KPMG Spark Blog

What is Managed Accounting?

Managed Accounting is a scalable way to serve your business’ accounting needs, using a combination of cloud-based software, automation technology, and human accountants. Join us as we discuss the elements of managed accounting.

You own your own business, working out of your house.  Or perhaps you’re responsible for a larger enterprise – one that has 5, 10, or even 50 employees? Almost every day there can be dozens of competing concerns, all of which seem to shout to be given top priority.  And on top of that, you must juggle numerous other routine and ‘expected tasks’ such as reviewing ad content, fielding and responding to texts, emails, and calls, working with vendors and suppliers, and even trying to squeeze in time to upgrade software, take care of bookkeeping, and ensure your financial information is accurate.

Is there a smarter, easier, and more efficient way to run your small - to medium - size business?  Is there something that can actually help you do less while completing more – and at the same time perhaps even save more money? There is – and it is called managed accounting.

Managed accounting is a new way of looking at the accounting function in your business. It’s a revolutionary and scalable way for businesses to simplify the never-ending and complex task of accounting and bookkeeping in order to save money and time.

The three pillars of managed accounting  

The key that allows you to actually do less and complete more (including reaching more of your goals) is to leverage the three elements of managed accounting. At the most basic level, the elements of managed accounting are technology, software, and people. At KPMG Spark, we call these the Pillars of Managed Accounting.

These three pillars can be further defined as: 

Cloud-Based, Information Software – this starts with the online access portal for all of your managed accounting services. Additionally, this coordinates all the communication with your human bookkeeper, which can include text messaging, instant messaging, email, and phone contact – either directly or through your portal. The software pillar of managed accounting also provides a dashboard of your current information as well as customized reports that you can view, download or print any time, and provides in depth views into the detailed transactions of your business.

Automation Technology - At KPMG Spark, we built a proprietary and automated accounting technology platform that runs in the background, enabling you to save time on tedious monthly tasks – like eliminating the need to book debits and credits. We use innovative machine learning and artificial intelligence to automatically and instantaneously categorize and record transactions so that you get real time reports and information on your business.

Human accountantsSimultaneously, while the automation technology is running in the background, we provide the opportunity for you to tap into our powerful network of accountants any time you need human help.  Our Spark accountants do the day-to-day accounting and bookkeeping for you.  We put a ‘human in the loop’ – our team of dedicated accountants – to complete those bookkeeping and accounting tasks that are consuming so much of your time.

Let’s take a closer look at each of the pillars so you can realize the benefits of managed accounting.

 

The first pillar: cloud-based, information software 

For the first pillar of managed accounting, KPMG Spark has developed cloud-based information software that acts as your portal to all of your managed accounting information services. The software pillar of managed accounting provides the tools to simplify accounting for your business. These tools include:

Business Dashboard

The software pillar of managed accounting provides you a customizable dashboard with a quick and easy view of all your accounting information. 

Communication Platform

The information software also provides you easy access to your human accountant (the third pillar). In the software you can text or instant message your dedicated bookkeeper, or you can find their phone or email contact information.

Reporting and Data Visualization

The managed accounting service provided by KPMG Spark provides easy to access accounting reports and graphic visualizations of your information. These reports can be viewed online for a quick snapshot of your business, or they can be downloaded or printed to share with other stakeholders.

Data and account management

The information software pillar also provides your business an easy way to change how your managed accounting services are being handled. You can setup customized alerts or emails that that provide reports or inform you about the status of our managed accounting services. You can also view, input or edit all of the individual data entries and transactions in your account.

The second pillar: automation technology 

For the second pillar of managed accounting, we have hired data scientists and technology developers to build KPMG Spark’s automation technology, which is a powerful time-saver for you and your business. What should the technology pillar of managed accounting take off your plate?

Automated bookkeeping

Our innovative machine learning technology analyzes your accounts in real-time, and categorizes financial activity: revenue, expenses, assets, liabilities, and owner’s equity so you have complete financials that are available in real time – at any time! 

Payroll

Another important element of managed accounting is to link your payroll processing with your books and records.  Your local, state and federal payroll taxes should be processed automatically and directly connected with your financial information. 

Documentation

Most businesses struggle with how to gather, organize, and retain the documentation (receipts, invoices, etc.).  With managed accounting, no longer are you saddled with gathering, retaining, and organizing receipts.  All the transaction documentation is stored in the platform so it can be viewed at any time.  An added benefit is all the receipts, invoices, and other substantiation documentation are immediately available which can be very handy if you get any questions from the tax authorities.

Tax Preparation

A strong managed accounting platform addresses tax preparation to save time and empower you to focus on running your business.  The technology platform should be designed so that the accounting information can be automatically uploaded and your business and individual tax returns can be prepared easily and seamlessly.

The third pillar: human accountants 

For the third pillar of managed accounting, human accountants with specialized knowledge and experience is critical.  To free up your time so you can focus on other important tasks, your business shouldn’t rely solely upon technology and automation; rather, it’s critical that a ‘human-in-the-loop’ exists.

The foundation of any powerful Managed Accounting solution is the specialist service and knowledge you will get from your human accounting team.  This team should exhibit all the following traits:

  • Dedication. Most importantly, a dedicated team for your business - don’t settle for call centers, or just random individuals assigned to your account!)
  • Availability. Individuals who know your business and are available every day
  • Knowledge. Specialists that can answer specific accounting, bookkeeping, or tax questions and those answers address your specific business issues
  • Immediacy. Many outsourced accounting services focus on the preparation of your business’ monthly financial statements.  Of course, this is important, but those financial statements should be available today – or any day you need them.
  • Specialization.  There will be times when you have to address new questions about your business – for example, can you qualify for tax credits, what are the advantages and disadvantages of buying versus leasing, do you need to collect and pay sales tax when you get a new customer?  Your team should be able to readily answer these questions.
  • Resources. At KPMG, we have access to more than 30,000 KPMG specialists in the U.S. If you have questions or issues that require very specialized knowledge this vast team of people are available to help.

Why KPMG Spark?

Managed accounting should reduce the amount of time you spend with administrative and accounting tasks.  It should free your time for more important business activities including attracting new clients and increasing revenue.  And managed accounting should be affordable, perhaps costing less than you are currently paying. 

When you sign up for KPMG Spark, you get a dedicated bookkeeper, accountant, and CPA who are available for you, whether you have questions about automated bookkeeping, or perhaps you need tax planning advice.  And you have all the resources and excellence of KPMG backing your dedicated account team!

Grow your business built on data – but let us handle the data.  Spend your time building!

 

 

KPMG SPARK and SPARK related services are generally not permissible for audit clients and affiliates.

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.

The following information is not intended to be “written advice concerning one or more Federal tax matters” subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.

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