The Tech Gap

AICPA's Top 10 Technologies Released

The AICPA today officially released its 2006 Top Ten Technologies. [Note: I emphasize "today" because, as a member of the committee that determined the technologies to be presented I have had the results for quite some time. I, however, chose to honor the AICPAs embargo date and did NOT write about them until today. Others covering this type of news were not so honorable and printed the list last week. As an editor and as a member of the AICPA's Top 10 Technologies, I am embarrassed for them.

Now --- that said --- below is a reprint of the Top 10 and the 5 Honorable Mentions. In as much as I helped draft this document I have taken it, without comment, directly from the AICPA's press release.

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For the fourth consecutive year, professionals who sit at the intersection of information technology and accounting have selected Information Security as the number one technology to watch in 2006, according to the results of the 17th annual Top Ten Technologies survey of the American Institute of Certified Public Accountants. Four new technologies join six holdovers on the 2006 list:  Assurance and Compliance, IT Governance, Privacy Management, and Spyware Detection and Removal.   

The following are the 2006 Top 10 Technologies. Those new to the list are so noted.

1. Information Security. The hardware, software, processes, and procedures in place to protect information systems from internal and external threats. It includes routers, perimeter firewalls, IP strategy, intrusion detection and reporting, content filtering, anti-virus, anti-spyware, password management, vulnerability assessment, patch management, personal firewalls, wireless security strategies, data encryption, locked facilities and user education.

2. Assurance and Compliance Applications (e.g. SOX 404, ERM). Collaboration and compliance tools that enable various stakeholders to monitor, document, assess, test and report on compliance with specified controls.

3. Disaster and Business Continuity Planning. The development, monitoring, and updating of the process by which organizations plan for continuity of their business in the event of a loss of business information resources due to impairments such as theft, virus infestation, weather damage, accidents, or other malicious destruction. This also includes business continuation and contingency planning.

4. IT Governance. IT governance is a structure of relationships and processes to direct and control the enterprise in order to achieve the enterprise's goals by adding value, while still balancing risk versus return over IT and its processes.

5. Privacy Management. Privacy encompasses the rights and obligations of individuals and organizations with respect to the collection, use, disclosure, and retention of personal information. As more information and processes are being converted to a digital format, this information must be protected from unauthorized users and from unauthorized usage by those with access to the data. This includes complying with local, state, national and international laws.

6.  Digital Identity and Authentication Technologies. A way to ensure users are who they say they are—that the user who attempts to perform functions in a system is in fact the user who is authorized to do so. This includes hardware and software solutions that enable the electronic verification of a user's identity or a message's validity, for example, digital certificates. This technology includes the use of bar codes, magnetic stripe, biometrics, tokens and access control for authentication, non-repudiation, and authorization.

7. Wireless Technologies. Connectivity and transfer of data between devices via the airwaves, i.e. without physical connectivity. Wireless technologies include Bluetooth (PAN), infrared, WiFi (802.11 WLAN), Wi-Max (802.16), 2.5G & 3G (WWAN) and, satellite.

8.  Application and Data Integration. Using current and emerging technologies, including .NET, web-services, Java, XML (the foundation for XBRL) & Ajax, to facilitate integration of data between heterogeneous applications. In its most basic format, XBRL focuses on the agreement to improve gathering, analyzing and sharing business reporting data. For example updating a field in one application and have it automatically synchronize with other applications. This allows organizations to select and seamlessly integrate "best of breed" applications.

9. Paperless Digital Technologies. Document and content management includes the process of capturing, indexing, storing, retrieving, searching, and managing documents electronically including database management (PDF and other formats). Knowledge management then brings structure and control to this information, allowing organizations to harness the intellectual capital contained in the underlying data.

10. Spyware Detection and Removal. Technology that detects and removes programs attempting to covertly gather and transmit confidential user information without his or her knowledge or permission. Spyware applications are typically bundled as a hidden component of freeware or shareware programs or attached to malicious websites. Once installed, spyware can monitor user activity, gather information about e-mail addresses, passwords, and credit card numbers in the background, then transmit this information to someone else.  Spyware can include Remote Access Trojans (RAT) and root kits. 

