Another AI Startup Aims to Eliminate Accountants

Georges raises $11.2 million to automate accounting, Canopy releases tax prep software, IRS to stop faxing, Free File stripped from IRS bill, continuous testing is in the cards for the CPA exam, ATAX expands nationwide, sign-in with Apple ID is coming to QBO and Xero, and more

Sponsor

Show Notes

Get in Touch

Thanks for listening! Follow and tweet @BlakeTOliver and @DavidLeary. Find us on Facebook and, if you like what you hear, do us a favor and write a review on iTunes. Interested in sponsoring the Cloud Accounting Podcast? For details, read the prospectus.

Subscribe

Transcript

This episode of The Cloud Accounting Podcast is sponsored by Xero. As an accountant, when you join Xero, you'll gain access to a full range of practice-management tools so you can manage your practice, and your clients from almost anywhere. To learn more about building a better practice with Xero, visit CloudAccountingPodcast.promo/joinxero. That is Cloud Accounting Podcast dot promo forward slash J-O-I-N-X-E-R-O. 
 
Blake Oliver: Welcome [00:00:30] to The Cloud Accounting Podcast. I'm Blake Oliver-
 
David Leary: And I'm David Leary-
 
Lorilyn Wilson: And I'm Lorilyn Wilson.
 
Blake Oliver: Lorilyn, it's so great to hear your voice. We're Twitter friends, and I've never met you in person, or heard your voice, and now here we are on the podcast.
 
Lorilyn Wilson: Yes. I'm a real person. I'm not an avatar. I'm not a Russian bot. I'm a girl. I do exist.
 
Blake Oliver: I was thinking, it is possible that you're some 300-pound dude in his mom's basement.
 
Lorilyn Wilson: You haven't seen me yet, though, so that's [00:01:00] still a possibility.
 
David Leary: I tried to introduce you two at QuickBooks Connect last year, but you know how that stuff goes. Actually, that was a failure of me. I always thought a lot more people knew who Blake was, and we'd be in a situation that we'd be standing there, talking to people, and I would never introduce Blake [cross talk] I thought they just knew him! It was totally rude behavior. I probably do it to my wife. It's embarrassing. Lorilyn, it's awesome to have you here.
 
Lorilyn Wilson: Thank you.
 
David Leary: What's going on in your world outside of cloud accounting? Anything [00:01:30] exciting happening?
 
Lorilyn Wilson: Outside of cloud accounting, just gearing up for summer with the kids, getting ready to hit up Xerocon here in a couple of weeks. Yeah, nothing much outside of that. 
 
Blake Oliver: I guess we should say you are a CPA, right?
 
Lorilyn Wilson: I sure am.
 
Blake Oliver: You're working in public accounting ...?
 
Lorilyn Wilson: I have a business partner, and we own a practice together. We do that fixed-fee model, where we do accounting and tax for small businesses.
 
Blake Oliver: Any particular [00:02:00] type of small business you like working with?
 
Lorilyn Wilson: By accident, we've niched in more the real-estate realm, but we also have some other random clients who do some cool stuff. One of my clients literally designs icons. On Snapchat, and stuff, or on Instagram, all those icons he designed.
 
Blake Oliver: Wow, that's cool. Boy, that's super-niche!
 
Lorilyn Wilson: Yes.
 
David Leary: Now we know where to go when we need Cloud Accounting icons.
 
Blake Oliver: Yeah, I'm thinking-.
 
David Leary: We have an inside track. We [00:02:30] did get a review. Should we jump in and read that?
 
Blake Oliver: Yeah, let's read that.
 
David Leary: It's five stars. It's from elbarto19. "Solid and thought-provoking. I've been listening to this podcast from about episode 45-ish. The content being reviewed is always on point. David and Blake do a great job in sharing all of what's what within the industry. What makes these episodes gold is the perspectives being shared by both, which use their past experiences, and current passions to deliver solid takes. Highly recommend this weekly listen."
 
Blake Oliver: Awesome [00:03:00]. Thank you, elbarto! 
 
David Leary: I don't know who that is in real life, so if you're on Twitter, elbarto, raise your hand, let us know.
 
Blake Oliver: Yeah. Really appreciate it. If you want to give us a review on iTunes, super-helpful; helps expand our reach and find more accountants to listen to the show. You can go on iTunes, or Apple podcasts, because they're getting rid of iTunes. Did you hear about that?
 
David Leary: Yes, I actually have some Apple news in one of my stories-
 
Blake Oliver: Awesome.
 
David Leary: -we could get into.
 
Blake Oliver: We'll talk about that. What should we start with, Lorilyn? What is hot in your mind?
 
Lorilyn Wilson: For [00:03:30] me personally. one of the things that's hot is people switching to using cloud accounting for tax prep. The first story here that springs to mind is the Canopy Tax Prep with Practice Management. Canopy has released their own online tax prep that integrates with their other practice-management type stuff. The reason that's interesting to me is I use Intuit ProConnect with our practice. That has a really nice push with QBOA. We [00:04:00] have all of our clients on QBO, we use their trial balance features, and then we can push all their business information really easily into Intuit ProConnect. The problem I'm seeing right now is there's not any other integration between an accounting platform like that, and an online platform that does that that well.
 
Blake Oliver: Got it.
 
