New Linked In Tax Network - Tax Technology People

By Simon Godley

This is a brief announcement that I have set up a new Group on Linked In, specifically for people who work in the area of tax technology. This is a rather experimental project at the moment, and it will be interesting to see if generates a critical mass of people in the sector. It is primarily for tax technology / tax software execs based in the UK, although it is open to non-UK members. I discovered that there were already a couple of tax technology Groups on Linked In generated in the US, but as with the broader tax market, the Atlantic does seem to split the tax technology world into two distinct people populations.

I have had my profile on Linked In for c.2 years now, but don't feel that I have really maximised its networking potential and functionality, hence this initiative.

The purpose of the 'Tax Technology People' Group, is mostly for networking in the sector. I guess it enables tax technology specialists to see who else is in their market (if they are interested), and possibly even to generate contact / debate between people with a common career interest. I am slightly sceptical about the latter purpose, but we will see.

Only people who have their profile on Linked In can join the group, otherwise Linked In as an enterprise wouldn't benefit. So if you are on Linked In, and you work in the field of tax technology / software, please join. If you are not on Linked In, have a look at setting up an account, I think it's a good business networking site with a good level of privacy options built in.

And of course, I would welcome any thoughts or feedback on the Tax Technology People group.

MYOB software branding to disappear

Source: AccountancyAge.com

The publishing business that acquired accountancy software company MYOB earlier this year has announced that it is to phase out the brand.

Wolters Kluwer told Accountancy Age that by September almost all MYOB branding will be gone and by January 2009 it will be completely replaced by CCH, the company's software arm.

Cathy Wolfe, CEO of Wolters Kluwer, said: 'MYOB still exists in Australia and is best of breed there'.

WK confirmed that following the acquisition there were no redundancies in sales and that it is not planning any big cuts. 'We want to expand our strong position so there is plenty of work to go round' added Wolfe.

Wolters Kluwer's announced last week that it had launched CCH ProSystem, a hybrid of both CCH and MYOB technology.

Simon Crompton, head of CCH, said: 'The new software has opened up a complete and totally integrated suite, for strong, big, and entry level organisations'.

CCH ProSystem will be available on upgrade to all customers of both CCH and MYOB and fully implements both package models into its framework.


SG comment - I have featured this article as amongst the MYOB brands are well known tax software products PerTax (including new rewritten .NET version), SecTax (for share dealings) and TrusTax (for trusts and estates). I suspect they will keep these product names, and repackage them as CCH products.

Microsoft creeping into tax software market?

By Simon Godley

I recently saw an article announcing that accounting firm Tenon has signed a deal with Microsoft to supply their accounting software, whereas previously they had favoured Sage. Tenon has said that they are continuing to use Sage, but the Microsoft offering is 'better'. Tenon will use the Microsoft product for outsourced finance function, presumably for their clients.

This prompted me to look at the Microsoft site for the product. There are actually two sites - one for financial management software and one for Microsoft Office Accounting, which seems to be for smaller businesses. Both sites are quite impressive, with video sales pitches which give a very convincing overview of the products. When you look at the add-ons available (for the Microsoft Office product), you can add a payroll service for an extra £9.95 per month. This does all the PAYE and NIC calculations, and can handle e-filing. The basic MS Office Accounting product is free to trial for 60 days, and then costs just under £150 to buy (for one user).

There is no evidence of specific corporate or personal tax products as yet, but I guess that could be another add-on from Microsoft in the future. Their current offerings seem to be pitched to the SME market, hence the competition with Sage, so no direct product competition with the suppliers of larger group CT software.

It is a brave move by Microsoft, and a move into mature markets (ie US and UK accounting software), but that seems to the their strategy on products - see what the competition has produced, and then design something better.

