Subscribe
Share
Share
Embed
Crypto.com mistakenly sends customer $7.2 million; the consequences drunken Big Four work events; Intuit releases automated tax advisory app; as prices rise, CFO's turn to automation
Show Notes
Sponsors
Jirav: https://cloudaccountingpodcast.promo/jirav
Liscio: https://cloudaccountingpodcast.promo/liscio
Relay: https://cloudaccountingpodcast.promo/relay
Need CPE?
Jirav: https://cloudaccountingpodcast.promo/jirav
Liscio: https://cloudaccountingpodcast.promo/liscio
Relay: https://cloudaccountingpodcast.promo/relay
Need CPE?
Subscribe to the Earmark Accounting Podcast: https://podcast.earmarkcpe.com
Get CPE for listening to podcasts with Earmark CPE: https://earmarkcpe
Get CPE for listening to podcasts with Earmark CPE: https://earmarkcpe
Show Notes
2:02 – Review from Scott Michael Collier – Thank you!
4:49 – PwC Manager is Suing the Firm After He Lost a Chunk of His Skull at a Drunken Work Event - Going Concern
8:04 – Ernst and Young employee, 33, found dead at Sydney office after Friday night work drinks
10:26 – Top House Intel Republican downplays Trump's records-handling: 'More of a bookkeeping issue'
12:16 – Crypto.com mistakenly sent a customer $7.2 million instead of a $68 refund - The Verge
17:41 – PCAOB, China sign agreement opening door for inspections - Journal of Accountancy
PCAOB observed problems during audits of SPACs
19:27 – California Passes Radical AB 257 Fast-Food Legislation
California Fast Food Wages Would Be Set by Government Under Bill Passed by State Legislature
California QSRs Push Back Against Wage Bill
21:39 – As prices rise, CFOs turn toward automation to control costs | Accounting Today
26:45 – Wassia Kamon, CPA, CMA, MBA on LinkedIn: Top 10 Accounting and Finance Certifications | 177 comments
29:43 – Email from Joseph – Thank you!
34:16 – Voicemail from Elliot – Thank you!
43:04 – Intuit unveils new logo design | Accounting Today
It’s a brand new day for Intuit!
45:22 – Intuit's (INTU) Earnings and Revenues Surpass Estimates in Q4 (Revised)
Intuit's (INTU) Earnings and Revenues Surpass Estimates in Q4
Intuit Inc. (INTU) CEO Sasan Goodarzi on Q4 2022 Results - Earnings Call Transcript
Intuit (INTU) Q4 Earnings and Revenues Beat Estimates
Intuit Reports Strong Full Year Results and Sets Fiscal 2023 Guidance | Business Wire
48:34 – MyCase Rolls Out Built-In Accounting and Integrated Document Automation
MyCase Announces Release of Accounting and Robust Document Automation Integration, Further Enhancing Legal Tech Platform
49:56 – Intuit releases automated tax advisory solution in move towards CAS support | Accounting Today
Intuit Accountants Launches Intuit Tax Advisor Integrating Tax Prep and Advisory
Intuit® Accountants launches Intuit Tax Advisor, integrating tax prep and advisory
51:16 – Watch Intuit Tax Advisor Video – Tax prep + advisory tools, together at last
57:52 – Bookkeeper360 raises $3.5M Seed Round to Scale Platform and Operations | Business Wire
59:32 – Fathom acquired by UK's Access Group | Accounting Today
1:00:56 – Karbon Client Portal is here! | Karbon Community
Get in Touch
Thanks 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) 695-1040
Need Accounting Conference Info?
Need Accounting Conference Info?
Limited edition shirts, stickers, and other necessities
Subscribe
- Apple Podcasts: http://cloudacctpod.link/ApplePodcasts
- Podchaser: http://cloudacctpod.link/podchaser
- Spotify: http://cloudacctpod.link/Spotify
- Stitcher: http://cloudacctpod.link/Stitcher
- Overcast: http://cloudacctpod.link/Overcast
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 link below to get more info.
Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd
Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Go here to create your classified ad: https://cloudacctpod.link/RunClassifiedAd
Full Transcript Available Upon Request - info@cloudaccountingpodcast.com
Creators & Guests
What is The Accounting Podcast?
The Accounting Podcast (formerly the Cloud Accounting Podcast) is the world's #1 accounting, bookkeeping, and tax podcast! Join us weekly for a roundup of accounting news, analysis, and interviews. Plus, earn free NASBA-approved CPE credits for listening with the Earmark app. Learn more at https://earmarkcpe.com.
Attention: This is a machine-generated transcript. As such, there may be spelling and accuracy errors within.
David Leary: [00:00:00] I recently saw a LinkedIn post that was a screenshot of somebody's folder of Microsoft Excel files for their 2023 budget. Could you not? There are 15 versions of the 2023 budget Excel file, eight of which had final in the name. Four had final, final and three had final dash. Final Dash updated when it's a screenshot like this. It really surfaces how insane it is. But what is more insane is that I suspect all teams doing any type of financial planning and analysis in Excel, they have folders of Excel files that look just like this. If this is true for you or your team, stay tuned to hear more from our sponsor Jirav later in the episode.
Blake Oliver: [00:00:40] And I think there's there's two things driving the automation. One is you want to increase worker productivity. But I think the other thing is workers have more power than they ever did before, and they don't want to work as hard as they used to. That's just the truth of it. And they don't have to. So you're investing in automation to make your full time workers happier so that they aren't on their feet so much. They're not running around taking drinks to the tables that they can just stand in one place and fill the drinks at the machine and put them on the robot.
David Leary: [00:01:15] Coming to you weekly from the OnPay Recording Studio, this is the Cloud Accounting Podcast.
Blake Oliver: [00:01:25] Welcome to another episode of the Cloud Accounting Podcast. I'm Blake Oliver.
David Leary: [00:01:30] And I'm David Leary.
Blake Oliver: [00:01:32] Hey, David.
David Leary: [00:01:33] We just keep pumping out episodes.
Blake Oliver: [00:01:34] Coming up.
David Leary: [00:01:35] On. It's amazing, right? Because what four years of this.
Blake Oliver: [00:01:38] Episode to 95, I believe, going into.
David Leary: [00:01:42] Five.
Blake Oliver: [00:01:42] Labor Day weekend.
David Leary: [00:01:44] And did you see our latest review?
Blake Oliver: [00:01:46] No.
David Leary: [00:01:48] Some accounting student in California, Scott Michael Collier. He has listened to all every single episode. He went back in.
Blake Oliver: [00:01:56] Time, every single episode, like all 294 episodes.
David Leary: [00:02:02] 94. But it's I think it's 330 because we have some bonus episodes and we had some not logical numbering for a little while there. But yeah, I think we're pushing well over 300 episodes. You went back and listened to all of these people are trying to offer him jobs on LinkedIn because they're like the due diligence in the follow through and the drive. Not to mention he's probably smarter than everybody else in his degree program. But let me read this here. Hey, Blake and David, I'm an undergrad accounting student in Orange County, and I love your podcast. I heard about your mark in May and liked it a lot. I had heard you mention this and thought I would give it a listen. I mistakenly think it would be similar to the number of episodes to earmarked. I started The Cloud Accounting Podcast at the beginning. Once I realized the beginning in 2017, I thought it would be cool to get the history of the industry over the past few years. Plus, I thought it'd be pretty fun to hear predictions about 2020 and then when the podcast switched from being monthly to weekly, maybe that was early weekly while I realized the size of the undertaking. It was a little frustrating when I wanted to call in and participate, but couldn't because of a trivial reason. Like the thing I wanted to address was actually occurred or happened a year and a half ago. But anyway, I'm all caught up now and love the show. You guys are entertaining and present a view of the industry I don't hear about in school that seems to be just trying to push me into Big Four. Thank you for helping me to see options that I wouldn't have heard about otherwise. I'm excited to keep listening and learning while I get through the rest of my degree program. That's five stars on Podchaser.