Lorilyn Wilson: I know you can download, and upload, so I was poking around their website, looking at what kind of integrations do they offer. Still I don't know anything that exists like that out there, which is ... That [00:04:30] ties into more this ... All the kerfuffle about QuickBooks Live, and some of the QBO people going, "Well, I'm gonna switch to Xero," and in my head, I'm like, that QBOA-Intuit-ProConnect integration is just way too good for me to switch.
 
Blake Oliver: Interesting. How much time does it save you to have that integration? It's taking the trial balance, and pushing it-
 
Lorilyn Wilson: Yeah, and to give you a perspective of what we had to do before, we used to have to download out [00:05:00] the trial balance, upload it into Engagement, which was a CCH program; do all of the adjusting journal entries there, and then re-hand-type into our system all the tax-return information, and then manually post the journal entries into QBO.
 
Blake Oliver: Got it.
 
Lorilyn Wilson: That was, on a even straightforward business return, probably about six hours.
 
Blake Oliver: Wow.
 
Lorilyn Wilson: Whereas, now, with the QBOA-ProConnect push, it's about an hour.
 
Blake Oliver: Yeah, that's a lot of time. What [00:05:30] is this ... Canopy is practice management for tax firms, or firms that focus on tax, primarily, right? Now they've released this tax-prep product. How does that change the game for you?
 
Lorilyn Wilson: You know what? Until they're able to do some type of connect, or push between QBOA, or even Xero, this is not a product I would even consider using.
 
David Leary: Well, I think it's just personal taxes, as well, right? You cannot do business tax returns with this.
 
Lorilyn Wilson: Why, though, would you release a [00:06:00] professional tax-prep software, and then leave out business returns?
 
Blake Oliver: No, I don't think that's right.
 
David Leary: I guess we should talk about this. Don't forget, we've talked about Canopy before in the past. They had that huge layoff. They were really growing like crazy, and, in a way, this software is late. I think they thought they'd have this out in time for the tax season.
 
Lorilyn Wilson: Oh, and here I am actually looking further down to the article. The software is currently available to file individual tax returns in 24 states, and then, for the 2019, they're expanding some of the business ones into eight [00:06:30] states, so this isn't even like a nationwide-
 
Blake Oliver: All right, so it's a slow roll-out. it's a beta-type product. Reminds me of how Gusto rolled out, right? Gusto wasn't originally in 50 states. It started in California, payroll, and then they gradually went into 12 of the big states, and then eventually, finally, after many years, got everywhere.
 
Lorilyn Wilson: Yeah, some of their features, though, are pretty cool. I would like to see ProConnect take their platform, and if they could make it more like this, with a tax resolution, and some of those [00:07:00] other items, that would be very interesting, and very useful.
 
Blake Oliver: Interesting.
 
David Leary: Even on the other side, the ProConnect platform, right, or the software, like Canopy, to connect through APIs to QuickBooks, or to ProSeries, right? That way, you can move that data from ... You could still use QBOA, but you can send your data to Canopy, if you're a Canopy user.
 
Lorilyn Wilson: Yeah, or even Xero. I've heard from a little birdie that Xero had no plans or has no plans to [00:07:30] go into the tax-prep service in the US, but if they could form partnerships with a company, and create that integration, that would be a game-changer, I think. Like I said, right now, I won't even consider Xero until they're able to do something like that.
 
David Leary: Xero has that in Australia, and I think Xero acquired a company similar to Canopy in the UK, to have that end-to-end thing. I agree, I think it's a very huge competitive advantage, because nobody wants to have systems [00:08:00] that don't talk to each other.
 
Lorilyn Wilson: Exactly.
 
David Leary: If you can have a full end-to-end solution, it's a huge benefit, and it's a competitive advantage for Intuit, for sure, in the US.
 
Lorilyn Wilson: Definitely.
 
Blake Oliver: Well, speaking of Intuit ProConnect, David, you have a poll here that was on the ProConnect website.
 
David Leary: I saw a poll that's on the ProConnect website. It just went out today. I think there's just a lot of people like me that are like, "I wonder what the results are?" They just clicked 'zero to 10 percent.' Right now, nobody's done the poll, so I think we can share it, and people do the [00:08:30] poll ... I'll just read the title of the poll. The poll is, "What Percentage of Your Firm's Revenue Comes from Advisory Services?" I feel like this ... We're in the Summer of Advisory. It's all the accounting conferences are going to be talking about. I thought this was an awesome question; this'd be a great story. I clicked on it. There's no results yet. We'll get that in the show notes, and we'll see.
 
Blake Oliver: I just took the poll, and I think maybe three of us have taken it so far, because it's 66- 
 
Lorilyn Wilson: Blake and David are two of them.
 
Blake Oliver: It's [00:09:00] 66.67 percent are zero to 10 percent, and then 33.33 percent are 11 to 20 percent, and nobody is over 20 percent. We'll share it in the show notes, and hopefully our listeners will go and vote in this poll, and we'll actually be able to see how much revenue are firms earning from advisory services now, because it's probably not that much, right?
 
David Leary: Well, hopefully it's more than zero to 10 percent, which is winning the poll by far, right now.
 
Blake Oliver: I think part of the problem with advisory services is that, actually, a [00:09:30] lot of firms, and a lot of partners are doing it. Lorilyn, I'd love to hear what you think. They're just not charging for it, right? They're charging for the tax return, and then they're giving advice to their clients, but that's not part of what their clients are paying for now, and it's-
 
Lorilyn Wilson: With us, we do the standard accounting, and tax prep on a fixed fee, but that fixed fee is priced at a premium. Built into that is they know they can reach out to us anytime and ask us stuff. We are charging for it, but it's not something that's line-itemed out in our engagement with them.
 
