PAPERLESS 2.0
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Learning Objectives
• Differentiate between the concepts of
Paperless 1.0 and Paperless 2.0
• List six key Paperless 2.0 opportunities
• Describe Paperless 2.0 strategies for
communicating with others, including
customers, clients, vendors, and
team members
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Paperless 1.0
• Paperless 1.0 focuses on storing and
retrieving documents
– Windows file folder structures
– Linked documents within accounting applications
such as QuickBooks and Peachtree
– Electronic filing cabinet software
– Document management software
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Paperless 1.0
• Impetus behind Paperless 1.0 was often
document storage retrieval and file room
replacement strategy
• Benefits include
– Opportunities for substantial cost reduction
– Easy – maybe anytime, anywhere – access to data
– Improved business continuity/disaster recovery
– Environmentally friendly
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Paperless 1.0
• Cost reductions
– Between 2% and 7% of all paper documents are
misfiled with an average cost of $120 to find
– Executives spend 150 hours per year trying to find
misplaced documents
– Copying and printing costs 2 to 5 cents per
page and average worker consumes 10k
pages annually
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Paperless 1.0
• Easy access to data
– Documents are stored in searchable database
– Many docs are automatically filed,
reducing/eliminating misfiles
– With Web-enablement, documents are available
anytime, anywhere
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Paperless 1.0
• Improved backup/disaster recovery
– In traditional environment, what happens when
disaster destroys physical file cabinets?
– With Paperless – assuming proper off-site backups
– all data is still available
• Better security
– Can lock down documents in database to prevent
unauthorized access/changes
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Paperless 1.0
• Environmentally friendly
– Reduction in paper printed internally
– Provides opportunity to encourage or mandate
vendors and potentially customers/clients to
transact business electronically, rather than via
paper documents
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Paperless 2.0
• Moves beyond merely storing and
retrieving documents
• Examines how information of all types flows
through an organization
• Seeks to revamp and automate workflow,
data entry, and document management
whenever practical
• Profit and efficiency gains are far greater than
with Paperless 1.0
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PAPERLESS 2.0 OPPORTUNITIES
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Opportunities
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Workflow
Paperless accounts payable
Employee expense reports
Automated data input
Audit confirmations
Document exchange
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Workflow
• Wikipedia: movement of documents and/or
tasks through a work process
• Properly done, leads to increased productivity
and accountability, along with client and
customer satisfaction
• Often integrated with paperless and
document management
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Workflow Tools
• Combination of
– Item tracking
– Workload tracking
– Activity tracking
• Can be used to create
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Instant, transparent status reporting
Summarized performance data
Simplified approval processes
Standardized processes
Business processes with fewer lost or
delayed transactions
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Workflow Tools
• Portals, web sites, and applications
that provide information on commercial
transactions, such as:
– Package delivery status
– Approvals
– Technical support case tracking
– Monitoring the status of routine tasks
– Requesting documents or services
– Project status
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Workflow Rules To Enforce Approvals
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Workflow Rules To Enforce Approvals
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Workflow For Managing Tax Returns
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Workflow Alerts
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Workflow Summary
• Workflow solutions appear in many flavors
– Built-in to accounting software (Peachtree,
Dynamics GP, SAP, and many others)
– Add-on to accounting software (SourceLink)
– Outlook
– SharePoint
– Built-in to document management systems
– Add-on to document management systems (XCM)
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Paperless Accounts Payable
• Can we all agree that traditional accounts
payable processing is a labor-intensive, timeconsuming, costly process, adding little value
to the organization?
• Paperless 2.0 offers significant opportunities
to improve this process
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Case Study
• The Compass Group, the world's largest food
service and hospitality organization with $21B
in sales and 700k A/P invoices annually
• Desired to reduce A/P costs, support faster
payment cycles, and facilitate vendors'
transition to electronic invoicing
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Case Study
• Implemented PAP that redirects hard copy to
data center where they are scanned and data
is extracted into system
• Transactions are routed via workflow rules to
managers for approval and email alerts are
sent to vendor requesting additional
information when necessary
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Case Study
• Resulted in
– Substantially reduced cycle times
– Real time electronic inquiries by vendors
– 80% of all invoices now processed electronically as
vendors "buy-in" to process
– Reduced A/P costs by 30%
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Traditional Accounts Payable
Simplified, Traditional Accounts Payable Flow
Receiving
Report
Start
Receive
Invoice
Match
End
Input
ERP
P/O
Pay
File
Check
Manual Pain/Cost Points
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Paperless Accounts Payable
Potential Paperless Accounts Payable Flow
Vendor
Inquiry
Receiver
Start
Receive
Invoice
Match
P/O
ERP
Pay
File
End
Payment
Automated Processes With Little Human Interaction
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• Vendors send bills directly to bill.com
• Can also upload supporting documents, such
as PDF, Word, Excel, etc.
