Accounting Process Improvement

Our client, a leading mid-tier accounting firm required project delivery expertise and capacity to implement large scale process and system improvements identified through a major ‘lean’ organisational review.  Through a structured program delivery approach, we harnessed the required internal resources, engaged widely across the organisation and delivered major changes throughout the firm. We were able to reduce the noise (non-value) adding activities by approximately 80% enabling them to redirect this capacity to value adding advisory services.

The ‘lean’ organisational review identified a number of non-value adding activities (waste) across the organisations tax compliance processes. A specific area that required immediate improvement was the way the organisation was managing their annual tax lodgements program.   The ATO had moved to require tax agents to meet an 85% lodgement target for each of the seven annual tax lodgement deadlines.  The firm needed to transition this process from an administrative focus to a proactive analytical focus in order to manage and meet the imposed deadline targets. This would require a change in business processes, toolsets and skills.  There were several key issues identified that needed to be solved:

1. Reporting and communication processes
2. Client data processes and quality management
3. Tax lodgement policies and procedures

We were specifically responsible for forming the program of work, confirming the scope with key executives and identifying the right people from across the organisation to help deliver the work.

We developed the program around 5 key streams of work:

1. Improving the management of client information to enable digital processes
2. The digitisation of ATO correspondence
3. The implementation of electronic activity statements
4. Tax compliance dashboards to track against the 85% lodgement targets
5. Improve firm wide communication across the end to end process

Workstream 1 – It became evident that each division were managing client data processes differently and mandatory client information was not being captured consistently. We conducted a ‘To-Be’ process workshop with representatives from each division to agree on a standard process. We then worked with the internal IT team to develop an online client form that could also be used on mobile devices by staff members.

Workstream 2 – All correspondence being received by the firm’s mail room from the ATO was paper based.  We worked with the firms operations team, IT team and several software vendors to develop a ‘To-Be’ process that involved scanning the mail as it was received, creating a standard letter based on the document type and then sending this to the relevant manager via a workflow for review and automated distribution.   You can read more about how we solved this major challenge in our ‘ATO Digital Correspondence’ case study.

Workstream 3 – Monthly and quarterly BAS statements were still largely being managed via a paper-based process. We worked with the firms accounting software provider to implement electronic activity statements across the organisation using existing system functionality.

Workstream 4 – We worked with the firms accounting software system vendor to create new tax compliance dashboards. The BI dashboards were developed using the software companies Practice IQ reporting tool. These drill down dashboards enabled each division, team and individual to track their compliance processing targets.

Workstream 5 – To improve the communication process we engaged with the corporate communication and marketing teams to understand their current learnings around firm wide communication. We developed an engagement strategy that combined face to face, print and digital communication.

In the delivery of all changes we leveraged the communication strategy established by workstream 5.

Client Data – The implementation of the standard process and online form improved data accuracy to over 90% for the mandatory information required for new client records.

ATO Correspondence – The implementation of the ‘ATO Digital Correspondence’ project reduced the end to end processing time for ATO correspondence from 2-4 weeks to less than 4 days.

Electronic Activity Statements – In the next two quarters following implementation the electronic process represented more than 60% of monthly and quarterly BAS transactions.

Tax Dashboards – In the first 12 months of implementation the dashboards were able to show an improvement of on time lodgement across the firm by more than 30%.

Tax Lodgements Communication – The solutions implemented by this workstream significantly increased awareness and knowledge of lodgement deadlines across the firm to 97%.

The firm was able to leverage the change management learnings and capability established across other key tax compliance initiatives.