Blake Oliver: Does [00:10:00] that include tax planning in there, or is that separate?
 
Lorilyn Wilson: Yeah. That's in there.
 
Blake Oliver: That's rolled in? Okay. You're basically, already ... Do you call it advisory? Do you think of it that way?
 
Lorilyn Wilson: We just call it consulting, limited consulting. They just know that anytime, they can ping us, and we'll help them out with whatever they have a question on. It's not necessarily only tax, or only books; it can be for a wide variety of things. They'll be like, "Oh, I'm [00:10:30] thinking of doing this new venture. Give me your thoughts on that." It's pretty loose, and wide.
 
Blake Oliver: Got it.
 
David Leary: There's a tweet related to advisory this week, too, right, I think?
 
Lorilyn Wilson: Yes. Yes. This one's from @TheBigFour tweets, he's a hilarious accountant you should always follow. Following the same vein, he tweeted, "I still have no idea what advisory does." 
 
Blake Oliver: It got two 228 likes, and 56 retweets, which is a lot for an accounting tweet, I think. 
 
Lorilyn Wilson: I'm probably thinking far too deeply on this tweet, but it's hard to define, because for everyone, it's going to mean something different. I [00:11:00] was thinking, in our firm, a lot of the type of stuff people ask us for advice on - we do the advisory or consulting, whichever we want to call it - a lot of it's tax-related, even though the majority of our time is spent doing their accounting work. For someone who, say, is just a bookkeeper, they're not going to be doing tax-advisory type stuff, so that's going to look completely different for them. I think that's why it's hard to define it.
 
Blake Oliver: Yeah, it's different. I [00:11:30] just had an advisory moment this week. I have one client that I still work with on the side, and she had an employee quit. She called me, and said, "What do I do? This employee quit. Should I pay her for these days when she wasn't in the office, because she hadn't yet officially quit, and was taking 'personal time.'" Of course, I'm here now, I'm a CPA, and I'm like, "How do I CYA?" I'm not an HR professional, so I'm [00:12:00] like, "Well, I can't really tell you that. You should probably call your lawyer," and then she just stops me. She's like, "Dude, just tell me what you would do if you were in my situation.".
 
I guess I can say, theoretically, if this were me in a hypothetical situation, what would I do? I'm doing advisory, right there. Right? I'm saying if it was me, I would rather just pay her through the end of the period, and not have to deal with any potential legal problems. I don't know, maybe I shouldn't have said that. Maybe they're going to get in trouble, but that was an advisory moment for me. I [00:12:30] charge a fixed fee, and that's what she expects - to get that kind of advice.
 
David Leary: The interesting thing about that Twitter chain was, it was a ... That's kind of a sarcasm Twitter account, is that correct? @TheBigFourAccountant? [cross talk] People were posting sarcastic remarks back. Even myself, I posted, "Hey, maybe there's some accounting conferences this summer that'll teach you how to do it." It quickly sub-chained into people really criticizing the conferences, and their one-hour, 'We'll [00:13:00] teach you what to do in an hour' type sessions, to ... People are grassrooting a real conference of some type to really get trained in advising.
 
Blake Oliver: Yeah.
 
Lorilyn Wilson: Yes.
 
Blake Oliver: Yeah. I almost never see in-depth sessions on how to do advisory; it's always like this very high-level thing. You can't take that home, and actually do something with it.
 
Lorilyn Wilson: I think that's the nature of a lot of conferences anywhere. It's this big, macro-level, bird's-eye view of stuff. I think to actually get value out of it, you actually have to create [00:13:30] some sessions, where you're actually workshopping. That's one thing I've found ... I haven't been to many conferences, but the couple I have been to, everyone is really just curious to know what everyone else is doing. "How do you do it? What do you charge? How do you ... What tech stack do you use?" I wouldn't be surprised if maybe, in the future, going forward, maybe some conferences pivot more toward that model, because I think that's what people really want.
 
Blake Oliver: Yeah, I like that. I've got some follow-up from some stories in past weeks. [00:14:00] Here's one on Free File. We haven't heard about Free File in a while, the whole Intuit [cross talk] 
 
David Leary: It took a week off, last week. 
 
Blake Oliver: It took a week off, right. ProPublica didn't come out with any new stories implicating Intuit in some dark marketing tactics, or what-not, but The Hill mentioned that House lawmakers this week have dropped the Free File provision from the IRS bill that is working its way through Congress. It almost made it all the way through. It got through the House. It was in the Senate, and [00:14:30] then this whole Free File thing happened, and now they've dropped it. They're going to pass this IRS bill, but without the Free File provision that would have enshrined the program forever in law. Probably, I think that the odds are likely that this program will either just continue to be renewed year to year, or it could eventually be eliminated. That's the news.
 
David Leary: From The Hill.
 
Blake Oliver: From The Hill. Another IRS story here is - you'll like this - the IRS decided - this is a story in the [00:15:00] Journal of Accountancy - that on June 28, it's going to stop faxing tax transcripts. Yeah.
 
David Leary: Did you say start or stop?
 
Blake Oliver: No, stop. 
 
David Leary: Ooooh ... 
 