Blake Oliver: [00:03:27] It's amazing we are disrupting the Big Four accounting industrial complex. One listener at a time, one student at a time. Thank you. Thanks so much for listening. I mean, that's a huge accomplishment. And I think we're going to send him a T-shirt as I.
David Leary: [00:03:41] Think it's in the mail. Sorry, I've been ordered on the way. Yes. Yes. I guess you automatically if you listen to all 400 episodes, you automatically get.
Blake Oliver: [00:03:49] Like, oh, man. Well, you know, you mentioned big firms or like the fact that this listener hasn't been told about anything other than that traditional career pathway. So I got to bring up some stories, two stories that I saw that don't make the big four look really great and I'll let you choose which one we start with, David. So first we have the story of an Ernst and Young employee who was found dead in the office after Friday night work drinks. And second, we have the story of a TWC manager who's suing TWC for losing a chunk of his skull at a drunken work event. Where do we go?
David Leary: [00:04:25] Oh, wow. Hold on. Let me just make sure I don't have any drunk work stories with the Big Four. No, I think the coin flip. Do you got a coin flip?
Blake Oliver: [00:04:36] I don't. I don't have the app. I don't have a coin. I don't carry metal currency anymore. Dave.
David Leary: [00:04:42] I don't have a coin coin for bitcoin.
Blake Oliver: [00:04:45] Well, I'm going to.
David Leary: [00:04:45] Right. Let's go with the chunk of skull. Let's. Let's go.
Blake Oliver: [00:04:49] Okay. So this is thanks to none other than going concern. In 2019, P.W. Singer Michael Brock was at an after hours public golf outing with colleagues when he got blackout drunk and awoke in the street later that night. With no memory of the evening, he suffered a life changing head injury and had to have part of his skull removed, most likely due to a fall he doesn't remember. And there are before and after pictures, David, and it's pretty disturbing. He lost a big chunk of his skull. I'll put the link in the chat for you, David, so that you can see it. And our listener's a mystery.
David Leary: [00:05:31] Like nobody else knows how he felt either.
Blake Oliver: [00:05:33] Well, so, you know, you're out with colleagues, you're heavily drinking. I mean, you know, we were just in New Orleans, David, so, you know, how can you maybe wander away or you're with a group and you fall and nobody notices, right? That something happened and you could crack your head open. It's like a seriously risky thing to be walking around on city streets when you're drunk. And so I guess, you know, he he he had this injury and he had to have part of his skull removed. He's okay. I mean, he's alive, but he's got this big dent in his skull like it looks like a piece of his head is gone. He basically woke up four weeks later after this pub crawl and had to go through recovery. So he's actually still working at GWC years later, but now he's sued the firm. And the reason is that, you know, he he says that he was required to go to this event. He was pressured to go to this event and that he was pressured to drink a lot. And here is the original invite from one of IWC's managers. It said, quote, I expect absolute attendance from all of those who attended last year's invitational. Nothing short of a certified and countersigned letter by an accredited medical practitioner will suffice. His excuse in the lawsuit also states that there was a, quote, very heavy pressure, unquote, from management to attend the event that, quote, encouraged excessive consumption of alcohol, unquote. And he's suing IWC for damages of approximately a quarter million dollars US which seems like like low. But I mean this is the UK, right? So they're not as litigious as we are here in the here in the States. It would be like millions.
David Leary: [00:07:11] Yeah. Every 25 million especially. I saw the picture. You sent.
Blake Oliver: [00:07:14] It. Yes. Pretty shocking. So and the event was styled as a pub golf outing, which involved visiting nine bars or holes in which they were allegedly pushed to consume a specific alcoholic drink. Workers who use the fewest swigs to consume their drink were given the best scores, which were recorded on cards that were printed and distributed in the office. It is claimed. So wow, this doesn't sound like responsible. Nine bars, nine drinks. Like that's a recipe for disaster. I think it just goes to the culture problem that you have in big firms, right? When the work itself is painful, the only way you can compensate for that is to try and create this cult like culture. Like literally, this is cult like behavior right here. Yeah, right.
David Leary: [00:08:03] Very.
Blake Oliver: [00:08:04] Brosh It's yeah, it's not right, Rolf. So now let's get to the other story, E.y. A young female Ernst and Young employee was found dead at the accounting firms Sydney office just hours after attending an event held by the company's social club on Friday night. And this was recently last week, so end of August. This is in Australia. A 33 year old Ernst Young employee spent the afternoon at the Ivy, a popular bar and club in Sydney's central business district, before she returned to their George Street offices, which were 450 meters away. The Australian exclusively revealed the employee arrived at the social event at around 5:30 p.m. on Friday before returning to the office around 7:30 p.m. to finish some work. So that's classic going to the social and then going back to the office to work.
David Leary: [00:08:57] The work. Yeah.
Blake Oliver: [00:08:58] Yeah. And her body was discovered by colleagues on Saturday morning after midnight. So she was, get this, escorted out of the ivy due to intoxication and security footage reviewed by investigators did not show her visibly inebriated upon returning to the office. And apparently they're waiting for a report from the coroner, but they believe the police, the NSW police believe her death was the result of self harm. So picture this young 33 year old goes to this work event, has to go back to the office to do more work and decides to kill herself. She's right.
David Leary: [00:09:34] So I don't know where to go from this. Yeah, it's the.
Blake Oliver: [00:09:38] They go talk to an accounting professor, James Guthrie. Guthrie And he said that Big Four companies had a, quote, flawed organizational culture, unquote, where junior employees commonly faced intense time pressures and worked long hours on supervised. So that was reported in at News.com value. So I I'm sorry for starting us off on that really uplifting story, but it's kind of fitting considering here in the States, we're going into the Labor Day holiday and this culture is not good for labor. I would say that that aspect of the culture is is very bad. And needs to end.
David Leary: [00:10:21] Yeah, I have a Trump story.
Blake Oliver: [00:10:23] Oh, great. Let's continue with all the good news.
David Leary: [00:10:26] It's not really true. So essentially, obviously, we know about the raid and did Trump have top secrets and documents and this had nothing to do with the story. The reason it caught my eye is Representative Mike Turner from Ohio. He's the top Republican on the House Intelligence Committee. He is downplaying the concerns about this. And that's fine. It's just what the way he framed the concerns and why they should be downplayed is his use of the word bookkeeping. Bookkeeping. He basically said because a lot of this, I think debate is about the archival part of this. Right. I think they want to archive some of these records. He's got them because, you know, Trump Lakes, all these magazine covers. He likes his history. Right. This face on it and type stuff. Right. Whatever. So he says. So at some point, this sounds like a bookkeeping issue rather than a national security threat. Is that what people think of bookkeeping? It's just like if you have a list of problems and it's minor, just call it a bookkeeping issue. Is that where we're at? Well, it's kind of sad.
Blake Oliver: [00:11:20] I'm not really sure what like Trump's lawyers are arguing, because first they were arguing that he had the total right to take this information because he can declassify whatever he wants at any time as the president. But then they're saying, oh, it was an accident like bookkeeping issue, meaning that like they took stuff that they weren't supposed to take and that wasn't his fault. They were blaming the GAO.
David Leary: [00:11:39] For bookkeeping like they could have just been. Like you could have said, like much ado about nothing. You could have, you know, said there's a blemish. It's like a pimple. You could have done all these things. But they choose bookkeeping to attack.
Blake Oliver: [00:11:51] That's a weird word. It's a weird, weird way to put it.
David Leary: [00:11:56] People are using bookkeeping to refer to something that's minor and doesn't matter. Yeah, just. Just. Just. That's the world we live in. All right. Well, hey, can you answer?
Blake Oliver: [00:12:04] Here's a funny bookkeeping error. Crypto.com remember Crypto.com Matt Damon was shilling for them at the Super Bowl?
David Leary: [00:12:12] Yeah, yeah. The dreamer adventurers and.
