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Why Most Accounting AI Will Hit an Auditability Wall

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Every day, another AI agent promises to revolutionize accounting. But there’s a fundamental problem most tech companies don’t understand: AI accounting will hit what FloQast CEO Mike Whitmire calls “the auditability wall.”

While Silicon Valley churns out press releases about AI agents that can handle complex accounting tasks, a reality check awaits. In this episode of the Earmark Podcast, host Blake Oliver sits down with Mike Whitmire, founder and CEO of FloQast, to explore why accounting AI is fundamentally different from AI in other business functions. Rather than getting swept up in the AI marketing frenzy, FloQast stepped back to solve the core problem: how to harness AI’s power while maintaining complete audit trails and human oversight.

As Whitmire warns, “A series of companies will come out with AI agents that can do a lot of this work fairly accurately. Then they hit this auditability wall, and it creates a big problem for companies trying to scale.”

The Auditability Problem That’s Breaking Accounting AI

Unlike other business functions where AI mistakes can be shrugged off, accounting operates under rules most tech companies don’t understand. When a sales AI messes up a lead, the stakes are minimal. But in accounting, every transaction must be traceable, every decision documented, and every process capable of withstanding regulatory scrutiny.

This creates a fundamental conflict between how most AI systems work and what accounting requires. “AI is really about automating work, and agents are doing non-deterministic work,” Whitmire explains. “So that becomes a little scary when you’re thinking about auditability.” Most AI systems function as “black boxes.” They can produce results, but they can’t explain their decision-making process in the detailed, step-by-step manner that auditors and regulators demand.

The problem is about to hit the industry hard. When AI systems can’t provide proper documentation and audit trails, auditors are forced to recreate all the work, defeating the entire purpose of automation.

Rather than getting swept up in the AI marketing that dominates press releases from major ERP vendors, FloQast took a different approach. “We tried to avoid the noise and think about how AI should be applied to accounting,” Whitmire says. They started with their experience as former auditors and accountants, asking: How do you combine AI automation with traditional software code and human oversight to create something that actually works?

The answer required rethinking the entire approach to accounting AI, leading to a solution that preserves audit trails and human oversight while still delivering efficiency gains.

FloQast Transform: Building AI Auditors Can Actually Trust

Rather than chase the latest AI trends, FloQast built something different: an AI system that auditors can actually work with. The FloQast Transform product harnesses AI’s power while maintaining the audit trails financial reporting demands.

The approach is simple: let accountants describe their processes in plain English, then use that narrative to generate automated scripts and complete audit documentation. “You build your agents,” Whitmire explains. “You chat with the product and explain your process in pretty extreme detail.”

As accountants describe their workflow step by step, the system populates what looks like a familiar Excel workbook. “This Excel workbook will ultimately be the audit evidence,” Whitmire notes. This isn’t just a user interface choice. It’s a deliberate design decision to ensure every AI-driven process produces the documentation auditors expect to see.

Take FloQast’s benefit allocation journal entry example. The process starts with integrating with UKG Payroll to pull down employee data. The accountant describes each step: “integrate with UKG,” then “pull down information around names, dollar amounts, state,” then “populate column A with this, populate column B with this, and bold and make the header gray because that’s the format I like.”

The system combines different types of automation. For routine tasks, it generates deterministic code that produces consistent results every time. But when the AI encounters something new, like when FloQast hired its first Kentucky employee, it doesn’t guess. Instead, “it surfaces the question to the reviewer of that work,” Whitmire explains. The accountant can approve the change, and going forward, Kentucky will be handled properly.

This approach changes the accountant’s role. Instead of being the preparer who manually processes transactions, they become the reviewer who oversees AI agents and approves exceptions. “Our goal is to empower accountants to automate the really repetitive, rote part of this job. Elevate them into the reviewer of the more complicated work that the agent’s now doing,” Whitmire says.