Tax Jobs - Weekly Highlights

This week I am revisiting and featuring the area of tax automation and/or tax compliance technology. Clearly a specialist area within tax, but one that seems to have filtered into multinationals that take tax reporting seriously. Consulting firms have developed teams within their tax offering that will purely advise multinational groups on how to improve and streamline their tax reporting and compliance processes, but are not looking to sell a specific tax software product.

Below is an example of this, being an excellent and forward thinking opportunity for someone with either a detailed tax compliance/reporting background from industry, or someone who knows their way around SAP/Oracle financial reporting systems:

Tax Manager - Tax Compliance Systems
London £55,000 - £90,000, depending on experience
See More Details

IRIS acquires tax software company

Source: AccountancyAge.com

Product and software developer IRIS has acquired Drummohr Technology, the makers of 'Tax Assistant', for an undisclosed sum.

So far, IRIS has announced that there are no plans to merge the two companies' range of products, but will include a strategy of sustained investment and introduction of new products where appropriate.

Martin Leuw, CEO of IRIS, said: 'By adding the Tax Assistant software to the IRIS range, we are able to offer an unparalleled wealth of knowledge and experience of this specialist sector.’

In a statement Drummohr Technology said: 'IRIS' goal (is) to revolutionise the accountancy profession with a range of quality solutions to suit every size and type of practice'.

SG comment: This year so far has seen a good level of consolidation in the tax software market. The above seems a relatively small acquisition, but earlier in the year we have seen Thomson Corporation acquire CrossBorder solution, for their transfer pricing and tax accounting software products. We have also seen the accounting & tax software arm of MYOB in the UK/Ireland be acquired by Wolters Kluwer, which is the home of CCH Software.

Deloitte is 'moving tax forward'

Deloitte’s website now incorporates a debating room, which is actually a clever marketing tool for their Tax Management Consulting practice. It is video based, so you see and hear the views of some of the Directors and Partners of the practice. It is very informative, and highly targeted towards Heads of Tax of large multinationals who may be looking to automate their tax reporting and compliance. You can also hear a couple of case studies, one from Carmel Moore, who is Director of Pfizer’s European Tax Centre and one from Andrew Constantine, Head of UK Tax Compliance for Lloyds TSB. It is a very useful web initiative for Heads of Tax who are not sure about tax technology, or how to get the most out of it for their business.

To see the above, click here

Deloitte have been developing this area of their tax practice for years, and they have gradually added on consulting services to their flagship tax software product Abacus, which Arthur Andersen developed and started selling to clients in the late 80s/early 90s.

Having worked in tax for Andersen in the mid-90s, I have seen the history on this, and a few of my peer group from the Andersen legacy who have stayed with the firm through its transition to Deloitte back in 2002, namely Mike Roberts and Andy Gwyther, are now very senior guys within Tax Management Consulting.

Digita (software) receives stamp of approval from Vista

Source: AccountancyAge.com

Digita has become the first accountancy software player in the UK market to receive a certification from Vista.

The Certified for Windows Vista mark identifies 'products that meet a higher standard of quality and exploit the best of what Windows Vista has to offer'.

'This gives us a huge advantage in developing our software for the profession as users benefit from the highest levels of integration across Digita and Microsoft products resulting in better business performance,' said Jerry Rihll, Digita managing director

Brad Goldberg, general manager for Windows Vista Product Management at Microsoft said: 'We are extremely pleased that Digita carries the certified logo and takes advantage of the new technologies available in Windows Vista.'


SG comment: I have posted this article as Digita is also very active in the tax software market, its products include Digita Personal, Business, Trust and Corporation Tax. Their marketing material states that these UK tax products are the only products accredited by Microsoft for use with Windows, hence the above article. Digita tax software has won the LexisNexis best tax software award 3 times: 2007, 2006 and 2003.

Where will we (and tax) be in 50 years?

