MARY DALE WALTERS
ACCOUNTING PROFESSIONALS HAVE EMBRACED THE INTERNET,
ARE MOVING QUICKLY TO REAP THE BENEFITS, SAYS CCH SURVEY
- It's a regular part of their daily work
- Web sites for firms are growing in number, scope
- Potential to benefit in the new economy is encouraging
(RIVERWOODS, ILL, August 23, 2000) â They've tried it, they like it and it has become part of their daily business lives. Not only are the accounting professionals pleased with what they find on the Internet, but they also are adopting more and more uses for the Internet in their practices and are benefiting from the exploding e-conomy, according to the CCH Accountants on the Internet 2000 study, released today. Conducted for CCH INCORPORATED (CCH), a leading provider of tax law information and software, by Harris Interactive, the global leader in Internet-based research, the survey provides a clear picture of the value and advantages the web is bringing to accountants, their practices and companies and their clients.
CCH, which has been offering products and services for business professionals via the Internet since 1995, explored the impact of the Internet on accountants in the industry's first definitive survey four years ago. The company's CCH Internet Tax Research NetWork sets the standard for web-based tax news and research and CCH will web-enable its market-leading ProSystem fx Tax software in 2001.
The survey of 600 U.S. accountants working in accounting firms and companies found that practically all accountants (96 percent) have access to the Internet and nearly all (88 percent) can get onto the Internet at their place of business. Further, nearly all (88 percent) of those with access â or 84 percent of all accountants â use the Internet for business purposes. Fifty-nine percent say they're there every day for business reasons, and a full 95 percent say it's a weekly habit.
This reflects a significant increase in access and usage from 1996, when a similar CCH study conducted by Harris Interactive (then called Louis Harris and Associates) found that only 51 percent had access and only 31 percent were conducting business in cyberspace.
Net is Prime Information Source for Many
Among the most dramatic findings of the survey is the wide acceptance of the Internet as a reliable source of business information.
âAccountants who use the Internet for business are more likely to turn to the web as a source of professional information than any other medium or format,â said Kevin Robert, publisher, CCH Federal and State Tax group. âThey're more likely to use the Internet than seminars or the print or CD version of magazines, newsletters and trade journals. This is even more significant given the high rate of usage by the profession. And, it's a substantial advance forward from four years ago, when even among users, the Internet was rated next to last as a source of information.â
It's not surprising that accountants use the Internet so much, according to Robert. Those who have turned to the Internet for professional information say they are highly satisfied with the rapidly expanding medium. One in 10 consider the Internet âabsolutely essentialâ as a source for professional information and 43 percent rate it âvery important.â
Nine out of 10 users believe that the Internet is making information more accessible, as do three-quarters of the non-using accountants. Users also have a high opinion of the quality of the information they find on the web. More than 85 percent of them rate the information available as âexcellentâ or âgoodâ in terms of timeliness, relevancy, accuracy, reliability and the quality of its source.
Accountants Employ Net in Many Ways
Sheer availability of information is the front-running attribute of the Internet for accountants, and the Net is affecting their daily activities in a variety of ways.
A majority of Internet business users in accounting firms of all sizes communicate via e-mail, conduct professional research, conduct general business research, download software or demos, read business and professional news, identify and research professional products and services and purchase professional products and services over the Net.
âWith accountants, we've found that the Internet is becoming their preferred method of customer service. Whether it's downloading demonstration software or being notified of upgrades by e-mail, our customers are increasingly relying on the Internet to make the most of professional software,â said Gene Landoe, president and CEO, CCH Tax Compliance, which produces ProSystem fx Office.
âMinorityâ Uses Are Likely Growth Areas
A minority of users in firms of all sizes say they access remote applications, access continuing professional education (CPE), store or manage client or payroll data and participate in forums.
But these âminorityâ uses may well represent growth opportunities for firms and vendors, judging from past experience. While only 29 percent of accountants have used the Internet to access CPE, for example, this is a dramatic increase from 1996, when less than one percent â one respondent in the entire survey sample of 600 â had sought CPE over the Net.
Approximately two-thirds (65 percent) of the users in the largest firms (11-plus professionals) report that their firms market themselves over the Internet. Less than half of the users in smaller-sized firms report such use. These responses largely reflect the establishment of a web home page by firms of all sizes.
Nearly one-fifth (18 percent) of all accountants report that their businesses or firms conduct financial transactions on their web sites. The figure is larger (22 percent) for corporate accountants, however, compared to accountants in firms, where just 10 percent say that their organizations are engaged in some form of electronic financial transactions.
âWe expect this evolution to continue as accountants use the Internet to transact even more business,â said Landoe. More than half of all accountants currently e-file tax returns, and that's a sign that they're ready for new electronic concepts â such as web-enabled organizers and processing returns over the Net via Global ProSystem fx in 2001.â
While at least half of all accountants using the Internet for business say that it has improved their communications, opened new opportunities and been a successful marketing tool, only a minority say it has made their work life easier or helped them better manage their businesses.
Big Firms Are First In Web Presence
When it comes to establishing a presence on the Internet, an accounting firm's size makes a difference.
The largest firms â those with 11 or more professionals â are most likely to have a web site. Seven out of 10 have one now, and 82 percent will have web pages a year from now if respondents' plans hold up.
