The Impact of Time Tracking on Accounting Firms

Introduction 

Accountants and other finance professionals handle multiple projects simultaneously. Accounting firms must ensure every project is completed within the stipulated time and according to the client’s needs. 

Thus, all accounting firms face tremendous pressure to meet project deadlines for all the accounts they manage. So, how do accountants achieve these objectives? The answer lies in the use of time-tracking software for accounting firms. 

Read on to understand the impact of time-tracking software for accountants on accounting practices. Additionally, learn about the best time-tracking software for accountants and how to obtain it for your firm. 

Why Accountants Need to Track Time 

The importance of time tracking for accountants cannot be overstated. Whether on the client side or agency side, accounting departments play crucial roles in the successful running of companies. 

Finance departments produce reports that the management teams use to make critical business decisions. Such decisions can determine the future success of companies. 

Often, accountants are swamped by the sheer volume of work they need to complete. This is especially true during the end of accounting cycles, such as quarterly or annual periods. The huge work volume, combined with limited timeframes, can increase the chances of accountants making errors. 

However, using time-tracking software effectively solves this problem. 

All the best time tracking and billing software for accountants have built-in features for monitoring project progress. You can use these features to track the completion of every single task for all accounts in real-time. 

Using time-tracking software for accounting firms can help you understand how you deploy your human and other resources. Timesheet software for accountants helps you optimize how your staff completes specific tasks and avoids wasting too much time on assignments that could be completed with fewer  resources. 

Impact of Time Tracking on Accounting Firms 

Using time-tracking software for accounting firms has far-reaching benefits on the way accounting practices run. The benefits of using accountants time tracking software range from increased productivity to better resource allocation. 

Additionally, time and billing software benefits the firm’s clients, and other stakeholders. Let us look at some of these benefits in detail. 

Increased Profitability 

You can improve your accounting practice’s profitability by using appropriate time and billing software for CPA firms. Such timekeeping software for accountants helps you to track every detail of assignments your staff completes and ensures you avoid two common mistakes: overbilling or underdelivering. 

It is common for CPA firms to overbill clients by failing to track the hours used to complete assignments. Given that accounting firms typically bill their clients based on factors such as hours spent, number of personnel, and others, CPA firms need to calculate these metrics accurately. 

You can use any good CPA time and billing software to calculate all metrics related to the clients’ projects you handle. This software should provide all the resources you need to bill your clients accurately and avoid under delivering. 

Your accountants can also use the software to set project deadlines appropriately. Accurate determination of project timelines helps you to allocate resources properly and avoid project creep. 

Therefore, using timesheet software for accountants helps your firm reduce inefficiencies and losses that may arise from poor tracking and budgeting. You can also use this software to identify the most lucrative projects and deploy resources to them accordingly. 

Optimize Internal Processes 

Your accounting firm needs to undergo continuous improvement to remain competitive. Change is important because it helps to identify internal inefficiencies and correct them. Also, successful change management enables an organization to identify and take advantage of existing opportunities to grow and increase profitability. 

Continuous improvement processes depend on large amounts of data. You need to capture the right data over some time before analyzing it to understand your organization’s internal weaknesses and strengths. 

Time-tracking software has built-in features that capture important data. Every time-tracking and billing software collects significant data from projects. The data ranges from the time that it takes your teams to complete specific tasks and other metrics. 

Data collected from time and billing software for CPA firms is important for driving decision-making. You can make important decisions based on data. Such decisions may cover specific aspects of the work you do for clients like how much time to allocate to specific projects and the potential returns on investment. 

Furthermore, data from time-tracking software is useful in identifying internal inefficiencies. You can identify areas where you lose money and implement corrective measures to prevent further loss. 

You can use time recording for accountants' data to optimize many internal processes in your CPA firm. For example, data on costing for past projects can be used to project the costs of running similar projects in the future. 

You can identify inaccuracies in costing past projects and correct such mistakes when estimating the time and resources needed to complete projects of similar magnitude. 

Improving Productivity 

It is easy to believe that time-tracking software benefits only the CPA firms. On the contrary, time tracking and billing software are beneficial to your employees. Typically, accountants in a CPA firm handle various projects that belong to different clients. Every project has specific needs and clients’ requirements. 

Ideally, all accountants in a CPA firm need to be functioning optimally to deliver results and meet all clients’ expectations. In reality, this is not always the case. Inefficiencies in terms of the time spent handling specific projects often occur. 

A good time-tracking software for accountants can help you solve this problem. Such an application can be useful for monitoring how every employee spends their time handling different clients’ projects. You can evaluate data from the software and help your staff optimize their time by reducing inefficiencies. 

Furthermore, timesheet software can be useful in determining if some staff overwork. Time recording for accountants’ data can show how much every person in your firm works overall in addition to the amount of time they allocate to specific projects. 

You can use this data to make the right hiring and staffing decisions. For example, you can decide to hire new finance professionals with specific skills to fill gaps. Also, you may decide to reallocate responsibilities based on the data. 

Therefore, adopting timesheet software for accountants can help improve staff performance and increase overall productivity in your CPA firm. 

Improved Costing 

Costing is one of the most critical aspects of any business. In this case, you need to project the costs of running your CPA firm as accurately as possible. Mistakes in estimating the costs of running various aspects of your business can result in huge losses. 

You need a good CPA firm time and billing software to project your business costs as accurately as possible. Such an application helps you estimate the amount of time you need to allocate to every single task of a project. 

Furthermore, time-tracking data helps you understand the amount of money you need to quote to your clients for every project. Thus, using such a tool reduces the chances of underquoting projects and making losses. 

How Basil Can Help You Track Time 

If you are looking for the best time tracking software for accountants, Basil is the right place to start. We provide a broad range of collaboration solutions for multiple industries. 

Basil Practice Management software for Accountants, CPAs, and Tax Professionals is our highly effective client cloud-based collaboration software for accounting practices. This is an affordable, efficient, and easy-to-use tool for accountants and other finance professionals. 

Talk to our team today to find out how we can help you track time in your accounting firm using Basil Practice Management for Accountants, CPAs, and Tax Professionals.