Blake Oliver: They adopted the modern technology of the fax apparently, many years ago, and have been using it until now. To prevent- protect against identity theft, they're gonna stop faxing transcripts to taxpayers, and professionals. You're going to have to now go on the IRS website, or use their app, or call a phone number, or submit a paper form in order to get transcripts sent to you. They [00:15:30] will only send them to you electronically, or via mail, and if you're a third party, you can't get them mailed directly to you. Now, they have to go to the address of record. A little small step toward more security when it comes to our personal information?
 
David Leary: I wonder how utilized that system was. 
 
Blake Oliver: The fax?
 
David Leary: Maybe it hasn't been used in four years, and they're like, "We should just get rid of that now."
 
Blake Oliver: All I know is that when I was at Armanino, we burned up the fax lines. [00:16:00]
 
David Leary: That was pretty [cross talk] Within three years, now? Wow. I have not dealt with the fax in a long time. Thank goodness. Knock on wood. Let's see, let's see. I kinda have an update- a related update to something from last week.
 
Blake Oliver: All right.
 
David Leary: Remember last week, when I was talking about how my QuickBooks Online price went up?
 
Blake Oliver: Yes.
 
David Leary: Okay, I did find an article here. I'm just going to read from the article, and then I'm going to let you guys take a guess at when this article was written.
 
Blake Oliver: Okay.
 
David Leary: "Intuit, like every other cloud-based software maker, [00:16:30] earns more money when you subscribe to its online products. It gives the company a continuous, almost guaranteed revenue stream, which not only boosts their recurring cash flow, but also its market valuation, which can now be more accurately determined using similar multiplier form they use to value cable companies, utilities, accounting firms, and any other businesses with a recurring revenue stream. It gives software companies the ability to control their future revenues, too. 
 
What stops Intuit from raising the monthly price of QuickBooks Online Essentials to XXX per [00:17:00] month? Sure, you can yell, but how far will it get you? You're stuck. You're not going to go through the cost, and disruption to move your accounting system, are you, just to save a measly $10 a month? [Right?] Now multiply that $10 per month by Intuit's millions of customers. Ka-ching!" The last paragraph in this article says, "Look for the continued growth of small-business cloud applications. Look for more PR from the software industry telling us all the benefits of the cloud. Just remember that you're not choosing a cloud application. The [00:17:30] choice is being made for you." Would you two care to guess when that article was written?
 
Lorilyn Wilson: Oh, gosh, since you primed it like that, I'm going to say it's something crazy, like 2010 or something.
 
Blake Oliver: Yeah, well, it mentions that Intuit has online products, so it's got to be within the last 15 years.
 
David Leary: I left out the price. It said, "If it increases the price to $36.95 for QuickBooks Online Essentials."
 
Blake Oliver: What price? [00:18:00]
 
David Leary: $36.95.
 
Blake Oliver: Yeah, I'm gonna go with ... I'm gonna do Price is Right, and I'm gonna go one year earlier than Lorilyn. She says 2010, I'm gonna go 2009.
 
David Leary: 2009. Okay, this is an article from Gene Marks in 2015.
 
Blake Oliver: Okay. That's not very shocking.
 
David Leary: It's not shocking, but it's this ... Pretty much, that was in 2015. It's not an article from the last three weeks, four weeks, five weeks, six weeks [crosstalk] where are all the price increases are happening. [00:18:30]
 
Blake Oliver: Your point is that the price increases have just been happening gradually over the last four years.
 
David Leary: The point is, it was inevitable. Right? This is going to happen, and it probably will keep happening.
 
Lorilyn Wilson: Right, but I think...
 
David Leary: Until people stop subscribing, the prices are just going to keep increasing. Eventually, Intuit's going to figure out, "Okay, here's the maximum you could possibly... [crosstalk]"
 
Blake Oliver: -market equilibrium.
 
David Leary: Yeah. Exactly.
 
Lorilyn Wilson: Yeah. I think Intuit needs to remember, too, is obviously, a lot of people have been mad about QuickBooks Live. People [00:19:00] make decisions based on emotion, and then they justify it with logic. Yes, people will have a breaking point, and it will be, "I don't care how much work begins to migrate all my clients off this program. You've done me wrong. You've pissed me off." I could see a lot of bookkeepers out there hitting that point, at some point, and being like, "I don't care how much work it is; I'm done with you."
 
Blake Oliver: Yeah. Well, we're already starting to see that bubble up in Facebook forums, and on Twitter. It's a small group of people online complaining, right? It [00:19:30] must not be enough to stop it.
 
David Leary: Yeah, but I think it's happening more than I've ever seen it. The proof of that is, it was happening four years ago. Somewhere it's hitting a psychological barrier of too high.
 
Blake Oliver: I mentioned the IRS no longer faxing, and modernizing, in that respect. The CPA exam is also modernizing. I unfortunately did [00:20:00] not have the benefit of taking the exam when it was given all in one day on paper. Every time I talk to people over a certain age, that's what they tell me, and I'm, like, "Okay, I've gotta hear this story again." Right? It was inconvenient in that you had to ... Currently, you have to take the exam during a testing window. You have to wait seemingly forever to get your results, and then you can't retake a section until you get your test results, and then you have to wait until the next window.
 
Lorilyn Wilson: Yeah, but then you're also on the ticking time clock.
 
Blake Oliver: Which is like, what, you [00:20:30] gotta do it all within two years or something?
 
Lorilyn Wilson: Or it might even be 18 months. It might be less than two years, yeah.
 
