [00:44:45] Hey, my name is Mary, and I'm calling from the Bay Area in California. I'm just starting a practice. I love your show. I've just discovered it. It's full of extremely useful information. I follow it every week and have gone backwards, so thanks so much for doing it. I'm sorry I'm a little late to the conversation about value pricing. I appreciate the idea of the consumer surplus. Some people are willing to pay more than others, so why leave that extra money on the table?  [00:45:16] But I'm curious to know the extent to which that perpetuates certain groups paying more than others. For example, people who don't feel as comfortable negotiating, or people who aren't as clear about their options. Like in salaries, would women and people of color get the short end of the stick? Of course, you can say that the market would take care of that with competition, but in my experience, humans are just way more complicated than that. This is more of a question than a stake in the ground. I just wanted to add that to the conversation. Again, I love your show, and I'll be listening every week. Thanks. Blake Oliver: [00:45:49] Thank you, Mary. Thanks for listening, and actually, that's a great insight, and it's something I don't think about enough, I don't think, is how value pricing discriminates in a negative way. We even use that word "discriminate," because that's what you do when you value price. You're giving a different price for the same service to different customers. We have to be careful when we do that, that we don't do it in a bad way, or a wrong way, or an unethical way. David Leary: [00:46:18] Because it's even illegal in some circumstances, right? Blake Oliver: [00:46:22] Yes. David Leary: [00:46:22] Charging for rent and things like that. Blake Oliver: [00:46:25] Yeah, so I don't have the- I don't know if I have the answer for that. I think it's important to have, I guess it would be important to have measures in place to make sure that we don't discriminate unfairly based on race, gender, sexual orientation, all of, the whole list. David Leary: [00:46:43] It's an unintended consequence that maybe people aren't thinking about that could take place. It could be one of those things where it takes place over time, and we won't know until years down the road and like, "Oh, God. Maybe this value-billing thing ..." Maybe Ron Baker is completely wrong. 30 years from now, we discover it was the worst piece of advice to ever come out of the accounting industry. Blake Oliver: [00:47:04] This is why I'm a fan of making most of the services, especially the entry level services that your firm offers fixed fees. Because then, it's fair to everybody who comes to the firm, it's the same. You can have tiers of that, of course, but it's fair because of that. Also, the people looking at your site, or when you present these fixed fees, you can say, "This is our fee that everybody pays at this range of their business." Me, as a customer, I like that. It doesn't mean you necessarily put it on your website, but the way you present it can be like that.  [00:47:36] Fixed fees are a way to avoid the value-pricing danger of discriminating improperly. You could have lots of different types of fixed fees for different sizes of business. The whole idea is to, if you wanna standardize your practice, is to not have to do value pricing all that much because it's time-consuming and tedious. If you're not doing big engagements, where it's a very heavy time investment, then you really don't need it, if you ask me; you don't need that much. David Leary: [00:48:06] We do have four reviews. You wanna just knock those out here? Blake Oliver: [00:48:10] Wow, four? That's awesome. Yeah, let's do it. David Leary: [00:48:12] I'll jump into the first one here. This is Kate Josephine Johnson. This review is on Podchaser. It's five stars. "The Cloud Accounting Podcast has been an absolutely invaluable asset to me as I built my new bookkeeping business over the last couple of years. I don't have a ton of time to weed through the relevant industry news. I can trust David and Blake to give me the most important news I need to know. I also appreciate how the podcast continues to help me build my professional confidence. I'm an entrepreneur and bookkeeper for the first time in my life after having been out of the workforce for many years.  [00:48:42] It is as if The Cloud Accounting Podcast helped me relearn the language of business and quickly get me brought up to speed with new bookkeeping industry, I find myself in. I highly recommend this product and I'm always recommending it, especially for anyone who is new in the bookkeeping and accounting world. You'll learn the language of the industry very quickly. You'll be a better advisor to your clients. You will learn information that can help you directly apply to be successful in your own business. I listen to every episode." Kate Josephine Johnson of Heritage Business Solutions and the Bookkeeping Side Hustle. Thank you, Kate. That's amazing. Blake Oliver: [00:49:15] Thanks so much, Kate. Great to hear. Our second review comes from Omolara. "I have been listening to Dave, and Blake, or Blake, and Dave for about a year now. Their podcast is super-relevant for accountants, especially those in public accounting. When I set out to start listening to various accounting podcasts, I wasn't expecting much. I thought, "Here we go. This is gonna be boring AF." Quite the contraire. Even though Blake and Dave are talking about the most boring subject in the history of mankind, they keep it light and interesting. They always share what is going on in their personal lives and I love their political commentary.???????? When I tell people I listen to accounting podcasts, they always think it's because I am so passionate about accounting :). In reality, it's because I found a podcast that isn't so boring I wanna jump off a cliff. Thanks, Blake, and Dave." David Leary: [00:50:04] That might be our funniest review we've ever gotten. Got another one here. This one's a five-star review on iTunes from JoshCrist. "Whether you're well established, or someone innovating in the accounting space, or just getting started as a catalyst for change, this is a must-listen podcast for you. David and Blake do an incredible job leading conversations that cover a huge breadth of topics related to the ins and outs of navigating an ever-changing accounting industry. As leaders who've actually experienced success themselves, I highly recommend listening and subscribing." Blake Oliver: [00:50:36] Our final review comes from Ssidawg73. "This is a great podcast. It's light on the chit chat, which I appreciate, and full of useful accounting information and developments. This is one of my weekly must-listen podcasts." Five Stars on Apple Podcasts.  [00:50:52] Thank you so much, everybody; all of you, Josh, Ssidawg, Omolara, Kate, for writing those reviews. They are so helpful. To all of our listeners, if you wanna go write a review, we would very much appreciate it. It really helps us get visible with all the accountants and bookkeepers out there who are looking for podcasts. David, where can people go if they wanna help us out?  David Leary: [00:51:16] You can go to Podchaser to leave a review. It's Podchaser.com per review on Apple podcast. That's great. You could call, leave us a voicemail. Phone number is (202) 695-1040.  Blake Oliver: [00:51:33] That is (202) 695-1040. It's a Google Voice number. Go straight to voicemail. You've got a three-minute limit. Let us know what you think. If you wanna reach me online, you can find me on Twitter. I'm at @BlakeTOliver. How about you, David? David Leary: [00:51:44] I'm on Twitter as well. I'm at @DavidLeary. You can also get a hold of me on LinkedIn. Just make sure you say you listen to the podcast, so we know you're not a robot. Blake Oliver: [00:51:53] Say you're not a bot. That makes it easy for me to accept your invite. Until next time, David, great chatting with you, as always. Stay safe. Stay sane. I'll see you here next week. David Leary: [00:52:03] Bye.____________________ ClassifiedsStill sending spreadsheets of unclassified expenses to clients? With ClientHub, automate this process and get client answers instantly. ClientHub is a client-communication platform that helps you consolidate client communication, securely share files, and instantly get answers, and much, much more. Get started today with a free trial at ClientHub.app and enter promo code "CAP25" for 25 percent off your first three months. ClientHub - frictionless client communication.____________________Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100.  
