Building an E-Practice
June 14, 2001
Visit the AccountingWEB Workshop Calendar for upcoming sessions.
You can read the complete transcript of the workshop.
Items covered in the workshop include:
What Is An E-Practice?
Why Build An E-Practice?
How to Build An E-Practice
Session Moderator: I want to welcome everyone, and thank you for joining us today! I'm happy to introduce David Thomas, who will be presenting a workshop on Building an E-Practice. David Thomas brings more than 20 years' experience in the fields of accounting and Internet architecture to his role as chairman and chief executive officer of Intacct Corporation.
During 2000, Mr. Thomas spoke at several accounting and technology events. He was a primary speaker at the AGN International conference, 28th Annual Chase Hambrecht & Quist Technology conference, and the Enterprise Outlook conference. He has also presented for CPA2Business, California CPA Association, CPASNET.com, and local chapters.
In 2001, Mr. Thomas is scheduled to be a key speaker at Venture One, Enterprise 2001, Enterprise Outlook, Illinois Business and Technology Solutions 2001, Pencor's 7th Annual Super Conference, 5th Annual Bridge21 Conference and the South Carolina Society of CPAs' Accounting and Auditing conference.
David Thomas: Hello, my name is David Thomas. I am the chairman and CEO of Intacct Corporation, developer of the first purely web-based enterprise-class accounting system. I'm glad you have all joined me this afternoon, and I hope to provide you with some valuable information about the concept of web-based accounting.
I would like to use the following format.
First, I will cover a specific topic and then ask for questions. When the questions have been completed I will move on to the next topic. Please hold your questions until I have completed each section.
I'd like to begin by giving you a brief overview of Intacct and then introduce the E-Practice concept. Intacct is the industry leader in web-based accounting. We have four major investors in the company: Hummer Winblad, JK&B Capital, Goldman Sachs and Deloitte and Touche. We recently closed a $21M funding round, and our entire executive team is comprised of accounting software veterans. Intacct launched its E-Practice service in Aug 2000. We have partnerships with Deloitte and Touche and also with CCH and Intuit on the tax side, with whom we are creating integration with their professional tax products.
I will now discuss professional web-based accounting at a very high-level, and then I'll delve down into the detail.
Intacct's full, professional accounting solution offers enterprise software that has a rich functionality and sophistication, yet is delivered through the Internet. All of our services are delivered online, and we deliver integrated business services such as online bill payment, payroll services and so forth. We also integrated web-based auditing with the content and methodology of Deloitte and Touche.
We have mission critical security and world-class data management. And all of this is delivered to our partners as a private-labeled service, which means we put your logo on the service and make it available for you to provide to your clients. Offering web-based accounting over client/server accounting offers four major benefits to CPAs:
- Anytime/anywhere access. Accountants and clients can securely review and interact with accounting data from any Internet-connected computer, from wherever they are.
- Self-service connectivity. Authorized clients, employees, vendors, and others can securely enter transactions, review data, and track business processes on their own, at any time, day or night.
- Collaborative accounting. An unlimited number of participants--accountants and clients alike--can simultaneously view and interact with the most current client business data and reports, all online.
- 4. Virtual IT department. With web-based accounting, there is no software to install, no new hardware to buy, and no IT networks to build--ever.
I would be happy to expand on these topics, or address any other questions you might have.
Does anyone have any questions at this point?
Gerri Siri: What you mean by collaborative accounting is that I can access my client's data from my office?
David Thomas: Collaborative accounting refers to the ability to work on the same data at the same time as your client
I want to talk a moment about integrated business services and how important this is to the change in the accounting space.
The Internet, because of its connectivity, has the ability to deliver a whole array of services that traditionally were offered as a stand-alone service. Things like being able to pay your bills, payroll services, banking, and so forth are now delivered in context of the application. So, for example, in the Accounts Payable system, a client can simply click "pay online" and we have a world-class company in Atlanta that actually generates the checks and mails them out. Another way of viewing this is, through a browser, the Intacct accounting solution is the foundation on the back end and then there's all these integrated business services that we've plugged into the system, including some which may be services that you provide, such as an audit.
Now I'll address the differences between the old way of doing accounting, which is the accounting software route, versus the new way - web-based accounting.
