Date posted: 25/02/2021 10 min read

What sort of signature app does your practice need?

Electronic signatures have become standard in many accounting practices but not all signature apps are created equal.

In Brief

  • For accountants, electronic signatures translate into fewer admin hours per week.
  • The COVID-19 pandemic, during which many people started working from home, exposed the limitations of sending documents by email.
  • Electronic signature apps can be split into general purpose apps, accounting-focused platforms and portal-based apps.

The art of the perfectly formed signature, sad to say, is another antiquarian business practice destined for the dump. All those hours experimenting with flamboyant flourishes of your surname will inevitably be replaced with anodyne key punches, geolocation tags and thumbprints.

The ultimate benefit of electronic signatures over posting hard copy or emailing PDFs is beyond argument. For accountants, it translates into fewer admin hours per week. Or from another perspective, a higher ratio of accountants to admin staff.

But despite these positives, the take-up of electronic signing hasn’t been as strong as expected. That is changing, and quickly.

Electronic signatures have had a spotty record of acceptance. They first appeared on less contestable contracts, where efficiency in signing a document was more valued than the ability to prove who had actually signed it.

The march towards legitimacy picked up speed during COVID lockdowns. Industry associations argued that publicly listed companies couldn’t hold shareholders’ meetings safely while maintaining self-distancing if they had to gather in person, as legislated. The Australian government enacted and then extended temporary changes to the Corporations Act 2001 to allow more electronic document execution.

Australia’s Treasury has released draft legislation to accept permanently the use of electronic meeting-related materials and documents in shareholder meetings. It has also launched a taskforce to review modern business communications.

But when it comes to accounting software, the horse has well and truly bolted. All vendors of accounting practice software have embraced e-signatures as an easy way to boost efficiency and they have become the standard method for signing tax returns, activity statements and financial statements.

What are the advantages of e-signatures?

Where a high level of trust exists, as one would expect between an accountant and client, the profession and software industry has decided that an electronic signature is good enough.

Natalie Lennon CA, of accounting firm Two Sides, has used electronic signatures since she set up shop in Sydney’s Caringbah three years ago. Before that she worked at a more traditional firm that still printed and posted paper documents. Sometimes, documents were emailed to clients who had to print, sign, scan and email them back.

Lennon estimates she saves many hours a week by using them. With hard copy, an admin has to print out and collate all the documents, insert “sign here” stickers, print the envelopes, and take it all to the post office, she points out.

The pandemic, with many people working from home, also exposed the limitations of sending documents by email.

“A lot of people don’t have printers these days, especially if they’re at home. It could cost an extra hour or two per client if they have to come in and sign it, and you have to show them where to sign it and everything else. Whereas we send it and the client can sign electronically and we have it back in five minutes,” Lennon says.

Lennon’s team uses two electronic signature applications. Xero Tax includes a function to digitally sign business activity statements and individual tax returns, thanks to a white-label partnership with Adobe Sign. Lennon creates corporate compliance documents in BGL’s CAS 360 and sends to clients for signing using DocuSign. (CAS 360 also integrates with Adobe Sign.)

Another advantage of electronic signatures is that they can be incorporated into automated workflows. Once the client signs the document, the signing software can automatically file it in the client’s folder in Dropbox or other online storage.

Any time saved is valuable

Ultimately, the greatest advantage is simplicity. E-signatures reduce the logistics of paper handling or email handling, chase clients who haven’t signed, and store documents in one place.

Even for sole operators this is worth the cost of a subscription. Christchurch-based Bronwyn Candish CA, director of Cloud Keepers, uses SuiteFiles to sign documents while travelling frequently throughout New Zealand.

“It is just about having everything in one place,” she says. “Things are automated – when the client signs off, the copy automatically goes to their file. When you’re just getting started your time is so precious ... anything that saves time is very valuable.”

“You’re trying to pay the bills, so anything that saves time is very valuable.”
Bronwyn Candish CA, Cloud Keepers

The portal option for client documents

Lever Group in regional Toowoomba, Qld, has used Reckon Virtual Cabinet for the past four years for its document management workflow. Virtual Cabinet includes an online portal where clients can log in and see all the documents needing signatures as well as those they have signed.

The advantage of portal solutions is they can include levels of approval for client documents on top of the electronic signatures.

“Any document that goes out of the office to clients goes to a partner for authorisation first through Virtual Cabinet,” says Alisha Lever, Lever Group’s practice manager. The document management workflow was a big improvement over the previous APS function, she adds.

“Virtual Cabinet has a dynamic search function that searches the content as well as the title so it’s much easier to find information. If someone has an email and the subject is not really relevant to the content of the email, then it can be hard to find again.”

