Firm of the Future Spotlight on Large Firms: Ceterus

Welcome back to our Firm of the Future profile series about larger firms who are benefitting from the cloud to better serve clients and find new revenue opportunities. In this new article, we spotlight Jonathan Martin, vice president of Business Development at Ceterus, a Charleston, S.C., firm.

Mindy King: Jonathan, tell us a little bit about you and your firm.

Jonathan Martin: Levi Morehouse founded Ceterus in 2008 when he realized small businesses were underserved when it came to reliable financial reporting. Fast forward 10 years and Ceterus is now a complete done-for-you accounting and benchmarked reporting solution for franchises and small businesses. I joined as employee #2; we saw entrepreneurs had an enormous need for accurate, real-time financial reporting and bookkeeping. We then created the first version of Ceterus Edge, our platform that automates bookkeeping and differentiates us from other CPA firms. In fact, we are a VC-backed firm and have raised more than $10 million to build our software, which makes transactions go through QuickBooks® Online accurately and in real time, requiring less human interaction.

MK: What prompted your firm to switch to QuickBooks Online?

JM: In 2008, Levi was already working to get his clients set up in QuickBooks Online and I knew nothing other than QuickBooks Online for the bookkeeping business I was running. For both of us, QuickBooks Online was a perfect fit because we believe it is imperative for small businesses to not only have full access to their financials, but also to see how they compare or benchmark to their peers. Also, there are no upgrading fees, we can customize our clients’ needs using third-party apps, and our clients have visibility into their profitability anytime and anywhere.

MK: What has surprised you the most about QuickBooks Online’s capabilities?

JM: It's always a welcomed surprise as QuickBooks Online continues to add useful functionality and additional integrations to the platform. Third-party apps have really transformed QuickBooks Online, making it a no brainer for small businesses and accounting professionals. Intuit® was also very responsive and has often taken our suggestions for improving QuickBooks Online since the first version.

MK: For your firm, what have been the biggest benefits and/or timesavers that you’ve seen after having switched to QuickBooks Online?

JM: The biggest benefit has been having a single platform accessible to our staff in multiple offices. Unique software and third-party apps make accounting more efficient. For staff or remote clients, entries are seen right away. Also, our software, Edge, works seamlessly with QuickBooks Online to automate entries, making the accountant much more efficient. For our staff and clients, Edge allows everyone to see transactions, cash flow and profits. The transparency between Edge and QuickBooks Online allows us to adjust something right away, in the event of an off entry.

MK: For your clients, what have been the biggest benefits and/or timesavers?

JM: Clients appreciate real-time access to Ceterus without sending backup files over email. When clients come to us and they’ve either been doing their financial themselves or working with an accounting firm whose hand they’ve had to hold to make corrections, we save them a significant amount of time and deliver accuracy – which is critical for their business. For small business owners, their time is better spent getting more clients or growing their businesses, not doing data entry.

MK: What do clients like most about being in the cloud, in comparison to their previous desktop experience?

JM: Many of our clients are franchise owners whose CPAs use QuickBooks Desktop to handle their bookkeeping needs. These entrepreneurs receive an exported Excel spreadsheet every month, and because they can’t login in real time, they aren’t able to see their P&Ls or see trial balance detail that they can then make adjustments to. Some of them have the ability to access their files remotely, but this isn’t as efficient as the cloud because they still have to share the files with their CPA and there is no real-time interaction.

When these clients, all of a sudden, begin getting anytime access to their files, while also getting financial information and benchmarked reporting reliably and on time in Edge, it's a huge difference for them because they feel empowered. They can login at any time, and if they see something off, they can let us know right away.

MK: How did you, or your team, get buy-in from key stakeholders at your firm to make a switch to QuickBooks Online?

JM: While initially it was a major undertaking migrating a variety of desktop solutions to QuickBooks Online, all members of our team saw the value and necessity of moving our business 100 percent to the cloud.

Some clients using QuickBooks Enterprise for a long time have concerns around losing historical data. The way we approach their concern is by showing that nothing will be lost and they’ll have the benefit of being able to see their historical data in our Edge platform, as well as QuickBooks Online. Providing visibility is critical to them; this is when we see the light bulb going off and they let us migrate them.

MK: How did your firm get agreement from your desktop clients to move to cloud? If those clients voiced any concerns, how did you address them?

JM: Our clients largely choose us, and expect us to use the most effective and efficient technologies to handle their bookkeeping and accounting for them. Moving to the cloud fits this expectation in almost every case. Keeping that in mind, we made the transition in 2011 and have never looked back.

MK: What apps does your firm use to extend the power of QuickBooks Online?

JM: First and foremost, we use our Ceterus Edge system to automate bookkeeping entries and develop benchmarked reporting. In addition, we are significant users of Bill.com, Gusto and Expensify, just to name a few.

When we meet with prospects, they often tell us that managing their outstanding AP is a nightmare because they need to wait for checks to clear and how much they owe vendors. Bill.com takes the guesswork out of invoices and is a really nice way to manage cash flow. Many of our clients are either multi-business owners or have several locations to manage; therefore, they need to have the ability to access their balance sheets and know at any moment what they look like. At Ceterus, we can manage this process for them so they don’t need to juggle cash flow for payroll or to pay invoices, for example.

MK: What piece of advice would you offer to other accountants or firms hesitant to move to the cloud?

JM: By not moving to the cloud, they are missing out on tremendous opportunity for scaling their firm – not only because of the third-party apps, but also the ability to have a much more streamlined service to their customers.

In our opinion, to succeed in the future, having all data in the cloud is a MUST. While the conversion can seem daunting and time consuming, we've done it thousands of times and we look forward to serving our growing base of franchises, small businesses and CPA firm partnerships, to take advantage of what the cloud offers.

One of our clients owned more than 20 locations of a specific franchise and recently sold a significant portion of his business for a substantial amount of money. He called me and said the reason he was able to close the deal quickly is because the financials he shared with the investor were so clean and uniform that they didn’t delay the process to purchase the business. Even the third-party auditors who reviewed the financials said, “These are some of the cleanest financials we’ve ever seen.” Our automation pumps everything in smoothly so the P&Ls are output seamlessly.