Other than picking the right people, selecting a cloud hosting provider is one of the single most important decisions your firm will make.
Whether you’re hosting just a single instance of desktop QuickBooks or all your applications as well as those of your clients, the hosting provider will be essential to your success. Just like any professional partnership, if you pick the wrong business, you, your staff, your firm and your clients may experience significant consequences, especially if you have a non-cancellable, long-term contract with the company.
It’s important for public accountants to pick a hosting company that works with them specifically. Accountants use more applications at once than almost any other professional, and more of their applications are database-driven, meaning they require more resources. Accountants also use more monitors and have more screen space, so they require more bandwidth to transmit the data on the screen from the remote server to another computer.
This difference means that if you take a normal hosting company’s remote desktop service and apply an accountant’s computer workload against it, your performance will be substandard – you really need a desktop hosting company which knows that you’re going to be running ten apps simultaneously on three monitors, and the host has therefore configured your users to have good performance on that more demanding workload.
Some hosting companies specialize in complete IT outsourcing for firms with 50 or more staff, others focus on firms from ten to fifty employees, and others concentrate on just hosting individual applications (e.g. desktop QuickBooks) for firms and their clients. It’s important to pick a company which has the experience, capabilities, and offerings to support your firm now and well into the future.
Caption: You should look for desktop QuickBooks hosting providers who have achieved the highest level of certification, “Authorized Commercial Hosting Provider” and confirm their status with Intuit by visiting the Intuit Hosting Program website
A second requirement when picking a hosting company is to find a hosting company that has experience dealing with the software that you use. Just as experienced tax practitioners often use “workarounds” in the data input screens, they’ve learned over the years to override tax software logic and properly present items on state and federal tax returns.
Hosting company IT professionals also learn over time how to work with accounting-firm specific software applications. If you select a firm without experience, every time a common glitch in an application appears, you will have to wait on the inexperienced IT provider to speak to the software company to learn what they should have known about your applications before they took on your business.
While every IT provider will have to call software publishers occasionally, a provider without experience working with accounting firms and their software will have to call for help much more often, resulting in more downtime and frustration for you and your team. Some application providers, like Intuit, require hosting companies who want to host QuickBooks to register with the software vendor, submit financial information, and undergo penetration testing before they are allowed to offer commercial hosting services to the public.
Inexperienced providers which are unfamiliar with the accounting industry will often not have proven, reliable solutions for critical issues, like “how will I print a tax return” or “how can I scan a document on my local PC and get it uploaded into the server”, frustrating you, your team, and your clients.
The way you will evaluate the quality of your experience and calculate downtime in your contract is called the “service level agreement” (SLA) or the organization’s “service standards”, which will usually be embedded in your service contract. Many companies also will quote statistics on their website related to the “historical uptime” of their service for the previous day, month, year, etc., and these statistics will usually show that the company has 95-99%+ uptime all the time.
It’s important to dig into how that statistic is calculated, because it can be so poorly defined or rigged to exclude so many things that it becomes meaningless. For example, some hosting companies don’t measure downtime which affects some but not all of a firm’s users, others exclude downtime incidents of less than 30 minutes (which represents a majority of downtime incidents), and a few only include downtime if it’s between 9:00 AM and 5:00 PM, Monday through Friday, excluding US Federal holidays (not helpful when working weekends before a deadline).
On the other hand, some firms count every minute that any user cannot access the system on a 24x7x365 basis but require you to file a support ticket on their website before the clock starts running – so if they’re really down, you may not be able to get to their support website to start the clock running. It is important that you don’t go out of business if there’s a tornado which affects a data center in Dallas, or there’s a massive power outage affecting a New York data center.
That’s why you should look for providers who can host your applications and data redundantly in two or more data centers. If a provider has properly configured the automatic backup of apps and data between two data centers, should an emergency shut down a data center unexpectedly, your firm can continue to operate seamlessly from a backup data center.
You should also look for providers which utilize data centers which have been engineered for redundancy and have recent independent third-party evaluations. The Uptime Institute has a tier system for rating data centers – Tier I is the lowest level of redundancy, and Tier IV is the highest level of redundancy.
We generally recommend that firms use hosting companies utilizing facilities which have been engineered to Tier III or Tier IV specifications. We also prefer data centers and companies which have frequent third-party examinations under standards like SOC 2 (Type II), ISO 27001, and also offer services which compliant with more stringent federal laws and regulations like HIPAA, PCI-DSS, and GLB.
Support is the third critical area for a practitioner. It’s important to understand the support at a very detailed level, as this is how you will deal with problems during the term of your relationship. When your computer systems are down, you are effectively out of business until they are restored. You need to have a written contract which clearly states when support (hours, days, holidays) is available, explains how you are to interact with support to start a ticket (voice, chat, website, e-mail, etc.), tells you where you can check on the status of an open support ticket, and details their standards for resolving issues documented on support tickets.
You should understand who will be providing support, where they are located, what credentials and certifications the team holds, and who you can contact if you are unable to get satisfactory response from the support team. You should also have clear documentation explaining what support services are included with your service plan, listing the types of services which are separate and will be billed at the provider’s standard hourly rates.
For example, if you were to convert from hosting your desktops and servers in-house to cloud-based hosting, you might continue to use your pre-existing cloud-based applications like Microsoft Office 365 or Google Apps for e-mail hosting. Under some hosting contracts, e-mail hosting support would be an included service, while under other contracts, it would be a separate engagement, billed on an hourly basis.
Hosting offers the opportunity for accounting firms to outsource their information technology function, allowing the practitioners to focus more on the business and be more effective in serving clients. Selecting a host is like bringing a new partner into the firm – with all of the related risks and rewards associated with putting your trust in another person. If you do your due diligence when evaluating potential providers, you are likely to have fewer problems than if you rush into a long-term service contract without really doing your homework. I hope you will choose wisely, as the current and future success of your firm depends on it.
Brian F. Tankersley, CPA.CITP, CGMA (@BFTCPA, CPATechBlog.com) advises firms and companies on accounting technology issues. He has served as the technology editor for a major accounting industry publication, and currently teaches...