Sponsors ADP Marketplace: https://cloudaccountingpodcast.promo/adp ClockShark: https://cloudaccountingpodcast.promo/clockshark BQE CORE: http://cloudaccountingpodcast.promo/core Show Notes 04:46 – Turns out, the people who work at Facebook are fighting just as much as the rest of us – Marketplace Tech 11:01 – We've got ... VOICEMAIL!  15:26 – A new internet domain for the CPA profession: .cpa – Journal of Accountancy        AICPA opens up applications for .cpa domains – Accounting Today  20:00 – Arizona First State to OK Nonlawyer Ownership of Law Firms (2) – Bloomberg Law 23:18 – Time & Budgets – Karbon         Karbon releases Time & Budgets – Accounting Today          App Aware: Karbon Updates Work Management Software – Intuitive Accountant 25:23 – Latest product news – September 2020 – Xero Blog 26:23 – Drury family sells $204m Xero shares, PushPay boss Bruce Gordon offloads on way out the door – New Zealand Herald        Second Xero block flies, this time via Jarden – Financial Review 28:41 – Zoom Revenue Soars on Remote Work Boom – CFO.com 30:52 – Zoom (ZM) Chief Accounting Officer to Resign – StreetInsider.com 31:51 – Plaid Unveils New Instant Account Update Feature | PYMNTS  32:58 – How your firm is missing a $682,000 opportunity – Accounting Today  38:03 for Summary why the pyramid scheme  41:26 – Spreadsheet error led to Edinburgh hospital opening delay – BBC News 43:13 – FedNow Aimed At Transforming The US Payment System Approved By The Board Of Governors Of The Federal Reserve – Forbes         FedNow: The Federal Reserve’s Planned Instant Payments Service – Harvard Law School Forum on Corporate Governance          Fed Announces "FedNow" Real-Time Payments Service – White & Case LLP  44:27 – Fed to have payments service ready 'as soon as practicably possible – American Banker 44:56 –  Coronavirus prompts renewed calls for postal banking, faster payments – American Banker         Roundtable: Public Money - A. Klein, How to Fix the Covid Stimulus Payment Problem: Accounts, Information, and Infrastructure – Just Money   46:18 – Why Kamala Harris matters to fintech in the 2020 election – PaymentsSource 50:14 – One more voicemail!  Get in TouchThanks for listening and for the great reviews! We appreciate you! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, please do us a favor and write a review on iTunes, or Podchaser. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus, and NOW, you can see our smiling faces on Instagram! You can now call us and leave a voicemail, maybe we'll play it on the show. DIAL (202) 695-1040Need Accounting Conference Info? Check out our new website - accountingconferences.comLimited edition shirts, stickers, and other necessitiesTeePublic Store: http://cloudacctpod.link/merchSubscribe Apple Podcasts: http://cloudacctpod.link/ApplePodcasts Podchaser: http://cloudacctpod.link/podchaser Spotify: http://cloudacctpod.link/Spotify Google Play: http://cloudacctpod.link/GooglePlay Stitcher: http://cloudacctpod.link/Stitcher Overcast: http://cloudacctpod.link/Overcast ClassifiedsClientHub: https://clienthub.app Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd  TranscriptADP has your back with ADP Marketplace, a digital HR storefront. Be a more trusted advisor to your clients by recommending apps to help streamline HR processes and free up time to focus on people. Stay tuned to hear more from our sponsor, ADP Marketplace, later in the episode. David Leary: [00:00:20] Really, in this grand survey from ADP, only 20 percent of firms had four percent or higher, but the Top 100 accounting firms, one in six of them are averaging more than 20-percent turnover. Blake Oliver: [00:00:31] The average turnover is 16 percent in those firms which have average partner compensation at Top 100 firms - equity partner, I should say - $682,000. So, the bosses are making $682,000, and the staff are turning over at 16 percent. You said that, in the U.S., a typical company is 3.2 percent. That's terrible turnover compared to a typical business.____________________This episode of The Cloud Accounting Podcast is sponsored by BQE Core. As firms everywhere are positioning themselves to work remotely, BQE Software is committed to supporting you and your employees during this critical time. BQE's Core products operate 100 percent on a native cloud platform that's uniquely able to help you in your efforts to embrace remote work while maintaining your productivity.In response to the impact that COVID-19 has had on your firm and your clients' businesses, the team at BQE has let us know that Cloud Accounting Podcast listeners will now receive three months of BQE Core for free with an annual subscription package purchased on or before September 30, 2020. To learn more, head over to cloudaccountingpodcast.promo/core. ____________________This episode of The Cloud Accounting Podcast is sponsored by ClockShark. ClockShark is the leading GPS, time-tracking, and scheduling system built for local construction and field-service companies that want a simpler way to track time, run payroll, and understand job costs. With the capabilities of crew tracking, scheduling, jobsite geofencing, teams, and project segmentation, automatic labor allocation, budgeting, and reporting, ClockShark has built a robust mobile time-tracking system to handle the unique challenges that face your clients.  With ClockShark, your clients can keep accurate records, like overtime, paid time off, unpaid time, hours per job, and tasks, as well as the crucial data needed for certified payroll. With the integrations ClockShark has, you'll be able to connect to one of many ADP payroll platforms through ADP Marketplace  and process payroll in minutes with the click of a button. ClockShark's pricing starts at just $6 a month per employee. Head over to cloudaccountingpodcast.promo/clockshark. ____________________Blake Oliver: [00:03:03] Welcome to The Cloud Accounting Podcast, I'm Blake Oliver.  David Leary: [00:03:06]  I'm David Leary.  Blake Oliver: [00:03:08] So, it's Labor Day weekend.  David Leary: [00:03:10] We're knocking out a recording early. This is Friday evening and probably when we're done recording, the feds will release some news about PPP loans. Blake Oliver: [00:03:17] Do you have any plans this weekend, David?  David Leary: [00:03:19] Just to chill out. I think we're gonna go to do a staycation at a hotel for one night just to relax. We had a pretty major- we soft-released our Melio accountants features this week. Blake Oliver: [00:03:29] Oh, cool. David Leary: [00:03:29] All the work we've doing the last six months at Melio is finally getting out the door. We're tiptoeing out into those waters. It's a little- it's scary to release a new offering, right? Blake Oliver: [00:03:39] Yeah. David Leary: [00:03:40] It's been a lot of work, but it's getting out the door, finally. Blake Oliver: [00:03:42] So, when do I get my Xero integration, is my question. David Leary: [00:03:46] It's in the stack. It's in the stack of a zillion things I need to do, for sure. It's getting out there - accountants features for Melio. Blake Oliver: [00:03:53] It's nice you're doing a staycation. I am also staying at home. I imagine pretty much everybody is staying at home, or a lot of folks are. What are they gonna be doing at home? Probably spending some time on Facebook, going at each other on the political spectrum. I don't know about you, David, but my Facebook feed, lately, has become very partisan. I have noticed this on both sides. I log in and I just see a lot of angst. I was driving to pick up my son from school just before we're recording this. David Leary: [00:04:23] Oh, wait, wait. He's going back to real school now?  