The system preserves every prompt sent to the AI, every output generated, and every decision made. When auditors come knocking, they can trace exactly how each transaction was processed and where humans intervened. It’s the kind of comprehensive audit trail that makes regulatory compliance possible while still delivering efficiency gains.

Beyond transaction processing, FloQast applies AI to other areas like variance analysis. When account balances trigger materiality thresholds, the system analyzes the biggest transactions causing the change and drafts explanations. “It’s like balance went up because of boom, boom, boom, boom, boom,” Whitmire says. “It’s not these wonderful essays on how things change. It’s like a list of transactions.”

The Future of Accounting: Cyborgs, Not Replacements

The auditability challenge yields a surprising conclusion: rather than replacing accountants, AI will transform their role in ways that could solve the profession’s biggest problems. But this transformation requires rethinking what it means to be an accountant.

Whitmire envisions accountants becoming “accounting transformation information managers,” professionals who combine accounting knowledge with software engineering capabilities. “It will be much more like the merging of an accountant with a software engineer,” he explains. “So you have the accounting knowledge, supplemented by software engineering tools like FloQast, where they can take their accounting knowledge, use our product, and automate their work.”

This isn’t just about learning new software. It’s about fundamentally changing the structure of accounting work. Instead of spending hours manually processing transactions, accountants would deploy AI agents to handle routine work so they can focus on reviewing exceptions, making judgment calls, and ensuring compliance.

The career implications depend on where you are professionally. For younger professionals, Whitmire recommends “Get really good at technology, learn these tools as they come out, and continue to learn about accounting. You’re going to be a very, very valuable employee going forward.” For experienced professionals, “You need to be really great at reviewing the work. Continue to be really great leaders, and run great organizations.”

This evolution could address the profession’s talent shortage. By making accountants more productive and the work more intellectually engaging, AI could help attract and retain talent. “My hope is that it does a really good job of plugging the talent gap we talk about so much,” Whitmire notes.

But there’s a learning concern. Whitmire worries about newer professionals who might skip foundational manual work and jump straight to reviewing AI-generated results. “I feel like the old man saying this, but I did learn a lot doing the work manually and struggling through it,” he admits. He recalls learning about jet lease accounting by struggling through contracts and GAAP guidance—work that an AI could now handle instantly.

The solution may require restructuring how accountants learn their craft. Perhaps starting in accounting roles where they do manual work before moving into audit, rather than the current model, where most start as auditors reviewing work they’ve never performed.

As Oliver puts it, “I would rather manage AIs than manage people.” It reflects both the appeal and reality of this AI-augmented future. Managing AI agents eliminates many interpersonal challenges while allowing professionals to focus on technical and analytical work.

The accounting profession is heading toward becoming a hybrid of human judgment and AI automation. The question is whether professionals and firms will adapt quickly enough to thrive.

Regulatory Changes on the Horizon

The discussion also touched on significant regulatory changes that could reshape the profession. There are efforts in Congress to eliminate the Public Company Accounting Oversight Board (PCAOB) and transfer its responsibilities back to the SEC without additional funding, effectively ending independent audit oversight.

“When I was at EY, we were always scared of a PCAOB audit. So it was a thing that drove behavior,” Whitmire reflects. The fear-based incentive improved audit quality, even if the overall effectiveness is debatable.

Without the PCAOB, the industry would likely return to peer review, where accounting firms review each other’s work. As Oliver notes, “You’re not so afraid of your buddies reviewing your work.” That’s the same dynamic that led to audit failures before the Sarbanes-Oxley Act.

This regulatory uncertainty adds another layer of complexity to the AI transformation. Firms implementing AI systems need to consider current audit requirements and how oversight might change in the coming years.

The Path Forward: Auditability as Competitive Advantage

The accounting profession’s rigid requirement for auditability is often seen as a weakness. But it may become its greatest competitive advantage in the AI revolution. While tech companies rush to market with AI agents that promise to automate everything, firms that understand and embrace the auditability challenge will build sustainable, scalable solutions.

