Register for Scaling New Heights to continue your accounting industry education.

The Importance of User Management for Accounting Firms

Carl Coe
Posted by Carl Coe on Oct 21, 2022 1:52:00 PM

Organization and efficiency are the keys to success for accounting firms of all sizes. It’s critical that you monitor these areas to help the firm be successful. The proper management of users – including staff, vendors, and clients – is vital in helping your company function effectively and run processes smoothly without errors. As the business grows, you have more employees, clients, choices, and procedures to manage. Top-notch user management with reliable accounting practice management software can help ease the burden of complexity that often increases over time. 

What is user management? 

Simply put, user management is the ability of administrators to manage user access to various IT sources. It’s widely considered one of the fundamental security requirements for any firm that uses different software and hardware resources. The administrator can regulate the level of access granted to any user through user management. Typically, an admin will create user groups with varying levels of access to read and edit files. For example, clients and junior-level team members might have read-only access, while senior executives have full access to all files on the server. 

User management also involves deciding on employees to onboard and off-board from different IT services. Platforms, storage systems, networks, SaaS services, and other IT resources could be included under the user management umbrella. The adoption of cloud-based IAM (Identity and Access Management) has recently given administrators far better control over diverse digital assets. This includes protocols like two-factor authentication (2FA), which requires users to enter code generated on a separate device to access their account. 



Benefits of user management for accounting firms 

How specifically do the principles mentioned above help accounting firms? A few important ways: 

Improved security and data integrity 

Protecting the integrity of financial statements is critical, regardless of the size or complexity of your company. However, ensuring that users – whether team members or external stakeholders – can execute their tasks efficiently is equally critical to a company's day-to-day operations. That’s why striking the right balance between secure user permissions and easy access in your accounting practice is vital. User permissions enable you to control who has access to your files and assign specific rights to each user based on need.  

For example, you might give your clients access only to a single folder where you keep all their past account statements and records. This lets them view and edit only files related to their work with you while keeping records from other clients confidential, even when stored in the same directory. 

User permissions can keep your data secure and precise by providing this fine-tuned authority over who accesses what in your organization. Correctly configured user permissions will prohibit unauthorized access and guarantee that the right parties only see sensitive information. Limiting access also reduces the possibility of a mistake when editing the file, which helps to preserve data accuracy. 

Enhanced team and client communication 

The use of accounting practice management software can significantly improve client communication and staff cooperation. Teamwork is much easier when every user can get needed access to a central platform that lets them access, modify, and share data. With email notifications, specific team members can get alerted when they’ve been given access to a new document, helping them ensure their work stays on track and gets completed in accordance with relevant deadlines. 

User management systems can also help with client management by making it easier to assign critical files and communications to the right people. For example, your client might have junior team members or contractors who may not be authorized to view sensitive documents like agreements, invoices, and payments collected or pending. In these cases, the software can help ensure files are only accessed by a set group of users with sufficient privilege.

Billing and payroll 

From an internal perspective, user management can be helpful to ensure your team’s time is appropriately distributed. Management tools let you create a user group for employees and then analyze metrics related to that group to understand better how the most essential staff members are performing.  

This is especially vital for accounting firms, where team members must bill a certain number of hours of client work for the firm to meet revenue and growth targets. This number is typically known as the utilization rate. With the right user management systems in place, it’s easy to track utilization rates across the entire company or divide your team into different groups and evaluate their performance against target utilization rates and other metrics. 


Final thoughts on user management best practices 

Accounting firms face a greater demand on time and resources than ever before. Trying to use outdated management methods will put a damper on your firm’s efficiency and restrict growth. In the worst-case scenarios, ineffective user management will lead to issues that negatively affect client satisfaction. 

Finding a user management system that meets your firm’s needs is essential to avoid these challenges. The ideal scenario is folding user management into a more comprehensive accounting practice management platform that handles other needs in your firm, such as document management, collecting e-signatures, and automating the creation of rote but necessary files like invoices and contracts. 



Topics: Practice Management


Sign up and stay plugged into the education, news pieces and information relevant to you.

Subscribe to The Woodard Report today! 

Do you have questions about this article? Email us and let us know >