By contrast, nearly one-third (30 percent) of firms with three to 10 professionals currently have a web site. If their web sites come to fruition, about half of the firms this size will have a web presence in 2001.
The very smallest firms, with one to two professionals, are least likely to have a web site now (20 percent) and also are least likely to have one a year from now.
Small Firms Score With Extra Web Features, Services
But the smallest firms that already have web sites are more likely than larger ones to offer a number of âvalue-addedâ services through them. Firms with five or fewer accountants are more likely than larger firms to offer tax or financial news and various calculator tools. The smallest firms â those comprised of one to two professionals â are more likely than larger size firms to offer tax preparation software.
Also, small firms â with five or fewer professionals â with a web presence are most likely to hire outside consultants or freelancers to design and maintain their web pages.
âThis is one area where a smaller firm can easily provide additional services that set it apart from other firms â and give itself a âbig-firm' look without a major investment of resources,â said Robert. âCCH's Federal and State Tax group is already feeling the impact of this trend. There has been tremendous interest in our recent alliance with Execusite (www.tax.cch.com/execusite), which builds accounting firm web sites and allows its customers to choose CCH's tax news and information for the firm's clients.â
Firms with an existing web site, and those planning to establish one, agree on many of the objectives for having a web presence. Providing information about services or products is the primary goal for both existing (94 percent) and prospective (96 percent) site owners. This is followed by the goal of establishing a business presence (89 percent for both existing and prospective site owners) and providing customer or client contact (82 percent for those with existing sites, 80 percent for prospective site owners).
However, the country's obsession with e-commerce and its evolutionary role in business may have helped ratchet up expectations of the next web generation, according to CCH. Those who plan to create web sites in the next year tend to have higher expectations or more aggressive goals.
Of particular note, 73 percent of anticipated newcomers say they expect their new web site to identify new business opportunities for them, while only 55 percent of current site owners have this expectation.
Forty-two percent said clients and business do come to them from their firm or corporate web site. However, many firm and corporate accountants with web sites apparently do little to evaluate the business impact of their sites. Twenty-seven percent of all accountants said they do not know if their web sites have brought them new business.
Seventy-three percent of those planning to build a Net presence said they want to sell services or products, versus 66 percent of those with existing sites. Also, a greater number expect their new sites to provide customer service â 65 percent versus 59 percent for current web site owners.
Net Use Will Increase
In general, accountants see their usage of the Internet increasing in the next year, with 70 percent anticipating greater use of the Net in business contexts. By contrast, only 55 percent think that their personal use of the Internet will increase in the next year.
A majority (57 percent) of those in accounting firms think that their use of the Internet specifically for accounting and tax applications will increase.
Leading the E-Commerce Revolution
Some accountants will certainly be leaders in the shift of commerce to cyberspace. Over one-fifth (22 percent) of accounting firms have seen an increase in the number of clients whose business is largely e-commerce based.
While much of their work for these clients has been in traditional areas such as general accounting, audit, tax and payroll, 42 percent of those with an increasing e-commerce roster report that they have provided technology consulting to their âdot.comâ clients. In addition, more than one-fourth say they are involved in business valuation.
One-quarter of corporate accountants said e-activities of their companies present them with special challenges, particularly with regard to new accounting processes required by e-commerce. Their greatest challenge, however, is in learning the new technology.
âThe CCH Accountants on the Internet 2000 survey quantifies what we are learning about the Internet and our customers almost every day. Simply put, the Internet has had a profound and lasting impact on the practice of accountancy,â said Robert. âMost important, it will continue to shape the way in which accountants transact their business and serve their clients.â
About the Survey
The CCH Accountants on the Internet 2000 survey of accounting professionals on the Internet was conducted for CCH by Harris Interactive during June and July of 2000.
Six hundred accountants participated in the live telephone survey; 400 were from accounting firms, with the remainder employed by corporations with $10 million or more in annual sales. Accounting firms ranged in size from sole proprietorships to regional and international concerns. The confidence factor for the survey is plus or minus 4 percent.
The complete CCH Accountants on the Internet 2000 is available for sale. Survey results â consisting of one loose-leaf volume (approximately 450 pages), include a summary report, charts for selected data, raw data tables, and the 1996 survey report â is available by calling 1-800-248-3248. Price is $200, plus applicable tax, shipping and handling.
About Harris Interactive
Harris Interactive (Nasdaq: HPOL), the global leader in online market research, uses Internet-based and traditional methodologies to provide its clients with information about the views, experiences, behaviors and attitudes of people worldwide. Known for its Harris Poll, Harris Interactive has over 40 years experience in providing its clients with market research and polling services including custom, multi-client and service bureau research, as well as customer relationship management services.
About CCH INCORPORATED
CCH INCORPORATED, headquartered in Riverwoods, Ill., was founded in 1913 and has served four generations of business professionals and their clients. The company produces more than 700 electronic and print products for the tax, legal, securities, human resources, health care and small business markets. CCH is a wholly owned subsidiary of Wolters Kluwer North America.
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EDITORS NOTE: Complete survey data, the survey questionnaire and selected charts and graphs illustrating the data are available to members of the press. Contact Neil Allen at 847-267-2179 or [email protected].