Interview: Jody Padar and the New World of Cloud Accounting
March 21, 2012
Jody Padar represents the next generation of accounting professionals. She is on the vanguard of a new movement of “digital CPAs” who are evolving the profession by embracing cloud services and social media to shift the way CPAs serve their clients. In four years since joining her father’s firm New Vision CPA Group, Jody has brought it to next-generation status and become a highly sought-after speaker and thought leader.
We were lucky enough to catch up with Jody while visiting SXSW and hear more about her vision of how accountants can serve people better:
Can you tell us a little about yourself?
I’m a Certified Public Accountant (CPA) with a Masters in tax and am CEO and principal of the Chicago-based firm New Vision CPA group. I came to SXSW with a group called CPA’s Gone Wild – we’re digital accountants who are willing and ready to work with folks who are already digital. It’s myself, my firm and the Thriveal CPA network owned by Jason Blumer. The group came together because we wanted to prove there are lots of digital accountants who are looking for digital clients. Where better to come than to SXSW where it seems everyone is digital!
How does digital accounting differ from traditional accounting?
We’re different because we’re cloud-based, and by using technologies where everything’s accessible remotely it really allows the CPA to have an interactive relationship with their client because they’re no longer transferring files back and forth. With traditional accounting you were limited to a very manual, static process: using paper and pencil and some accounting software. Digital accounting means a totally different experience: we log on, you log on and we’re able to work in real-time together. It’s fundamentally changed the accountant’s relationship with their client not to mention how the accountant can provide day-to-day financial information to their clients by having real-time access.
What’s the most exciting part about this kind of new movement in accounting?
The movement takes accounting, as a profession, back to where it was and where it should be: back to the trusted advisor role. Your accountant shouldn’t be wasting time doing bank reconciliations or spending hours and hours tying out pennies. Your accountant should be looking at your books with a higher level of financial information and focus on giving you sound business financial advice, which is really where our clients need us most.
You should look to your CPA in more a partnership role, as a kind of outsourced controller or CFO and have them help you that way as opposed to inputting numbers, etc. At the end of the day, all that data entry is going to go away and that’s not really a value-add for your business. You should be looking at your CPA to be a most trusted business advisor for you instead.
What kind of advice would you give someone on how to find a trusted advisor?
The most important thing to look for in a CPA is that you can get along with them. Just like you would have a relationship with your physician, you need to make sure you can communicate with your CPA and know you’re on the same page.
If you can’t pick up the phone and call your CPA, you’re going to have an issue there. You want to make sure that you get along with your partner, and it should be that kind of relationship.
How are some CPA’s changing the model to develop these relationships?
So whereas most traditional CPA’s bill by the hour, we’re changing the model and creating set prices with value-pricing. What’s cool about that is that it means you have unlimited connection with your CPA. If you’re working with a CPA who’s doing value-pricing, you can pick up the phone and ask them a question because you know they not only want you to call but also appreciate that you have a chance to be proactive and not reactive. I think the CPA profession has kind of gotten it wrong for the last hundred years because they pushed their clients away and this new type of CPA thought is that services are value-priced, so that we work in a partnership with clients. It’s not a transaction-based kind of thing; it’s more like an intellectual capital kind of sharing.
There’s a whole new generation of accountants coming out and it’s not an age thing, it’s a state of mind. If you are a small business owner and believe that things should be digital, which i believe they should, then you should find a digital accountant with the same mindset and that same fundamental belief that you’re already in a digital world and should be working with an accountant who is digital.
There’s no reason your accountant shouldn’t be logging on to FreshBooks and working together, with you in real-time. There’s no reason even that reports should be printed. If you’re still printing out reports and bringing it to your accountant, maybe it’s time to find a new accountant.
Would a CPA recommend FreshBooks?
What FreshBooks does for the CPA, which I think is really cool, is FreshBooks gives the client only what the client needs. They can invoice their client, and then give the accounting back to the accountant. I’m not going to do it all by hand I’m going to connect it to another online software also based on the cloud and create a unique financial system for my client based on their needs to create your full financial ledger. You as the FreshBooks user only have to worry about the invoicing piece, the accountant takes care of the rest. You know this because working with an online cloud-based accountant that you can get access to the data and they have access to the data and therefore you can do a lot of proactive financial management type of things so you can look at your profitability more easily and where you’re at and dig deeper into that financial information whenever you want to.