Create efficiencies through accounting technology with Twyla Verhelst (Part 1)
In this two part episode, Phil speaks with Twyla Verhelst, Head of FreshBooks Accountant Channel and Leader of the Accounting Professionals Program. Twyla talks about her role at FreshBooks Accounting and what they offer. She shares what to look for in choosing accounting software for your business, asking yourself what you need and are trying to gain efficiencies. She also discusses the differences in accounting between the US and Canada.
Narrator [00:00:02] Hello and thank you for tuning in to another episode of CPA review and more. We are pleased to bring you the number one podcast for CPAs and CPA candidates. If you'd like to learn more about how Yaeger CPA Review can help you, find us on our website at Yaeger CPA Review dot com. Now, here's your host, Phil Yaeger.
Phil [00:00:28] This is Phil Yaeger, welcome to CPA Review and More. We talk about the CPA exam, how to prepare for it, and also more means we have people in the accounting sector who talk about what they do. So it's not just preparing for the CPA exam. Today's guest is Twyle Verhelst. And I got that right the first time. She is a chartered accountant in Canada, correct.
Twyla [00:00:56] I'm a CPA.
Phil [00:00:58] With chartered professional accountants of Canada.
Twyla [00:01:00] You've got it.
Phil [00:01:00] OK, she does not hold the US CPA, but I would think--the major difference is you use the IFRS (International Financial Reporting Standards) where the AICPA really has not gotten on board with that. In fact, on our CPA exam, as of July 1st, 2021, they will not be testing the IFRS any more. Okay. Alright.
Phil [00:01:28] And she has had a FreshBooks accountant channel. That is not a channel on a podcast, okay. She'll explain to you what that is. And she's leader of the Accounting Professionals Program, and she's the top. Now, we're not talking small time here. We have the top 50 women in accounting--she's one of them--, and creator of the--I'm reading your LinkedIn--what is the VpD-Ex?
Twyla [00:01:57] Yep. That's the video per day experiment.
Phil [00:02:00] And what do you mainly--you're program leader at FreshBooks Accounting, right? Tell us what FreshBooks Accounting is and what exactly do you do at FreshBooks Accounting?
Twyla [00:02:14] Sure. I'm happy to share that. So FreshBooks itself is a accounting software. So it began in 2003, really started as an invoicing software. The founder of FreshBooks, he was running his own design agency and created FreshBooks as a online cloud invoicing platform to execute or deliver his invoices to his clients that looked very professional, were efficient and timely so that he could get paid essentially. And so it started as an invoicing platform, built out an extensive feature set inside of an invoicing platform in twenty sixteen fresh books, launched an entirely new platform which made it go from an invoicing platform over to an accounting software or an accounting platform. So since 2016 FreshBooks is actually a full-cycle accounting platform, double entry accounting, the general ledger chart of accounts, the bank feeds, financial reports that we're all familiar with inside of a platform that we use to do day to day accounting. As for what the accountant channel is and what my role is at FreshBooks, so predominantly since twenty three FreshBooks has focused on creating a platform for business owners. So as a result, the platform is very easy to use. It's extremely intuitive, despite having quite a robust feature set to help business owners run their business and run their business efficiently. So since June of 2020, we then launched a accounting professionals program. We designed it as FreshBooks as a company that we want to support our accounting community and the accounting industry.
Twyla [00:03:58] And really what we want, what we want to do. There's support the the clients who were already using FreshBooks to ensure that they could collaborate efficiently and effectively inside of fresh books, that they could use it in conjunction with their accounting professional or their accountant. And so as a result, in order to do that successfully, we need to ensure we're supporting accountants. And so that looks like product features for accountants inside of the platform. That also looks like a program that best supports accountants, listens to them, gets their product feedback, gets them collaborating, lets us provide them with content that they can use to add value to the firm, support them in supporting their clients using FreshBooks.
Phil [00:04:43] Do you mainly deal with--by the way, I don't know if I mentioned--she is in Calgary, Alberta, Canada. Okay?
Twyla [00:04:51] That's right.