By Simon Godley

Reading through the paper this lunchtime, I had one of those 'What is happening to the world moments?'. This was mostly driven by the first article reporting a 19 year old boy in Nebraska who had been on a shooting rampage in a shopping mall, killing 8 people, and then shooting himself. Clearly this is the behaviour of a very disturbed person, however the comment that caused me to reflect the most was that his suicide note revealed that he 'just wanted to be famous'. Fame? I couldn't kill a fly without feeling tremendous guilt, but I can kind of see the logic here. The boy becomes obsessed with famous people, maybe he develops some sort of resentment and jealousy that they are famous, and the only way he can quickly have the perceived level of attention that you get when you are famous is to commit this atrocity. The fatal flaw in his plan - he never got chance to enjoy his very short lived 'fame'.

My thoughts then turned to the concept of fame. When did fame begin? My conclusion to this was when media started, when things were reported about people, when newspapers were written, and then fame possibly caught on a lot faster when people could go and see a moving picture - this is when you can really get to 'know' someone in terms of their looks and personality. Therefore, fame has evolved out of technology.

The next article was more revelations from HMRC and their breaches of security. The acting head of HMRC David Hartnett, being quizzed by the Treasury select committee, was putting the breaches down to 'systematic failure'. Sounds a bit like blaming technology to me.

Thirdly, how did the wife of the 'dead' man from the canoeing accident get exposed for potential fraud - someone had found a picture of him and her together in Panama, which had been posted on the internet, dated July 14 2006. His 'death' certificate is dated 21st March 2002. Once again, technology (ie the internet) playing a significant part in the process.

So the opening pages of today's newspaper reveal three articles where technology has played a significant role, two times in a very harmful way, and once in possibly a helpful way.

So what on earth has all this got to do with tax? Well, what about tax technology? Surely a good thing in the UK, for example, where tax and accounting rules become more and more complex. The idea of the tax compliance process being fully automated, with clever software that is coded into ERP systems, pulling out the relevant tax (and VAT) numbers and placing them in the correct fields of a tax computation. So where's the downside, is there one?

To digress slightly, I recently took a trip to France to buy some booze for Christmas, and decided to stay overnight in Boulogne. From the point of deciding to make this trip, the first time I actually spoke to another human being who was incidental to my trip was when I said bonjour to the receptionist of the hotel in Boulogne, after buying my booze. Everything I had to do up to that point, including buying a channel crossing and booking a hotel room was totally automated. So technology also removes chains of people, and hence removes jobs.

So I guess the big fear with tax technology is the impact on tax professionals' jobs. Going back to the troubles within HMRC, we have already seen 12,500 job cuts as a result of the Inland Revenue merging with HMC&E, and the plan is to cut another 12,000. This was highlighted recently in Taxation Magazine, with Mike Truman launching his 'Stop the Staff Cuts' campaign. As tax technology improves and becomes fully integrated into large PLC, are we going to see an evaporation of those working on tax compliance?

We have realised that we can't live without technology and computers, but hopefully we will realise that even though computers do clever things, and save us time, they have no common sense or imagination, something that only humans can possess.

Microsoft will find small business software market tough

Source: Kevin Reed, Accountancy Age

Microsoft has been warned that it faces an uphill struggle in gaining ground in the small business software market if it does not focus on customer services, a rival warned today.

Following Microsoft's launch of Office Accounting in the UK yesterday, rival software provider MYOB said that while the move would expand the market as penetration was not high, the US software giantwould have to focus on customer service to displace existing customer bases.

'Small business owners want a partner that will support them and help them to grow their business, not just sell them software,' said Wayne Schmidt, managing director at MYOB.

'My experience is you need to be offering a complete support and service solution, not simply product. Having a deep relationship with accounting practices is also critical to the success.'

As part of its offering following the long awaited launch, Microsoft will launch a UK accountants' network and has taken an aggressive stance on its pricing; offering the product for free in certain circumstances.


SG comment: Given previous track record at launching their own products into established markets, I suspect Microsoft will make this work. Maybe at some point you be able to buy/download Microsoft tax software? That could be a bit too niche, even for Microsoft.