Honorable Mention

In addition to the Top Ten Technologies list, this year the AICPA is also including a section for Honorable Mention, the technologies that placed #11− #15 in the final tabulation.

11.  E-mail Filtering including Spam and Malware scanning. Solutions (software, hardware appliances and/or managed services) that help reduce/eliminate unwanted, nuisance and malicious e-mail delivered to end-user inboxes by employing a number of strategies including white list, black list, content filtering, domain name authentication and real-time SMTP connection monitoring and blocking. 

12. Outsourcing. Hiring an outside resource to perform all, or portions, of an organization's internal IT support, transaction processing, application support or special projects.

13. Storage & Backup Technologies. Technologies that allow additional storage capacity, either locally or over the Web, to be added to a device or network that can then be used for additional space or data backup. Technologies include Direct Attached Storage (DAS), Network Attached Storage (NAS), Storage Area Networks (SAN), optical (DVD, CD, Blu-Ray), etc. Web solutions include Connected, Live Vault and NovaStor. Storage strategies include copying data via disk imaging, cloning, shadow copying, etc. to easily and quickly maintain duplications of data to ensure fast and easy recovery.

14.  Patch & Network Management Tools. Tools and strategies to centrally patch, manage, upgrade and maintain applications and operating systems across an enterprise, eg. MS MOM (Microsoft Operation Manager), MS WSUS (Microsoft Windows Server Update Service), Shavlik, Dell Open Manage, ZenWorks, Unicenter TNG, etc.

15. Technology Competency & Effective Utilization. The methodology and curriculum by which personnel learn to understand and utilize technology. This includes learning competency and learning plans to increase the knowledge of individuals. This also includes ensuring that the organization has resources available to efficiently train new hires on technology and train current employees on full utilization of existing technology on a timely basis.

Econ 101 -- A Lesson

This piece has been floating around for many. many years --- I honestly have no idea of its true origin, but I can tell you I found at least 5 websites claiming crdit for it! This is most certainly NOT one of them. I'm no where near clever enough to have authored it. I have used it in presentations from time to time and was recently asked to reporoduce it here for reference.

Bill H. --- your request is answered. See below.

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Let's put tax cuts in terms everyone can understand. Suppose that every day, ten men  go out for dinner. The bill for all ten comes to $100.

If they paid their bill the way we pay our taxes, it would go something like this: The first four men (the poorest) would pay nothing. The fifth would pay $1. The sixth would pay $3. The seventh $7. The eighth $12. The ninth $18. The tenth man (the richest) would pay $59.

So, the ten men ate dinner in the restaurant every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve.

"Since you are all such good customers," he said, "I'm going to reduce the cost of your daily meal by $20."

So, now dinner for the ten only cost $80. The group still wanted to pay their bill the way we pay our taxes.

So, the first four men were unaffected. They would still eat for free. But what about the other six, the paying customers? How could they divvy up the $20 windfall so that everyone would get his 'fair share'?

The six men realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being 'PAID' to eat their meal.

So, the restaurant owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so: The fifth man, like the first four, now paid nothing (100% savings). The sixth now paid $2 instead of $3 (33% savings). The seventh now paid $5 instead of $7 (28% savings). The eighth now paid $9 instead of $12 (25% savings). The ninth now paid $14 instead of $18 (22% savings). The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to eat for free. But once outside the restaurant, the men began to compare their savings.

"I only got a dollar out of the $20," declared the sixth man. He pointed to the tenth man "but he got $10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got ten times more than me!"

"That's true!!!" shouted the seventh man. "Why should he get $10 back when I got only $2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!" The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The ones who get the most money back from a reduction are those who paid in the most. Tax them too much, attack them for being wealthy, and they just may not show up at the table anymore. There are lots of good restaurants in Europe and the Caribbean.

SmarThumb

CES boasted a whole slew of USB-based products. Some made sense, others didn't (I'll spare you the VAPIR portable, high-tech, digital system for aromatherapy and phyto-inhalation. Oh, BTW, I'll be tracking how many of you click on that link!) and a few were pretty darn slick. The SmartThumb falls in the last category.

