Digital Signatures for Form 8879 and Engagement Letters. Revealing the Truth about Client Portals and File Sharing Systems

Transcription

1 Digital Signatures for Form 8879 and Engagement Letters Revealing the Truth about Client Portals and File Sharing Systems Presented by cpaperless, LLC:

2 Is This for the Future or Available Today? 1. Use E-Signatures for all accounting documents 2. Exchanged in a secure and compliant manner 3. Using technology your staff and clients will easily adopt 4. With real time signature tracking from Outlook August 15, 2012

3 Webcast Agenda About the Presenters Digital Signatures vs. Electronic Signatures Agenda Evaluating Portals and Secure File Exchange Solutions CPA Saf and CPA SafeSign Product Demonstration Q&A

4 cpaperless, LLC Provide Enhancement Tools for the Paperless World Plug-ins to commonly used applications Create efficiency by automating manual processes Easy for your staff and clients About cpaperless Products 1. Tic, Tie & Calculate Adobe Acrobat Plug-In 2. CPA Saf Next Generation Client Portal 3. CPA SafeSign e-signatures (First to CPA Market) 2,000+ Customers and 15,000+ Accountants Steve Dusablon Andrew Hatfield President & CEO VP Sales & Marketing (800) x 110 (800) x 120 Steve.Dusablon@cPaperless.com Andrew.Hatfield@cPaperless.com

5 Digital Signatures in the Accounting Industry 1. Definitions 2. Should your firm use Digital Signatures or E-Signatures? 3. How firms are using them and how they apply to your firm

6 Digital Signatures Digital Signatures Use Public Key Infrastructure (PKI) to ensure sender s digital identity Requires identity verification through a trusted Certification Authority (CA) Verisign, Entrust, ARX, etc. A certificate is then installed on each users devise Definitions Bottom Line: NOT Practical for Accounting Firms Requires certificate for all partners and staff Requires certificate for all clients Expensive and cumbersome to use

7 Electronic Signatures Electronic Signatures Legally compliant since October 2000 with the ESIGN Act Sign from your PC or mobile devices without prior verification or cumbersome certificates Slow Adoption: Vendors have delivered the technology in complex, complicated and expensive forms Rapid Acceleration: Easy to use with CPA SafeSign, Adobe EchoSign & DocuSign Definitions Bottom Line: Firms are Using E-Signatures Because They are Easily Adoptable and Cost Effective Only requires an internet connection Taxpayers can use with any PC, tablet or smart phone No prior verification process is required

8 Electronic Signatures Engagement Letters (EL s) Postage is just part of the cost. The labor costs more. Batch send all EL s at the click of a button Real time tracking, reporting & automated reminders 50% savings with CPA SafeSign Use in the Accounting Industry Client Consent Forms Newsletter distribution (IRC Section 6713) Employment & Vendor Forms I-9, W-4 and W-9 Form 8879 E-Signatures are legally binding based on the ESIGN act of 2000 Form 8879 instructions do not specifically address Firms interpret instructions in IRS Pub 1345 as inconsistent with IRS paperless mandates 8879 is to be retained on file by CPA and taxpayer for 3 years Bottom Line for 8879 Form is rarely submitted to the IRS IRS recognizes that many firms are using E-Signatures and have not issued supplementary instructions or warnings

9 In order to use E-Signatures in the accounting industry You need a secure file exchange solution Traditional Client Portals and broad based file exchange solutions are OLD TECHNOLOGY

10 Evaluating Secure File Exchange Traditional Client Portals CCH, Thomson Reuters, Creative Solutions, efilecabinet, emochilla, etc. The Research Project Broad Based File Transfer Solutions Market Research: Accounting Industry Interviewed over 1,000 firms Surveyed 100 firms The Bottom Line Shocking truths revealed Before you buy or renew your portal, pay attention to the next 7 slides

11 Sharing Our Research

12 Firm Research #1: History of Secure File Exchange Accounting Document Types Too Large Massachusetts 201 CMR Identity theft on the rise Breach of privacy laws are clearly defined Client confidentiality and document security becomes a big issue Transfer Solution Can t These Files Anymore PROBLEM STARTS: Fact: Accounting firms report that less than 30% of their clients adopt their Client Portal or File Exchange Solution. THE BOTTOM LINE Clients don t adopt Client Portals Clients use Your firm needs to use for secure file exchange

13 Firm Research #2: Evaluating Document Types Document Type % of Transfers Document Formats Frequency Of Transfer Encryption Required Signature Required Preferred Delivery Method Large Files QuickBooks 12% Monthly or Annually Yes No Client Portal / File Share 1 Small Files Tax Returns Power of Attorney (2848) Fed e-file Authorization (8879) State e-file Authorization Extensions (4868) Payroll Reports Attestation Reports Client Organizers Various Word & Excel files Contract & Transaction docs 88% Annually Yes Some Secure 2 Signature Required Engagement Letters Client Consent Forms Annually No Yes E-Signature Application 3

14 Why is this Important? Most firms are using a solution designed for 12% of their files for 100% of their documents

15 Firm Research #3: What Firms Were Doing Document Type Large File Transfer Solution Issues Large Files 12% Not Many Designed for large files Drop box available Requires a server (Login Required) Login is not an issue Repetitive process (monthly) - clients and staff are trained Small Files 88% Circle of Frustration and Inefficiency Small files historically were sent through Login Required with Portals FREQUENCY: Not often enough to remember a password FAMILIARITY: How do I use this Portal? E-Signature They Don t Provide

