How Chaney & Associates doubled its revenue within two years of moving to the Cloud.

Firm Profile

Steve Chaney is a CPA and managing partner of Chaney & Associates, headquartered in Roseville, California. This progressive, 9-year-old firm specializes in the not-for-profit niche, providing financial and tax services, including financial reporting, payroll, bill management and controllership services to churches and other faith-based organizations all along the West Coast. He has a staff of 13: one CPA, four working to become CPAs, and eight clerks/bookkeepers.

After starting his career as a Tax Manager at Arthur Anderson, Steve left the firm to start his own practice in 2002. Steve had volunteered as a treasurer at his local church helping them with their accounting procedures. Having a passion for faith-based organizations, Steve decided to build his practice around this niche and used Shelby Systems, a legacy/SQL-based, church management software program, as the firm’s core accounting application. In less than 6 years, Steve grew his client base to 75 churches and experienced 32%+ growth in revenue, year over year, from 2002 to 2008. However, he wasn't running a very efficient practice and optimizing the firm's profitability.

Challenges/Goals

  • The firm was using a legacy fund accounting system that was too cumbersome for its clients to use and required the firm’s staff to spend countless hours producing special manual reports for each client
  • Firm was spending $5,000 to $6,000 a month in staff hours and courier fees to exchange paper files/invoices and to have their clients sign checks. The firm’s fees were based on value billing, so they had to absorb these costs, which affected the firm’s bottom line
  • Clients had limited visibility into cash flow
  • Wanted to establish the firm as a provider of strategic outsourced controllership services
  • Had a goal to expand from 75 churches to 200 church clients

 
Results with an integrated online accounting and bill management solution

  • Realized 89% growth in revenue after 2 years of implementing the Intacct accounting/GL system and Bill.com’s bill management solution, available through the AICPA Trusted Business Advisor Program
  • Eliminated $5,000 to $6,000 a month in staff hours and courier fees
  • Created standardized, repeatable processes that could be quickly adapted for current and new clients alike
  • Provided clients with comprehensive, real-time dashboards of business performance – which have become the firm's core marketing asset in attracting new clients
  • Gained better visibility into clients’ financials to provide more strategic and profitable controllership services
  • In 2 years, expanded from 75 to 314 church clients without having to expand firm staff
  • Successfully increased effective rate without having to increase billable rate

 
It’s time for a better workflow solution…

Although Steve used a legacy fund accounting system as the standard platform for all his client engagements, it was too cumbersome for his clients to use and required his staff to spend countless hours producing special manual reports for each client, creating a very inefficient and costly business process.

The firm had created a Citrix-based server for clients to get into the system, but they had to go through 5-6 steps to access the monthly report and select the funds or departments that they needed to view. It was not user-friendly for clients; they were not able to drill down to the details and they began to question why they had to go through so much trouble to obtain the information they needed for services that were supposed to be provided by the firm.

On-boarding new clients was also time consuming, taking approximately 2 weeks to transition them from QuickBooks to the Shelby System. It required Steve to go to his client’s office to create a SQL database to set up the chart of accounts, because the Shelby software could not import the information from QuickBooks. It was a long process and, as a result, limited the firm to selecting new clients that were within the Sacramento area.

Steve’s practice was also heavily paper-based, having to print and mail invoices and checks for his clients’ payroll and monthly vendor bills. Steve was spending an average of $5,000 to $6,000 a month in staff hours and courier fees to exchange files and invoices and have his clients sign checks. His firm’s fees are based on value billing, so he had to absorb these costs, which negatively affected his bottom line.

Steve could clearly see that his current business model was costly and inefficient, consuming his staff’s time and impeding his firm’s growth and profitability. Steve knew he had to make a change if he wanted to achieve his goal of growing his client base to 200 churches within 5 years. 

The benefits of cloud-based accounting solutions…

In 2008, Steve read an interesting article in the Journal of Accountancy’s technology issue about the benefits of cloud-computing in client accounting – and this served as the impetus to moving his practice to a cloud-based service delivery platform. Steve began to do some research on the featured cloud vendors and learned more about the Trusted Business AdvisorSM Solutions Program from CPA2Biz and its integrated client accounting solutions, including Intacct, a cloud-based accounting/GL platform and Bill.com, an online bill management application.

Steve was convinced that a cloud-based service delivery platform was the solution he was looking for to transform his business model and advance his practice. While many accounting professionals fear the risk of change, Steve says “The risk is going with what you have. Our current system was so far removed, it was time for a change." Being cautious, he decided to take a phased approach to ensure a smooth and successful implementation of these new technology solutions – first implementing Intuit’s online payroll and Bill.com’s online bill management solution in 2008, followed by Intacct’s accounting application to replace the Shelby Systems software in 2009. 

Chaney & Associates realizes 89% revenue growth in just two years…

In just two years, after implementing the cloud-based solutions, Steve realized an 89% growth in revenue and now serves 314 churches and other non-profits – all with the same staff, surpassing his original goal. Steve attributes this phenomenal growth to having a sophisticated cloud-based accounting and bill management system powered by Intacct and Bill.com, which enables him to offer controllership and CFO services.

Recently, Steve secured a private university as a client, whose accounting was controlled by a church organization that also used the Shelby System. The church was charging the college a steep monthly service fee and provided the college financial statements that were months old and that lacked the financial visibility they needed to understand their budget’s performance. The monthly fee was high because their accounting required four full-time staff members, dedicated to doing the work, but the college VP still had to process the check requests, approve them all, and hand them to the church.

By moving to a cloud-based system, Steve was able to take on this client at a profitable rate, while helping the college save significant money. In short, the cloud-based service delivery platform enabled Steve to do the same work in less time on a fixed fee, while maintaining his desired effective rate. “The point of touches to my clients has been dramatically reduced. We no longer have to process and cut checks manually; billing and reporting are now generated electronically. We’re letting technology do the ‘heavy lifting,’ rather than having people create those efficiencies. That’s how we are able to improve our effective rate.”