Blake Oliver: [00:04:25] He goes to a community center where he is in a pod that learns online with the help of a few tutors. David Leary: [00:04:33] So, it's tiptoeing in the waters, right? Blake Oliver: [00:04:35] Yeah. It's like a hybrid-ish approach, and it's working because nobody- there hasn't been an outbreak. So, there is a way to social distance to make this happen, it's just- it's expensive. Anyway, I'm driving to pick him up, and I'm listening to Marketplace Tech with Molly Wood, I think. There was a story there about how Facebook has their own internal Facebook. Did you know this? David Leary: [00:04:55] I feel like I've heard about this before, or I know of its existence. Yes. Blake Oliver: [00:04:59] So, it makes sense, if you are Facebook, you would want your employees using Facebook. What they did is they created an internal version called Workplace. They then sell it now to businesses. Actually, you could go buy Workplace by Facebook and use it as an internal Facebook for your firm if you wanted to do that. A lot of firms- David Leary: [00:05:21] I've heard it's actually decent. I've heard it's surprisingly a good communication tool to use in-house. I've heard it's decent. Blake Oliver: [00:05:28] Yes, if you think about it, it's familiar to everybody because everybody pretty much has used Facebook. So, if you know how to use that, you can instantly use this. So, Facebook has their own internal Workplace, and it has 50,000 people because Facebook is big: it's like a little city. People don't just talk about work; they talk about all sorts of things. Apparently, according to this report on Marketplace Tech, it's gotten really partisan on there. There are people posting political stuff left and right. This Workplace app uses the same Facebook platform that we all do on the social media site. The algorithm has been apparently pushing very controversial topics to the top of everyone's news feed, and it has become really bad on that Facebook with a lot of anger, and vitriol, and just the same stuff that we're seeing. David Leary: [00:06:19] Okay, so the algorithms- because they get lots of clicks, they're gonna push that stuff up to the top of your feed because it gets a lot of engagement. Blake Oliver: [00:06:25] Yes. David Leary: [00:06:25] That same algorithm's being applied to the internal Workplace Facebook groups as well, and coincidentally, because Facebook uses it, they're basically eating their own dog food in the way they probably never intended to or wanted to. Blake Oliver: [00:06:39] It's an algorithm that prioritizes posts with high engagement. So, the idea is that if something is getting a lot of comments, a lot of likes, a lot of engagement from users, then other users will want to see it. The negative side effect of this, the unanticipated consequence, is that a lot of stuff that upsets people is what gets them to engage. This is what we have all been seeing on social media, is that really upsetting things get a lot of engagement and these get into our news feeds. That's why you see such a partisan environment. A very small percentage of people interacting over these posts with a lot of comments – really extreme liberals, really extreme conservatives – can mess with the algorithm in that way. They're not messing with it. That's how it's designed to work, right? David Leary: [00:07:25] Well, the mainstream media is that way. It's very extreme on both sides, and ultimately, the politics is like that. The impeachment is a great example, right? They got people so divided, but both sides got tons of donations because of the impeachment. They both won. Blake Oliver: [00:07:41] Right, right. Exactly. So, technology is prioritizing, or promoting, or making it good to be controversial. To get back to this story about Facebook, why I'm telling you this is that, apparently, recently, Mark Zuckerberg had to step in and say, "We're not gonna have these conversations on Facebook Workplace anymore." The irony of that, David, is just astounding. I almost couldn't drive. I was just floored that Facebook's algorithm is so broken that Mark Zuckerberg had to step in and say that "We are going to override it and not have these political discussions on Facebook anymore," on their internal Facebook. Of course, he's not gonna do that on the real Facebook. David Leary: [00:08:24]  We can't opt into that on the real Facebook? Blake Oliver: [00:08:26] I know.  David Leary: [00:08:27] Maybe it's a paid tier, a premium offering. Twelve bucks ... You pay $1 a month for Facebook, and you get a better feed.  Blake Oliver: [00:08:33] Well, remember how it used to be where it was just chronological? David Leary: [00:08:37] Yeah. Blake Oliver: [00:08:37] The news feed was just whatever everyone posted, and it was in order, and you just go through it. It wasn't surfacing stuff based on engagement. That should be an option. I wish that was an option. I would switch that. So, anyway, I thought that was really funny.  [00:08:54] One takeaway, by the way, from all this, if you're a CPA or an accountant, bookkeeper, trying to get people to see you online, from a marketing standpoint, this is why, if you wanna get noticed on LinkedIn, or Facebook, or Twitter, it's actually really good to somehow figure out how to be controversial because that's what gets surfaced.  [00:09:11] So, you wanna be controversial enough with something where people start commenting a lot, but, obviously, not so controversial that it harms your business. Just be thinking about that if you're thinking about marketing. That's, unfortunately, the way these algorithms are designed. You're not going to get a lot of views if what you post is making people feel good; they just feel good and then they don't click. David Leary: [00:09:37] So, we should be titling our episode titles very controversially to get attention. Blake Oliver: [00:09:42] We did that deliberately with our last episode, with the payroll tax deferral. We put Trump in there, just because we know that it makes people ... It either makes people happy or sad. It's one way or the other, at this point, right? David Leary: [00:09:55] We can make a big post that says, "Desktop software sucks," or we can make a poster about, "The billable hour sucks," and we get all these people fired up and responding. I see how the system works; we might be able to game this a little bit. Blake Oliver: [00:10:06] Yeah. Unfortunately, that's the way it works in the world of digital marketing these days, so, I wanted to bring that up. I also have lots of stories this week. Amazingly, it was a very busy week for me, anyway. We have the new .CPA domain that was released. Karbon has a feature out, Time and Budgets, and a spreadsheet story, as well – a spreadsheet error that led to a hospital opening delay, believe it or not. David Leary: [00:10:33] Spreadsheet stories are my favorite, though, that we get. I love our spreadsheet stories. I have some instant payment stories. Blake Oliver: [00:10:39] The Wall Street Journal had a feature on how auditors are struggling to access data and do their jobs during remote work. I thought that was interesting; auditors don't get a ton of love from the press. There's a canton in Switzerland that is now accepting taxes in Bitcoin, that's pretty cool. The question is, where do we start?  [00:10:57] Maybe we should start with the voicemails we got. We got two listener voicemails, both about accounting education – one of our recent topics – and what should we be doing as an accounting profession to train people so that they're actually useful when they come out with their accounting degree and make CPA firms want to hire them? Because, as we have discussed in the past, the hiring of CPAs ... Well, it's actually not CPAs, it's the hiring of accounting degrees into CPA firms has declined by 30%. David Leary: [00:11:32] Well, this is appropriate because one of our reviews we got was written by a student. So, it's very appropriate these voicemails are tied to a student listener. Blake Oliver: [00:11:41] So, let's listen to those voicemails and then we'll hear that review. Kayla Shwitter: [00:11:45] Hi, my name is Kayla Schleeter. I am calling from Grand Forks, North Dakota. First of all, I love your podcast. It is up-to-date, straightforward information that is really enjoyable to listen to. I just wanted to call in about how I agree with what you said about the grunt work is what makes you good at what you do 10 to 20 years in the future. I was fortunate enough that in my small-town high school in North Dakota, we had three years of accounting. The first two years we learned the basics of accounting. Then in year three, we used QuickBooks Desktop to enter transactions for a fake business, and then reviewed the financials to have an understanding of what that means.  [00:12:28] That experience and understanding is what got me a job at a small business doing data entry while pursuing my accounting degree. That eventually led me to doing what I do now, which is software consulting and providing advisory services at a regional accounting firm. I think the best first step for educating future accountants is integrating cloud-based accounting software with actual workflow into the curriculum. Maybe Intuit can set up, if they haven't already, a special pricing structure for educational institutions to have access to the product to help the future generations enter the workforce well prepared. Finally, I also agree with the point that you mentioned at the end of the podcast about potentially shifting away from so much time in the classroom and extending internship experiences. Again, thank you so much for the podcast, it's super-helpful, and stay safe, and healthy, guys. David Leary: [00:13:25] Great voicemail.  