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5 Ways to Protect Your Accounting, Tax Preparation, or Finance Business

Besides making sure your accounting, tax preparation, or finance firm has adequate business insurance coverage, the best way to mitigate your company's risk is to prevent accidents from happening. Below are five proactive steps you can take to make sure your financial firm stays above the fray.

Step One

Step One: Secure Data at Your Accounting, Tax Preparation, or Finance Business

One of the biggest challenges you face as the owner of an accounting, tax preparation, or finance firm is securing all of your electronic information and communications. In today's world, it's impossible to do your work without the aid of the Internet and computer networks. In addition to Cyber Liability Insurance, here are three ways you secure the sensitive data your company handles each day:

Arm Your Firm with an Effective Security Strategy

Whether you decide to maintain your security system in your office or "in the cloud," your first line of defense is a network firewall. A network firewall controls the ebb and flow of traffic by investigating data and deciding whether or not that data should be transferred from an outside network to yours, and vice versa. In addition to preventing unauthorized intrusions, firewalls protect company's network by…

  • Filtering URLs and applications.
  • Scanning for harmful viruses and malware.
  • Encrypting information.
  • Providing secure wireless connectivity.

In addition to a firewall, you may consider equipping your network with voice system security, full-disk encryption, two-factor authentication, endpoint security and port protection, and updated anti-virus/anti-malware software. Further, always remember to protect your data with some kind of data loss prevention system.

Of course, none of these prevention strategies will matter much if your company suffers some kind of disastrous data loss, either from a server failure or otherwise. That's why a reliable back-up plan is crucial. In other words: data recovery. Many sources recommend the "old 3-2-1" rule…

  • Keep three copies of important files (one original and two backups).
  • Store data on two kinds of media (an external hard drive, a disk, the cloud, etc).
  • Store one copy out of the office.

As a final note, remember that a truly secure network is routinely tested for weaknesses. Typically, a business like yours will hire another company to do this for them.

Bolster Your Electronic Security Strategy with Physical Security

Perhaps obviously, it's not enough to protect your data by electronic means. Your information is as valuable as any of your company's physical possessions, so treat it as such. In other words: Lock your door! You may think about installing security cameras and an alarm system on your company's property. In addition, any place where you store information — file cabinets, drawers, a server room — should be monitored 24 hours a day.

Implement a Communication Policy

As a business owner, you need to make sure you and your employees are on the same page when it comes to information security. Communication protocol should be documented, and your staff should be adequately trained and confident enough to enact protocol, should the situation arise. While this document may expand as your company grows, here are a few key areas to highlight…

  • Company computer and e-mail usage. Employees should understand what is appropriate company communication, and what is not.
  • Phone and laptop usage. They're called mobile devices for a reason. Your team should be trained on how to protect this equipment, even when it leaves the office.
  • Personal storage. Adequate and secure information storage starts on an individual level.

When so many of your company's operations are performed online and so much sensitive information is stored on your servers, your business's success depends on your vigilance.

Step Two

Step Two: Keep Your Accounting, Tax Preparation, or Finance Firm Accurate and Friendly

After Cyber Liability, Professional Liability is probably one of the biggest risks for your accounting, tax preparation, or finance firm. In addition to purchasing sufficient Errors and Omissions Insurance, there are two major prevention techniques you can stress in your workplace in order to avoid costly Errors and Omissions claims:

1. Avoid Miscalculations and Other Numbers Errors

There are many small ways to make costly errors — both for you and your clients — in the fields of accounting, tax preparation, and finance. You already know how important it is to be accurate and consistent, but it never hurts to be reminded (or to remind your employees). Most errors happen when a company spreads its resources too thin.

When work is plentiful — during tax season, say — it might be hard away to turn away good business. But stressed, overworked employees make more mistakes. In the long run, you'll save more money, not to mention your reputation, by referring clients to a trusted associate. If you do this, be sure to ask for a written agreement absolving you from any responsibility should the client be dissatisfied with the referral's work.

2. Stay on Your Client's Good Side

It may sound simple, by many Professional Liability claims can be avoided by staying friendly with your clients. None of us are mind-readers, and it's not uncommon for a client to feel gipped or slighted by your company, even if you have made no errors or omissions mistakes.

Some of these clients may try to take you to court, even though you've done nothing wrong. Establishing respectful, long-standing relationships with your customers is one way to minimize this risk. Most people won't try to sue people they like. But in the end, no one can guarantee the temperament of their clients — that's one reason why Professional Liability Insurance is so important.

Step Three

Step Three: Makes Sure Your Accountants, Tax Preparers, & Financial Professionals Know How to Communicate

Many types of insurance claims can be prevented by clear, consistent communication. Lawsuits are more likely when communication breaks down, so make sure your employees understand how to keep the lines of communication open. It might even be a good idea to establish some kind of written protocol with which to train your staff. Below are a few ways you and your employees can stay on the same page as your clients:

Articulate Expectations Clearly

Even though you use written contracts with your clients, it's important to go over the details of the work with your client to avoid miscommunication. That way, it's less likely that your client will feel that he is, for example, being cheated out of a service. In addition to your company's responsibilities, the client's responsibilities should also be discussed and written out, if at all possible.

Never Ignore the Client

We've all experienced the occasional client who calls or emails constantly, which is rarely productive. And while it may be tempting to start ignoring these points of contact, you don't want to risk offending your client by your radio silence.