FloQast Transform demonstrates that the future isn’t about choosing between human judgment and AI automation. It’s about creating systems where they work together seamlessly. By preserving audit trails, maintaining human oversight for exceptions, and generating documentation that auditors can use, they’ve solved the fundamental problem that will likely sink many AI accounting startups.

For accounting professionals, this is a career evolution opportunity. The future belongs to those who combine accounting expertise with technology capabilities. These professionals will be empowered by AI to focus on higher-level analysis, judgment calls, and strategic work. The professionals who master these systems now will find themselves in increasingly valuable positions as the technology matures.

To hear the complete conversation about FloQast’s approach to accounting AI, including detailed technical examples and Whitmire’s predictions for the profession’s future, listen to the full episode above.

How Smart Small Businesses Turn Economic Headwinds into Competitive Advantages

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Small businesses are navigating a unique economic moment in 2025. They’re still serving customers and meeting market demands, but they’re doing it while managing changing costs and ongoing policy uncertainty. Despite these challenges, they’re not shutting down or laying people off. Instead, they’re finding creative ways to adapt.

Nicholas Tremper, senior economist at Gusto, shared this insight in a recent Earmark Podcast episode. Tremper tracks data from hundreds of thousands of small businesses through Gusto’s platform, so he has a unique view into how small businesses respond to today’s economic challenges.

The picture Tremper paints is more complex than the headlines suggest. While businesses face real pressures from tariffs, labor shortages, and economic uncertainty, many thrive by combining two essential strategies: utilizing AI to boost productivity and offering more appealing benefits to attract workers. For accounting professionals, this creates new opportunities to become strategic advisors rather than just compliance providers.

Economic Headwinds Create Planning Challenges

In the current economic environment, several interconnected challenges reshape how small businesses operate. Tariffs have reached a weighted average of about 18% across all imports—a significant jump from single digits in previous years. While this level is manageable for most businesses, the bigger problem is uncertainty.

“Small businesses don’t necessarily know how to think about what their costs will be three or six months from now,” Tremper explains. This uncertainty affects everything from inventory planning to contract bidding. For example, if you’re a retailer trying to stock up for the holidays or a contractor giving price estimates months in advance, not knowing future costs makes planning nearly impossible.

The labor market adds another layer of complexity. Unemployment sits at a relatively low 4.3%, but the July jobs report showed weakness with only 73,000 jobs added versus 100,000 expected. More concerning was the massive downward revision of 258,000 jobs from previous estimates for May and June. (Updated numbers released after the show was recorded are +22,000 jobs for August.)

This reflects what Tremper calls an economy that’s “idling”—staying in place rather than growing or contracting. Businesses aren’t laying people off, but they’re not hiring aggressively either. The combination of an aging population and tighter immigration policies creates structural labor shortages, especially in construction and hospitality sectors that traditionally relied on both groups.

These pressures force businesses to delay growth plans. As Tremper puts it, “You may not be able to work on that fourth development. You may have to stop at the three.” When you can’t reliably access more labor, expansion is much more complicated.

Entrepreneurship Boom Continues Despite Challenges

Despite these headwinds, there’s been an entrepreneurship renaissance in the United States. The number of new business applications skyrocketed during the summer of 2020, and as of June 2025, new businesses were still 57% higher than June 2019 levels.

The resilience of small business formation helps explain why the economy has remained relatively stable. “One of the reasons that the economy has been so resilient is because these new businesses have been bringing creative ideas to market,” Tremper notes.

What’s particularly interesting is who’s starting these businesses. For the first time, almost half of new businesses were started by women, compared to 30% in 2019. There’s also been an increase in businesses started by nonwhite entrepreneurs, showing entrepreneurship is spreading across demographics.

