Sunday - August 27, 2000

Accounting Professionals Embrace the Internet

They've tried it, they like it and it has become part of their daily business lives. Not only are they pleased with what they find on the Internet, but also accounting professionals 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 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 84 percent of all accountants use the Internet for business purposes.

-- Fifty-nine percent say they are on the Internet every day for business reasons. This reflects a significant increase in access and usage from 1996, when a similar CCH-Harris Interactive (then call Louis Harris and Associates) poll found that only 51 percent had access and only 31 percent were conducting business in cyberspace. 

Among the most dramatic findings of the survey is the wide acceptance of the Internet as a reliable source of business information.

-- Accountants are more likely to use the Internet than seminars or the print or CD versions of magazines, newsletters and trade journals. 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.

-- One in 10 consider the Internet "absolutely essential" as a source for professional information, and 43 percent rate it "very important."

-- More than 85 percent of accountants rate the information available as "excellent" or "good" in terms of timeliness, relevancy, accuracy, reliability and the quality of its source.

-- 85 percent of accountants who use the Internet for business reasons say that they have visited the IRS site and it is, far and away, the personal finance site they recommend for their clients (49 percent). Other highly recommended sites are CNNfn and Money.com.

Sheer availability of information is the front-running benefit of the Internet for accountants, and the Net is affecting the daily activities of accountants 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.

-- Slightly less than half of all firms in each size category say they e-file returns through the Internet.

-- A minority of users in firms of all sizes access remote applications, access continuing professional education (CPE), store or manage client or payroll data and participate in forums.

-- But these "minority" uses may well represent growth opportunities for firms and vendors judging from past experience. For example, while only 29 percent of accountants have used the Internet to access CPE, this is a dramatic increase from 1996 when less than one percent had sought CPE over the Net.

-- Approximately two-thirds (65 percent) of the users in the largest (11 or more professionals) firms 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 over their Internet 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. -- Fifty-two percent of all accountants say they have made business purchases via the Internet, compared to 27 percent in 1996.

-- More than half of accountants surveyed (53 percent) say that they do not think that Internet transactions should be taxed.

-- Seven out of 10 of the largest firms (11 or more professionals) have a web site now, and 82 percent will have web pages a year from now.

-- Nearly one-third (30 percent) of firms with three to 10 professionals currently have a web site. About half the firms this size predict they will have a web presence in 2001.

-- The very smallest firms, with one or two professionals, are least likely to have a web site now. Twenty percent have one now and these firms are least likely to have one a year from now.

The smallest firms that already have web sites are more likely than larger ones to offer a number of "value-added" services through them.

-- Those in 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 (those comprised of one to two professionals) are more likely than larger size firms to offer tax preparation software.

-- Also, small firms (with five or fewer professionals) with a web presence are most likely to hire outside consultants or freelancers to design and maintain their web pages.

Firms with existing Websites and those planning to establish one agree on many objectives for having a web presence. 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 say clients and business come to them from their firm or corporate web site. However, 27 percent of all accountants say they do not know if their web site brings them new business.

-- Seventy-three percent of those planning to build a Net presence say 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; 65 percent versus 59 percent for current Website owners. 

-- Seventy percent of accountants anticipate greater use of the Net in a business context.

-- Fifty-five 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. 

-- Over one-fifth (22 percent) of accounting firms have seen an increase in the number of clients whose business is largely e-commerce based.

-- Forty-two percent of those with an increasing e-commerce roster report that they have provided technology consulting to their "dot-com" clients.

-- More than one-fourth say they are involved in business valuation.

-- One-quarter of corporate accountants say e-activities of their companies present them with special challenges, particularly with regard to new accounting processes. Their greatest challenge, however, is in learning the new technology. 

-- An overwhelming percentage of accountants work in a Windows(R) operating environment.

-- Only three percent report that they are still using DOS and only three respondents in 600 say they are working in a Mac environment.

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