Blake Oliver: [00:12:16] The fortune favors the brave by cryptocurrency. And then it plummeted. Right. Not good for his brand. Well, the Verge reported that Crypto.com mistakenly sent a customer $7.2 million instead of a $68 refund. This is. And you're going to love how this happened, David. How how does a crypto exchange, basically a bank for cryptocurrency, accidentally send somebody the equivalent of 7.2 million US? It was in Australia, so it was like ten, 10 million AUD. You want to guess? You want to try to.
David Leary: [00:12:52] I've no idea. I'm going to guess. It's a minor bookkeeping issue.
Blake Oliver: [00:12:58] The customer had requested a 100 Australian dollar refund and somebody at Crypto.com accidentally typed an account number in the payment amount field when processing the refund. So they were supposed to put in 100, 100, but they put in her account number into that field. So they gave her 10 million.
David Leary: [00:13:22] So is this a human error or is it just bad UI? Remember that thing with Revlon the.
Blake Oliver: [00:13:27] Oh how they accidentally.
David Leary: [00:13:28] Give a huge loan and they paid the loan off too early because the UI was confusing.
Blake Oliver: [00:13:32] Yeah, who knows, right? Whether it was the UI was bad. But like, it's funny to me that crypto.com a cryptocurrency exchange, first of all, is doing this manually with humans and that there's no controls in place to make sure that this kind of thing doesn't happen. Oh, and the best part is they didn't they didn't notice it until like seven months later. So that initial transfer occurred in 2021 when that employee typed the account number and the payment of Mountfield Crypto.com only realized the mistake when conducting an audit in December of 2021, and now they're trying to get the money back. So they sued her, right? They filed a lawsuit. And this is the other thing about crypto, right? Like so she she noticed the money in her account, transferred it out to us dollars didn't set off any alarm.
David Leary: [00:14:16] Bells.
Blake Oliver: [00:14:18] Are not US dollars Australian dollars. I'm sorry. Okay. And then decided to like buy $1,000,000 house. So Crypto.com had to file a lawsuit because they couldn't get the money back anymore and they successfully put a freeze on the account. And the court has ordered the account holder to sell the home and return the money with interest to the exchange. I mean, so if that happened, if that happened to me. I would definitely like. You can't stick around. You've got to flee the country, right? You've got to get out of the, out of the reach of the law in Australia.
David Leary: [00:14:52] Yeah. Move it to, to something in the U.S. where it's harder to get. Right. I mean and they stay like, I don't know their app just moved it to this other place. I don't have control over this. It must have. Yeah. Wow, that's a lot of money.
Blake Oliver: [00:15:03] So this is the thing about crypto. It's like it's it's not, it's not necessarily better than our, our current financial system when developers don't even put rails in place. Right. And we've we've been talking about how these errors that happen, these bugs in the software where hackers exploit and drain money from blockchains. There was another example of this, the Solana based decentralized exchange op. Defi accidentally vaporized $661,000 after developer shut down the entire programing, powering the exchange using a single command.
David Leary: [00:15:40] This episode of The Cloud Accounting Podcast is sponsored by Lucio, Steven Brewer and company CPAs has a blog post on their site titled Why Don't We Email and Text Clients? Here's the TLDR. Email is one of the least secure methods of electronic communication. Text messages can be intercepted, emails and text messages can spread viruses, malware, etc. need to protect personal info, name, address, date of birth, social security numbers, bank account numbers, etc.. You're probably wondering how Stephen and his team communicate with clients. They use Lucio. Lucio allows you to have secure real time communications with your clients via a mobile app that includes reminders, task management, e-signatures document scanning and exchange and uploading and unlimited storage. If you are ready to significantly improve your staff's focus, collaboration and relationships with clients, head over to Cloudaccountingpodcast.com promo slash Lucio. That is cloudaccountingpodcast.com promo for l i CIO. That kind of more ridiculous bookkeeping errors.
Blake Oliver: [00:16:44] Don't talk about it. Yeah, I want to go.
David Leary: [00:16:46] I mean, if you've been following anything about the Ukraine, the war in Ukraine, and, you know, we're sending over all these weapons and all this money and apparently nobody kind of knows where a lot of these weapons are. And it's because to quote unquote, they do all their accounting on paper. So they can't pin down where this equipment's at. It's just it's gone to some extent. And the acting inspector general of the Department of Defense, Sean O'Donnell, he said that they keep track of weapons using hand receipts. It's just all paper.
Blake Oliver: [00:17:17] Here's a.
David Leary: [00:17:17] Here's the tracking.
Blake Oliver: [00:17:18] Of this. There's an anti-tank javelin missile here. Here's a paper receipt for that. You know, like.
David Leary: [00:17:24] Yeah, there's not even like a Google sheet set up of like, here's the weapons. Here's another column. Like who he delivered.
Blake Oliver: [00:17:29] It, what division has it?
David Leary: [00:17:32] Yeah. It's just bad bookkeeping.
Blake Oliver: [00:17:34] Bad bookkeeping, bad bookkeeping.
David Leary: [00:17:36] I remember episode title this week.
Blake Oliver: [00:17:41] Well, let's talk about a little bit about audit. This is just a quick follow up. We've talked about how some Chinese companies are at risk of getting delisted from U.S. stock exchanges because they weren't allowing the PCAOB to inspect their audits. Yeah, and this has been a big beef between China and the U.S. is, hey, if you're going to be on our exchanges, we need to be able to inspect your audits to make sure that these audits are legit and the companies financial statements are legit and good news for the worldwide capital markets. The PCAOB and China have signed an agreement opening the door for inspections. So basically it looks like the U.S. got what it wanted beginning with 2021. After three consecutive years of PCAOB determinations, the positions taken by authorities and the People's Republic of China obstructed the PCAOB ability to inspect and investigate registered public accounting firms in mainland China and Hong Kong. Completely. All companies audited by those firms would be subject to a trading prohibition on US markets. That was the original law.
David Leary: [00:18:39] Basically, we gave a three year window to, you know, manufacture the books so that when the audit comes, you know, it's going to be perfect. Now it's it's going to be perfect. So didn't even bother auditing. They fixed it.
Blake Oliver: [00:18:51] So PCAOB is going to be able to select the firm's audit, engagement and violations it inspects and investigates without. The Chinese authorities saying what's going to happen? They're going to get to view complete audit work papers with all information included those manufactured ones. Right. And they're going to have access to interview and take testimony from all personnel. So they're getting full access. It's that's a win for the PCAOB.
David Leary: [00:19:16] Did you see your great state of California, your former great state of California?
Blake Oliver: [00:19:21] I'm no longer a Californian. I'm I'm an Arizonan now. I've been here two years. That's long enough.
David Leary: [00:19:27] So they passed a bill on Monday called the AB 257, or it's also called the Fast Food Accounting, Accountability and Standards o fast recovery. Essentially what it's going to do. It's going to. Create this board as governing board of fast food restaurants. And one any restaurant that's part of a chain that's 100 or more has to start paying their employees $22 an hour.
Blake Oliver: [00:19:53] Yeah, this is a wage. This is. This is crazy, David. This is nuts. This is a wage setting labor board that's going to determine the minimum wage for all of these larger fast food chains in California.
David Leary: [00:20:07] And so now they're really pushing on Governor Gavin Newsom to veto this bill. So which is crazy, right? So the Democrats push this bill through because they're all Democrats in California and now they're now others are lobbying another Democrat to veto this. Because the thing about the long term effect of this and if you think about this, right, so you have employers, you have a small business. Minimum wage is $15 an hour. Mcdonald's now has to pay them $20 an hour. Essentially, what they what they did is they wrote this law like, oh, if we only make the biggest the people with 100 franchises or more across the country do this, they're going to get punished. Just the big boys will be punished. But really, you're punishing all small businesses because how are you going to hire somebody? If they're going to get paid $20 an hour at McDonalds, right?
Blake Oliver: [00:20:49] Yeah. I mean.
David Leary: [00:20:51] So they basically just raised the minimum wage. To 24 hours an hour. Not only that, this council, this fast food council, will have the power to dictate terms of employment, like wages and benefits and hours worked. They really it's kind of a crazy thing. And then some part of me thinks like, what's the long term impact and what impact is McDonald's? Just like employers are just too expensive. We'll just start making more and more robots. I mean, obviously have the kiosks to order it. Have you been to McDonald's lately?
