Quarterly reporting for investment firms is a notoriously time-consuming process. Larger firms may have hundreds of communications to send out to investors at the end of each quarter, including K1 tax filings. The complexity of tax laws, privacy and security requirements make it impossible for accounting professionals at investment firms to automatically generate K1 statements and send them securely by some electronic method to each investor. For one of our venture capital clients, this process involved several accounting staff members exporting a variety of reports out of their financial systems and manipulating the data in a several Microsoft Excel spreadsheets before manually extracting the data from these spreadsheets into secure PDFs. The PDFs then had to be individually and manually password protected with a unique password known to each K1 recipient. Ask any accounting professional at an investment firm: they all dread quarter-end because of this task.
ECHO software engineers are experts in helping business get a handle on their data and providing visibility into that data with timely, specific reporting. This concept was applied to our client’s K1 dilemma by creating a custom application that automated much of the process typically handled by staff members.
A one-time investment of a few coding hours by an ECHO software developer eliminated hours of work and potential errors for not only that client, but for several clients who also took advantage of this solution. Gone are the hours spent by accounting and administrative professionals processing reports and spreadsheets and manually transferring such data into secure PDFs. Staff members no longer dread the end of each quarter, employee turnover has been reduced, and investors are receiving their K1s sooner.