Keep Communication Professional

Whether you're writing a quick email or deciding how to navigate a client's emotional outburst over the phone, it's extremely important to stay calm and professional. Remember, a happy customer is less likely to bring a lawsuit against your company.

Create a Timeline and Stick to It

When working on a large project, it may be a good idea to make an estimated schedule of what will be completed and at what time. Then, keep your promises. This will help you navigate the large project — especially when you're swamped with other projects and requests — while establishing trust and confidence in your client. This also serves to avoid lofty client expectations, and you have something physical to point to if she tries to push the project more quickly than you are comfortable with.

If You Must Miss a Deadline, Let the Client Know ASAP

While this should avoided as much as possible, situations do arise that require a shift in the schedule. Apologize to your client, and try to let her know as soon as possible of the change. No one appreciates these kinds of surprises.

Step Four

Step Four: Promote a Happy and Healthy Workplace Environment

Your office might not seem like the most physically dangerous work environment, but jobs in the accounting, tax preparation, and finance fields pose special kinds of health risks. As the owner of a business in this sector, it's important to learn about these dangers, and what you can do to prevent them from happening.


Being in charge of another party's money is inherently stressful. As you read above, small mistakes in this field can mean big consequences for your clients. But these consequences extend to your business as well as your employees' professional careers. Errors can mean lawsuits for your company and severe professional penalties for your employees, like licensure repeal. Pairing these high stakes with long hours and the demand of, say, tax season is enough to make anyone break. Signs that you are your employees might be overstressed include…

  • Anxiousness, irritability, or depression.
  • Fatigue or trouble concentrating.
  • Social withdrawal.
  • Apathy or a loss of interest in work.
  • Muscle tension or headaches.

No one wants to see their employees unhappy, and overstressed employees are less productive, but there are ways to promote a happy office space. Business owners can use a combination of organizational change and stress management techniques to help their employees navigate a stressful workplace environment. This could include…

  • Starting with the basics. This means promoting an environment free of workplace discrimination (based on religion, race, age, gender, etc.) and encouraging a work-life balance through family-friendly policies.
  • Clearly defining an employee's responsibilities. First, you should make sure that each employee is working within his or her means. This means that their responsibilities should be reasonably matched with their skill sets and resources. After these roles are clearly defined, schedules should be established and workloads should be monitored by managers.
  • Open the lines of communication. This means making sure workers understand it's okay to reach out if workloads become unmanageable. You may also want to give employees opportunities to voice their concerns and opinions with regard to decisions and changes that affect their jobs.
  • Make room for social engagement. Perhaps you could provide a "break space" for employees to blow off steam. You could also plan "extracurricular" events, like company sporting leagues or recognition dinners.

Fostering a workplace environment that avoids and manages stress will ensure you and your employees stay happy and productive.


Sitting at a desk for most of the day isn't exactly the healthiest lifestyle. Research suggests that long periods of inactivity can increase your employees' risk for diabetes and heart issues. And while sitting at a desk might not be the primary risk factor in these individuals, there's enough evidence to suggest that exercise has a place in the office.

In addition to these risks, people who frequently work at computers risk hand conditions like peritendinitis, tenosynovitis, and carpal tunnel syndrome. Here are some things you can do to make sure your employees stay in the best physical condition…

  • Provide employees with appropriate gear. For you, this may mean ergonomic chairs and keyboards. Be sure to also instruct your employees in proper use of the gear (for example: proper posture).
  • Encourage physical activity. This may be anything from providing break time for short walks or providing instructions for workplace exercises, like wrist and finger stretches.
  • Keep a clean workplace environment. Make sure wet floors are properly marked, and make sure commonly soiled places — like the restroom or the break room — are properly cleaned and maintained.
  • Train your employees. Ensure that your employees are informed of the potential hazards of their profession, and make sure they stay up-to-date on preventative safety techniques.

When your employees are happy and healthy, your business is more likely to stay productive and avoid costly Workers' Compensation claims.

Step Five

Step Five: Protect Your Property

Securing adequate Property Insurance coverage for your accounting, tax preparation, or finance firm is one way to protect your business in case of accidents outside of your control. But there are some accidents you can prevent. Below are some tips:

Keep Valuables Secure.

Sometimes in this field, you are your employees may have to travel outside the office with equipment, like a laptop or tablet. Make sure your employees are trained on proper safety procedure. For example, equipment should never be left unattended. In the office, make sure highly-valuable areas are considered "restricted access" when you are away from the office.

Check for Electrical Hazards.

Working with a computer network often means dealing with all the cords and wires that come with it. Many fires start from inadequate wiring or overloaded circuits. Call in an electrician to inspect your workspace and make sure everything is properly installed. That way, you can reduce your business's risk of electrical fire.

Protect Your Transit Equipment.

Since accountants, tax preparers, and other finance professionals often requires the transmission of information, you may want to ask an insurance agent whether or not you need to add Inland Marine Insurance to your business insurance plan. This is a special kind of Property Insurance that safeguards a specific professional asset.

More Business Insurance Tips

More Business Insurance Tips for Accountants, Tax Preparers, & Finance Professionals

For more tips and tricks on how to protect your accounting, tax preparation, or finance firm, check out "Six Costly Business Protection Myths" and "Seven Things To Know Before Buying Insurance."

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