Another major timesaver is rules-based capture of emails. Accountants had to manually save emails in APS, and there is no integration between APS and Microsoft Outlook. Virtual Cabinet integrates with the whole Microsoft suite. This allows it to automatically file any emails for each client.

“Auto-capture on email means that we don’t have staff worrying about what’s going into inboxes and not being saved because it’s all going into the system,” Lever says.

The move to digitise the practice and move to a paperless office has increased Lever Group’s ability to process more work with fewer admin staff.

“I don’t know what the bottom line is, but we are definitely doing more work with less people,” Lever says. “It means we can afford more staff to do more value-adding work.”

“We are definitely doing more work with less people.”
Alisha Lever, Lever Group

Real-world advantage of an online portal

The biggest impact of using a portal is that it notifies clients as soon as documents arrive, they’re not waiting in the post for them, says Ainsley Coggins CA, director of Accru Harris Orchard, a firm with 60 staff in two offices in Adelaide and McLaren Vale, SA.

“They don’t miss a signature because everywhere they need to sign is designated by us. And they will continue to get reminders if they haven’t completed all the signings,” she adds.

Accru Harris Orchard also uses Virtual Cabinet, as well as NowInfinity for ASIC documents. The firm is “working through” which ASIC documents still require penned signatures. “We are making sure it doesn’t come back to bite us that we don’t have a physical signature,” Coggins says.

Another advantage of the portal is increased confidentiality. Coggins sends any client documents that contain sensitive information via the portal, which files the document in the client’s directory on return. The client sets their own password to their directory on the portal and doesn’t need to share it with the firm.

Accru Harris Orchard in Adelaide uses the privacy controls in Virtual Cabinet to give higher security levels to certain internal documents as well. Anything to do with HR is accessible only by a restricted list of staff.

How to choose your signature application

Applications for electronic signatures can be split into three camps: general purpose apps, accounting-focused platforms and portal-based applications.

General purpose apps: The general purpose apps such as Adobe Sign, PandaDoc and DocuSign are widely accepted and easy to use. One advantage is you can use them for any type of document you need in business, whether it’s an employment contract or non-disclosure agreement. They will also sync easily with Microsoft 365 or your online storage of choice, such as Dropbox. However, these standalone applications can be quite expensive if you’re only using them occasionally, especially if you send the bulk of accounting-related documents through practice software. They also lack the flexibility required for more complex signing combinations.

Accounting focused apps: FuseSign, an accounting-focused platform, can manage the process of signing a group of documents with multiple members such as a family group. FuseSign sends documents in a bundle with individual permissions for each document, only sends reminders to the individuals who haven’t signed, and can put aside any document rejected by a group member so you can still finalise the remaining documents.

Accounting practice software often integrates a white-label signature application within the same interface, so it appears to be the same program. The advantage here is simplicity and cost – the price of the signatures is often included in the practice software, and you don’t need to worry about learning another interface.

One disadvantage in some programs, such as Xero Tax, is you can’t send any other types of documents for signing, such as the aforementioned employment contract. This is annoying if you’re wanting one solution to sign and store everything.

Portal-based applications: Portal-based applications such as Reckon Virtual Cabinet and NowInfinity also tackle the larger problem of document management workflows. Support staff can prepare documents for signing and notify partners to review when ready. They also centralise all the information about a single client, including email conversations.

There’s certainly more than one way to sign a document. It’s up to each firm to decide which method suits best.

Are electronic signatures legally acceptable?

For all their efficiency, e-signatures struggle with two factors: legal questions about their validity and proving who signed a document.

CA ANZ recommends “extreme caution” with electronic signatures “as the legal implications of signing a document electronically could render that document invalid”.

Some jurisdictions have amended the definition of a ‘deed’ to enable a deed to exist in electronic format. However, the majority have not and so the common law requirement that a deed exist on ‘paper, parchment or vellum’ still exists to make electronic deeds in those jurisdictions invalid.

CA ANZ also notes there is a distinction between an electronic signature which is any method of affixing, or inserting, a ‘signature’ into an electronic document, and a digital signature which is affixed or inserted in accordance with a secure protocol that permits authentication of the identity of the person signing.

But software companies have pushed ahead with e-signatures regardless of the legal position, effectively creating an umbrella of legitimacy.

It all comes back to provability. The forging of penned signatures has a long and storied history. It is relatively trivial to copy the outline of a person’s mark. However, there are tell-tale signs in the depth and pressure of each stroke that experts can analyse to determine whether the signature is genuine.

Compare that to the typed signature in most signing applications, where you press a button to turn it into a calligraphic swirl. How do you know who was at the keyboard?

