The cloud, coupled with mobility, remains a major issue among the topics that will impact firms this year. The only question is the pace of adoption. Consumers and many areas of business have moved en masse to the cloud. So far, most of the installed base for the three major tax and accounting players remains wedded to the desktop.

One of the more immediate impacts of the cloud is how it is changing the way vendors view their products. The tax and accounting application suppliers—Thomson, Wolters Kluwer CCH and Intuit—have historically had products that were not open to work with software packages from other companies.

That is being changed by the openness of the cloud and the intrusion of consumer products into the professional space and the emergence of software written from the ground-up.

Some think the combination of cloud and mobile is changing what practitioners are likely to buy.

When it comes to practice management and time and billing, "The whole profession is going outside the big players," says Jim Bourke, principal with Red Bank, N.J.-based WithumSmith+Brown.

Practice management applications such as "Practice Engine and Star, built form the ground up, are giving Thomson and CCH a run for their money," he says. In fact, Bourke's firm switched from CCH Practice to Practice Engine last year.

Webb Stevens, VP of product management for cloud vendor, Avalara, says consumer applications are also moving into the professional market.

"We are seeing Drop Box and Box moving from being to consumer applications," says Stevens, whose company markets cloud-based sales-and-use tax applications. "They are starting to compete with purpose-built solutions for accounting firms."

While Box's website shows it participates in a number of markets, accounting is not one of them. But financial services is and Webb notes that "Box.com wants to offer all the tools that need to be available for a compliance system."

In a December interview with eWeek, CEO Aaron Levie said Box will become a platform company. And it has a lot of elements that could be adapted for the professional accounting market—document, project and meeting management; online document storage, mobile access with the ability to upload large amounts of data securely, the company says.

Stevens says security concerns will push the profession towards applications provide safety and drive all businesses away from email, eventually. "People have talked about the death of email for a lot of years," says Stevens. "I think in the next year, we will start to see some firms that are early technology adopters start to move in that direction."

Messaging will replace email in many areas. Facebook, Stevens says, is trying to move into enterprise-sized organizations with its messaging system.

Companies that provide integration also will alter the application landscape. It will become less necessary, Stevens says, to have products from one company as vendors increasingly have the ability to link a variety of different software packages. That last comment moves into the issue of best-of-breed, which is receiving a burst of life from the cloud.

Best-of-breed has somewhat been shoved aside over the last 15 years as vendors argued it was better to purchase applications from one supplier, which can integrate their functions, usually drawing upon a common database. And while that situation is not likely to change dramatically in 2016, the suite suppliers are making their products friendlier to other software packages—or at least talking about doing it as the work is still in the early stages.

Jon Baron, who runs the Professional Segment of tax and accounting for Thomson Reuters, began talking of the possibility of opening up code a year ago. Wolters Kluwer was the first to enable customers and vendors to seamlessly intergrate their applications and custom solutions with the company's cloud platform-CCH Axcess-launching its Open Intergration Platform back in 2012. Caution was also the stance of AccountantsWorld president Jeff Gramlich, who said early last fall his company is considering opening its code up selectively to add ons.

"The days of CCH and Thomson providing all of the solutions is gone," says Ray Barlow, VP of accountant solutions at Sage.

Of course, Sage has a vested interest in hoping that develops as it launched a series of cloud-based accounting firm applications last year. This is led by Sage Impact, which the company describes as providing the web-based hub to access other firm applications.

However, Barlow's view fits with what is being said by other industry observers. "If you are not so good at workflow or project management, you have to leverage those other companies," he says. "You've got to open up your code."

Barlow also hits a theme that has been voiced by concerned consultants—there is a mismatch between accounting firms and small businesses. " Small business are using cloud application at far greater levels than accountants think they are," he says.

Buying the Latest—Or Not?
The question of changing operating systems also faces business. Microsoft is aggressively offering free upgrades for Windows 10, but a lot of firms will likely remain with their older versions for the moment.

Roman Kepcyzk, director of consulting services for outsourced service provider Xcentric, sees many advantages in moving to Windows 10 for accountants, whose offices have loads of applications that must be utilized. They will be able to operate more of these via a single screen.

"The snap feature will allow accountants to quickly open up or view four applications easily onscreen and increase productivity," Kepczyk says. The new edition also will better utilize screen space on oversize monitors that he says are replacing 19-inch and smaller screens for desktop systems while migration to 3K and 4K display screens "will improve efficiency through better screen clarity and ergonomics."

For David Cieslak, who speaks at many accounting and tax conferences, security concerns should spur firms to upgrade systems. "Buying the latest and greatest technology has never been more important," he says. "I don't think there is enough good security."

Under the best circumstances, Cieslak foresees a bad year with the increasing likelihood of incidents that threaten accounting firm data as the bad guys grow increasingly sophisticated in their ability to steal or disrupt the data of others.

Cieslak, partner with Simi Valley, Calif.-based Arxis Technology, points to the growing threat of ransomware. That term covers the phenomenon via which those writing malware can infect a computer if a user opens an infected email. Typically, ransomware encrypts all the data on the affected device via a program referred to as a Cryptolocker and the perpetrators demand money to unlock the system—usually payable via Bitcoin. Cieslak says the code is very hard to break and the amounts demanded are moving from the arena of $300 or so to $1,500 per incident.

"The ransomeware stuff is getting very efficient and I think we are going to see a lot more end users falling victim," he says.

Cieslak has also observed growing instances of whaling, a new form of phishing by which code writers are deceiving companies into sending them money. Under a whaling scenario, the hackers study companies to find who controls levels of spending that are worth their while and obtain the email addresses of these individuals.

"They are going after senior financial people," Cieslak says. The attackers send "a personalized email as if it's coming from a superior or executive within the organization," he continues. That email will instruct the recipient to wire funds to pay for some purported financial organization.

At presentations in the last four months, Cieslak has had attendees report they have been hit. These individuals relate, "I thought it was just me. But the very same thing has happened to me," he relates.