• Bills are routed to approvers
• Upon approval, bill.com pays bill
• Data synchronizes with QuickBooks,
Peachtree, and Intacct
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256-bit SSL encryption
FDIC-insured
SAS 70 Type II audit (Now called SOC 3)
Unlimited storage space
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• $24 per month for one user//$49 per month for
up to five users
• Payments
– ePayments payments are $0.49 each
– Checks are $0.99 each
• Positive Pay
• Cleared check image storage
• Syncs with QuickBooks Desktop and Online,
Intacct, Sage 50, and NetSuite
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Path to Paperless Payables
• Understand capabilities of accounting/ERP
system and third-party add-ons
– Specifically, looking for invoice import and
electronic banking capabilities, in addition to
document matching
• Seek to receive invoices electronically
• Scan and convert paper invoices
• Make electronic payments
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Paperless Expense Reports
• All of the pain/cost points of accounts payable
– Likely, even more!
• Consider how much time and effort is
expended by employee and by accounting
department to process reimbursable
expenses, including those that are passed
through to a customer/client/job
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Paperless Expense Reports
• Look for tools such as Tallie to provide
integrated
solution for:
– Managing business travel and expenses
– Expense report automation
– Reviewing and approving expense reports
– Reporting and analyzing data
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Paperless Expense Reports
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Paperless 2.0 in CPA Firms
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Electronic filing
Automated data input
Linking data between applications
Workflow opportunities
Confirming data in audits and reviews
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Automated Data Input
Data Center
Electronic
Data
Paper
Documents
DMS
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Automated Data Input
• Key Players
– Thomson Reuters
– CCH
– Intuit
– SurePrep
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Linking Data Between Applications
• Consider opportunities to link data from
general ledger/write up/client systems into
tax applications
• Supported by most major CPA firm vendors
within their suites
• Most link back to QuickBooks
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Workflow Opportunities
• One of biggest areas of Paperless 2.0 growth
available to CPA firms
– Establish workflow rules and route transactions,
projects, jobs, tasks, and tax returns within firm
based on workflow rules and scheduling status
Copyright © 2014 K2 Enterprises, LLC. Reproduction or reuse for purposes other than a K2 Enterprises’ training event is prohibited.
Workflow Opportunities
• Key players
– CCH
– Thomson Reuters
– Doc.It
– XCM
Copyright © 2014 K2 Enterprises, LLC. Reproduction or reuse for purposes other than a K2 Enterprises’ training event is prohibited.
Confirmations
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Usually manual, paper-bound processes
Costly and inefficient
Opportunities for fraud
Confirmation.com can provide automated
confirmations that meet the requirements of the
professional standards
– In-Network confirmations
• Pre-validated authentic and authoritative responders
– Out-of-Network confirmations
• Auditor must validate responder, but can use all of the tools
to automate the process
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Confirmation.com
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Asset
Liability
AP
AR
Alternative Investment
Bond Issue
Canadian Asset
Canadian Liability
Commercial Real Estate
Compensating Balance
Contingent Liability
Cutoff Statement
Derivatives
Escrow Account
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Letter of Credit
Line of Credit
Money Market Fund
Mortgage Debt
Obligation to Lessor
Pension Plan Assets
Register - Capital Stock
Safe Deposit
Securities Held with Broker
Securities Held with Custodian
Signature Card
Time Deposit
Transfer Agent - Capital Stock
Treasury
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Exchanging Information with Others
• How does your organization exchange
information, including sensitive information,
with customers, clients, vendors,
employees, etc.?
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Portals
• Secure web-based tools providing confidential
one-way or two-way exchange of information
• Also can facilitate data entry, as in case of CPA
firm portals
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Portal Usage Scenarios
• CPA firm completes client tax returns or
financial statements
• Creates PDF file and posts PDF to portal
• Client automatically receives email
notification and accesses portal to
download data
– Could also include banker or other
third-party access
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Portal Usage Scenarios
• During periods of benefits enrollment,
organization posts electronic forms to
employee-specific portals
• Employees logon, complete elections, and
data is automatically imported into company's
HR system
• Eliminates manually completing paper forms
and keying data
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Portal Usage Scenarios
• Customer accesses secure portal to enter
purchase order data
• Upon automated verification of data, order is
accepted by company and converted into sales
order in company's ERP system
• Customer has 24/7 access and company
reduces labor costs associated with order
entry and acceptance
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Leading Players
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CCH
Thomson Reuters
ShareFile
XCM
Dropbox
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Box.net
TrueShare
FilesAnywhere
DriveHQ
SkyDrive
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Next Steps
• If your organization is not yet a Paperless 1.0
organization, that's a great place to start
• If your organization is "paperless," perform an
honest self-assessment of just how paperless
it really is
• Chances are you will find significant
opportunities to implement paperless
workflows over transactions of all types
Copyright © 2014 K2 Enterprises, LLC. Reproduction or reuse for purposes other than a K2 Enterprises’ training event is prohibited.
Summary
• Paperless 1.0 is a good start
• Ask, however, if it has truly revolutionized
your business processes
• If not, you are likely leaving additional profits
on the table
• Identify opportunities to move into
Paperless 2.0
• Prioritize adoption to take advantage of the
easiest and least costly opportunities first
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