These new business owners face similar challenges regardless of their background. When asked about their top three challenges, they consistently mention cash flow, time management, and acquiring customers and employees. At least two of these are areas where accountants can provide significant value.

AI Boosts Productivity Without Replacing Workers

Here’s a statistic that might surprise you: 95% of small businesses using AI aren’t cutting their workforce. Instead, they’re making their existing employees more productive. This contradicts the common narrative that AI inevitably leads to job losses.

The productivity gains are substantial. According to Gusto’s research, 80% of small businesses using AI report productivity increases of 20% or more. But the key insight isn’t just that AI works; it’s how it works.

“Rather than an AI doing somebody’s job, what the person’s doing is they’re like, I’m the expert and you’re going to be a teammate to help me accomplish this quickly,” Tremper explains.

Businesses use AI for routine tasks like summarizing information and conducting market research—the necessary work that doesn’t require deep expertise. Meanwhile, humans focus on applying their knowledge, making judgment calls, and building client relationships.

This approach creates an unexpected benefit in hiring. Businesses that allow employees to use AI report 45% less difficulty finding new workers. It turns out people want to work for companies that give them tools to focus on meaningful work instead of tedious tasks.

The most successful AI implementations happen when businesses develop clear plans about when to use human expertise versus when to leverage AI for efficiency. This strategic approach creates a cycle where better tools lead to more satisfied employees, which makes companies more attractive to potential hires.

Benefits Become Essential for Talent Competition

While AI tackles productivity, smart businesses simultaneously invest in benefits to attract and retain workers. In today’s tight labor market, benefits are competitive necessities.

Offering healthcare benefits increases employee retention by 40% in the first year. Retirement plans show similar effects. What’s interesting is that half of the businesses offering retirement benefits don’t do any company matching. They get significant retention benefits just by offering the benefit.

This creates opportunities for businesses willing to think strategically about their total compensation packages. While competitors focus solely on wages—an expensive and difficult race to win—smart businesses create comprehensive value propositions that extend beyond the paycheck.

For accountants, a communication gap represents a missed opportunity. Fifty percent of small businesses don’t know if their accountant offers benefits guidance, and two-thirds of those simply never thought to ask. When small businesses receive benefits guidance from their accountants, 60% say it influences their benefit decisions. For businesses under two years old, that number jumps to 85%.

Accountants as Strategic Partners

This economic environment creates new opportunities for accounting professionals to evolve beyond traditional compliance work. The share of businesses reporting productivity gains from their accountants has jumped dramatically—from 52% in 2021 to two-thirds in 2025.

“Small businesses view their accountants as business partners. These aren’t number crunchers. These are people who are actively helping me figure out what I’m going to do next,” Tremper explains.

Businesses navigating today’s challenges need more than bookkeeping and tax prep. They need guidance on cash flow analysis, scenario planning, and strategic decision-making. When small businesses can’t predict their costs or easily access more labor, having an advisor who can help them model different scenarios is invaluable.

Cash flow, time management, and hiring are all areas where accountants can provide significant value. Whether it’s helping a client switch to upfront billing to improve cash flow or advising on benefits strategies to attract workers, these services directly address the problems keeping business owners up at night.

Interest rates remaining higher than business owners would like make this financial guidance even more critical. As Tremper notes, “It’s so important to really understand the return on investment on those borrowing costs.” Businesses need help evaluating whether investments will generate enough return to justify higher borrowing costs.

Cautious Optimism for Small Business Future

Despite the challenges, Tremper remains optimistic about small businesses’ prospects based on their track record of resilience. Over the past five years, small businesses have navigated a pandemic, an inflation crisis with rates hitting 8-9%, a major labor market reshuffling, and now uncertain tariff policies. Through it all, more people keep choosing to start businesses.

“They’ve got this grit, this creativity,” Tremper observes. “These things make me most optimistic about small businesses.”