Blake Oliver: [00:21:19] Yeah. Yeah, I order.
David Leary: [00:21:20] Just have a big it's like a big iPad. It's gigantic. Yeah. The size of your body. You just order from that. There's no people. Yeah. And that's where they'll get some. They start building robots for French fries and these other things. They get to amortize it, right? Yeah. At some level this is going to tip where it's not worth giving anybody jobs. And this is going to come back to bite California. Well, in the face. And what I.
Blake Oliver: [00:21:39] Don't understand about this, it's like we're I'm maybe this legislation started years ago and that's why this is happening now. But it makes no sense in the current environment where workers have a lot of power and wages have been rising. So like the last thing we need is to keep to artificially increase the minimum wage, the wage for restaurant workers even further. It just it's like totally tone deaf, like with the inflationary environment too. We're in like it's 14% of the market, California for fast food. So it's a big deal for all these bigger chains. But you know, you brought up automation and robots and stuff like that. And I spotted a story. About how CFOs are turning to automation to control costs. So exactly what you're talking about, David. If labor costs go up, then the the ROI of automation also goes up because every labor dollar you save can go into automation technology. And I was just watching the news, local news yesterday, and there was a story about this sushi restaurant here in the Phenix area that it's one of those, you know, conveyor belt sushi restaurants. And they've recently.
David Leary: [00:22:55] Don't get sick at those.
Blake Oliver: [00:22:57] I think it's called Kura Sushi. They're a chain. It might be nationwide, but they're big. They've been doing the conveyor belt sushi for a while. I've never gotten sick from conveyor belt sushi, only supermarket sushi, by the way. And they now have these robots that take your drinks because that's the one thing you at a conveyor belt sushi restaurant you can't do is get the drinks out to people on the belt. So they have this robot with little platforms on it. And the worker fills up the, you know, Coca-Cola or Pepsi or whatever and puts it on the robot and press the table number. It takes it to the table. And now they've got them in all the restaurants like so. For them. They clearly made the calculation that it was better to. Use those robots, invest in those robots than to hire people to take those drinks around. And bigger picture. Going back to this CFO story. A recent survey from Gartner showed that 98% of CFOs say they will not cut their current tech investments, and 66% are, in fact, planning to increase investment in automation over the next year. They are specifically investing in automation technology that will reduce costs and increase efficiency. 33% are aiming to automate more back office functions, and 27% said they want to focus on automating operations such as warehousing and transportation. So inflation, higher labor costs leading to that. That's going to accelerate automation. I mean, we're going to this is going to be the golden age of automation like the next few decades because it's not.
David Leary: [00:24:31] Like it's not it's not a cost cutting move in the way it was kind of in the eighties. We're like, we want to build cars differently and we're getting robots to build the cars. And it was really just manufacturing. But now it's hitting the service industry. It's going across the board because it's two pressures. You're right, there's the pressure of we can't hire anybody anyways. So we've already started this march. But then when you have government saying Now pay people this much more regardless of your bottom line very quick, you can afford it. Regardless how the math works, you have to pay them this fixed amount. So it's yeah. That, that those two pressures are going to force companies and if you think about something like McDonald's is very price sensitive like they probably know better supply and demand than anybody. They move a penny on it on a Big Mac and they know the effect of that.
Blake Oliver: [00:25:15] And I think there's there's two things driving the automation. One is you want to increase worker productivity. But I think the other thing is. Workers have more power than they ever did before, and they don't want to work as hard as they used to. That's just the truth of it. And they don't have to. So you're investing in automation to make your full time workers happier so that they aren't on their feet so much. They're not running around taking drinks to the table so that they can just stand in one place and fill the drinks at the machine and put them on the robot.
David Leary: [00:25:48] I don't know. Like, my daughter works fast food. Now she's 16. I'm thinking, like. Is that going to be an option for maybe your kids soon? Maybe not. You just have to be an influencer. There's no jobs left to be influencers until somebody figures out how to do that with bots.
Blake Oliver: [00:26:03] Oh, yeah. Well, you.
David Leary: [00:26:04] Know, nobody will have jobs. Like, none of us will ever have jobs except for accountants. The only ones.
Blake Oliver: [00:26:09] And I do think there's a there's a real chance of that happening in our lifetime where I get so good that, like many jobs, are completely automated. Or we'll just you know, they but we always think that's going to happen, right? Historically, people have always said, like jobs are going to get automated and there won't be jobs and then we won't have to work. But then we always figure out how to invent new jobs, like weird new jobs that never existed before, like even influencer. Like whoever would have guessed that, like, being a social media influencer would be a profession?
David Leary: [00:26:37] Well.
Blake Oliver: [00:26:37] Podcasting or podcasting or something like that. Right. So, you know, we'll. We'll come up with new, bizarre ways for people to make money, I'm sure.
David Leary: [00:26:45] Well, the other way you can ensure there's going to be jobs for people as you create certification programs. So I saw this great post. This is from Wasilla, Carmen, CPA. She was a she CPA, CMA, MBA. Right. So she posted on LinkedIn. And it's one of those like LinkedIn slide deck things. So you kind of have to jump over there to get it. But basically this is the top ten accounting and finance certifications. So obviously I'm going to hit next year. Number one, CPA. Right. That's the big one. And then you have a CPA. Okay. So this is chartered certified accountant. You have CFA, which is chartered financial analyst. You have KMA, which is certified management accountant. You have CFP, which is certified financial planner. You have FRM, which is financial risk manager. You have EF, MVA, which is financial modeling and valuation analyst. You have APAC, which is certified corporate FP and a professional. And then you have CFA, which is certified fraud examiners, CIA, which is certified internal auditor. And that's it. So that's like ten of them. So that's another way to ensure our profession always has jobs because we just don't let people in because they have always certifications. There's two ways to look at it, but I thought it was really helpful. Deck And she she really lays out like who issued by the background the requirements. Some summaries of it it's a really cool little deck so.
David Leary: [00:28:12] This episode, The Cloud Accounting Podcast is sponsored by Giraffe. Are you still using Excel to create budgets, cash flow forecast revenue models and hiring plans for your fast growing or mid to large sized clients? Drive is an all in one financial planning and analysis solution that maximizes the collaborative value of forecasting, budgeting, reporting and analytics giving you and your clients the confidence and speed needed to drive their business forward. The best part of Giraffe is that it eliminates the constant rework that your team or clients must do every time data or variables change need to adjust projections based on hiring two more employees. Just connect your payroll app to draft and your numbers are updated. Need to account for marketing and spend changes the impact of new leads or upcoming deals. Just connect draft to your CRM and of course, giraffe connects to all the cloud accounting systems you love, including QuickBooks Zero Net Suite and Intact Drive knows that firms that offer advisory services that include budgeting, forecasting and PHP anda are 34% more profitable. That is why Giraffe has an accounting firm partner program that guides you step by step through the process of adding CPA to your firm. If you're ready to become an accounting firm partner with Giraffe, head over to Cloudaccountingpodcast.com promo slash giraffe that is cloudaccountingpodcast.com promo forward slash j i brave plant smarter, faster and together with giraffe.
Blake Oliver: [00:29:31] All right. We're going to get into app news. But before that, let's do listener mail. You've got mail.
David Leary: [00:29:43] Hi, Blake. We take on a high volume of business clients and mostly focus on bookkeeping.
Blake Oliver: [00:29:48] And fractional CFO services. This means.
David Leary: [00:29:51] That most clients come to us needing a big catch up.
Blake Oliver: [00:29:53] Job, but initially we price this out as a fixed flat fee for the period. An example would be $1,500.
David Leary: [00:30:00] To get.
Blake Oliver: [00:30:00] 2022 caught up from January. We have these.
David Leary: [00:30:03] Projects going on with some staff and staff also working on recurring monthly work. We are a seven figure firm, but not yet at the point that we have separate departments working.
