Document Management for Accounting Practices

Why document management software is a must for accounting practices

Accounting is complex and errors can be costly, so it’s no surprise innovation has long been a part of accounting history. During the 1950s, accountants became some of the first professionals to invest in computers. In the last 10 years, there’s been another technological boon to the industry: cloud computing.

The ability for records, paperwork, documents, and files to be stored and accessed via document management software presents a golden opportunity for accounting practices. However, many practices have been slow to adopt a cloud-based document management system.

While new systems can be disruptive and reframing processes can be difficult, one key piece of business knowledge that emerged from the pandemic is that agile companies retain a competitive edge. And with the tedious, error-prone nature of tax compliance, perhaps we should take a page out of our mid-century forbearers’ book and embrace the technological wizardry before us.

To that end, let’s look at:

  • What is cloud document management?
  • Why are accountants moving to cloud-based document management systems?
  • How can a cloud document management system help my practice and clients?

What is cloud document management?

Cloud document management systems for accounting practices are database solutions that eliminate the need for on-premises hardware and software management. Your files are stored and accessed via software hosted by a third party.

Essentially, you make or accept digital copies of documents and store them in a centralized program securely managed by a trusted vendor. Much like Gmail or Apple Photos, you log in to access what you need, but you don’t have to manage the program onsite — or dedicate IT resources to installing software or maintaining the servers needed to run it.

Some accounting document management software is designed strictly for collecting, editing, and accessing files. Others help you automate some of the collection, reporting, and application processes needed for document management and tax compliance, for even more efficiency.

Why are accountants moving to cloud-based document management systems?

There are many reasons accountants are moving to the cloud. A few key factors are as follows:


The accounting industry is facing a massive shortage of new professionals. With accountants becoming more in demand, it’s imperative that operations are streamlined and staff allocated properly. Manual processes and inefficient systems overburden employees who are already carrying heavy workloads.

Technology like accounting document management software and automation can reduce tedious tasks like manually maintaining a database or searching through filing systems to find relevant documents. Information can be shared more easily across teams or departments using links and secure logins.

With less time spent on manual processes, accountants can focus on building customer relationships and generating revenue. 


When documents are stored in the cloud, employees don’t have to be onsite to access the files they need. They can log in remotely and locate documents with a simple keyword search. 

With the highly competitive hunt for accounting employees, systems that enable remote work can give you an edge. Not only do people appreciate the flexibility it allows, but it also expands the geographic areas in which you can look for qualified candidates.


Manually managing documents creates a complex world of paper and physical storage systems. On-premises software solutions require expensive hardware and the specialists to manage it. With cloud document management, the solution expands to meet the need of your practice, without requiring more square footage or an increase in IT resources.


For anyone managing documents with sensitive information, security is a primary concern. Cloud security has grown by leaps and bounds in recent years. Reputable platforms have stringent security measures and multiple safeguards to protect data. For example, the Avalara platform features:

  • 24/7 security operations center
  • Dedicated security programs
    • Application security
    • IT security
    • Security Incident Response Team (SIRT)
    • Security risk and compliance
    • Red team

How can a cloud document management system help my practice and my clients?

Cloud document management can help you create more efficient processes and organized systems for various parts of your organization. For instance:

  • Clients have the option of emailing or uploading forms and files
  • Business license management can be handled online
  • Tax returns can be automatically generated then e-filed
  • Exemption certificates can be stored in a digital database 

Accounting document management software reduces your paperwork and the risk of misfiling or misplacing hard copies. And when auditors come around, they can be supplied with exactly what they need, streamlining the auditing process.

Provide services or referrals to meet your clients’ needs

In addition to simplifying business processes, document management software can help you expand the tax compliance services you offer clients, including:

By helping your clients with tax document management, you’ll allow them to offload a huge portion of their compliance burden. You’ll also gain a fuller picture of their tax and business situation, enabling you to be a more effective partner. Cloud-based software gives you the ability to provide compliance document management to multiple clients at scale without overburdening your staff or existing systems.

If your practice isn’t ready to provide new services directly, you can still pass this efficiency on to your clients by referring them to a trusted cloud-based compliance management partner, like Avalara.

Choosing the right cloud-based document management system

You need to find a solution that fits your business needs. An intuitive option that integrates with your existing systems will help you implement your new database more quickly. 

Avalara has solutions designed to help accounting practices and their clients with sales tax filing, sales and use tax research, business license management, exemption certificate management, and transfer pricing. The dual efficiency of document management in the cloud and automation has helped practices expand services without overburdening staff.

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