Blake Oliver: This is an article in Going Concern, talking about how beginning in June 2020, NASBA is planning to roll out continuous testing, which means that there will no longer be test-window limitations, and you can retake a test section as soon as your grade for any previous attempt has been released. Basically, it's gonna get rid of that window, which, [00:21:00] why do they need that these days? Right? Theoretically you don't.
 
Lorilyn Wilson: Yeah, I don't even understand. I think all two essays are gone out of the CPA exam, if I remember correctly. I could be wrong on that, but I never understood why, in the sections where there were no essays, why you couldn't get your results immediately.
 
Blake Oliver: Yeah, I took the first part of the EA exam before I switched over to the CPA exam. That exam's amazing, because you take it, and you press "Submit," and you get your result right there. You're [00:21:30] sitting there in the test center, and you can either celebrate, or cry.
 
Lorilyn Wilson: Yeah, yeah! You don't have to wait six weeks, losing your hair.
 
Blake Oliver: If they can do that for the EA exam, why can't- like you said, why can't they do that for the CPA exam, if it's all just multiple choice? Even if it's simulations, they can grade that spreadsheet, automatically, theoretically. 
 
Lorilyn Wilson: Yeah.
 
Blake Oliver: Yeah, it's great. We're moving forward, guys; we're making progress as a profession.
 
David Leary: Finally, finally, finally.
 
Blake Oliver: David, that means you [00:22:00] can sit for the CPA exam now.
 
David Leary: I have some time on my hands. This week ... I'll add that to my to-do list here.
 
Blake Oliver: You have to suffer with the rest of us, you know. One of us...
 
David Leary: Can I real-time tweet it, as I'm taking the test? 
 
Blake Oliver: I don't know, you might get kicked out of the Prometric Exam Center.
 
David Leary: We could try it. We could try it. What else do you have, Lorilyn?
 
Lorilyn Wilson: All right, this is from France. I feel like these are popping up every week. We have another startup raising all this money to do some type of AI [00:22:30] accounting-automation programs. This one's on ... If we were in America, I'd call it "Georges," but I think since this is France, it might be "zhor-zhay."  Another company raised $11.2 million. I pulled this quote from it. "It's not perfect. You will still have to manually categorize some transactions, but it's still much faster than entering each transaction in an accounting application. Once everything is tagged properly, Georges generates paperwork, and sends [00:23:00] it to tax authorities." That, right there almost gave me a heart attack [cross talk] 
 
Blake Oliver: Wait ... 
 
David Leary: -$11.2 million in VC money. That is amazing. Amazing!
 
Lorilyn Wilson: I've seen people do their books, and I'm like, "It's just going to take all that, and call it good, and send it off to the tax authorities?" 
 
Blake Oliver: Lorilyn, you can send all your clients to Georges, and just sit at home, and just hang out. Yeah. They don't need ...
 
Lorilyn Wilson: Yeah. Then, what made me wonder is back to- back with the [00:23:30] whole Botkeeper thing. How much is AI, and how much is humans [cross talk]?
 
Blake Oliver: Right. Good question. Well, the quote up top is great. This is the problem with mainstream press. This article in Tech Crunch starts out with- the second sentence is, "With Georges, you can get rid of your accountant altogether, and switch to a software-as-a-service product." Let's get rid of the ... Yeah, it gets rid of the accountants altogether. [00:24:00]
 
David Leary: Maybe something got lost in translation here, but even so, what stood out for me is, a lot of these companies are coming up, and they're doing what I would argue is bank-feed accounting, right? People that have very, very simple businesses - they just have a debit card, and they get bank statements, bank feeds - and then they're auto-categorizing it, which is really what QuickBooks, and Xero already do.
 
Blake Oliver: Well more like QuickBooks Self-Employed, right?
 
David Leary: Yeah, yeah, exactly. These are kind of QuickBooks Self-Employed plays. Yeah, I would agree-
 
Blake Oliver: There's millions, and millions of those businesses. This is not ... Lorilyn, [00:24:30] I'd imagine that you probably don't have a ton of that kind of client, right? It's just cash-basis business, like Schedule C?
 
Lorilyn Wilson: No. No, no, we don't. Probably almost none of 'em. It's all primarily S-corps, and partnerships, but some [inaudible] it's like doctors, architects, lawyers. I'm like, "Whoa!!!!!" 
 
David Leary: What's funny about that sentence, they say they focus on one type of company in particular, people working on their own as "freelancers, coaches, doctors, [00:25:00] architects, lawyers." Lawyers can't do bank-feed accounting [cross talk] They have to track the trust accounts. I don't know if this just got lost in translation, when the news came to America, or something, but-
 
Blake Oliver: No, this is from their pitch deck, right? [cross talk] They're trying to make their total addressable market as large as possible for the VCs. That's how you get $11 million. Let's make an accounting firm sound super-sexy and get a bunch of money.
 
Lorilyn Wilson: I could do that. I'll do that. Somebody give me $11 million [cross talk].
 
Blake Oliver: All right, so Lorilyn, I'm gonna reach out to you after ... We're gonna make our pitch deck, and we're gonna [00:25:30] go raise $10 million for our startup- that we'll do accounting, and then we will just flee the country.
 
Lorilyn Wilson: Yeah, we'll throw some automation lingo in there. Automation. Machine learning.
 
Blake Oliver: Yeah.
 