Blake Oliver: [00:30:12] On recurring and catch up work. Is it better to have separate departments for each?
David Leary: [00:30:16] What are industry averages for time it takes to catch up a client's books?
Blake Oliver: [00:30:20] There's more moving parts to catch up work. What is.
David Leary: [00:30:23] A reasonable way to manage it and reasonable expectations to have when developing.
Blake Oliver: [00:30:27] Links and processes.
David Leary: [00:30:28] With.
Blake Oliver: [00:30:28] Employees. For high growth firms, the high or.
David Leary: [00:30:31] Low profits made off of the catch.
Blake Oliver: [00:30:32] Up work could be clouding the recurring work profitability. That was from Joseph on LinkedIn. A lot of questions in there, David. Did you catch any that you want to answer?
David Leary: [00:30:43] I don't think I've answers to them. But I mean, the gist of it is is. You met, is it important to manage your catch up work separately? A Just because of the effort and processes involved, you don't want somebody who's doing monthly stuff over here and you know, to be distracted with that. And then kind of the. Do you even keep all the fees separated and the fee structure for all of that?
Blake Oliver: [00:31:05] Yeah, well, I can tell you what we did. I had a separate onboarding and catch up team and the people who did the ongoing service, the bookkeeper is responsible for the ongoing monthly engagements. That was separate and that worked really, really well. And the reason I recommend it is because. If you're doing a bunch of catch up work, but you're also trying to take care of your ongoing clients. Something's going to give. Because catch up work might be months and months and months or years even of work. And it all has to happen very quickly in order to get that.
David Leary: [00:31:36] Sometimes surprise right. Start digging in that you did not know existed to start.
Blake Oliver: [00:31:40] Exactly. And so there's a lot of time up front in a very small amount of there's a lot of work in a very small amount of time. And so that you don't want that impacting your current clients. So I would definitely have a separate team that does that. You can have them do the onboarding as well because it makes sense. They're already getting the documents, but if you get big enough, you can have a separate person who just collects everything, does onboarding. Then you have a team that does the consulting, slash cleanup work, and then you have a team that does the ongoing engagement. And another reason other than just the the workload to do this, to separate this out, is that I found that different people are good for those jobs. So it takes a different skill set to be good at that cleanup work, more of a consulting type of mindset, somebody who likes to problem solve and deal with those issues. And a lot of times the accountants and bookkeepers who do the ongoing work don't like the surprises, they want the consistency. That's why they're in that job in the first place. So you've got to think about people's preferences.
David Leary: [00:32:44] Began, I guess, pricing wise. Right. He said he fixed fee or flat fee for 200 bucks a month or whatever to do the work. Some part of me is like, Oh, why don't you just do it free to roll it into your subscription. But I guess there are some, some set of clients that you do all the work and they're like, Thanks for cleaning my books up. I'm gone. Yeah. So you don't want to like because if you just if you chase the long term value, yes, it makes sense to give it free. Or maybe you could structure it like we'll do the cleanup work. And then after a year, if you still be on a client, I'll refund you for that cleanup work. I don't know. Maybe it's like that type of thing too. Sure. They said the client.
Blake Oliver: [00:33:17] I would say you could. Most of the time you can charge for this stuff because it's not like they've been paying somebody. They know that they need to pay for this. The problem is that when you do that, a lot of times firms will heavily discount the clean up work in order to get the client, and then the client could just leave. So you've done all this cleanup work for a heavily discounted price when they're gone. So I always recommend, if you're doing cleanup work, have a minimum commitment for the ongoing. So six months, a year, that sort of thing, unless you're getting paid full price for that cleanup work. So the only way you discount is if you get something in return. And that's just a general good rule in sales is never give something without getting something. There's always a give and take in any negotiation. So if they're asking you for a discount. Get something in return, get a get a longer term commitment. All right. Our next listener message is from Elliot regarding the discussion of the IRS audit percentage. Hi, Blake and David. Longtime listener, first time caller. I'm in Australia so have no skin in the game here.
David Leary: [00:34:22] But I think asking what percentage of tax.
Blake Oliver: [00:34:24] Returns should be audited is completely irrelevant. If the purpose of an audit is to uncover people underpaying their tax liabilities, then the metric shouldn't be about the total number of audits. The IRS could easily increase the number of audits, but if they didn't collect any additional tax, then what's the point? If they want to collect more tax, then the figure reported should be how much additional tax was collected as a result of audit. You could also have a metric around the percentage of audits that resulted in additional tax collected to ensure that those selected for audit were being selected appropriately. Incidentally, the tax gap is a theoretical concept.
David Leary: [00:34:57] And includes underreporting of.
Blake Oliver: [00:34:59] Tax liabilities from people not declaring the proceeds of their criminal activities such as underground gambling, drug dealing and money laundering. I'll quote Australian figures here, but I suspect the proportions would be similar in the U.S. The most recent report in Australia shows the Australian Tax Office estimates there are around $11 billion in missing taxes as a result of the shadow economy each year. Given the.
David Leary: [00:35:21] Tax gap for.
Blake Oliver: [00:35:22] Individuals not in business, that's ordinary.
David Leary: [00:35:24] Working.
Blake Oliver: [00:35:24] People is only $8 billion.
David Leary: [00:35:26] I often.
Blake Oliver: [00:35:27] Wonder whether auditing people to pick up an additional few hundred dollars each in tax is really.
David Leary: [00:35:32] Worth the effort.
Blake Oliver: [00:35:33] Particularly when you could easily raise the additional tax revenue by limiting deductions in some areas, or even by not.
David Leary: [00:35:39] Reducing tax rates and taking advantage of bracket.
Blake Oliver: [00:35:41] Creep. I'd also be fascinated to know if the data collected from audits is collated in some way and passed on to the senior regulators and legislators so they can use it to better design the tax system or even something simple like changing the design of the tax forms. If auditors reported people are constantly making the same mistakes, then maybe it's not deliberate fraud. It might just be through ignorance or simple errors. I understand the threat of audit encourages people to do the right thing and audits do need to be a part in the compliance activities for all tax authorities. But the bigger picture is that tax authorities should be making it easier for people to pay.
David Leary: [00:36:15] The correct amount, and I'm not.
Blake Oliver: [00:36:17] Sure that simply auditing more people is the best way of achieving that. Love the show. Great listening as always. Elliot Brennan. Thank you, Elliot.
David Leary: [00:36:25] He kind of said the issue right in the beginning of the call, the voicemail, which is essentially the purpose of audit, the audit that he's saying. The purpose of the audit is to. Get cash to bring in more revenue. And I think that's part of the problem. That's what people are so scared of and they hate it. You're coming for my money, when really the purpose of the audit is to make sure everybody's everybody's doing their fair share. Right? Everybody's. If they do an audit and they find out we ought to. 10,000 people and everybody's honest and perfect, that's just as good as an audit that recovered money, I would say, because that means people are doing things correctly.
Blake Oliver: [00:37:06] Yeah. And I've heard this from a few people saying this about the audit rate, which is, you know, you have to look at it based on the direct revenue brought in by audits. But but that's that's not comprehensive because the possibility of an audit is what. Makes people be honest. A lot of people, anyway, I think if there were let's do a thought experiment, if there were no audits, if our tax system was completely voluntary and there was zero chance it would ever be audited. David or anyone. What do you think the tax cap would be? I think there would be just massive, massive tax evasion. Right. It's the possibility of audits that makes people think twice about doing something that they shouldn't do. Just like it's the possibility of getting caught by the police that stops people from walking into a Best Buy and walking out with a giant big screen TV. Right.
David Leary: [00:38:06] So, I mean, it encourages behavior.
Blake Oliver: [00:38:08] Yeah. It you got to have some sort of check on people. And and I find it funny that everyone wants to dance around this question. Nobody wants to answer my question that what is a reasonable audit rate? And I feel like there could be a behavioral economics way to answer this question, which is to say like like do studies if the chance of getting caught is like a certain within a certain range that incentivizes the most behavior, the the correct filing while minimizing the cost of compliance. That's what we want. But nobody wants to talk.