Phil [00:04:52] So we have an international show here.
Twyla [00:04:55] [Laughs] Love it.
Phil [00:04:55] I live in Maryland, which is international near Washington, DC. But what is most of your clients? Are they US accountants or they Canadian accountants? And what's the big difference in the way they do the accounting?
Twyla [00:05:11] Yeah, great question. So FreshBooks itself is a global platform, so even though it started in Toronto, Canada. It is a global platform, started firstly in Toronto and then expanded to the US. And now we've got offices in Amsterdam, Croatia, as well as Mexico, and then, of course, the US and Canada. So I work with mainly North American accounting professionals in these early stages of starting the program. And predominantly, to be honest, I mainly speak with more US accountants than Canadian accountants. A big piece of that is because we have a really big user base for FreshBooks in the US.
Twyla [00:05:49] So we've got accountants who are coming to us saying, I've got a new lead, who's using FreshBooks, or I've had a client on FreshBooks for a few years now. And I'd love to work more effectively inside of the program now that we're actually supporting accounting professionals in a really intentional way. And so there's Canadian and US accounting professionals that are partners inside of the program. But due to the fact that we have a large user base in the US, plus your population is significantly larger than it is here in Canada, then there is certainly a large number of US accountants inside of the partner program.
Phil [00:06:25] Is your program geared for the US accountants to GAAP (Generally Accepted Accounting Principles) where the other than the US market is that the international--the IFRS--is that the way the thing is set up for different types of the way we present things?
Twyla [00:06:43] Yeah, yeah. Great question. So really inside of the program, it's a very standard listing our standard format for the financial statements so that that really follows along with GAAP, GAAP standards, as opposed to IFRS or anything a little bit more formalized, really. FreshBooks itself is predominantly used by small to midsize businesses who are who are private. And so they're usually following then gap or something more informal than having to have that very formalized notice to read your statements and following IFRS standards.
Phil [00:07:20] Now you are selling your platform program to accountants and then they they sell it to their clients. Is that the way it works?
Twyla [00:07:30] Yeah, that's a fair way to look at it. I mean, when we are supporting accounting professionals who are using FreshBooks or want to start using FreshBooks, it would be fair to say that it's kind of like a reseller type scenario where the accounting professional is the one who is recommending FreshBooks to their their business owner, to their client, or setting it up on their behalf.
Twyla [00:07:52] And and the business owner is doing a part of the workflow and the accountants doing a part of the workflow. So in in the case of of how that kind of works, and ultimately we do have we have accountants who are using FreshBooks for their own book of business or their own practice.
Twyla [00:08:06] But essentially what we're really wanting to work closely with the accounting professionals to help them collaborate with their clients who also want to use FreshBooks.
Phil [00:08:15] If they (accountants) get FreshBooks for their clients are they paid on a commission basis? How are they paid? Are they paid by billing the client? How does that work?
Twyla [00:08:27] Yeah, so right now, the way the program is set up is we have an affiliate program and so then each accountant or accounting partner who refers a client on to FreshBooks receives a referral bonus or a referral commission for every new invite that they bring on to FreshBooks. That's the way it is right now. I mean, if I let you in under the hood, I would tell you that that's not the way it will be in the long term. We want to make it if we have requests. I mean, part of our myself and my team do very often is gather feedback. We're in information gathering mode always, and our partners are very good at sharing with us. What is it they want to see next? And there's high requests for more of a rebiller--formal rebiller/wholesaler-type scenario where they could rebill their clients for X number of dollars for the subscription and be billed themselves inside of their firm for those subscriptions. So that's in our line of vision and something that we're taking into consideration for our future roadmap.
Phil [00:09:30] We were talking about one of the big areas now that accounts going into here in the States is advisory services. And in fact, the big four firms, most of the revenue now comes from advisory services, not the audits of public companies. And what I want to know is two things. How competitive is this market that you're in? And what makes you different or better than another program? I mean, I'm not--comparing you to QuickBooks is not fair, is it?
