IT Predictions For 2007 And Beyond

Excel 2007 Drives Last Office Implementation In Fall
Excel has always been the “accountant’s hammer” used by practitioners
for doing virtually any project that would require calculations. With Excel
2007 increasing the spreadsheet grid to 1,048,576 rows and 16,384 columns, Excel
will be capable of handling even more advanced data management needs that traditionally
required Microsoft Access or data extraction tools such as ACL and IDEA. With
Excel having a much shorter learning curve than the extraction tools, we anticipate
that Excel-based tools such as Active Data will take off or such routines will
be integrated by the audit applications. We anticipate the accounting vendors
to stabilize their utilization with Office 2007 products over the summer, and
firms will transition beginning in September 2007 and lock down on this product
through 2010. This may be the last workstation install of the Microsoft Office
as competition from web-based solutions including Google and Linux will drive
Microsoft to match the offering.

MS Office Accounting 2007 Takes QuickBooks Head On
Let me start by saying that I LOVE QuickBooks Professional 2006, and it makes
my company’s internal accounting more effective today than any other time
in my professional career. With the addition of document management tools such
as Personable SourceLink and Cabinet NG, scanned images of source documents
can be attached to QuickBooks entries, creating a completely paperless accounting
infrastructure that can be backed up and provide disaster recovery for accounting
processes. Why Intuit has not integrated this feature in QuickBooks 2007 is
surprising, particularly as Microsoft is touting that it has included this capability,
as well as being fully integrated into Microsoft Office 2007 applications, which
will make it particularly attractive for new businesses starting this year.
History has shown that when Microsoft integrates products into its Office suite,
they can take on competitors such as Lotus 123, WordPerfect and even Netscape
Navigator. Microsoft has even stated that ALL of our QuickBooks history will
transfer. With the promise of a completely integrated product having digital
source document capabilities, our organization plans to convert all data and
run parallel accounting through a year-end rollover and into January. Expect
to see an article in a future issue on what product we kept.

SharePoint Drives Firm Knowledge Management
Virtually every firm today has three information “buckets” that
include the following: data actively managed within their accounting applications,
data archived in document management applications, and the rest of the firm
“stuff” such as policies, procedures and resources in the firm intranet.
Most firms manage the other stuff using web design tools such as Microsoft FrontPage,
but this has been mostly limited to hyper-linking files from the intranet to
source documents. We expect the gradual adoption of Microsoft SharePoint in
the next year, which will take firm intranets to another level and incorporate
knowledge management capabilities that allow firms to integrate information
from different applications, similar to what Lotus Notes has done for larger
firms in the past decade. In addition, with firms adopting Microsoft Vista (to
replace Windows XP) late in 2007, the ability to have “Google-Like”
searching both on the workstation and on the network will evolve.

Web Storage Proliferates
As the cost of managed storage on the Internet plummets, firms will back up
all data to secured web resources and even offer access via client portals.
Today, Xdrive gives away 5GB of storage to anyone, and JungleDisk charges $41
to store 20GB of data for one year. Accounting and website vendors will take
advantage of these low-cost storage solutions and incorporate security similar
to that used for the firm’s online banking to offer managed services that
will backup data in real time and offer secure portals to transfer *.PDFs of
documents to and from clients.

Display Envy Proliferates
With the cost of some 19” monitors dropping to $200, firms will standardize
their tax production on three monitors in the year ahead. Auditors will not
be left out and will carry mobile displays for dual monitors in the field using
more rugged-ized screens such as the Shuttle XP17, originally designed for gamers.
Please note that screen response speed will be crucial, and some firms opting
for cheaper USB connections will be disappointed while those firms adding video
cards and buying docking stations capable of multiple monitors will thrive with
this technology.

Encryption Tools Come Of Age
With concerns about data security continuing to be a major concern for everyone,
encryption applications will become standard for both hardware and data. All
data stored on laptops or removable media such as USB drives will require passwords
and be automatically encrypted when created. Tools to simplify the administration
will evolve this year, and the cost will be driven down so there will be no
excuse not to use them.

Ubiquitous Internet Access Via Broadband Cellular
While many tax and accounting firms have onsite Internet access, it is not a
guaranteed proposition as networks become more secure and difficult to connect
through to the firm. Today’s broadband cellular services provide the largest
area of coverage, which allows accounting firms to connect to the Internet from
virtually any place they may work. While the speeds of these connections are
usually between 400Kbps and 700Kbps, with the right remote access
tools, they can be adequate for accessing firm resources and applications like
e-mail and time and billing. With the next rollout of fourth generation cellular
services, accountants will be able to connect at even faster speeds, leading
to the eventual adoption of “thin” laptops that would have an operating
system but no hard drive, virtually eliminating security risks caused by stolen
laptops.

Web Applications Take Over
Firms will move to web-based applications when they provide comparable functionality
at a lower cost and with a more secure environment, such as what has happened
with banking, payroll, research and forms. In addition to the web-based data
storage listed above, vendors such as CCH, Thomson Creative Solutions and Lacerte
will offer entire accounting “suites” built on .NET capabilities,
and externally managed tax and accounting firm data centers such as Xcentric’s
GrayMatter will take over maintenance of the firm’s entire IT infrastructure.
With all data and applications centrally managed, firms could utilize the thin
laptops mentioned above. An added benefit of web applications, data and thin
laptops would be that the firm would be protected against virtually any kind
of disaster.

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Roman H. Kepczyk, CPA.CITP is president of InfoTech Partners North America,
Inc. and works exclusively with CPA firms to implement today’s leading
best practices and technologies.