SmarThumb is a USB flash memory based suite of personal productivity tools. With the SmarThumb you can use just about ANY Windows computer with a USB port --- home, work, travel, play, even at your client's office. The device comes with software, 24 different applications, pre-installed so it's pretty much plug and play. Applications include several dealing with security --- eraser, encoder, shredder, and lock, as well as productivity apps like notepad, directory, to do list, clock, wallet, photo album, favorites, address book, calculator, and email. Of course, like all really cool stuff, it's only available internationally, not in the US. And no word on just when --- but you can bet these things will be popping up all over, and soon.

GLL Prediction: We'll begin to see more and more of these as publishers and software developers rush to a [short-term] DRM solution. While I'd welcome ONE SmarThumb-style device I'd want it populated with the programs I chose, not those assembled by some junior executive aggregator. Eventually we may store ALL our applications and data "on the 'Net" and each carry a SmarThumb, or iteration thereof, as a "backup". Security guys would love finally being able to enforce the, who you ARE, what you KNOW, and what you HAVE strategy for network access.

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A Few Finds from CES

I had a nice conversation this morning with Richard Oppeneim, CPA.CITP, long-time industry pundit and fellow CES attendee. We found that we both had discovered some "single-purpose" boxes that just might have an application in a small accounting practice. We discussed the Chili Box, the Mirra, the Yellow Machine, and a few of the new 8 gig USB devices. Total listen time is under 10 minutes.

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MP3 File

Disposable Power Pack

Until battery technology catches up with our portable device's seemingly unquenchable thirst for the power they produce, we're all somewhat tied to a wall socket. And that catch-up doesn't appear to be anytime soon. I suppose that's why I was so drawn to the Medis Technologies booth at CES. The Medis Power Pack is a fuel-cell that's both portable and disposable. Out of the box the device is inert and, in that state, has a shelf life of over a year. It only becomes "active" when the user snaps a seal forcing the chemical reaction to start. Once started the power pack is usable for four to six weeks.

The unit's patent pending power management system has the capability of charging a wide variety of different devices using a system of connectors [a one-time purchase] that access the particular device’s battery. When used to power a cell phone, the power pack will deliver about 20 hours of talk time, or about five to six full charges of the battery, depending on the individual cell phone power consumption and battery type.

The nice thing is that it's small AND inexpensive. It measures about 3 inches x 2 inches x 1 inch and weighs about 5 ounces. It's expected to retail for about $10. Small enough and cheap enough to claim a spot in MY gadget bag!

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"Another One Bites the Dust"

No --- don't worry. I haven't taken podcasting so far as to start playing 1980's pop rock hits from Queen. The post title is rather designed to chronicle yet another of the old stalwart software companies being absorbed. The twist on this story is that the victim company had actually escaped that fate a few years ago when it was first acquired. 

Mark Fenimore, owner of CPASoftware since 1990, sold the company to Best Sage Software back in 2002. Sage's purchase was reportedly "strategic" in that it rounded out the product line to include internal accounting firm products, i.e. write-up, tax compliance, payroll, depreciation, etc. Industry watchers weren't at all surprised when Sage immediately dropped the tax compliance product and transferred the "less than 500 users" to CCH's ProSystemFx as a part of a then fledgling alliance. Yesterday, in a joint press release Sage and CCH announced "that they have entered into a new agreement that significantly expands their strategic alliance and strengthens each company’s ability to best serve the accounting community with premium products and services." Hidden down in paragraph 5 was what I considered to be the meat --- "The agreement also includes the acquisition of the Sage Practice Solutions line of business by CCH, including Sage Practice Manager, Write-up and Document Manager."   I interviewed Sage's CEO Ron Verni and CCH's CEO Kevin Robert yesterday. Both were very positive about the business line transfer and almost giddy about a future when CCH content is "built in" to the Sage product line.

[Translations: SAGE: In-firm products are outside our core expertise and providing them to practicing accountants didn't give us the traction we had hoped for. CCH: We really wanted the VPM product as it essentially doubles our practice management user base and, it's already done in .NET and Sequel!]