With the old way, if you consider the cost of the hardware, software and infrastructure, the total cost of ownership could be very high. The complexity of installation, customization and IT management takes up a lot of time. Additionally, integration issues such as having your accounting in one office and another application somewhere else and maybe payroll that doesn't integrate makes for a very cumbersome solution. And if you have remote access and multiple locations, it gets very complicated and costly. Then there is the scalability issue of outgrowing an accounting solution as the company grows. These are just some of the problems involved in the old accounting software model.
With the web services model, there are virtually no upfront costs and no infrastructure requirements - just a monthly subscription fee. In terms of simplicity, it's pre-installed and configurable, and service upgrades and backups are done by us while you sleep. Because it's on the web and we're using a world-class infrastructure hosted by Exodus, this solution will grow as the business grows. Features such as unlimited numbers of users, transactions, locations and so forth allow for that. Regarding integration, we integrated the service with our XML interface on the back end to all kinds of different services and applications, so you can integrate other services with the accounting system as well.
Are there any questions about the differences between the software and the services models. Any questions about any of this?
Bic Wood: Does your system provide integrated data transfer and sharing capabilities outside the accounting applications within the system? In other words, could a client send me information like a spreadsheet or a scanned invoice within the Intacct system?
David Thomas: A client could send you documents or xml files etc. using our internally supported email delivery feature. Scanned document support is currently available only in the audit system.
Thomas Buckley: Can you update certain accounts, like inventory, by uploading file in XML?
David Thomas: Yes, we support a number of csv uploads of data such as transactions.
Let's move on.
We partner with three different channel models:
First is the traditional CPA firm. If you're a traditional CPA offering tax, audit and business consulting, we have an E-Practice suite of solutions tailored to the needs of your firm.
We also have partners that offer outsourced accounting services.
And sometimes we have partners who offer both types of services. So if you provide bookkeeping services to your clients, using the connectivity of the web, you can push that work out to people who work remotely, or you can manage it and allow your clients to have limited access to the accounting solution while you do the outsourced accounting.
The third model is solution providers. This is for those of you that may be working in vertical markets or are building semi-custom solutions with some measure of integration. For example, we have a solution provider partner who specializes in providing solutions to nursing homes. They have been installing a large number of our services in those nursing homes, which allows them to do a lot of the outsourced accounting for them remotely integrating with their own vertical solution.
Any questions about our channel programs?
Thomas Buckley: Can you integrate a web store?
David Thomas: Currently the integration with a web store must be done with our xml gateway. We will be supporting a more integrated solution in the near future
Let's move on to data management and security of web-based accounting services.
Our data management is made up of Oracle database servers, UNIX operating systems running on application servers, Cisco routing switches and firewalls. We use an application server farm architecture, and we're hosted by Exodus who is the leader in hosting. We have redundant Internet connections to prevent any downtime, and we have fail-over units on every piece of the system for power, the firewall, the load balancing, the application servers, the database servers, and the like. We also do nightly backups of all the data, so the issue of your clients forgetting to do their backups and having a horrible problem when their hard-drive crashes is eliminated. You don't have to worry with this model, because their data is backed up every evening.
Now I'll touch briefly on physical security of data.
Exodus, where our servers are housed, has unprecedented security with such requirements as hand scans, bullet-proof glass, armed security guards, a fireproof building.
In terms of data security, we use 128-bit SSL data encryption. RSA suggests it would take 1 trillion years using today's technology to decipher the 128-bit data encryption that is the maximum allowable by law. We use Verisign digital certificates, Cisco PIX firewalls, UNIX virus protection, and of course, the nightly backups.
Any questions on data management or security?
I'd like to summarize the benefits of partnering with Intacct:
1. A powerful web-based infrastructure. This will allow for that anytime anywhere service and the no investment in IT.
2. A new revenue opportunity for you as a firm. You can mark up and bill your clients for our services that have been private labeled for you.
Significant competitive advantages for you. You will be ahead of the pack in offering key services.
Thomas Buckley: Whom do you see as your biggest competitor? How do you differ from Netledger.com?