Blake Oliver: [00:13:26] My mind almost exploded when I heard three years of high school accounting. That's amazing. David Leary: [00:13:33] Yeah, it's probably the exception, right? Where people are getting three years of accounting in high school. Blake Oliver: [00:13:37] That's awesome. Obviously, the work experience thing is great. Really great insights. All right, you up for number two? David Leary: [00:13:44] Yeah. Tasha Chambers: [00:13:45] Hey, Blake, and David. Tasha Chambers from Wisconsin here; longtime listener, first-time caller. Calling regarding your comments on the changes that should be made to the accounting education. Blake, I wholeheartedly agree; I think that we should return to an apprenticeship model for accountants. I would love to see maybe two years in the classroom, where they learn the basic 'debits equal credits,' but so many of them are coming out and they have just no practical application for the knowledge they have, and they can't make the leap. I think that it would be a great service for kids; it would be a great service for students; it would be a great service for the firms, as well, to bring people up and teach them their way. So, great show! Have a great day. Blake Oliver: [00:14:32] Well, thank you, Tasha. David Leary: [00:14:33] Yeah, I still firmly believe you can't replace that in-the-weeds hard work. You just can't. Blake Oliver: [00:14:39] No. Work experience is so important when it comes to accounting. Like you said, David, starting a business is the best way to learn about running a business, and a lot of that is accounting. David Leary: [00:14:49] We also got, from a student- we got a review. Blake Oliver: [00:14:52] Oh, let's hear that.  David Leary: [00:14:53] This is from Jrg828. The review is five stars on Podchaser: "Funny, entertaining, and informative. What more could you ask for? I listen to The Cloud Accounting Podcast to discover new technology, statistics, industry news and trends, as well as best practices as a professional. Great for students, too." Blake Oliver: [00:15:10] Thank you so much. David Leary: [00:15:11] The theme here is about students. So, let's just say, Blake, now, I've busted my ass; I got my experience; I take the test; I'm a CPA. Can I now go get a .CPA domain? Blake Oliver: [00:15:22] Well, no, actually; not yet. Almost. So, CPA.com is making available ".CPA," the top-level domain that they wrangled from the lords of the internet. I forget who-  David Leary: [00:15:39] The ICANN. Blake Oliver: [00:15:40] The ICANN, yes. So, the AICPA is the official registrar for the .CPA domain. You can now, if you are a CPA firm, apply through October 31 to get the same URL you have currently with .CPA at the end of it. For instance, if you have BlakeOliver.com, you could apply for BlakeOliver.CPA, if you are a CPA firm. I actually can't yet do that because I am an independent CPA. I have to wait until January 15, when .CPA registrations will be opened up to individual-licensed CPAs. David Leary: [00:16:19] Doesn't that mean all the good ones will be gone by then? You're gonna get BlakeOliver2552.CPA. You're not gonna get a good domains. Blake Oliver: [00:16:27] Well, yeah, we'll see. I'm curious to see how many people actually sign up for this, because it is not cheap. I guess for a firm it is. It's only $225 per year for each domain, and if you're a CPA firm, that's really no big deal. They do have premium domains at a higher price. So, if you want a domain with only two or three letters, that'll be $690 per year, and I imagine that it'll be mostly firms that grab those.  [00:16:55] Here's one thing that I only saw in one publication. Going Concern said that one of the conditions of getting this .CPA domain is that you have to redirect your current domain to the new one. So, if you have that sweet .com domain, you are going to have to commit to use .CPA as your main domain. You can't just get that and redirect it to your .com- David Leary: [00:17:18] Now, does that include all your email addresses and everything else, as well? You have to utilize this as your entire stack? Blake Oliver: [00:17:26] Well, so, according to Going Concern, what they said in there, it seems to me that's the way they want it to work. It makes sense, right? If CPA.com is going to create this whole domain and try to get it to become the domain for CPA firms, that every CPA firm and every CPA uses, but definitely the CPA firms, they need to make people use it. They don't just want people buying it and redirecting it. That's just me thinking out loud. David Leary: [00:17:51] You have to be a CPA firm? What if you're a bookkeeping firm, or an accounting firm, you ...?  Blake Oliver: [00:17:57] Well, you have to be registered as a CPA firm, I believe, is what that means. So, that's different in every state, but if you are not registered as a CPA firm, then I don't think you would be able to apply for this. David Leary: [00:18:09] Now, what if you're a CPA firm, but you're not a member of the AICPA? Are they gonna allow you to buy it? Blake Oliver: [00:18:13] I don't know about that. I am not sure; I didn't see that. It is limited to licensed CPAs, and CPA firms. That's what I know. David Leary: [00:18:22] I saw a lot of pushback on the interwebs, a little bit, on the Twitter, that people were a little shocked by the price because you can ... What's a domain? Twelve bucks a month for a for a typical .com domain? Blake Oliver: [00:18:31] Yeah.  David Leary: [00:18:32] People are shocked about the price. Then, also, think – there's a lot of people that don't renew their AICPA membership; they don't think it's worth the money. They could utilize this as a carrot to get people to renew. "Hey, if you renew your application, you get your domain." Blake Oliver: [00:18:48] I would love to see CPA.com make this free for individual CPAs ... Not free, but included with your membership, because you're already paying a few hundred dollars a year. Why not give everyone their own .CPA domain as part of that? But I guess it's gonna be on top of that. It would be a great way to convince independent CPAs to actually maintain their membership because I know a lot of people, once they leave big firms, where the big firms pay for the membership, then they let theirs lapse because they don't see the value as much anymore. David Leary: [00:19:19] I tried to register CloudAccountingPodcast.CPA, and it wouldn't let me get through there. For me personally, I'd like to get, "I'm-not-a.CPA" Blake Oliver: [00:19:28] Well, unfortunately, David, if you and I tried to make The Cloud Accounting Podcast into a CPA firm, I'm not sure if we could, in most states, because it's a 50-50 business, and to be a CPA firm, you've got to have at least 51% CPAs in many states. It varies, right? [00:19:47] Something I saw interesting in a related profession – in the legal profession, this is not common. To have non-lawyer owners of lawyer firms is actually- historically, you can't do it. Well, our state, Arizona, is now the first state to okay non-lawyer ownership of law firms. This was a big hullabaloo on Twitter, right? David Leary: [00:20:08] Well, I think a lot of it's an ethical thing. They think that as soon as a lawyer is motivated by profit, he or she is going to not have any judgment and not represent clients properly. Blake Oliver: [00:20:19] I don't understand how having non-lawyers in your firm or having non-CPAs in your firm makes you less ethical. David Leary: [00:20:25] My experience with a lot of lawyers is they are horrible at running their law firm. They're always changing partners because they're just not good businesspeople. They're good at practicing law, but they suck at running their business. If you open the door to let them partner with somebody that knows how to run a business, they could actually do better at their law job, right?  [00:20:44]  I do feel like it's an ethical argument, which almost leads me to be like, "Then why are you charging by the hour?" The fact that that's mandated, that they must bill by the hour; they can't even value bill in many cases ... It's just really being shaken up, and this is just another inch down the road. Good for Arizona being one of the first states to do that. Then, also in Arizona, I don't know if you remember, about a year ago, they were one of the first states to let people – if you move here, you don't have to retake your test or your license, for lots of different industries. Blake Oliver: [00:21:12] Oh, yeah. Is that the case for CPAs? I don't know. David Leary: [00:21:16] I think so, yeah. Blake Oliver: [00:21:17] So, I could get my license here in Arizona now. Oh ...   David Leary: [00:21:20] Yeah. The same thing- there's a podcast about stupid things that should go away now that we've had COVID, like, "Hey, maybe it's okay for people to drink on the sidewalk. Maybe that's all right." We could have beers outside during our dinner. Maybe that's okay, right? But one of the things is nursing. Nurses, nationwide, take the exact same exam, but you're licensed in each state, and all of these states would not let licenses move.  [00:21:43]  Now, because of COVID, they had to suspend all these laws, so that way some nurses who were registered in New Jersey, could go help out in New York City. So, they suspended all these laws, and hopefully laws like that will go away because it doesn't make any sense. If you're a nurse and you take a national test, you should be able to work in all 50 states. Blake Oliver: [00:22:01] There's one more consequence of this ruling here in Arizona about law firms. The Big Four, now, if more states follow suit, have an opportunity to start competing in the legal services world. We've got Big Law and we've got Big Four accounting and consulting, and we might start seeing a lot of overlap. So, Big Law firms creating consulting divisions and going after that kind of work, and then, Big Four accounting firms going after legal work by starting to hire lawyers and provide those services. David Leary: [00:22:30] This, in theory, should be better for the consumers, long term. Blake Oliver: [00:22:33] Now, I imagine that our listeners may have some thoughts on this and some strong opinions, and we would love to hear those – your opinions about the .CPA domain, the presence of non-CPAs owning CPA firms, or really anything you want. You can also leave us a voicemail, just like Kayla and Tasha. Give us a call at 202-695-1040. That is 202-695-1040. It's a Google Voice number; it goes straight to voicemail. You get three minutes to tell us what you think, and we will definitely listen to it, and we maybe will even play it on the air. That's it for the CPA stuff. What's next? Should we talk about app news?  David Leary: [00:23:12] Yeah, let's jump over to the apps.  Blake Oliver: [00:23:17] A big one from Karbon; the practice management solution has released Time and Budgets, "Time and Budgets is designed to allow Karbon customers to set time and dollar estimates, track time, compare budgets against actuals, manage capacity, analyze progress and performance, allocate resources and more." So, it's now in beta and is rolling out to all Karbon customers in the coming weeks. David Leary: [00:23:41] I always thought Karbon was about managing your communications. It feels like now it's heading towards full-blown firm management. Blake Oliver: [00:23:51] I think this is an interesting new feature, because I do recall Karbon, at its inception, arguing strongly against time-based billing and having this attitude that you don't need to track time and manage your firm that way. David Leary: [00:24:09] Oh, like if we went and Googled some of their old webinars and things. Blake Oliver: [00:24:12] I do recall that being part of the mentality, which is the mentality of a lot of cloud accounting firms that have moved to value-based pricing and don't track time anymore. Clearly, there are lots, and lots, and lots of firms ... The vast majority still track time. So, I think maybe this move is just an acknowledgment that this is something that firms want, and you cannot grow to take on most of the market, unless you're gonna offer it.  [00:24:42]  I will admit too, there is value, potentially, in tracking time. It's not good or bad, it is not one or the other. There are a whole spectrum of ways to track time and bill using time in a firm and use it in combination with value-based pricing. Maybe you use it to track performance, maybe you don't. Maybe you use it on some projects, maybe you don't. To go completely cold turkey is really challenging, and I think everybody will agree with that. Having a way for firms to be able to track time, while they move on to a new practice management platform makes a lot of sense to me. David Leary: [00:25:14] Well, in a way, if Karbon really saves so much time in improving the communications, now that it's being tracked, they'll be able to prove the value for the product and charge more. Blake Oliver: [00:25:22] Exactly, there you go. Xero released their September 2020 updates. I'm a fan of Xero, but I have to say, I am, again, somewhat disappointed in the pace of feature releases recently. The only thing in this list that stuck out to me that was even worth talking about is they have a redesigned date selector that finally makes sure that dates are formatted correctly for U.S. customers. Now, it's month, day, year instead of day, month, year, which is the rest of the world.  David Leary: [00:25:52] So, Xero rolled out 10–11 years ago in the U.S. market?  Blake Oliver: [00:25:56] Yeah. David Leary: [00:25:56] Now, the dates are working correctly? Blake Oliver: [00:25:59] They gradually started fixing it, and I don't think it was ever completely fixed across the whole product all at once because it's different code bases for different parts of the product. You would run into issues, sometimes, where you'd type it in the U.S. format into a field and then it wouldn't stick, and you'd have to go back and change it, and it was really annoying. David Leary: [00:26:20] Rod Drury, the former Xero CEO, founder of Xero, he actually did a sale. It's a planned block sale, but he sold over $2 million of Xero stock. Another former executive also sold, but somebody that's on the board actually bought 400,000 shares. So, there's a lot of movement happening, but the fact that people that are currently on the board that are at a different phase of their life are buying Xero shares is probably a good indication. This is just ... People have to do that, right? Executives have to rebalance their portfolio eventually. You just can't have all your eggs in one stock, especially if you're not active in the company anymore as much,  as Drury is.  Blake Oliver: [00:26:53]  I might give Xero a hard time on features because I'm a user, but I'm bullish on the company, globally, and their prospects over the long haul, for sure. So, that was the news is that Rod Drury is cashing out and now is super, super rich? That is awesome. It's great that somebody could make- I don't even know how much he's worth, at this point, but $200 million just right there from cloud accounting software is pretty cool; accounting software ... It's just awesome. Anyway  ...____________________ This episode of The Cloud Accounting Podcast is sponsored by ADP Marketplace. How can you be a more trusted advisor for your clients as they face new challenges? By recommending solutions from ADP Marketplace, ADP's digital HR storefront. With ADP Marketplace, clients can try, buy, and implement highly rated HR apps that can share data with ADP. With secured data integrations, it's easy to streamline HR processes and adapt to new business needs. Help your clients discover new ways to recruit and onboard employees, boost performance, offer unique financial-wellness benefits, and much more.   With integrations for popular business software, like Expensify, PayActiv, Slack, and ClockShark, clients can add value to the tools they already use by simply and securely connecting them to ADP. Have clients in field service, or construction? ClockShark can help them track time to quickly and accurately run payroll, all integrated with ADP. Visit ADP Marketplace at apps.ADP.com, or right from your Accountant Connect dashboard. Not set up with Accountant Connect? Sign up today. It's free. Head over to cloudaccountingpodcast.promo/ADP. ADP has your back with ADP Marketplace.____________________ Blake Oliver: [00:28:41] The people who invested in Zoom are very happy, because Zoom stock bumped up ridiculously after their revenue numbers came out. Their revenue rose 355 percent to $663.5 million in the last quarter, crushing analysts' estimates of $500.5 million. To put this in perspective, the company made as much money in the past three months as it did in the entirety of 2019. David Leary: [00:29:10] Wow. Blake Oliver: [00:29:10] Yeah. One key metric, the number of Zoom customers with at least 10 employees exploded to 370,000, which is up 458 percent, year over year. That is startup-level growth, not growth-company-level growth. Just amazing. So, their stock jumped 22.7 percent. I'm not sure where it stands right now, after the recent fall in the markets, but it's still way up from where it was, and I wish I'd bought some Zoom stock when all this started. David Leary: [00:29:44] It'll be interesting to see how this sustains long term, because obviously Teams is coming in heavy. Google has moved their videoconferencing up higher. When you book a meeting now, Google really pushes you to use their videoconferencing. Facebook's coming down the pipe with their- they're basically gonna move Facebook's portal to be a little bit more meeting-based for work. There's other competitors now getting into this and taking it way more serious because of the pandemic, but obviously, they can't maintain this growth. Eventually, people are going to be Zoomed out; there's no more people you could possibly add. There's a finite amount of people that need to use Zoom. Blake Oliver: [00:30:18] They've expanded the market to kindergarteners, so how far can they go?  