Twyla [00:10:05] And that's okay that we chat about QuickBooks. I mean, I really think that, um--maybe to answer your first question--how competitive is the market? The market for software in general is very competitive.
Twyla [00:10:17] And I think that's due to technology advancements. I mean, gosh, even accountants are starting to learn to code and create solutions in software to solve pain points. So in general, the tech stack or the techs base is extremely competitive. How competitive is accounting software inside of that? It's still quite competitive. And really, what makes it compelling to use FreshBooks versus another platform, whether that's QuickBooks or whether that's Wave or whether that's Zero, really comes down to what is it you need from the accounting software. And this is this is the same sort of audit that you would do with any type of software technology. What is it that you need from that technology?
Twyla [00:10:57] And in looking at that, a big part of what our accounting partners are considering when they're looking at FreshBooks is: do I need to put this software in front of my client? Meaning in order to complete my work, does my client first have to complete their work? And if the answer to that is yes, that's the first kind of part of your decision tree as to whether or not FreshBooks could be a good fit of software for your client, because not all software is intuitive for business owners, and business owners tend to resonate with different styles inside of the accounting platform. So even though we have competition in the space of accounting software, they each look and feel very different as an accountant and as a client, as a business owner.
Twyla [00:11:46] And so what is it you're trying to get from the software? Let that be the leading question in determining what software is the right fit for this client engagement. And speaking from experience, prior to joining FreshBooks, I had my own accounting-bookkeeping-advisory practice. It was heavily, heavily focused on advisory. And we really looked at software as a way to gain efficiencies. And it's not only a way for us as a team for us to gain efficiencies, but how does it gain efficiencies for the client? And when we speak about advisory, then we get into some of the soft parts of an intangible parts of accounting, which is more around relationship and client experience. And technology plays a role inside of that.
Twyla [00:12:34] And gosh, the sooner that we recognize that the technology that you put in front of your client impacts their client experience, the reality is you can't do really good advisory, a) if your client's not doing the work that they need to do in order for you actually have the information to do advisory, but b) if it's a friction spot, if your client is in front of a software that they constantly are dreading logging into, not getting their work done on time, feeling like I remember feeling like a nagging mom sometimes because I was trying to get some information from my clients and I needed it in order to do my work. But if that actually impacts the client experience, even though I was delivering really good advisory on the backend.
Twyla [00:13:19] And so I think that how we stack up against the others, there's a time and place for each type of technology and and a time and place when other software might be a better fit than we are as FreshBooks versus there's times when FreshBooks is a better fit than some of the other software. So part of our role is our team is helping accountants determine when is a piece of software a good fit and how do I and my client use that software efficiently and effectively so that I can do what I agree to do for them inside of our client engagement.
Phil [00:13:55] A lot of I don't know if you still have this in Canada, but it used to be or in the states that accountants, CPA, small firms, they used to make their money doing what we call write up work, you know, the books and the financial statements. And I don't know if they still do payroll, but that's the way they made their money. A lot of these people have been I'm sure you have different people, people who are younger, older. All right. And obviously, the younger people probably are more agreeable to this type of program because old people all over older accounts like myself, we actually look at this stuff and say, oh, my God, it's just making our lives harder because, yes, we want to provide our clients with the best service, the best consulting.
Phil [00:14:45] However, we have to take time to learn this. All right. And yet we still have to continue to do the work in the practice. How do you balance that? I mean, you know, what is the age group? Is that hard to say? What's the age group of people who you deal with? Are they say in their forties and up? You have people are still in their 70s practicing. What do you find? You know, I know people who are older don't like--they don't like computers. So how do you say to someone, well, don't worry about it you'll still be able to do your work and yet we'll still be able to train you. You do that training, correct?
Twyla [00:15:23] Oh, yes, absolutely.
Phil [00:15:24] Well, how do you balance the time? How do you tell the person to balance the time.
Twyla [00:15:28] Yeah. And you know what? I think they already come to us with an understanding of they will need to balance the time in order to be really up to date and current on technology. And you're absolutely right. There's there's a a section or a group of accountants inside of the CPA program in Canada and the US who are advanced further along in their career. Embracing new technology is not their thing that they're waking up and jumping on a bed and getting excited for. And they will still have, in my opinion, a career that finishes off and they can retire in as that type of professional.