The economic fundamentals, while softening, aren’t collapsing. Consumer spending continues to increase, albeit more slowly. People are choosier about purchases, but demand hasn’t fallen off a cliff. This provides a foundation for businesses that can adapt to changing conditions.

The businesses succeeding in this environment understand that sustainable competitive advantage comes from combining cutting-edge tools with meaningful employee value propositions. They’re not choosing between technology and people; they’re investing in both simultaneously and strategically to create resilience against future uncertainty. By maximizing productivity per employee and creating strong retention through benefits and culture, these businesses position themselves to weather whatever economic storms may come.

For accounting professionals, this transformation represents a challenge and an opportunity. Clients need more strategic guidance than ever, and they’re willing to pay for and value that guidance in ways they haven’t before. The firms that master this new approach can build sustainable competitive advantages that compound over time.

Listen to the full conversation with Nich Tremper to discover specific strategies for advising your clients through this period of transformation and learn how to position your practice as an indispensable strategic partner in their success.

80% of Businesses Overpay Property Taxes by 20%: Here’s How to Fix It

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What if I told you that your business could be overpaying millions in property taxes? It’s not just possible—it’s probable, according to property tax expert Josh Malancuk, President of JM Tax Advocates. In a recent episode of the Earmark podcast, Josh, drawing on his 28 years of experience in the field, reveals a startling statistic: about 80% of the commercial properties his firm evaluates are overvalued by 20% or more.

Uncovering these overpayments isn’t as simple as glancing at a tax bill. It requires an approach that most businesses—and even many tax professionals—overlook. “Most of the time, county and state assessors are kind of flying blind with their assessments, which is why we see about 80% of the time, large commercial properties are overvalued by 20%,” Josh explains.

During the podcast, Josh outlined the flaws of commercial property assessments, explained the property tax appeal process, and shared a real-world case study in which his firm slashed a $25 million assessment down to $9 million, saving the client over seven figures in taxes.

The Hidden Flaws in Commercial Property Assessment

The stark differences between residential and commercial property assessments create a perfect storm for overvaluation. For residential properties, assessors have a wealth of comparable sales data. Josh explains, “With certain property types, like a home, you’re going to have lots and lots of sales, probably sales right across the street, so it’s relatively easy to predict what your home value should be on a per-bedroom or per-square-foot basis.”

Commercial properties, however, present a unique challenge. Consider a 1,000,000-square-foot manufacturing facility in a small town. Josh says, “You’re lucky to see sales of any sort within three years.” This scarcity of comparable sales data forces assessors to rely on mass appraisal models.

As Josh describes, these models are “a one-size-fits-all” approach. They are typically based on reproduction cost or construction cost trends, with little consideration for the specific characteristics and market conditions of individual properties.

Josh’s firm uses comprehensive databases and sophisticated market analysis to combat these inaccuracies. They expand their search for comparable transactions to a regional or even national level, mirroring what a typical market participant would consider when evaluating a property.

The capability gap is significant. Josh notes, “99% of the time your county and your state assessors do not have that same capability.”

Navigating the Property Tax Appeal Process

Discovering an overvaluation is just the first step. Navigating the appeal process requires careful attention to varying deadlines and jurisdictional rules. Josh explains, “Each jurisdiction has its own period to appeal the property assessment. So once you get the notice, the appeal deadline can be as short as ten days or 30 days, or there may be no notice at all.”

The appeal process can involve multiple stages, from informal discussions with the assessor to county board hearings and, in some cases, escalating to state-level appeals or litigation. Each step requires a deep understanding of procedural rules to avoid disqualification.

Successful appeals rely on customized analysis, taking into account factors such as:

  • Age and condition of the property
  • Size and layout
  • Specific use and any functional obsolescence
  • Land size and characteristics
  • Truly comparable properties in the area or region

“Once we figure out the best approach, we build our market data and bring that into an organized message to the assessor to basically support our contention that the market value is different than their assessment,” Josh says.