David Leary: [00:38:44] You're right. It's 10%, 15%. There's some number that basically almost 100% eliminates fraud on tax forms.
Blake Oliver: [00:38:50] Yeah. And we don't want a 100% number.
David Leary: [00:38:52] It's not one out of 1000. Right. Like right now, I'll tell you that.
Blake Oliver: [00:38:55] Right. Right, exactly. It's sort of my feeling is like, well, if we increase that audit rate a bit, maybe that would get people to be more honest. Think of it like speeding tickets, right? Like we don't have police and cameras on every single street in our cities, but there's the possibility that you're going to speed by one. And that's what gets people to drive under the speed limit or slightly above the speed limit.
David Leary: [00:39:21] 19 miles an hour above the speed limit. Because toe gets criminal, like.
Blake Oliver: [00:39:25] Right. Yeah. Well, no, but so in.
David Leary: [00:39:26] Scottsdale, you cap it.
Blake Oliver: [00:39:28] So in Scottsdale, the police have these like little vans that they park on the side of the street and they move them around to like randomly. And so you never know when there's going to be one. And it's pretty rare, but I got caught by one, right? And now.
David Leary: [00:39:41] You know, so Tucson got rid of all that was we voted all that stuff out. I can't believe they're still doing that in Scottsdale.
Blake Oliver: [00:39:46] Well, it's a huge revenue generator for the city.
David Leary: [00:39:48] You don't have to pay the ticket. You know that, right? If they don't serve you, you just throw it away. You say I wasn't driving.
Blake Oliver: [00:39:54] Well, you know.
David Leary: [00:39:55] That's what was happening to me. They couldn't enforce it. They couldn't collect. Yeah. Like the collections of it was too much because nobody was paying them.
Blake Oliver: [00:40:01] Right? Well, you know, that's another problem, right? But what I guess what I'm trying to say here is that it's the possibility of an audit that gets you to gets some people. Some people would be honest without it. Right. But we know there's a lot of people who wouldn't. And that's why I think the tax gap is so large, because it's really easy to get away with tax evasion for year after year after year and you never get caught. You know, the gross tax gap in the US accounts for $441 billion in lost revenue each year, according to the latest estimate by the Internal Revenue Service. And that's on the Tax Foundation website. So I'm going to go with that. $441 billion. David, like, is is that student loan relief, that student loan forgiveness? Every year?
David Leary: [00:40:43] Yeah.
Blake Oliver: [00:40:44] Every year. That is like half of the PPP money, which was $800 billion like every year lost due to tax evasion. And now, yes, some of that might be due to criminal activity, which is never going to get reported. But I'm sure a lot of it is in legitimate businesses that are filing taxes and are just underreporting their income or taking deductions that they shouldn't.
David Leary: [00:41:11] Oh, no business like. Okay, if you pay cash, I'll give you a discount. Yeah.
Blake Oliver: [00:41:15] Yeah. And it's not just cash.
David Leary: [00:41:16] It's like a 10% discount because they're getting a 30% return. Yeah, that money, of course. A 10% discount. Yeah. This episode of The Cloud Accounting Podcast is sponsored by Relay. Like we just discussed, the announcement that we have launched earmark media and one of the things we've had to do with a new business venture is open a bank account.
Blake Oliver: [00:41:40] And we used relay to do it with both of us being in two different cities. You in Tucson and Scottsdale, going to a physical bank branch together was impossible, so we had to do something else. But with Relay, we were able to open the account online. I invited you and we added our initial capital.
David Leary: [00:41:59] It was easy. I just accepted the invite, connected my bank account and did a transfer. And did you also, Blake, did you see that they've rebranded?
Blake Oliver: [00:42:08] Yes, I was able to get a sneak peek. And I got to say, I love it. Especially their new tagline on the money.
David Leary: [00:42:16] I love that I'm going to get a new relay card. My other one's a little, little haggard and beat up from using it too much and it looks like it's going to have tap. Do you know when this goes live?
Blake Oliver: [00:42:24] It's live right now.
David Leary: [00:42:25] Great. If you want to see the new relay head over to Cloudaccountingpodcast.com promo slash relay that it's cloudaccountingpodcast.com promo forward slash relay. Why? We could jump into avenues because there is, you know, taxes involved. We have a Twitter earnings. You want to jump in?
Blake Oliver: [00:42:46] Yes. Let's do app news.
David Leary: [00:42:54] So last week we got busy and we didn't cover the Intuit app news from last week. They had their earnings and they also released the logo. Do you want to do earnings or logo first?
Blake Oliver: [00:43:04] Well, when I first saw the the rebrand announcement with the new logo, I didn't I couldn't figure out what was different without comparing the old one and the new one side by side. And it looks like they just cut the head off of the the eye and the t yeah.
David Leary: [00:43:16] They cut the heads off the bodies. Right. Yeah. And then the ends a little bit more rounded. And but it's silly because the people in there actually was great. I thought that was really, really great. But it's also like kind of silly because they. They changed the font of the main Intuit logo. So the use in the ends and the t's are slightly different, but all the subbrands have a different style t and they have the end with the when you draw an end, there's the street back on the end. So the Intuit logo no longer has this straight back.
Blake Oliver: [00:43:47] And we just say that like nobody cares.
David Leary: [00:43:51] I mean, I do think it nobody cares.
Blake Oliver: [00:43:53] And most most people have no clue what into it is anyway. They know the sub brands.
David Leary: [00:43:59] And so speaking of the sub brands, that's the big difference. I noticed Mint is not listed in the lockup for the sub brands, and I think that's because Mint is just kind of rolled into credit karma. I wonder if they're going to completely kill Mint and it'll just be credit karma. You do your you do your credit report there. You do your personal finances there. Yeah, right. You have the credit karma personal bank, right? I think I mint must be going away, which is kind of interesting. And then the other thing is the lockup because everything's lowercase and this is the craziest one of all. So QuickBooks, technically speaking, everybody, when you do QuickBooks, it's capital IQ. Capital B always has been. Always will be. Every every developer, anybody that ever uses the logo has to do that. But then they create this branding in this logo and there's lowercase Q and lowercase B, which is just bananas, right? They're not usually utilizing the same branding strategy thing. It's a little crazy. And the other comment on this, I saw some photos of the announcement on LinkedIn, etc., and they got new shirts and they're kind of like they actually, you know, Expensify had their new shirts. We talked about this about a year ago and it kind of had the blues kind of similar to the cloud accounting code Past Blue. And there were like a dark gray shirt, kind of like our shirts. And now I saw the Intuit ones and the blue is a little different shade and it's on like the gray shirt. It looks just a little similar to The Cloud Accounting Podcast shirts. I'm just so I'm just saying.
Blake Oliver: [00:45:18] Well, what about.
David Leary: [00:45:19] Their earnings, which we also missed last week.
Blake Oliver: [00:45:21] So what's new with earnings?
David Leary: [00:45:22] So they had they had revenues of $2.4 billion for the quarter ending July 2022. The small business and self employed revenues grew 41% year over year to 1.77 billion. And then there are online services, so there's going to be payroll payments, time tracking, QuickBooks Capital, they grew 116% year over year to 657 million.
Blake Oliver: [00:45:47] That's a lot.
David Leary: [00:45:48] And then of that 657, 265 was MailChimp. So millennium's contributing, you know, almost a third of their services revenue, which is pretty interesting. They still have $3.2 billion cash on the balance sheet. And then total desktop ecosystem revenues grew QuickBooks Desktop 1.5% during the quarter to $489 million. So QuickBooks Desktop is still like.
Blake Oliver: [00:46:15] Half to.