Over time, it’s inevitable digital signatures will win on provability thanks to biometrics. You can already authenticate credit card payments for online purchases using a fingerprint sensor on a keyboard. The whorls on your finger or the prominent features of your face will provide all the evidence a court needs to determine whether you agreed to an electronic contract.

What you need to know about electronic signatures

The table below outlines some of the key facts users need to know about five popular electronic signature applications. The options listed here are by no means exhaustive. A product’s inclusion should not be regarded as an endorsement by Chartered Accountants Australia and New Zealand. Information included in this guide has come from the relevant vendors or associated websites. Prices may be subject to change.

Product Cost What access control options do you have  Does the software integrate with tax/accounting software Does the software have approval workflows

SuiteFiles

Digital signing that is built into your file management. Includes e-signatures and digital signatures, multiple signatories, multiple authentication options, automated updates and more.

A$35 per user, per month (unlimited signatures).
Multi-factor authentication available. Access controlled through login to SuiteFiles site for those sending documents.
Yes. Yes.

Practice Ignition

Practice Ignition goes beyond just digital signatures, and provides an end-to-end solution for client engagement, onboarding and payments which then automates invoicing and workflow. Used by more than 5000 accounting and bookkeeping firms around the world.

A$99 to A$499 per month depending on the number of clients engaged through Practice Ignition.
Practice Ignition allows you to restrict access to proposals, and also includes user permissions where access can be limited within the firm.
Yes. Practice Ignition integrates with Xero, QuickBooks Online and other platforms.
No.

PandaDoc

Provides convenient and legally-binding electronic signature software. Documents can be signed anywhere from any device. Also offers document analytics and 200+ document templates to choose from.

Free to US$59 per month, depending on plan.
PandaDoc offer a few roles and permission settings. Account owners can restrict and permit access to different workspaces as required.
Yes. Freshbooks and QuickBooks via our Zapier integration.
Yes.

FuseSign, made by FuseWorks.

Includes tailor-made features for the accounting industry:

  • set signing/viewing/no access permissions for each individual document
    (and each recipient) in a very simple way
  • unlimited documents and unlimited recipients per bundle (a group of
    documents)
  • unlimited user accounts at no additional cost. Firm-wide control panel/
    dashboard
  • smart rejection handling to finalise/retract or remind clients
  • custom branding and firm-wide customisations
  • two-factor authentication for signers included in subscription cost no lock-in contract subscription options, optimised for mobile use.
From A$28 month with 22 signing credits. A signing credit is used when there is a signer required on a bundle. A bundle can have unlimited documents and unlimited recipients.
FuseSign has a unique functionality in that each recipient for a bundle has unique actions for each document within. These are sign, view, or no access. This allows much faster and easier administration of complex family groups and multiple recipients with various requirements.
FuseSign integrates with workflow automation tool FuseDocs that integrates directly with many practice and document management systems, and has a roadmap for further integrations.
Yes. FuseSign has the ability to draft and have a bundle reviewed prior to sending.

Virtual Cabinet – Client Portal

Virtual Cabinet’s built-in e-signature technology allows businesses to reduce the number of paper documents produced, routed, and filed, speeding up the process of obtaining approvals and completing business transactions.

Features include:

  • legally binding electronic signatures in keeping with the Australian Electronic
    Transactions Act 1999 and the New Zealand Electronic Transactions Act 2002
  • security – ISO 27001 compliant.
  • audit trails record every interaction the recipient has had with the documents
    in the Portal
  • multiple document signatories
  • customisation of portal to match your companies branding
  • two-way upload – request documents from customers to be returned via the
    Portal
  • secure messaging to clients within the Portal
  • real-time reporting on all outstanding actions, read status, and disk space
    usage.
  • notifications when a recipient has signed a file or added a new message
    bulk publish documents for signature or for information.
  • send files up to 250mb.
  • document retraction of items you no longer want the recipient to view, giving
    you complete control over access
  • Verify Signed Document function where documents signed using
    e-signatures can be checked for tampering by uploading it to our website.
A$28 per user, per month, but scaling discounts apply based on user numbers.
Access to the Portal website is secured by login details unique to each user account, ensuring that only the intended recipient can read and sign their documents. Documents can be removed from the Portal at any time by the company that sent them. All documents within Virtual Cabinet have strong security policies in place to ensure that company employees can only access the documents that are applicable to their job.
Yes. Virtual Cabinet integrates with all major accounting and tax production software including APS, CCH, Xero Practice Manager, Digita, Sage, GreatSoft and others.
Yes. Virtual Cabinet provides approval workflow that can be customised to your requirements.

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