When entrusting your financial well-being to your accountant(s), you may be asked to provide them with access to your bank accounts, credit cards, and other financial institutions. This request might cause you to pause for a moment to consider the obvious questions, concerns, and potential dangers that you might imagine would come with granting that kind of access. With that in mind, we’d like to address those questions and dispel those fears that you may have.
Why do they want online access? I give them my statements every year at tax time.
The biggest reason for wanting online access is to be able to access bank statement information in a digital format. With this easily retrieved, on-hand information, the accounting firm will have relevant information ready when needed and won’t need to make another request from their client each time new information is required. The accountant can also access this information throughout the year, as opposed to waiting until year-end.
I provide them copies of the statements digitally in PDF format. Isn’t that enough?
Online access allows your accountant to download information in order to save time in the manual entry of information. It also enables them to download transactions into accounting software to avoid the possible errors created in manual entry.
Is it secure to provide someone access to my banking information?
If you’re thinking about your online financial security, you might first ask yourself, “Do I feel safe having online access with the bank itself?” If your answer is no, then there is a much larger question to discuss. If you answered yes, then you most likely already have online bank access and, yes, it is secure if you do the following:
- Provide your accountant with his or her own login and credentials (most major banks allow this).
- Make sure the accountant has “View-Only” access. This means that the accountant can see statements and check images but CANNOT make transactions or transfers, pay bills, or move YOUR money.
- Make sure that they do not have any administrative rights to add more users or make changes, other than relating to their own access.
You are already providing the details about your business accounts to your accountant, so they are already taking actions to safeguard your information. Therefore, online access is simply a part of your financial security that they will be safeguarding.
What are the benefits of allowing access?
- The accountant can access information in the moment and save you time, effort, and any costs associated with retrieving additional information that may be required.
- Having continuous access means any questions that arise can be addressed in a timely fashion and not months later when you may not recall a transaction.
- Your accountant can be proactive in providing advice, which can result in reduced tax liabilities, among other possible cost savings.
- Online access will provide additional time to discuss financial matters with your accountant throughout the year, thus, avoiding any last-minute surprises come tax time.
- You’ll have another set of eyes watching over and protecting your accounts from any misappropriations or mistakes.
Written by Joe Manzelli , Digital Transformation Specialist at DSJCPA