David Leary: [00:46:16] Get along. Unfortunately, it will never die. Yeah. Listen to the conference call and there's nothing major in the conference call but the vibe I got in here or one takeaway was flat out. They said 51% of the company is small business of Intuit. So for all the TurboTax business, Intuit does small businesses, 51% of all of Intuit's business. And they're talking about how. Revenue growth. And this argument of how they how they've been growing now is they tend to grow slow until they innovate and they give an example of their payments product. So 4 to 5 years ago, the payments business only grew at like 11%. And then when they innovated and improve the payments experience across the platform, now it's growing 30% plus right now, like 2 trillion invoices are moving through the system and they're managing the platform. So it's kind of a and then so they're talking about this when it comes to their other product lines as they throw in this innovation and improvement curve on some of these products. And then, you know, they're still at the bottom. We've talked about this like they still think there's a $20 billion opportunity here, you know, and then. Oh, and this ties into my next story to some this a quote from Suzanne, the CEO of Intuit in the conference call.
David Leary: [00:47:31] He said that because he was asked about whether or not not the economy is getting tough, what that's going to mean. And he comes out and says that we're not a line item on the small business budget. We are the platform that fuels their success. We are mission critical. Without our platform, a small business can't run their business. And I see that quote and I'm kind of like, Wow, that's kind of pretty cocky. And this is my comments from last week that I captured because we didn't get to the news and I was thinking about, you know, I think this is where Intuit and Xero, ET Cetera are wrong. They're full of themselves. Right. You have toast, Shopify, Shopify Clear Law Firm Software Builder Trend, which is for construction, eco brewmaster for breweries. Those are the mission critical apps. Those are the platforms they run their business on. Like I think payrolls, commodity time tracking and commodity marketing apps are commodity merchant services. A commodity bill pays a commodity bill scan even the GL, they're all commodities that are easily swappable. So like this is kind of naive on Suzanne's part, I think right of where they stand and proof of this is, did you see the announcement from my case?
Blake Oliver: [00:48:33] No, tell me.
David Leary: [00:48:34] So my case is law firm software. And about a year and a half ago, they purchased two companies that do some good work well, blah, blah, blah. They finally launched out what they're calling is my case accounting. But the key to this whole press release is this sentence. The feature eliminates the need for firms to use third party accounting software.
Blake Oliver: [00:48:55] Yeah.
David Leary: [00:48:57] Like. Hello? Like you. Like. Like. You know, that's the threat. That's where you're.
Blake Oliver: [00:49:02] At. Yeah, that's the threat. That's the threat to into it is is all of these front office apps building their own GLS or integrating with something that's I mean, QuickBooks is getting expensive, right? And at a certain point, people will say, hey, you know, maybe I don't need to do all my accounting and something that's $90 a month just to do my accounting if I'm not using it for anything else. So I think that's where I mean, that's what QuickBooks has been working on. Intuit has been working on making QuickBooks this holistic solution. So you can run your whole business on it.
David Leary: [00:49:40] And in the meantime, you know, you got to stop this people really and you've got to stop this.
Blake Oliver: [00:49:46] And here's a new product. There's a new product from Intuit this week that shows you I hope that anyone who still if anyone's listening and they're still enmeshed in desktop like let's I don't know if you're there but you've got to check out this new product from into it. And this reflects their strategy of integrating all these cloud based products that they're innovating with. This is called Intuit Tax Advisor, and we're using a new recording platform. So for those of you who are watching on YouTube, you can actually see my screen and I am going to play the video for you. David announcing this new product. So the headline on the website is Tax Prep Plus Advisory Tools Together at last build custom tax plans in minutes with data automatically generated from your cert or pro connect software so you can connect this into IT Tax Advisor app into your Intuit Tax Prep software, pull in your client information and then create tax plans using strategies that have been pre built into the software. So this is a lot of stuff that people do in Excel sheets to show clients what's possible. And the presentation on this is really spectacular. It's really it looks like a beautiful product. So I'm going to play the video for you. And if you're listening on the podcast, go find the link in the show notes and see it in action for yourself or go to go to the link in the show notes and see the website.
Intuit Tax Advisor Ad: [00:51:16] Just something you've been waiting for is finally here. Tax Adviser, Tax Prep and advisory tools together at last with Intuit Tax Advisor. It's so easy to build custom tax savings plans for your clients. You'll wonder why you haven't done it sooner. You should have because no resource like this has ever existed. Intuit Tax Advisor is the first of its kind. It's a proactive tax planning tool that can develop complex, personalized tax plans for your clients and provide them with easy to read customized reports. There's no need for spreadsheet scanning or manual data entry. With Intuit Tax Advisor, you won't ever have to think about those things again because client data is automatically mined from your laser or pro connect software. Sinking data this way translates into far more accuracy for your clients and far less time for your practice. All legislated tax law updates are automatically incorporated into planning and projections with built in compliance. Personalized tax planning is an amazing way to grow your business and provide value added services for your clients. Intuit Tax Advisor provides you with things like smart suggestions that generate personalized tax strategies and insights directly from your clients tax return. You can choose to add them or dismiss them. It's up to you. You'll also have the ability to try different tax scenarios to see their implications. Don't see a strategy you want. Create your own in minutes. Save and modify it at any time. You can also choose from our library of strategies. Where you can plug and play from hiring your kids to 401 (K) contributions.
Blake Oliver: [00:53:07] And then the video concludes with examples of the reports that you can send to your clients. And they are beautiful. So think of this as a sales and marketing tool. You can plug in the tax information from the return. You prepare for your compliance engagement and you can say, look, if we do these strategies for you, you're going to save this much in federal tax, this much in state tax. Your whole total savings is, let's say, $10,000. Right. And it's going to offset our fees. Right. Like that's how you position these advisory. Engagements is I'm going to save you X dollars in tax. And so you're actually going to come out ahead even after you pay my much higher fee for that.
David Leary: [00:54:00] I'm glad you brought the show, because I actually bring the show on stream, baby, to see how this maybe won't. We didn't talk at the time, but I was also looking at this and I wrote this down. I said, it looks very polished and arguably more finished than other Intuit launches. And the fact that you kind of picked up on that as well, like this looks like a real deal winning home run product. It's very impressive looking from this, you know, unlike, you know, QuickBooks paint, you know, which is crap, right? It's just like, you know, they really have done this. I can argue the abbreviation and the press release is not good because they call it ita and this is bad. That needs a better acronym of some type. But it it's cool. It's interesting. One question that I have about it is My Barbarian is well, in the video, they're like, this has never been done before. And it's like, Yeah, into it. Why didn't you do this a decade ago? You've had all the data, the expertise, the knowledge. You could have done this forever.
Blake Oliver: [00:54:52] And it's false because there's a la Cert Tax Advisors thing that they have in the past, and there's a FAQ on their website where they talk about the difference between this older product and this new one. So it's just it's it's a, it's a new iteration of what they've already been doing. But I think this one is, you know, in the cloud, it creates those beautiful reports. All right.
David Leary: [00:55:11] It looks pretty nice. It looks nice. And then some piece of this leads me to a bigger question. Right. We've talked about this before with QuickBooks Live like that last mile. Like if Intuit wants to automate more stuff, right? They have bookkeeping and they do bookkeeping. They can learn things and they can really understand what to do to solve these last mile problems. Kind of like this. Is this like a way to get last mile edge knowledge? Now you get to see all the strategies accountants are applying with clients, and then you spin this out as a TurboTax tax planner type product.
Blake Oliver: [00:55:40] Or it becomes part of TurboTax live like a higher level plan for TurboTax, live. Right. With their own tax advisors. And it's all pre canned. Right. So it's easy. Just I pull in your information, I don't have to be an expert with 20 years of experience. Maybe I have had a few years of training to do this. It's upskilling or I mean, this goes back to the whole automation thing, right? It's like all these tax strategies are well established and you can apply them. It's just hard to do that with spreadsheets and to figure all this out for clients if you don't have a lot of experience, but if you're on rails in a software product, you can actually see like like based on the information from the return. Here's the ones you should recommend and here's what's going to happen. And it just makes it a lot easier for people with less experience to do this kind of work for clients do tax planning. So it's, it's about the combination of the human and the software, right? That's the future of our profession. It's been that way, starting with bookkeeping. It's just moving up that value chain.