David Leary: Apple had big news this week. They released a $20 billion computer system, and all this other stuff they announced. The new AirPods [crosstalk]
 
Blake Oliver: Oh, the cheese grater.
 
David Leary: The cheese grater, I think, is what the computer looks like.
 
Blake Oliver: The new Mac Pro, is that what they call it? Looks like a giant cheese grater.
 
David Leary: Don't [00:26:00] they have a monitor with a $1,000 stand? If you buy it without the stand ... If you need the stand, it's $1,000 to buy a monitor stand.
 
Blake Oliver: That is a great example of value pricing, right there, cuz you really need that stand, right? 
 
David Leary: I guess it supports the typical- you could bring your own stand, so it's not like it's proprietary- 
 
Blake Oliver: Yeah, but then it won't match; it won't match the cheese grater,  you know? 
 
David Leary:  -but if you want the look; if you want the ... Exactly.
 
Blake Oliver: It's really important when you buy ... I have this little adapter for my Macs that I can plug in my USB microphone that I'm [00:26:30] using right now, because, of course, the new Macs only come with USBC, not normal USB - just so they could make it a few millimeters thinner. Originally, I ordered the wrong color, and it was really bugging me, so now I have the one that matches my Mac exactly. I think that same principle is what they're using for this stand that costs $1,000. It's gotta look right, if you're spending that much money [crosstalk].
 
Lorilyn Wilson: You're not gonna have needs ... Georges is gonna have [crosstalk].
 
David Leary: Every employee gets [00:27:00] one. No kidding. It's all part of the on-boarding. In that slew of all this Apple news that came out there, there was something that actually affects all of us, as cloud accountants. 
 
Blake Oliver: What is it?
 
David Leary: Especially the app developers. Apple is coming out with something called Sign In with Apple. Just like there's Sign In with Facebook, there's Sign In with Google, there's Sign In with Intuit ... Doesn't Xero have a single sign-on, as well?
 
Blake Oliver: Yeah, they've got some sort of single sign-on now.
 
David Leary: Okay. Apple changed their developer guidelines, so [00:27:30] if you want to have a store- I'm sorry, an app in the Apple store, if you use any other third-party sign-in ... This is going to be ... Every single app that's on Apps.com for QuickBooks that uses Sign In with Intuit will now have to add Sign In with Apple to their app, or they can't be in the Apple store.
 
Blake Oliver: They're going to instantly become the biggest single sign-on provider because of that.
 
David Leary: Yes. This is interesting, right? Tomorrow all ... Well, not tomorrow, but in tomorrow's world, everybody's gonna be able to use Sign In with Apple for [00:28:00] all these cloud apps that we use.
 
Blake Oliver: I'm really surprised they haven't done this sooner, because this is going to solve so many problems for apps, like having to have a password manager, and log in to hundreds of apps ... If Apple just saves, or just links these apps to my Apple ID, I no longer have to sign into them; I no longer even have to create a password for them? That's gonna be great for ... I mean there's obviously downsides to that, but [00:28:30] it's gonna be great, I think, for the average consumer.
 
David Leary: This was squished at the very, very, very bottom of some developer-release notes, like teeny ... It's a huge announcement that just got brushed under the rug, and I think this is ... You know how Apple's playing up this big privacy game?
 
Blake Oliver: Yeah. 
 
David Leary: This is a direct- right at Facebook, and right at Google. They're going right after those two. People in our space, you sign on with Intuit, but it's not across the whole world. There's not billions of people using it. This [00:29:00] Apple going straight at Facebook, and straight at Google.
 
Blake Oliver: That's why they buried it.
 
David Leary: So, yeah-
 
Blake Oliver: You found it. You caught it. How did you find this?
 
David Leary: I don't know. I think I saw a tweet. It caught my eye, and I was, like, "That's interesting. That's gonna impact us." I didn't go ... I'm not an Apple fanboy. I wasn't reading Apple press releases, and all this stuff.
 
Blake Oliver: You don't even have a Mac.
 
David Leary: Somehow, it caught my eye. Yeah, I don't have a Mac. What's that?
 
Blake Oliver: What [00:29:30] else? What else? Speaking of security, remember I was talking about the NSA last week, and how a hacking tool that they-
 
David Leary: Can you stop talking about them? We're gonna get in trouble!
 
Blake Oliver: Well, no, this is a positive story. The NSA issued an advisory this week about a different flaw called BlueKeep. I can't even remember what the one last week was called, but this is different. It's another- yet another Microsoft Windows flaw. It is super-super-critical and [00:30:00] has just been ... Microsoft just released a patch for it in May, and something like a million computers still are not protected. They've not been updated. This only affects computers that are not running Windows 8 or Windows 10. 
 
It's earlier versions. If you're on Windows 7 and before, you have to update your computers ASAP, because apparently, it's a vulnerability that would allow malware to spread all over the internet. This could be as bad as WannaCry was in 2017. If your firm is [00:30:30] running earlier versions of Windows, you gotta update. It's very unusual for the NSA to issue an advisory like this. They almost never do it. I think it's only the third time that they've issued an advisory, so, there's a question as to - is this connected in some way to another leak maybe that hasn't been disclosed yet? Why would they be doing this instead of the Department of Homeland Security? Whatever the reason, update your computers.
 
David Leary: It's not a paid press thing for Microsoft or anything like that, where- 
 
Blake Oliver: No. Not at all. Well, I [00:31:00] don't think Microsoft would really want to be paying for this kind of publicity.
 