David Thomas: NetLedger is a QuickBooks competitor and offers a good small business solution. We are focused on providing an enterprise solution. Gray haired executives of the accounting software space who have been building solutions for up to 25 years. NetLedger sells direct. We only sell through you.
Bic Wood: Could you comment in general on the competitive landscape? I would be particularly interested on what you could tell us about other solutions such as Bridge21/AccountingStation, and whatever cpa2Biz is going to do (in addition to NetLedger).
David Thomas: The general market consists of ASPs, Software providers, and Software as a Web Services. ASPs offer traditional Client server solutions that have been retrofitted for the web through tools like Citrix's. They will be unable to compete on price and have a challenge in integrating with other web services. Most of the major software providers have some kind of ASP solution. The traditional software providers are struggling to decide what to become next.
This reminds me of the move to Client Server and how it allowed some relatively unknowns such as SAP to become very successful. Intacct stands alone as the only truly built for the web solution for the enterprise.
David Thomas: How is that Bic?
Bic Wood: Good answers. Can you comment at all on cpa2biz? Will they go with FinanceManager? How do you differentiate if they do?
Thomas Buckley: Is the writing on the wall for Peachtree?
David Thomas: They are building an interesting portal for CPAs.
Finance manager is a given because of the Microsoft investment. That will suffice on the very low end. As for Peachtree, I am not about to predict the future success of any Vendor. Finance Manager will have a hard time competing with QuickBooks or Net Ledger much less Intacct. Enterprises need very powerful reporting and budgeting. They want scalability. They want support for multiple locations departments etc.
I still have a few more points to summarize on the Intacct partnering.
4. A proven management team supporting you
Gray haired executives of the accounting software space who have been building solutions for up to 25 years.
5. Key accounting industry partners
Deloitte and Touche and CCH.
6. A unique E-Practice service
Audit, Tax Integration, and Client management.
7. We only sell through professionals.
There. Are there any other questions?
Gerri Siri: David, how does the private label work?
David Thomas: You provide us with a logo and our customer service group will create a url with your logo as the premier logo on the service. It might be good to give some contact information
Bic Wood: Could you give us a "sneak preview" of features and capabilities you are going to add to the system in the near future?
David Thomas: If you would like more information about the benefits of web-based accounting, you can contact our sales consultants toll-free at (877) 886-7600. You can also attend our webinars by signing up at our website www.intacct.com
Any final questions?
Thomas Buckley: Thanks for the information - Your Grecian Formula is in the mail.
David Thomas: New features will include consolidation (next 30 days), a full featured order entry inventory purchasing system, and many others.
I gave up on Grecian Formula. I went gray at 30; many years ago
Bic Wood: Thanks, you have an impressive and much needed product.
David Thomas: Thank you for your time today. I hope I was able to provide you with valuable information about web-based accounting.
Session Moderator: David - thank you so much for sharing all of this valuable information!
David Thomas: Good-bye.
Session Moderator: Thank you all for joining us today!
David Thomas brings more than 20 years’ experience in the fields of accounting and Internet architecture to his role as chairman and chief executive officer of Intacct Corporation. Thomas began developing accounting software in the late 1970s, and in 1980 founded Cyma Systems, Inc., an early provider of PC-based accounting software. While at Cyma, he personally engineered the first PC-based accounting system and established a customer base of nearly 50,000 companies. Later, he negotiated Cyma’s acquisition by McGraw-Hill.
In 1995, he founded BroadQuest, Inc., where he led the development of enterprise portals to help large companies view enterprise-wide information. BroadQuest’s key customers have included Novell, Wells Fargo Bank, and Johnson & Johnson.
During 2000, Thomas spoke at several accounting and technology events. He was a primary speaker at the AGN International conference, 28th Annual Chase Hambrecht & Quist Technology conference, and the Enterprise Outlook conference. He has also presented for CPA2Business, California CPA Association, CPASNET.com, and local chapters.
In 2001, Thomas is scheduled to be a key speaker at Venture One, Enterprise 2001, Enterprise Outlook, Illinois Business and Technology Solutions 2001, Pencor’s 7th Annual Super Conference, 5th Annual Bridge21 Conference and the South Carolina Society of CPA’s Accounting and Auditing conference.