David Leary: [00:56:43] And it still shows that Intuit, even though they're an old dog, they still have new tricks in there. Yeah, the new stuff, I, I know they've never talked about this, but they have a product and I always forget the name of it, so I can never pull up the website. But it's funny because we were at Zero Con, one of the keynote speakers, somebody asked him like, what things should zero build? And he's like, Well, I really like it for my calendar and some billing software and my zoom, you know, task management were all combined into like one app. And I was sitting there, I didn't, I was like, Intuit's built this already. Some of it, I think it's because of QuickBooks Live, but I can never remember the URL for it. And they're not marketing it yet, but it exists and then it's really slick. And so basically you could be my client. Blake, I just give you the URL or you book on my calendar. It's the same product. It takes notes. Well, we're we're meeting if I want to build you, like, oh, yeah, I'll do the cleanup work. You sign the contract right in the zoom call and you pay me right in the same call. It's not a zoom call. It's whatever this platform Intuit built is, but it's like there's still good things that can be possible here. But then they do stuff like that. Weird business, the business store. That's kind of weird. Quick. Riksbank That's not good. Yeah. Hit and miss I guess.
Blake Oliver: [00:57:52] The big company, you know, speaking of human software hybrids. Bookkeeper 361 of the original cloud based bookkeeping firms has raised a $3.5 million seed round to scale their platform and operations. The round was filled by new strategic partners, customers and previous investors who are also angel investors. Etsy.com now bookkeeper 360 is interesting because they built their own app, so they have an app on the app store called Bookkeeper 360. It plugs into QuickBooks, it plugs into Xero. And so it's actually a really powerful funnel for them to get leads for their bookkeeping services because you can connect it, get this dashboard. And then you can also interact with your bookkeeper 360 bookkeepers through the app. So it's like their own client portal communication system that they've built. Yes. Yeah. And that's really interesting to me. It's an it's an accounting firm, bookkeeping firm that has built their own software now they don't build their own. Gl I think that's the smart thing is don't try to build your own ledger because that's that's what Nero did and it failed, right? It's too complicated. It's too much. But you can build your own client interface and report presentation tool. That's doable.
David Leary: [00:59:10] Yeah. And then the basically the virtual office interaction. Yeah. Right. With your client.
Blake Oliver: [00:59:15] Scheduling.
David Leary: [00:59:16] You could customize you could customize that to the experience you want to offer your.
Blake Oliver: [00:59:19] Client. And actually, this is what you're talking about, right? Like what somebody said they wished, you know, zero would build bookkeeper 360 has built that a lot of that that's.
David Leary: [00:59:27] Kind of similar.
Blake Oliver: [00:59:28] Exactly share files do you know schedule meetings, all that stuff.
David Leary: [00:59:32] So so two other things happened last week that we kind of missed. We didn't get to in the news stripe, laid off taxes and taxed our employees. So straight taxed our tax chart was tax calculations. So, you know, it's an avalanche type product, right? They acquired them because they you know, obviously Stripe has lots of transactions going through and they're supposedly going to stack and integrate this in. They started with the A product, but now they're laying off somewhere between 45 and 55 people and they just acquired them in 2021. But they said the company, you know, is still going to like work on these swift tax tools for e-commerce companies. So but obviously they did do a layoff there. And then the other piece that we missed last week was Fathom Fathom reporting. Yeah, got acquired by Access Group. So access group sounds like they've been gobbling up a lot. They're kind of like the the sage group of the Asian Pacific Reason region. So they're been gathering, they've been gobbling up like they bought rec and accountants. Now they've got fathom they're kind of a private equity company, basically buying up this tech stacks. It did say that Fathom currently has 7500 customers worldwide at the time, and but they also access portfolio already had reporting and financial planning tools. So who knows where this is headed?
Blake Oliver: [01:00:56] Carbon released a client portal. Did you see that, David? So now your client, if you're using carbon, your client can have access to all your open and closed requests, including current client requests that haven't been completed. They'll also have copies of documents that you have uploaded so you can keep track and easily find what's been sent. And they did something different with the client portal versus their current functionality. The current functionality is if you if you send a message to a client or you give them a task, the client gets an email with a and with a link, and then the client sets up a pin number like a four digit pin. And then every time they click the link, they have to put in their pin as a security measure. That is a huge pain. I've been on the receiving end of this because the firm I work with uses carbon because I forget, you know what pin I use? I try not to use the same pin as my bank account, you know, that sort of thing. And so now they're just doing these one, I think Slack calls and magic links where it's just you get an email to verify, you have control of the email and then you get into the portal. So it's a passwordless portal system, which is like the ideal situation in my opinion. You don't want people to have to remember a password.
David Leary: [01:02:09] Especially for like your lawyer, your accountant's portal, your doctor's portal. I don't want to say logins passwords. Yeah, I agree.
Blake Oliver: [01:02:16] So this is one of the big like missing features in carbon and now they've got their first version of it. So they continue to really, you know. Grow and they're penetrating the larger firm space like carbon is becoming a very, very popular solution, especially for mid-sized firms, because they've got this new functionality now. Well, David, I think that's all the time we've got for this week. Where can people find you online?
David Leary: [01:02:43] I'm on all the socials. @davidleary. I am easy to find.
Blake Oliver: [01:02:47] I am at Blake t Oliver. Send me your emails. Voicemails are even better. You can email those to Cloud Accounting podcast at earmark CPE. That goes to both me and David now. Cloudaccountingpodcast.com. Earmark CPE. And you can get CPE credit for listening to this show. Download the earmark CPE app on the Apple App Store or the Google Play Store. Sign up for free. Start earning free CPE credits for listening to this show and many, many other amazing podcasts. We just added Panda today to the lineup on earmark CPE. So now if you're interested in forecasting, financial planning and analysis, you can get CPE for listening to Paul Barnhouse podcast. And there's just so many more. And actually, what's a.
David Leary: [01:03:34] Three day weekend? You could listen to a lot.
Blake Oliver: [01:03:36] You can catch up on all your CPE. And we just launched we did a soft launch this week of Drunk Ethics. Yes, you heard that correctly. Not Drunk History. Drunk Ethics hosted by Greg Kyte. Greg Kyte is a CPA and comedian. He and his friend Adam Broad, who is a MBA and a comedian, do a four hour behavioral ethics CPE course. It's a premium course on the earmark app, so you can get four ethics credit satisfy your ethics requirement in each episode. They take a shot every 7 minutes until the end of the episode while they teach behavioral ethics. And it's actually really, really insightful and funny at the same time. I have never laughed so hard while learning so much. So go grab that course and I guess I'll see you here next week. Have a great Labor Day weekend, David.
David Leary: [01:04:24] Yeah.
Blake Oliver: [01:04:25] Bye.
David Leary: [01:04:29] Time for the classifieds. Do you dream of starting a bookkeeping business? But you don't know where to start. Join the Bookkeeping Biz Workshops a live four day workshop series hosted by Serena Shoop, CPA. You'll learn where to start, what it takes, what tech to use, how to build a business, not a job. Plus, how to get comfortable on discovery calls. The workshops begin September 20, so register today at BC Workshops online. That's BC workshops online.
Blake Oliver: [01:04:59] Hey, podcast listeners, it's Blake, and I wanted to let you know about a new show I'm working on with CPA comedian Greg Kite and blogger Slash former CPA Caleb Nyquist. It's called Oh My Fraud, and it's a podcast all about financial crimes. That's right. A true crime podcast for accountants by accountants. Caleb and Greg are going to come together every couple of weeks to unpack their favorite frauds and explore the circumstances, psychology and interpersonal dynamics involved. They also fully indulge in victim blaming the defrauded widows, orphans, infirm and feeble minded. Because who can resist if you fancy yourself a trusted advisor or prefer your true crime with spreadsheets instead of corpses? Listen to this show to learn what to watch out for and to keep your clients, your firm, and even yourself safe. To subscribe, go to oh my fraud dotcom or search. Oh my fraud on Apple Podcasts, Spotify or wherever you get your podcasts.
David Leary: [01:05:57] 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 The Cloud Accounting Podcast know by running a classified ad at the show notes for the link to get more info?