David Leary: Yeah, but they want people to upgrade [cross talk]
 
Blake Oliver: Well, yeah, and that's the thing. That's one of the reasons why it's important to upgrade, right? It is because of the security vulnerabilities in old software that isn't supported. 
 
Lorilyn Wilson: My three-year-old downstairs is losing his mind. He thinks I left him. I'll be right back, okay?
 
Blake Oliver: That's okay. I have the exact same problem when I'm recording at home, where I'll lock the door to my guest room/office, and my son will just come, and start pounding on the door. [00:31:30]
 
David Leary: You know, Lorilyn, if you play an episode of The Cloud Accounting Podcast, he'll just be bored to death, and he'll just go [crosstalk].
 
Blake Oliver: No worries. Well, we can continue, and I'll just edit out any noise if we need to.
 
Lorilyn Wilson: Yeah. That works.
 
Blake Oliver: Okay, cool. Where were we? What did we leave off with? I just forgot. We were talking about the NSA.
 
David Leary: I have a quick little small one.
 
Blake Oliver: Okay.
 
David Leary: A fast story; it's kind of big news, though, because I think the stats are interesting. ATAX Franchise, [00:32:00] and Loyalty Brands are Joining Forces to Expand Nationwide, and to Serve the $2.13 Trillion US Latino Market." This article is really good because it has a lot of stats that maybe people aren't aware of. For example, did you know that in the last decade, US Latinos launched 86 percent of all new businesses in the United States?
 
Blake Oliver: Living in Southern California, that does not surprise me, but I had no idea it was so high.
 
David Leary: Same thing in Arizona. I'm not surprised, but-
 
Blake Oliver: It's insane. 
 
David Leary: That's pushing [00:32:30] 90 percent. 86 percent is really, really, really high. They are addressing it ... Basically, their point of view is there's no clear service provider focused on servicing the US Latino community, when it comes to tax services, individuals, and business services, like payroll, and bookkeeping on a nationwide basis. They're really taking ... What I think smaller firms are doing locally, right ... I'm sure in Southern California there's firms focusing on the Latino community, but there's nobody [00:33:00] trying to do it nationwide, and they're gonna [crosstalk]
 
Blake Oliver: Would it be fair to say these guys are like the Latino-focused H&R Block? Is that what they're- is it retail tax? Is that what this is?
 
David Leary: It's gonna be tax. It's gonna be some advising; it's gonna be payroll, and bookkeeping. It's gonna be full service for individuals, and businesses. They wanna push for 400 locations by the end of 2021.
 
Blake Oliver: This is really interesting because we've been talking a lot, with TurboTax Online, and with QuickBooks Online, about the decline of retail tax, and [00:33:30] the decline of the freelance bookkeeper, or independent bookkeeper, due to these platforms. Maybe this is the niche kind of approach that will succeed in that world, right? Unless, of course, Intuit goes and creates TurboTax Espanol-
 
David Leary: Which they have before. They may have done it twice, and it just never really got traction in the market.
 
Blake Oliver: Interesting. That's really cool. I think it just proves your [00:34:00] point, David. The riches are in the niches.
 
David Leary: As always. Yes.
 
Lorilyn Wilson: Can I talk about an accounting poll I ran on Twitter?
 
David Leary: You ran your own poll [cross talk] 
 
Blake Oliver: Yeah. Let's hear it.
 
Lorilyn Wilson: I did, and it got 79 votes, so a pretty sizable section of all accountants.
 
Blake Oliver: I think we could almost call that scientific.
 
Lorilyn Wilson: I think so, too. I think our sample size is large enough. It just popped into my head. I said, "Do you let clients choose [00:34:30] their accounting software?" 11 percent said, yes, they let them choose. 56 percent said, "Hell nah." Then, 33 percent said, "Yes, if they pay me lots." That's actually 44 percent are still letting the client dictate what the accounting software was. I just thought that was interesting. It seemed high to me, just because I know internally [cross talk] Oh, go ahead- 
 
David Leary: What's at your firm, then? What do you guys do?
 
Lorilyn Wilson: We control it. I'm very clear, and it's, like, "This is my sandbox [00:35:00]. If you want to work with me, you're coming into my sandbox, and its systems that I like that make me efficient."
 
Blake Oliver: Well, you are very disciplined, and that sweet, sweet cash can make it really hard to turn down a client, if they want to stay on a particular application.
 
Lorilyn Wilson: Yeah, and too, we've spent a lot of time over the past year building out our workflows, and making them very specific, very detailed. Then to have to do that over multiple accounting software is just- it'd be a pain in the butt. Doing it for one was hard enough.
 
Blake Oliver: Yeah, [00:35:30] I agree completely. That's the big benefit of standardizing on a particular app. Like you said earlier in the show, you have your workflow where it goes from the GL, into tax, and it saves you like five hours per return, which is insane. It totally makes sense you would want to have every client on that workflow. Otherwise, it just doesn't scale up.
 
Lorilyn Wilson: Yep. Exactly.
 
David Leary: What I've never understood is the psychology of this. I really, truly feel like if I go see a doctor, I don't dictate at [00:36:00] all what tools they're gonna do. I don't even dictate what they do to me a little bit. You kinda do - you choose your doctor, but then they decide they're gonna do something, and they're just gonna do it, and you don't have any say. A lot of professions are like that.
 