Case Study: Uncovering Millions in Savings for a Food Processing Plant

Picture a sprawling food processing plant, its buildings a patchwork of structures dating back to the early 1900s. Josh’s team tackled this real case, starting with a staggering $25 million assessment and a tax bill of around $1 million annually.

Their approach? A month-long deep dive into every nook and cranny of the facility. “I spent about a month hiking around this manufacturing plant, discovering all of the nuances and all of the ages and the sizes and ceiling heights and the like.”

Donning hard hats, safety glasses, and brightly colored vests, the team pored over dusty blueprints, traced the facility’s tangled construction history, and scrutinized every square foot of the million-plus square-foot complex.

Their approach unearthed a treasure trove of assessment inaccuracies:

  • Entire sections of demolished buildings are still being taxed.
  • Incorrectly recorded ages of structures.
  • Outdated layouts and obsolete features are impacting market value.

The result? “We filed a protest, and in the end, we took that assessment down from $25 million to $9 million,” Josh proudly states. “It ended up saving the company seven digits over the years that we appealed.”

Impressed by the millions saved, the client entrusted Josh’s firm with reviewing their properties across an entire state—some 30 additional sites.

Unlocking Hidden Value in Property Tax Assessments

This examination of the intricacies of property tax assessment reveals a surprising truth: significant savings are hiding in plain sight, waiting to be uncovered by those willing to look closely enough.

Let’s recap the key insights:

  1. Mass appraisal models often lead to widespread overvaluation of commercial properties.
  2. Customized, property-by-property evaluation can reveal substantial inaccuracies.
  3. Navigating the appeal process requires expertise and attention to detail.
  4. On-site inspections can lead to millions in savings.

For businesses, these insights represent an opportunity to free up capital for growth and innovation. For tax professionals, it’s a chance to deliver immense value to your clients, potentially saving them millions of dollars.

Some jurisdictions even allow for retroactive relief, potentially multiplying the savings across previous tax years.

To gain even more insights that could revolutionize how you approach property tax assessments, listen to the full Earmark podcast episode featuring Josh Malancuk. 

Then ask yourself: How much-hidden value might be lurking in your property tax assessments? The answer could be worth millions. Isn’t it time you took a closer look?

Work Smarter, Not Harder: The 3.3 Rule for Accountants

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Want to 2x your productivity while working way less? Sounds like a pipe dream, right? According to CPA John Briggs, it’s not just possible – it’s the key to thriving in accounting.

I recently chatted with John on my Earmark Podcast, and he explained his game-changing “3.3 Rule.” This approach challenges the traditional 70-hour workweek and billable hours model that’s been burning out accountants for decades.

John says the 3.3 Rule is the secret sauce for boosting efficiency, reclaiming work-life balance, and improving profitability.

So, what exactly is this magical rule? And how can you implement it in your firm? Let’s dive in.

Understanding the 3.3 Rule

The 3.3 Rule is based on cognitive science research showing that the average office worker is only truly productive for—get this—2 hours and 53 minutes in a typical 8-hour workday.

John takes advantage of this natural productivity pattern by structuring work in focused bursts of up to three hours, followed by strategic recovery periods.

As John puts it, “The rule, simply stated, is the most efficient workday consists of working up to three hours at a time, followed by a 30% recovery period.” So, if you crush it for three hours straight, you’ve earned yourself a full hour of downtime before diving back in.

The beauty of the 3.3 Rule is that it adapts to different work styles:

  1. 🏃‍♂️ “Sprinters” who work in short, intense bursts (think 60 minutes of work, 20 minutes break)
  2. 🚶‍♂️ “Joggers” who can maintain focus for 1.5 to 2 hours
  3. 🧘‍♂️ “Zen masters” who can work for the entire three hours straight

The key is to know your rhythm and match your work style to the task at hand. As John says, “If I feel like I’m losing focus after an hour, that’s totally fine.” It’s all about working smarter, not harder.