Twyla [00:16:08] Now, if their entire practices that way and it's on desktop and not really about what they'll resell or sell their practice for, that's another conversation. But when you come down back to the question of what is the age group that we're working with, it's it's a. It varied, it's it's really based more so on mindset, and I have this conversation inside of FreshBooks a lot that the type of accounting professional that we are going to be able to do the best work with is what I would call a modern accountant who already understands it. Gosh, this evolution of our industry is moving very quickly and tech space moved very quickly. And if I want to keep up and and continue to evolve my practice and support my clients, that there is going to need to be some time trade-off between working on my business and working in my business. And tax is probably not the season. When you're working on your business, you've got to be working in your business. But campus tax season, what does that look like?
Twyla [00:17:11] And we we speak to a lot of accountants in the latter half of the year, 2020 being an exception to that because of the deadline that kept moving forward. But generally speaking, it's kind of the latter half of the year where accountants focus more on processes, technology changes, advancements, improvements in more collaboration with the industry at large to say, what are you doing? What are you doing? That's why conferences generally are the latter half of the year. It's the time when when people are in that mindset versus now to talk to an accountant in the next two months to say, hey, you should embrace a new piece of software. We promise you we will give you a certification and product education and support that. That's not the right timing. And we are very, very understanding of that. But I do think it's a mindset. It's a mindset of where do I where is my practice right now? Where do I want it to be? Do I want to finish up my career as doing more of those traditional deliverables? Or do I want to embrace this advisory which will just naturally I can say this from experience to Natera. If you're going to do advisory, you need to embrace technology. Otherwise you're going to have an advisory that's extremely high priced because you're doing so many things manually and in a way that that technology can do more efficiently. So the opportunity is to use the technology, create some efficiencies to free you and your team up to do more advisory. So it's really that mindset.
Twyla [00:18:41] It's kind of where am I going with my practice and and that understanding of this means and an investment in my firm and my clients in order to do that.
Phil [00:18:52] The CPA exam here in the States is going to start testing, July of 2021, areas of artificial intelligence, different types of technologies. Now, I want to know in Canada, do they teach this at the undergraduate and graduate levels? Because a lot of schools here do not teach that. So the only way these people are going to be able to get the experience, especially the entry level people coming into the firms, is if the firm has some type of training for them. All right. A year ahead of that, I mean, I see the United States not being the universities here, not being ahead of the in other words, they're going to test artificial intelligence. They're going to test different technologies. You know, robots. Well, that's artificial intelligence. But our students here do not get that information necessarily in the university. Do they have that in Canadian universities? Are you aware of that?
Twyla [00:19:54] And I think we're we're pretty close to being on par with where the US is at in that regard. And it's funny because just yesterday I was having a conversation with one of our executive team members here at FreshBooks about what we can what can we do to contribute to that push towards getting this information in this education out to the accountants of tomorrow, as they call them, sooner, so that we aren't kind of playing a game of catch-up once we get into the firm?
Twyla [00:20:21] And really, I mean, in any other industry, I think that ultimately what you want is that your new fresh accountants that are joining the firm are the ones that are the most tech savvy and that they know the most about this and they can help with contributing to the firm and where the firm is headed there right now. I think we're experiencing similar to you that they're coming out with with a really great education around accounting and all of the things that you and I probably learned inside of accounting, but that they don't necessarily have any more knowledge or understanding of where the tech fits in. In fact, if anything, less, because I know for up here in Canada, we mainly see that happening hands-on inside of the firm.
Twyla [00:21:03] So they're coming coming into the firm, kind of being a few steps behind in their experience and using that technology versus the other way around would be that they're leading those conversations because they're so far ahead of it. And when they think about the social media platforms and the other technology that these younger generations are using relative to what I'm using and perhaps you're your speak for both of us that probably we're using, they should be the ones that are leading that conversation, but they're not here either.
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