David Leary: [00:30:21] Yeah, there's not many-   Blake Oliver: [00:30:22] It's funny, you mentioned Google. I don't think Google has a shot here, because Google built browser-based videoconferencing, and they just can't figure out how to make it not suck up every single bit of power in your computer. Because not only is it Chrome, and Chrome is resource-intensive, but then you've got videoconferencing going through Chrome? It's a disaster. Every time I boot up a Hangout, I'm sad because I can't do anything else. Whereas Zoom just runs with no problems these days. David Leary: [00:30:50] Did you see that they also disclosed that their chief accounting officer is leaving the company? Blake Oliver: [00:30:56] No, I did not. Hopefully, we're not gonna hear about some shenanigans after this. David Leary: [00:31:00] He's resigning as of October 16, 2020. It's interesting. The disclosure really goes out of its way to call out, "Nothing's going on; there's nothing questionable, it's a peaceful exit," etc., etc., etc., etc., etc., but there's an interesting thing about the new replacement that's coming in, and how the offer letter to the new replacement has an annual base salary of $350,000, and a sign-on bonus of $40,000. Blake Oliver: [00:31:30] So, what's crazy about that? David Leary: [00:31:32] The only reason I'm bringing that number up is because I think later on, we're gonna talk about there were some stats about how much partners at accounting firms make. Blake Oliver: [00:31:41] Well, let's talk about that. How much do partners at accounting firms make? David Leary: [00:31:45] Before we jump to that, really quickly, I'll just make a quick ... One more last piece of app news before we jump out of app news. Plaid, who, basically, builds bank feeds, right? Blake Oliver: [00:31:54] Yep. David Leary: [00:31:54] Almost all the apps are using it; a lot of them are using Plaid under their covers. Plaid, about a year ago, started working directly with the banks to offer the banks a service where, "Hey, we can help you build out your bank APIs," and they called that Plaid Exchange. Now, what they're doing is, if you now use Plaid Exchange, you can actually offer your customers instant account activity. If your bank-  Blake's bank uses Plaid's Exchange service to build out your APIs, my bank feed's gonna be instantaneous now. Blake Oliver: [00:32:23] I don't have to wait until close of day for my feeds to update the next day, it's just instantly? That's really cool. David Leary: [00:32:30] Yes. Assuming they push it out in the bank feed ... Basically, it is available within seconds, the user's activity; you can authorize it-  Blake Oliver: [00:32:36] You can just be sitting there, reconciling those accounts all day long, just have QuickBooks open, as soon as a transaction comes in, just code that thing. David Leary: [00:32:44] Refresh, refresh, refresh. Except for QuickBooks, I don't think uses Plaid. QuickBooks has their own proprietary-  Blake Oliver: [00:32:48] I think Xero uses Plaid now, right? That's a good sign for them. That's nice. Can we talk about partner compensation because it's-  David Leary: [00:32:55] Yeah, let's jump into that. Let's jump over- Blake Oliver: [00:32:57] It's a really big number, and for people who don't know how much accounting firm partners make, it's shocking. David Leary: [00:33:03] So, the average equity of a partner at a Top 100 accounting firm is $682,000 a year. Blake Oliver: [00:33:08] You mean the average salary of an equity partner is $682,000 a year? David Leary: [00:33:12] Yes. Blake Oliver: [00:33:13] That doesn't include the Big Four? That is insane. That's a lot of money. I think I saw an article from Gene Marks, was it in Accounting Today with this number in it? Is that how we came across it? David Leary: [00:33:25] Yes. There was a study that came out from Inside Public Accounting earlier in the month. Blake Oliver: [00:33:30] Got it. To be clear, this is the Top 100 firms, excluding the Big Four. Do you want to talk about the Gene Marks article? Kayla Shwitter: [00:33:39] Yeah. There's an article, and the headline was very eye-catching: "How your firm is missing a $682,000 opportunity." I was like, "Oh, that's interesting." Maybe there'll be some, "Oh, you should offer this service. There's some service you should be offering." I really read the article, and a couple of stats are in it, because it compares this survey, and the survey from ADP. ADP had a 2019 survey about the state of the workforce. The turnover in a typical business is about 3.2 percent. It's not a huge amount of turnover, but – really, in this grand survey from ADP, only 20 percent of firms had four percent, or higher, but the Top 100 accounting firms, one in six of them are averaging more than 20 percent turnover. Blake Oliver: [00:34:24] The average turnover is 16 percent in those firms. We have average partner compensation at Top 100 firms – equity partner, I should say – $682,000. The bosses are making $682,000 and the staff are turning over at 16 percent. You said that, in the U.S., a typical company is 3.2 percent. That's terrible turnover compared to a typical business. What is Gene saying that we should be learning about this number then? David Leary: [00:34:54] This is the part I don't get. He talks about how, in general, I feel like accountants- they don't wanna say how much they make. Partners, I guess, are embarrassed of how much they make. Blake Oliver: [00:35:03] So, they keep that to themselves. They don't advertise that they're rolling in dough is what he's saying. David Leary: [00:35:09] Yeah. They're not advertising the number, but my observation, though, is actually weird, and maybe we could, just as a side conversation related to this, is I don't understand ... When I worked at Intuit, I never said, "David Leary, Intuit shareholder." How come employees of the big accounting firms put their name and then say shareholder?  Blake Oliver: [00:35:29] Or equity partner, or partner? David Leary: [00:35:31] Yeah, instead of just saying, "I have this position at this firm." It's almost like they wanna tell you they make $682,000 a year, but they don't want to actually tell you that. Blake Oliver: [00:35:40] Well, that is possibly it. The other part is that there's a class difference between the equity partners, and the partners, and all the staff. It's a total-  you're either in the club, or you're not. Everybody wants to get into that club, at least once they- when they first get to the firm, they're bought into the idea of probably getting to partner someday; at least a lot of people are. You know that you can make a lot of money if you become partner.  [00:36:07] I guess Gene's point here is that because accountants don't talk about it, the partners don't advertise how much they make, that they're losing out and that staff are turning over. If they talked more about partner compensation and the benefits of becoming partner, then staff would stick around, and they wouldn't leave, and they would try to become partner. That's what I'm getting out of this. David Leary: [00:36:32] All right. The argument is because people don't know they could make $600,000 a year at an accounting firm, they just quit and just go get a different job somewhere else.  Blake Oliver: [00:36:41] Because it's hard, right? They become less-  David Leary: [00:36:42] They have to go to work at Zoom for $300,000 a year. Blake Oliver: [00:36:45] Yeah, they get less motivated or something ... Maybe they would stick it out. I take a different approach to looking at this, and I see that number, and then I know how much the staff and managers make, and the senior managers don't even make close to that number. I think to myself, well, maybe it's not that 16 percent of staff are turning over every year because they don't know that if they stuck around, they would make all this money if they became partner.  [00:37:15] Maybe it's because they know that, and they're annoyed that the partners make that much money, and they don't want to stick around. What I'm trying to say is that if the partners shared the wealth more, maybe people would stay around, and they wouldn't leave. If you pay people more, then are they gonna leave? I think money motivates people, right?  [00:37:34] If partners are sticking around to become partner or future partners are sticking around to become partner to make more money, if you just paid your managers, and senior managers, and staff all more, then maybe they would stick around, too. This is how big firms work is they're giant pyramid schemes, right? You convince people to join, and you work them to the bone, 60-   David Leary: [00:37:56] Episode title. You said it. Top accounting firms are pyramid schemes. That's the episode title. Now, here's the voicemail number: (202) 695-1040, call us up. Blake Oliver: [00:38:05] It fits with the marketing message about creating controversy. Engagement through controversy. I'm saying this tongue in cheek, but I'm a bit serious about it too, because how does it- it's not a literal pyramid scheme, but it has some resemblance to a pyramid scheme in that it is: recruit people at the bottom, get them bought in to this vision of someday becoming partner and moving up, and create this whole annual promotion schedule, so they're always competing to get to the next level, and then work them really, really hard and pay them not super great. That way, the profits flow up to the partners – the smallest group at the top. You just keep people hanging on for years, and years, and years, hoping that they're gonna make it. Eventually, they realize they're not gonna make. It is a ridiculously small number of people that become partner ever. Everybody else-  David Leary: [00:38:58] So, you're rolling the dice, here. It's a gamble. You're like, "Am I gonna be able to become partner before I burn out?" Or "I'm a young person ..." and he's saying this here. He's like, "Yeah, they should be telling people about the long-term financial rewards as long as they commit to being an accounting professional and keep the professionals, and good for you ... Let's work hard." Really, that's the gamble. There is a pot of gold at the end if you don't burn out first. Blake Oliver: [00:39:19] Right, and of course, when you're young and you have this attitude that you're the best; you're confident; you make that deal. You're saying, "Oh, yeah, I have what it takes to make it."  Then, of course, life goes on. Maybe you have some kids; that slows you down a bit. You decide, "This is not for me," and yet you've dedicated a bunch of your life to generating a lot of profits for the partners, and you never saw any of that yourself.  [00:39:43] I'm not saying it's all bad. You got a ton of amazing experience; you learned a lot and everything, but you definitely didn't benefit financially the way that the partners do. I think that is gradually changing because it's becoming more obvious, I think, with transparency that you get from the internet ... If you're an accounting student, and you just wanna know what it's like to work at the Big Four, you can just go on Reddit and learn all about PwC, and Deloitte, and KPMG from all the totally disengaged employees there who spend all their time on Reddit.  [00:40:18] You can see it's not exactly what the recruiters are promising you. Tell me I'm wrong. I'd actually love if somebody is listening to this and disagrees. You can call our number. You can leave a review and tell us what you think. If you agree with me, if you are one of those people who had this experience, let us know, as well. David Leary: [00:40:37] Well, so, how many years does it usually take to become a partner at a Top 100 firm would you guess? Blake Oliver: [00:40:44] Gosh, I don't know. 20 years or something? David Leary: [00:40:46] Blake, we'll do the podcast for 20 years, and there's a pot of gold at the end here. One day, you will get a $600,000-a-year salary from the podcast in 20 years, based on our current growth rates. Blake Oliver: [00:40:58] We're gonna do that much sooner, David. I'm looking forward to the Cloud Accounting Podcast yacht. We gotta figure out a way to get a tax deduction for having a boat, that's for sure. David Leary: [00:41:09] One of these days. Blake Oliver: [00:41:10] So, where do we go from here, David? What else do you want to talk about in the time that we have left? I've got a story about the spreadsheet error. David Leary: [00:41:19] I don't wanna skip that. Talk about that because I really love the spreadsheet stories that we always have. Blake Oliver: [00:41:25] So, there was this hospital in Edinburgh that was supposed to open; a very expensive hospital. I don't know, I want to say close to half-a-billion euros or something. The hospital opened up and then they immediately had to at least not use part of it, because the critical care rooms did not have the required features by law. They are required to have 10 air changes per hour. As we all know now, due to coronavirus, it's important that you aren't breathing recycled air when you're trying to control infections.  [00:41:58] The critical care rooms are supposed to have 10 air changes per hour. Well, the ventilation systems that were built only did four air changes per hour. The air was traced by Grant Thornton auditors back to a 2012 spreadsheet. So, this is eight years ago now. "This looks to be based on our review, human error and copying across the four-bedded room generic ventilation criteria into the critical care room detail," which I will translate from auditor speak, means, somebody accidentally copied and pasted from the wrong column into the wrong column. They had the number four in there instead of 10; everybody missed it all the way through the whole bidding process. That's the danger of spreadsheets there. David Leary: [00:42:42] I'm speechless. A mistake in a spreadsheet was in 2012 and it probably would have never been a big deal, but then COVID came and all of a sudden, it was a big deal. Blake Oliver: [00:42:51] I guess so, yeah. I'm wondering, actually, how much of an impact COVID had on it. All it takes is one person to do that copy-paste in some sheet that's way at the end of the workbook that nobody ever looked at. So, that's my spreadsheet error story. What else should we talk about here? David Leary: [00:43:06] FedNow, we could talk about that if you want?  Blake Oliver: [00:43:08] FedNow?  David Leary: [00:43:09] We missed this story. It was actually the first week of August. The Board of Governors of the Federal Reserve System, the Federal Reserve Board, they proposed a development of a real-time settlement service, RTGS, and basically, the public name's gonna to be called FedNow. It's instant money movement; faster payments, instant payments, instant movement of money.  [00:43:35] They built their own system and, essentially, everyone knows about their clearing house for ACH, and the delays in that and how it's not real-time. The private-sector banks got together, and they actually built their own RTP – real-time payments network – but they really cut out the small banks, the credit unions, retailers, technology companies. They all just were not big fans of this. They all got cut out.  [00:43:54] What they've done is they released a 50-page press release about this. The timeline, really, originally on this was going to be- it started in 2013; they started watching the strategies to build this out. Then, they really committed to building it out in 2019. They were actually gonna go through and really build this, and they were looking for a comment. Then, they really thought they'd get it out '23–'24; they'd start to really round it out and polish it off.  [00:44:23] What's happening is, because of the stimulus now, an earlier roll-out might happen because of stimulus, and it really ties a couple of stories we had together in the past because a lot of people didn't get their stimulus checks. We've talked about it before, they saw instant impacts to the economy once the checks started getting into people's hands and getting into their bank accounts, or they cashed those checks, right? Blake Oliver: [00:44:43] Yeah, yeah.  David Leary: [00:44:43] There's all these people that are unbanked, people that didn't get the checks. The IRS didn't  have their addresses. There's all these reasons the money didn't get to people fast enough. It turns out, what they wanna do is basically utilize the post office now.  [00:44:57] Now, the post office story is getting tied in this, and the unbanked is being tied in, to where the unbanked will just go to the post office and get some sort of debit card, and the Fed will put money directly into people's bank debit-card accounts. Basically, it's a bank of the Fed, and they're bypassing the normal banks, and they're bypassing all the, what is it, nine regional feds, right? Blake Oliver: [00:45:20] Wow. Wait. So, that's big news, if that's what's happening, because I had heard about this instant payment system coming someday, way down the road, so that we can replace ACH and actually have instant transfers like they do in Europe. We had speculated about how it would be beneficial for the Fed to have a bank account for every American, and that way, they could just put the stimulus money into it. Are you saying that this is now happening?  