Implementing the 3.3 Rule

So you’re sold on the 3.3 Rule. But how do you make it happen in your firm?

First things first: mindset shift. John emphasizes the importance of self-awareness. “If I feel like I’m losing focus after an hour, that’s totally fine,” he says. The key is to match your work style to the task at hand.

By implementing this methodology, John’s firm has maintained an average of just 42 hours per week during tax season for the past three years. You read that right – 42 hours. In busy season.

So, what’s the secret? Two words: value pricing.

John advocates for setting prices based on the value provided to clients, not the time spent. “I don’t necessarily think billable hours is actually a great way to bill in general. I like value pricing or fixed pricing,” he says.

Value pricing complements the 3.3 rule by:

  1. 💸 Allowing firms to benefit financially from increased productivity
  2. 🙅‍♂️ Removing the pressure to “look busy” during less productive hours
  3. 🎯 Focusing on outcomes for clients rather than inputs from accountants

But wait, you might be thinking – how do you measure productivity without billable hours?

John’s firm uses job descriptions and result-based metrics. For example, they might track the number of tax returns completed or the complexity of clients managed. They use a weighting system where complex clients are equivalent to multiple simple clients, ensuring fair workload distribution and accurate productivity measurement.

Implementing the 3.3 Rule isn’t always easy. It requires a fundamental shift in how we think about work. But the payoff? Happier staff, better work, and a healthier bottom line.

What Happened at John’s Firm

What’s it like to implement the 3.3 Rule? John shares his journey of transformation:

“When I started my firm, I said, ‘I refuse to put my team through the same crap that I had dealt with,’” he recalls. For John, that meant hiring more staff to ensure everyone could work at about 80% capacity, allowing room for those crucial recovery periods.

And the benefits? They go way beyond just happier employees (though that’s a huge win in my book!).

John notes, “When you work, you work.” Those focused work periods lead to higher productivity and fewer errors. Plus, this approach helps retain top talent in an industry where competition for skilled professionals is fierce.

The 3.3 Rule doesn’t just benefit your team – it benefits your clients, too. You’re delivering real value by focusing on outcomes rather than hours logged. And when you’re not stuck in the weeds of busy work, you have more bandwidth for the high-level strategy and advisory work clients crave.

Of course, implementing the 3.3 Rule isn’t always a cakewalk. John recalls, “When I introduced it to my team, they were weirded out. They’re like, ‘Is this a trick to get me fired because you’re going to catch me not working?'”

Leadership buy-in and clear communication are crucial to overcoming these challenges. You’ve got to walk the walk and lead by example.

The 3.3 Rule, combined with value pricing, offers a blueprint for firms to align their work practices with human cognitive limitations and client needs. By focusing on outcomes rather than hours worked, firms can achieve the holy trinity: increased productivity, improved work-life balance, and enhanced profitability.

It’s a win-win-win for accountants, their firms, and their clients. And in an industry long overdue for a shake-up, that’s something to get excited about.

Get all the details by listening to this episode of the Earmark Podcast.

An Accounting Firm Owner’s Guide to Strategic Technology Adoption

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Is your accounting firm’s technology stuck in the past? In a world where clients expect seamless digital experiences and remote work is the norm, relying on outdated, disconnected software can be a recipe for inefficiency, frustration, and even lost business. But with so many options on the market, how do you choose the right tools to propel your firm forward?

In a recent Earmark Podcast episode, Blake Oliver shared his framework for strategic technology adoption. He argued that firms that intentionally select software to streamline operations, enhance client experience, integrate smoothly, and enable standardization will be best positioned to thrive.

Blake walked through the key software categories firm leaders need to consider, from proposal management to artificial intelligence (AI). He emphasized the importance of choosing tools that are easy to use, align with the firm’s unique needs and processes, and facilitate client collaboration.

