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Cloud Document Management and Client Portals, the Cure for Data Breach and Privacy Risk

Cloud Document Management and Client Portals, the Cure for Data Breach and Privacy Risk

Nimbus recently interviewed Alan Fitzgerald, the Founder of Practice Connections. For nearly 20 years Alan has been in the Australian tax and accounting software industry and for the last three years of those, as an independent consultant advisor to accounting firms big and small.

He has spoken at local and international accounting conferences, recorded several webinars and podcasts directly relating to accounting technology (all available on his LinkedIn profile).

We asked Alan a couple of questions regarding the importance of having a cloud document management system and managing risk in terms of GDPR and NDB privacy issues. He also gives some great advice for firms when it comes to deciding which cloud document solution to buy!


NIMBUS:   Alan, why is it important these days for accountants to have a suitable document management system and secure client portal in place?

ALAN:  With the Notifiable Data Breach scheme and GDPR in Europe (which can also affect Australian firms / companies), it’s illegal to send any kind of information where a person’s details (any detail) can be identified e.g. specifically tax file number, address, IP address etc. To get around this, I’ve seen firms redact correspondence / tax returns to a point where it is impossible to identify the taxpayer; so the recipient cannot even prove if what they have received is actually for them!

If you send any information via email with identifiable personal data, you’re breaching the act.

Email is like a river. When you send PDF or other documents through an email system, the risk is that someone can grab those documents – like bears hunting salmon in Canada or they get sent to the wrong address – human error. That can set off the GDPR/Notifiable Data Breach. Portals are a “cure” for that. For a firm looking at a document management system, the automatic thing you should have as part and parcel of that is portal functionality. This will allow you to share information to a client in a secure manner. I.e. the client logs in with specific credentials, they get access to your system where you have ‘’published’’ the documents that you want them to see, so that they can download, electronically sign, return etc.

NIMBUS:   GDPR and Notifiable Data Breaches are now a fact of life. How prepared are accountants to handle these privacy issues nowadays?

ALAN:  There’s a high level of awareness across the profession, but I’m not sure that this has in turn been met with appropriate responses. In early 2018 I met with a firm that asked if I could recommend a portal solution. I asked them what portals they had looked at to which the response was “3, but they only do about 90 percent of what we want.” So I asked, “What does your current portal do?” Their response was, “We don’t have a portal”. My advice was simply to say ”Just buy one of the portals from one of the companies that you looked at because (a) it’s going to secure the documents that you’re sending through to your clients, and (b) it does 90 percent more of what your current portal does!! You’ll also be surprised as to how much the vendor will work with you to fix the ten percent that you feel it needs – just start!”

A journey of a thousand miles starts with a single step.”

I often use the expression; “A journey of a thousand miles starts with a single step.” in these discussions. Accounting firms must be willing to step out of the comfort zone and take a risk that the software may only suit 90 percent of what they actually require it to do; Perfect software does not exist but that should not stop you losing out on functionality that CAN make a difference to you.

The software, in their mind, has to be 100 percent because that’s the message that they give to their clients. “Come to me and I’ll get everything right. The books will balance. It will be black, and it will be red.” You know, that scenario.

But, when it comes to software, accounting firms have to actually take the risk that the software may only suit 90 percent of what they actually require it to do and that’s the key thing. They have to get on the journey instead of waiting for the perfect piece of software which is never going to become available.

I encourage every firm to do their homework on portals; Understanding what you actually want is important. Do your primary research on a contextual level and talk to at least 3 vendors, determine if they can meet your high level requirements. Learn what they do well and what they don’t do well – but don’t get too deep into the features. Ask why firms choose them. Ask about opportunities they have lost; not every accounting firm is the same so they may have not won a deal for a reason – it may not be a bad one, but will give you a good reference framework.

Do not do a feature for feature comparison between applications

ALAN:   Software changes so rapidly these days (especially with cloud software) that feature for feature comparisons will just waste your time as you will not be able to keep up. You cannot do nothing and hope it will go away as you will run the risk of breaching the act – and the penalties are significant.

The best time for your firm to have purchased a portal was a few years ago – the next best time is now.

Alan can be followed on LinkedIn, Twitter @PracConnect, or his website


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