16 Circle of Frustration And Inefficiency The Circle of Frustration and Inefficiency Brought to you by our competitors.

17 Circle of Frustration And Inefficiency 12) Staff is at a loss, and s the file without encryption 11) Client sends to staff asking for unencrypted file 1) Staff sends a client small file(s) with a large file transfer solution 2) Client receives notification 3) Client clicks a link to login and download files 10) Client receives PDF files, but wants to forward their tax return to their banker and needs to remove the password 9) Staff spends 7 10 minutes converting files to PDF, adding watermarks & manually adding password and encryption 8) Why can t they just it to me? 7) Client logins in, but can t figure out how to download file(s) 4) Client Forgets password & sends back to staff 5) Staff is in middle of tax season and sends to IT to handle 6) IT Staff has to resend password to client

18 Take a deep breath Our most important research slide is next Defining the Next Generation File Exchange Solutions

19 Firm Research: Document Exchange Workflow File Preparation Client Portal or File Share System Sign Documents Client Request Documents Login and Login and Download Download & Storage Print Documents Sign Scan & or Fax Back Mail Back Gather Documents Change Documents Add Watermark Scan Mailed Copies To PDF Staff Rename Files Add Password & Encrypt Store in DMS CPA Saf & Portal & File Share Convert to PDF Format Add Signature Process Send Documents Transfer CPA Saf CPA SafeSign

20 Research Summary Truth by the Numbers

21 Research Results: By The Numbers Less than 30% Fact / Result Description % of clients that used a firms Client Portal or File Share solution 3 years How long a firm used their Client Portal before abandoning it 12% Large Files: Requires server 88% Small Files: Send as 1.4 Times Number of times per year the average client logged into their Client Portal 7 10 Minutes How long it takes to convert, process and manually encrypt PDF files before sending 24% Estimated % of files that were sent unencrypted. Takes too long. NOT IN COMPLIANCE 93% % of partners that were disappointed their staff were spending time manually encrypting PDF files $4.63 Cost to mail each client engagement letter

22 What Accounting Firms Need Receive Files of any Size Send Large Files from Outlook Research Conclusion Send Small Files Through Compliant Easy for staff and clients Eliminate password issues Allow clients to save / forward files without passwords Automate The File Preparation Process Significant cost savings to your firm Savings pays for the software E-Signatures Everything Done Through Outlook Use with ANY Tax Program or DMS Solution CPA Saf and CPA SafeSign

23 CPA Saf with CPA SafeSign Document Type CPA Saf & CPA SafeSign Issues Large Files 12% Not Many Designed for large files Drop box available Requires a server, but login is not an issue Repetitive process (monthly) so clients and staff are trained Small Files 88% Send As Option The foundation of CPA Saf Automates File Preparation Change documents without changing the originals Change files names Convert Word, Excel & Other to PDF Apply watermarks Apply passwords and encryption APM stores clients passwords and send in secondary No passwords on individual files (forward to banker) E-Signature First To Market The ONLY e-signature application designed specifically for accountants

24 CPA Saf CPA SafeSign Evaluating the Financial Impact of the Automation

25 File Preparation Cost Savings Description 250 Tax Returns 750 Tax Returns 1,000 Tax Returns 2,500 Tax Returns Number of Transfers ,000 2,500 Cost Savings Minutes Saved Per Transfer Hours Saved Per Year CPA Saf Savings ($30 cost per hour) $630 $1,890 $2,490 $6,240

26 Electronic Engagement Letters Cost Savings Manually Sending Number of EL's Description Cost Per 500 1,000 2,500 5,000 Bonded Paper (2 sheets) $ Mailing Envelope $ Return Envelope $ Postage - Mailing $ ,500 3,750 7,500 Postage - Return $ ,125 2,250 Labels & Sign Stickers $ Labor - Sending $ ,750 4,375 8,750 Labor - Receiving $ ,250 2,500 Total Cost $ 2,315 $ 4,630 $ 11,575 $ 23,150 CPA SafeSign Number of EL's Description Cost Per 500 1,000 2,500 5,000 Licensing Fees $ ,000 2,000 5,000 10,000 Labor - Sending $ ,250 Labor - Receiving $ Total Cost $ 1,175 $ 2,350 $ 5,875 $ 11,750 Savings with CPA SafeSign $ 1,140 $ 2,280 $ 5,700 $ 11,400

27 Product Comparison Cost Analysis & ROI Assumptions: 10 User Firm 1,000 Clients & Tax Returns Approximate Cost of Product $1,800 * $1,860 ** $1,500 ** $800 ** $2,500 * File Preparation Cost Savings ($2,490) Engagement Letter Savings ($2,280) Net Cost of Product (Without additional Storage Costs) ($2,970) $1,860 $1,500 $800 $2,500 + Storage + Storage + Storage * Unlimited Storage **Storage Costs Extra

28 Secure Document Exchange Solution Summary Feature Description 1) Basic File Share Features Send & Receive Files Online Data Storage 2) Secure 3) File Preparation Automation (Outlook) Make Changes To Files Rename Files Convert Files to PDF Add Watermarks Add Passwords & Encryption Add E-Signatures 4) Electronic Signatures (Accounting) Engagement Letter Automation Consent Forms

29 SYSTEM REQUIREMENTS Staff System Requirements Microsoft Outlook 2007 or 2010 Microsoft Office 2007 or 2010 Internet Connection Citrix and Terminal Server compatible Clients Any System Adobe Acrobat Reader 7.0 or higher (Free Version) Internet Connection

30 NEXT STEPS FREE 30 Day Trials What do we do next? Contact Us: Available to all members of your firm! Web: Phone: (800) x 100

31 Pricing? Pricing

32 Q & A