Proposal Software

Blake recommended proposal software options that allow firms to quickly generate professional, standardized proposals, collect e-signatures and payments, and kick off projects seamlessly. “You cannot standardize the service delivery to your clients if you don’t have standard terms in your engagement letters,” he noted.

For example, Practice Ignition and Anchor allow firms to create templated proposals with standardized terms, pricing, and payment schedules. Clients can quickly review and sign off on engagements digitally, reducing friction and ensuring consistency across the board.

Practice Management

For practice management, Blake stressed the importance of workflow tools that centralize client communications, automate tasks, and provide visibility across the firm. With remote work now the norm, he argued, “If you’re in a remote environment, how can you work remotely without having workflow software?”

Platforms like Karbon, Canopy, and Client Hub offer client portals, task management, team collaboration, and insights reporting features. By standardizing processes and centralizing information in one system, firms can boost efficiency, transparency, and accountability, even with distributed teams.

Blake shared a cautionary tale from his experience, where choosing the wrong practice management tool cost his firm weeks of lost productivity. The lesson? Prioritize ease of use and team buy-in when evaluating options to ensure successful adoption.

General Ledger & Payroll

In the realm of general ledger and payroll, Blake advised firms to curate a lean tech stack of best-fit solutions. Instead of accommodating every possible client need, he suggested choosing one or two options that cover the bases for core client types, focusing on scalability, integration, ease of use, and reporting capabilities.

For the general ledger, that might mean standardizing on QuickBooks Online for most clients, with Sage Intacct reserved for those with more complex needs. On the payroll front, Blake highlighted Gusto and OnPay as user-friendly options that automate compliance and integrate with popular GL systems.

Blake emphasized the goal of going deep on a few core platforms rather than spreading yourself thin across a dozen different tools. By strategically limiting your tech stack, you can streamline training, support, and processes while still meeting diverse client needs.

Accounts Payable & Banking

Turning to bill pay, Blake highlighted the spectrum of solutions available, from all-in-one platforms like BILL for larger clients with complex approval workflows to more streamlined options like Relay for smaller businesses. He emphasized the key is to match the tool to the client’s specific needs and design efficient processes around it.

For example, a large nonprofit with multiple departments and strict controls might benefit from BILL’s advanced approval routing and audit trails. A small business, on the other hand, may prefer Relay’s simplified workflow and flat-fee pricing. The right fit depends on factors like transaction volume, number of approvers, and accounting complexity.

Whichever tool you choose, Blake stressed the importance of clear client communication and well-defined processes. Establish expectations around bill submission, approvals, and payment timelines upfront, and consider designating a dedicated team member to manage the AP queue and troubleshoot any issues.

Artificial Intelligence

Finally, Blake touched on the exciting frontier of AI, noting that ChatGPT’s new offering for teams, coupled with Microsoft’s significant investment in OpenAI, has made the technology more viable for accounting firms than ever. He advised listeners to start exploring use cases like drafting routine documents.

For instance, firms could leverage ChatGPT to generate first drafts of engagement letters, email responses, or work papers based on predefined parameters. By automating the initial content creation, staff can focus on more strategic work like analysis and advisory.

However, Blake cautioned against an “AI-first” approach. Tools like ChatGPT should augment human expertise, not replace it. He recommended starting with narrow, well-defined pilots and keeping humans in the loop to review and refine AI-generated content.

The Path Forward

Across all these categories, Blake underscored the importance of approaching technology decisions with intention and a focus on client needs. Flashy features may generate buzz, but the true test of any tool is how well it supports your firm’s service delivery and client experience.

By aligning your tech stack with your strategic priorities, designing efficient processes, and investing in training and change management, you can harness the power of modern software to drive meaningful results. The key is to start small, iterate often, and never lose sight of the humans at the heart of your business’s heart – your team and your clients. Ready to dive deeper into Blake’s strategic technology playbook? Listen to the full episode and start charting your firm’s path to digital success.