From Our New International Bureau "Down Under": Why Xero Won’t Take the US In a Hurry

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Overburdened by Compliance

Having worked with accountants in all the above mentioned markets, I don't think you can say one is more or less conservative than the other. Of your points mentioned I think point number 3 should be at the top of the list. In all other markets, you have a much more simplified tax code. Accountants in Australia for example were faced with change your business model or you become irrelevant many years ago. So they have transitioned into the business advisor or financial planning role much more quickly that their US counterparts who still have an enormous amount of compliance to deal with at (potentially) the city, county, state and federal level.

I agree with Laura that the accountant and especially the CPA is definitely a trusted business advisor. Providing regular and consistent business advice is a difficult business model to pursue if the accountant is bogged down in compliance for one third of the year. If you do want to change how your clients see you- is the business advisor, the firm does need to fundamentally change its structure and remove itself from the burden of compliance, which is also how it pays the bills for the remaining 8 months of the year. It's a difficult transition that can be made, but it's a strategic and structural change that is required.

I believe the Xero's and QBOs of the world need to do a better job promoting the ecosystem. This is where true efficiencies can be realized. I've experienced first hand productivity bumps when combining, Receipt Bank***, ZenPayroll with Xero. When combined the platform presents a very enticing value proposition that can dramatically change an accountants practice.

***Full disclosure - I will be taking the role of VP Business Development at Receipt Bank in January 2015.

Damien Greathead more than 1 year ago

A few comments :)

1. The QB Connect conference attracted mostly QB ProAdvisors. So perhaps, possibly, any generalizations made about that crew might not spill out to the rest of the accountant population.
"1. Pass Me My Cardigan" I would suggest that you find plenty of Sage/Peachtree enthusiasts who wouldn't touch QB with a ten foot pole at the Sage Conference. If you're at a country fair where the fishing contest was only stocked with trout, don't be surprised if you catch a trout.

2. I highly dispute the claim that accountants aren't considered to be consultants and business advisers to American businesses. The highly paid consultants are usually only engaged by large businesses. Trust me. If it's small business, chances are that the CPA and Bookkeeper the only consultants the business has. :)

I debate whether or not Xero can automatically upload taxes to every single tax jurisdiction for payroll. Remember, it's not the states, but cities, and even school districts. Every single one of the tax jurisdictions has a separate computing/uploading process. It would take more than one programming group/process to make the payroll work in all jurisdictions. For a long time, for instance, many payroll companies didn't process the 'labor & industries' tax in washington state because of it's complexity.

laura Dodson more than 1 year ago

Great Comments Laura

Thanks for reading and thanks for sharing your thoughts.

garyd ( more than 1 year ago

Solid Reply Laura

Wonder why I can't get me some Bass at a trout conference?...
Really wonder how many non believers went to the QBO conference or was the place just packed with groupies that follow fads. "Oh this is the new cool thing... sure I think its the better than sliced bread." Then the next thing comes out.
In short I hate that Intuit is shoving QBO down everyones throat and suspect many pro advisors are perhaps being paid off or in some way incentivized. (I don't know that for sure)

To me it is clear that the big winner in QBO is intuit and the stock holders not the customer. It is not feature rich nor is it cost effective over 1 or even 3 years. Worse yet if you operate more than one company in QB the cost benefit is exponentially worse.

If you are an investor of N2it then I bet you are definitely "in to it."

Richard more than 1 year ago

Cost-benefit of online software

Hi Richard, I just wanted to address your point about the cost benefit of online software. For trading entities the extra cost is definitely worth it for two reasons; you have the benefit of instant advice from your bookkeeper or accountant, who can log straight into your accounts and give you feedback. No delay while emailing files, finding the right desktop software version, etc.
The second is the benefit of working with real-time information. Bank feeds make a huge difference as do third-party programs such as Invitbox which automatically convert accounts payables invoices. The extra dollars a year are inconsequential given the ability to make better business decisions with live data and on-call advice.
-- Sholto Macpherson

Sholto Macpherson more than 1 year ago

Conservatism and accountants

Hi Laura, it's Sholto here. You make a fair point about catching trout, but I was told several times that QB Connect was the first global conference focused on QBO. In fact, I heard that Intuit employees who worked on QuickBooks desktop software were not allowed to attend. Not sure whether this is true but apparently one of those employees who did attend had to wear a black t-shirt (QBO?) over their usual uniform. The VIP Summit, held the day before, included QBO experts (and media) from around the world. It was clear that many who attended weren't heavy users of QBO, but the QBO advocates were well represented (eg. Michelle Long from Long for Success and Stacy *QBO Evangelist* Kildal).

Glad to hear that US accountants have the opportunity to move into advisory. It's been a game changer for a lot of accountants in Australia; they love the work, their clients love it too.

The US taxation system amazes me. I don't understand why SMEs haven't risen in revolt and guillotined every tax bureaucrat outside of the federal govt. A unified system makes so much more sense.

Sholto Macpherson more than 1 year ago

Laura Dodson

Sholto, thank you for the reply.

Ah, I wouldn't call it 'move' into the advisory. It's expected that CPA's also be business advisers for many decades. Large CPA firms have whole divisions/departments devoted to it. I think one of most forward thinking is Deloitte.

I wouldn't be surprised if some forward thinking people looked at the US system and realized that accountants in other countries could be also be making extra bank for doing something they already do. :)

Laura Dodson more than 1 year ago

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