The transaction gets Sage out of a product line that fell clearly outside their current strategic vision and gives CCH a huge leg up on their long-time vision to be a premier "full-suite player".

GLL's predictions ---- look for a two to three year "convergence" process with CCH's ProSystem Practice and the VPM Sage Practice Manager product. Ultimately VPM will win out as it's at quite a bit ahead technologically. Sage's paperless product (Document Manager) and it's payroll offering will probably die a quiet death while the rest of the line (client write-up, accounts payable, accounts receivable, and client checkbook) will likely find a home in the ProSystem line-up. Score one for Kevin  Robert --- this is a strategic stroke of genius. Stay tuned.

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Dining With Giants of Our Profession

Last month I was called to Denver for an AICPA National Accreditation Commission meeting. A few days before the trip I had a telephone conversation with WAYNE HARDING and he was kind enough to invite me to dinner. I quickly accepted as Wayne is very well-known for having a quick wit and marvelous insights regarding the direction of practicing accountants relative to the technology they adopt. This would be both entertaining AND educational! Only when I arrived did I realize that we were to be joined by my old friend MIKE DICKSON (my mentor and predecessor CITP Credential Committee Chair) and RICH OPPENHEIM, whom I had not previously met.

Needless to say the dinner was a blur or reminiscing and predicting --- we covered everything from the Burroughs B92 to Radio Shack's "trash 80" to GPS and retinal scanning devices. These guys are the absolute definition of "accounting geeks". I was in heaven!

The first piece of good news is that all four of us are CITPs (you may be eligible --- go here for more information) and we're all proud to be so designated.

The second is the RICH has agreed to occasionally write for www.TheTechGap.com. You'll see his first piece here. Let me tell you a bit about Rich --- he started a dual career as a CPA and working with technology in the 1960s. Over the past 4 decades, he has continuously provided insights on the world of business and implementation of technology to support the enterprise. He has developed systems on every platform from mainframe to today's web environment. The wide range of clients over his career includes accounting firms, service companies, and computer based education.

Since the early 1980s, Mr. Oppenheim has done freelance writing – reviewing a variety of computer technology products. Currently, he is a member of the AICPA's InfoTech Update Editorial Board, along with writing for several professional publications. Academics include an accounting degree from the Wharton School of the University of Pennsylvania and postgraduate work at New York University.

Soon after relocating to Denver in 1994, he joined a unique personal service organization, as Chief Operating Officer. Responsibilities included management level training and development of industry specific software. Richard is a founder of IdentiRISK, a provider of computer-based continuing education courses. He was instrumental in the original CITP credential launch and holds one of the very first certificates.

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A Quick Video of My New Home Office

This is another test --- this time of the video capabilities of TypePad. This is the home office in my townhouse in Sioux Falls. As you can see I may have gone a tad overboard, but hey, it's TECHNOLOGY, right?

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Test of Podcast Capabilities

This is a short recording to finally test the automatic feed feature of TypePad and their interactions with Audioblog.

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MP3 File

Planon's DocuPen Just May Deserve a Spot in Your Bag

Yesterday I blogged a bit about CES --- and it's sheer enormity. Fortunately (for me AND for you!) I have friends who are also "on the lookout" for technologies applicable to the practice of public accounting. Today's article comes from RICHARD OPPENHEIM, CPA.CITP. Many thanks for your piece, Rich --- I appreciate your wisdom and experience.

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When you need a copy and there is no copier in your accessory bag, there is Docupen. This device is a pocket portable scanner the size of a fat pen. Slide open the pen and you can scan up or down an entire text page or over a small or full sized image. The Docupen has internal memory that can hold up to several hundred documents which can be any combination of separate text pages, photographs, business cards, newspaper articles and more. At any time you can connect the Docupen to a computer via USB cables. While connected the batteries are recharged.

The image shows the RC800 which is a full color scanner and retails for $300. There are other models for $100 less, the 700 models, that are only black & white. The scanner is bundled with OCR software that can be installed on your computer to convert the scanned text documents to editable text for inclusion in any word processing document.

Richard Oppenheim, CPA, CITP