Keep Ahead on Compliance for CPAs

Why It Matters

CPAs and accounting firms are responsible for handling and storing highly sensitive information, including confidential financial records or social security numbers. The value of this data make these organizations prime targets for cyber threats, and with such high risk comes high expectations for compliance regulations. Upholding ethical standards, managing evolving tax and reporting requirements, and ensuring ongoing protection of client data are critical for a successful firm. Failure to do so damages not only your bottom line, but your reputation. 

Compliance Challenges

CPA firms are under immense pressure to protect the sensitive financial data they hold, and the ability to stand up to evolving cyber threats and compliance regulations. Alongside the already established ethical, professional, and reporting standards all firms must abide by, there always seems to be a never ending barrage of updates and new rules to follow. Some new regulations CPA firms need to keep in mind include:FTC SAf

FTC Safeguards Rule

Although originally concerning financial institutions, it now impacts CPAs that handle client data, mandating a comprehensive security program which includes risk assessments, access controls, encryption, monitoring, and continuous oversight by a qualified individual.

Beneficial Ownership Information (BOI) Reporting

Under the Corporate Transparency Act, many businesses must now report their beneficial owners to the Financial Crimes Enforcement Network (FinCEN). While assisting clients, CPA firms must ensure their own data governance and systems are robust enough to handle with new category of sensitive information. 

Compliance Checklist

Here are some key steps your firm should look into and take action on now:

• Conduct a Risk Assessment - Map out your data flows, vendor dependencies, user access privileges, and security gaps. 
• Designate a Qualified Individual - Someone with cybersecurity/ technical knowledge and awareness to confidently handle compliance oversight.
• Implement Access & Data Controls - Use role based access control, encryption, consistent monitoring, and secure backups. 
• Create or Update Policies - Implement a security policy, incident response plan, vendor management policy, and data retention policy. 
• Train and Test Staff - Integrate regular trainings, phishing simulations, and a periodic audit of compliance.
• Vet Vendors and Cloud Services - Ensure your third party tools  and vendors meet your standards for compliance and security.
• Document, Document, Document - Maintain records for policies, trainings, assessments, and remediation efforts. 
• Review Continuously - Compliance regulations are continually being updated, your firm needs to update alongside them. 

Promoting Partnerships

For CPA firms, compliance now spans across technology, ethics, data governance, tax laws, and transparency regulation. With so many boxes to check, proactivity in ensuring their systems have compliance regulations embedded in them is crucial. Partnering with an MSP such as AdvanTech gives you not only a qualified individual, but a team of professionals with the knowledge and expertise to ensure your firm is secure and compliant. If you're questioning your security standing, reach out to us today.