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How CPAs manage computer technology.

CPA firms spend an average of $2.67 per chargeable hour on computer technology, which includes hardware, software and training. That amounts to about 3.5% of gross revenues and $2,053 per employee.

This information comes from a survey of CPAs, many from an industry group, the Accountants' Computer Users Technical Exchange (ACUTE).

Yet despite the fact that so much money is being invested in technology, few CPA firms really manage it. For example, only 22% of the firms surveyed took the time to develop a long-range plan for how they will computerize their offices--what hardware and software they will buy--which indicates that, instead of planning where they want their level of computerization to be some years ahead, they probably make purchases on an as-needed basis.

Clearly, that's a mistake. Such lack of planning indicates money is being wasted and computer technology is not being put to its best use.

The survey also discloses that while most CPA firms prepare income tax returns for individuals and businesses using batch or interactive processing, some CPAs still do the job the old-fashioned way-on paper: about 6% do individual income tax returns, 14% do business tax returns and 35% prepare financial statements manually.

Batch processing is used by 63% for individual income tax preparation, 34% for business tax processing and 43% for financial statement preparation. Of the firms that use interactive processing, 57% use it for individual tax returns, 73% for business returns and 54% for financial statements.

Some 39% of the firms that don't use interactive processing intend to switch to it by the 1993 filing season, 47% intend to switch for business income tax processing and 34% plan to switch for financial statement preparation.

Although minicomputers are giving way to personal computers, the minicomputer market is still substantial. IBM has the lion's share of the minicomputer market; 50% of the respondents have the IBM S/36, 19% the IBM AS/400, 10% the IBM S/34 and 8% have various other IBM models. Other brands total 13% of the market.
COPYRIGHT 1993 American Institute of CPA's
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
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Title Annotation:Computer & Technology Surveys
Author:Pottroff, Harley W.
Publication:Journal of Accountancy
Date:Jan 1, 1993
Previous Article:How CPAs use software.
Next Article:New guidance helps CPAs minimize tax penalties.

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