Accountants, for some reason, let themselves get bullied. The client's like, "I'm gonna use this. I don't care if it's a DOS program." We see this, right? Some law firm will still be using some DOS program to print out their invoices, and then the accountant has to scan these invoices, using AutoEntry to get them to QuickBooks [00:36:30] Online, because they can't get the law firm to stop using this old DOS software. I don't understand why accountants ... Is it a human nature thing? Should the CPAs have [cross talk] 
 
Blake Oliver: We're just too nice. We need to be assholes. You know? We need to- 
 
Lorilyn Wilson: I think so.
 
Blake Oliver: I feel like a lot of doctors are like that; at least surgeons that I've met.
 
Lorilyn Wilson: Oh yeah, yeah. All of us need to have more of a doctor complex. That would be really good for the industry.
 
Blake Oliver: Yep, yep.
 
Lorilyn Wilson: I've [00:37:00] had clients who actually, for moral, or ethical reasons, or potential clients, who did not want to use Intuit, because some of the stuff we've been talking about has been going back years with them, with some of the shady tax practices, and lobbying for certain things. I just had to tell them, "Sorry, I use Intuit. Good luck. Go find another accountant. I respect that. I respect that you're standing on your ground, and your morals, but ..." At the end of the day, I'm trying to feed my family, as well.
 
Blake Oliver: It totally makes [00:37:30] sense to me. So Lorilyn, thank you so much for joining us. I think that's all the time we've got this week. If people wanna connect with you online, learn more about you, and what you're up to, where can they do that?
 
Lorilyn Wilson: The best place to find me is gonna be on Twitter. My handle is @LorilynWilson, and I'm in there goofing off, having fun. If you get offended easily, maybe don't come check me out, but if you love fun, absolutely come follow me.
 
David Leary: You have some of your own hashtags, as well, right? 
 
Lorilyn Wilson: I do. I do. Probably the biggest two ... Well, now that "Game [00:38:00] of Thrones" is over ... I did have #accountantswhoGoT, which is not as applicable anymore. Then the other one is #accountantswhohealth. I'm pretty big into health and fitness, but, at the same time, I'll go on there, and use that hashtag in a tongue-in-cheek way, as well.
 
Blake Oliver: All right. Well, I will be the #AccountantWhoDoesn'tHealth 
 
Lorilyn Wilson: Accountants who DON'T health! 
 
Blake Oliver: -#accountantswhodon'thealth, and we'll see who gets the bigger following.
 
Lorilyn Wilson: You will. [00:38:30]
 
Blake Oliver: I was doing really well for a while, and then I just fell off the wagon, and I haven't worked out in weeks. I'm gonna have to get back into it. Maybe you can inspire me.
 
Lorilyn Wilson: Tomorrow's a new day.
 
Blake Oliver: Tomorrow's a new day.
 
David Leary: Blake, you're gonna bring ... I'll bring sardines for you.
 
Lorilyn Wilson: Yes! [crosstalk]
 
Blake Oliver: That's the problem for me, is conference season. That's where I screw up, because I'm flying, and I use the plane as the excuse just to eat all the junk food they hand me, and I have my Southwest drink tickets. I'm like, "I've gotta use these before they expire," and then [00:39:00] I get to the hotel and I'm like, "Oh, I gotta go find the treadmill," and it doesn't happen, my clock is all screwed up. That's the big challenge for me.
 
Lorilyn Wilson: What I'm hearing is at Xerocon, you need an exercise instructor. That's what I'm hearing.
 
Blake Oliver: Yeah, can you give me a wakeup call, and then [crosstalk] and bootcamp thing, where you just throw me out of bed [crosstalk].
 
Lorilyn Wilson: -vomit and do sprints. Yeah, we'll do this.
 
Blake Oliver: All right, it sounds good. Well, now I'm really looking forward to Xerocon.
 
Lorilyn Wilson: You'll [00:39:30] be hiding from me, won't you?
 
Blake Oliver: You will be there. We'll see you at Xerocon. Are you going to any other conferences this year, Lorilyn?
 
Lorilyn Wilson: Probably the only other one I'll be at will be QB Connect in November.
 
Blake Oliver: All right. That's great. I'll see you there, as well. Awesome.
 
Blake Oliver: David, if people want to connect with you online, where should they go?
 
David Leary: You can find me on Twitter, as well. The easiest way is @DavidLeary.
 
Blake Oliver: I am @BlakeTOliver. Don't forget that you can follow us on Facebook. You can connect with us on LinkedIn, and [00:40:00] almost every social media platform imaginable- no, that's not true. We're not on Snapchat; we're not on Instagram, because who would wanna look at us recording The Cloud Accounting Podcast? I still haven't figured that out yet. We haven't cracked that.
 
David Leary: I have a plan for Instagram, finally- 
 
Blake Oliver: You do?
 
David Leary: -because I record in the closet. I'll just put on a different outfit, and record, and I'll take a little-
 
Blake Oliver: It'll just be a series of pictures of you in your closet?
 
David Leary: With different clothes. There's at least I at least, in this closet, have 250 Instagram photos [cross talk] [00:40:30]
 
Blake Oliver: It'll be David's Wardrobe. That's great. All right, well, thanks again, Lorilyn, and we'll see you soon. David, talk to you later.
 
Lorilyn Wilson: Bye. 
 
David Leary: That was fun. 
 
Blake Oliver: Bye.
 
David Leary:  Bye. 
 
Copyright (c) 2019 Blake Oliver