David Leary: [00:45:48] I'm tying a couple of articles here together, but I would not be surprised, as we see this next round of stimulus becoming more real, that this becomes a distribution method that is required. Even Senator Kamala Harris, vice president nominee now, I guess we have to say, she, actually ... This is a branch-off of the  Obamacare rollout. The U.S. Digital Service, which was set up to help fix the healthcare.gov website, a teeny little agency, she wants to expand their budget by 400% because this all ties to modernizing Medicare payments. It's all tied to this TreasuryDirect accounts, these digital wallets. Blake Oliver: [00:46:28] Well, it would make so much sense for Treasury to have a way to directly give stimulus to Americans and not have to go through the banking system. Because we saw that they had to pay the banks a pretty hefty chunk just to process those PPP loans, and then they had to cut checks via the IRS, which costs a lot of money and is super slow and doesn't get to everybody.  [00:46:52] If they could just have an account at the Fed for every American that is tied to your social or something like that, then they could just give you the money directly. Like you said, if you don't have a bank account to link it to, you could just go to the post office and get a debit card that way or something. That's brilliant. I could see there being a ton of opposition to this from the banking industry. David Leary: [00:47:13] Yeah. It goes back to, also, we were talking about that modern monetary theory. If you think about it, now, the Feds can just inject money into the economy instantly and then pull it back. Then if you think about it, now that it's all digital, instead of it being tracked to just the penny, they could go out as many decimal places as they want. This is where you could start getting into negative interest rates. You could have very small negative interest rates and you'd only be losing a couple of pennies a day, or less than pennies a day, right?  Blake Oliver: [00:47:41] But it would force people or incentivize people to go out and spend the money in those accounts. David Leary: [00:47:45] Exactly. This is all connected this instant payment. Basically, what was built to just move money around is now getting tied into the stimulus package possible, UBI, which we've talked about. It's really taught- you really see all these stories coming together into this federal wallet if you want to call it that. Blake Oliver: [00:48:03] Well, this is gonna make Libertarians scream, but I think it's a really good idea. If we're gonna have stimulus like we just had, we need to be able to do it more efficiently and get the money out quicker, and this would be a way to do it, and to track it; to see where it's being spent would be interesting, too. I don't know if the Fed has a plan to track that, but they could.  David Leary: [00:48:27] It's just also scary at the same time, right? We have all this technology, and how much we're giving up our lives. You have your locks connected to the Internet. Actually, somebody here in- I don't know if this happened you, but I've heard people in Tucson, because the rolling blackouts in California and all of this ... All of those Nest thermostats were adjusting people's air conditioning in Arizona up to 86 degrees because they wanted to conserve some electricity, but you can't have your house at 86 degrees when it's 110 degrees out. It's just doesn't work.  Blake Oliver: [00:48:27] They had it on the automatic setting, where it just does it? Yeah. David Leary: [00:48:59] Yeah. So, essentially, the government, if they wanted to ... You've got your smart lock; you've got your smart car; you've got your smart bank account that the government can control, and your smart thermostat ... They could just lock you in your house, and take your money away, and you're stuck in the house. I know it's a little 'tinfoil hat,' but are we giving up rights when we- the more dependent we get on all this technology stack like this? Blake Oliver: [00:49:19] Well, and that's what we have to balance, right? We have to balance technology with freedom and liberty. It's a real challenge. Disinformation is a consequence that nobody ever anticipated in the way that it's become a problem where ... To go back to Facebook, they're gonna not even accept new ads a week before the presidential election because they're so concerned about disinformation, apparently. David Leary: [00:49:44] Well, we keep getting into this because every time- obviously, every time we talk about PPP, and that's on our artwork, and we run an ad on Facebook, we keep getting into the list of-  Blake Oliver: [00:49:54] Oh, I know!  David Leary: [00:49:54] -Russian hacker advertising or something. We constantly have to play this game with them. David Leary: [00:49:58] Yeah. We had to verify our identities in order to have political ads. Apparently, the PPP is so controversial that it falls under that. I've got more I could talk about, but that's all that we've got time for this week. David Leary: [00:50:13] We have one more voicemail, though, we should play. Blake Oliver: [00:50:14] Yeah, we have a voicemail to take us out. Again, if you want to call us, I'll read that number one more time; 202-695-1040. If people want to reach you online, David, where's the best place for them to do that? David Leary: [00:50:28] The best place is on Twitter, but I'm also on LinkedIn and I know previously, I've told people, say that you like the show, so I know you're not a robot. But Blake, I saw you tweeted this great solution to how you can figure out if it's a robot on LinkedIn or not? Blake Oliver: [00:50:42] It was one of our listeners, I think it was D.J. He tagged me in something on social and I can't find it now, because I don't remember where it was. It was somebody saying that if you put an emoji in front of your first name or just as part of your first name on LinkedIn, that it will then identify all of the spammers to you because they're just taking your first name off your profile and then you sending a message. So, then you can just look for that emoji and you know, "Oh, they clearly didn't type this themselves," and it worked. I caught somebody.  David Leary: [00:51:10] Because I'm never gonna type "Beer Mug Blake" when I go to talk to somebody on LinkedIn.  Blake Oliver: [00:51:15] That was the example, was somebody put a beer mug in front of their name. I put an abacus in front of my name. David Leary: [00:51:21] I went and put a blue checkmark. So, hey, I'm one of those blue checkmark people now. I got the blue check mark. So, we're gonna report back on this in a week, because I get literally 50 a week, so it should be very clear. I'll do a screenshot of my LinkedIn inbox. Blake Oliver: [00:51:37] Well, if you want to reach me online, I'm at @BlakeTOliver and again, you can connect with me on LinkedIn. Just be sure to let me know you're a listener of the show, so I know you're not a bot. Here to take us out is our final listener message. Omalara: [00:51:52] Hey, Blake and Dave. This is Omalara. I'm calling in from Mexico. I've been listening to your podcast for about a year and I really love it. That's why I'm always posting those reviews of LinkedIn because I love your podcast. It's super-relevant and it's funny, which I don't think you can use those two things when describing accounting, ever. So, that's why I am gonna be a lifelong listener. As long as I'm in the field of accounting, I'll be listening to your podcast. Keep doing what you're doing. Thanks, guys.____________________ ClassifiedsStill sending spreadsheets of unclassified expenses to clients? With ClientHub, automate this process and get client answers instantly. ClientHub is a client-communication platform that helps you consolidate client communication, securely share files, and instantly get answers, and much, much more. Get started today with a free trial at ClientHub.app and enter promo code "CAP25" for 25 percent off your first three months. ClientHub - frictionless client communication.____________________Want to get the word out about your newsletter, webinar, party, Facebook group, podcast, e-book, job posting, or that fancy Excel macro you just created? Why not let the listeners of The Cloud Accounting Podcast know by running a classified ad? Hit the show notes for the link to get more info and be sure to check out our special stimulus pricing of four episodes for just $100.