No CPA or accounting firm is taking cyber security lightly in 2022. According to Statista, the United States suffered 1,862 cyberattacks, leading to 298.08 million data breaches. Some industry sectors saw more significant cases of private data violations than others. And sadly, the accounting and finance sector is one of them.
Just like CCTVs and staff ID checks are crucial to secure on-site data breaches, accounting cyber security is crucial to secure virtual and cloud data. But again, the question that arises here is “How to improve accounting cyber security?”
In this blog, Finsmart Accounting – a leading accounting outsourcing firm in India – will share 8 accounting cyber security measures that are helping accounting firms across the globe keep clients’ financial data secure. These tips and ideas will help your accounting firm ensure safe data sharing and pare down the chances of virtual threats.
Accounting cyber security measures
Are you ready to discover our list of best accounting cyber security measures? Let’s go!
#1 Get a password manager
Maintaining financial reports, evaluating accounting operations, and preparing tax returns for clients – there are a lot of activities that CPAs are supposed to carry out on a monthly, quarterly, or yearly basis. Working with so many accounts, logins, and reports often makes accounting professionals shy away from strong, unique passwords.
Since weak passwords can make CPA firms prone to cyber attacks, a password manager is of prime importance. It can help generate strong passwords and share access without compromising cyber security.
Don’t want anyone to access your accounting and bookkeeping data through unrecognized IP addresses or at odd times? No problem! Password managers also come with features like geo-locking, IP locking, and time-locking that make it easy for CPA firms to block unwanted access to financial data during non-business hours and also check brute force attacks from unknown IP addresses.
LastPass, Dashlane, 1Password, and Bitwarden are some of the best password management tools for CPA firms to improve accounting cyber security.
#2 Keep software up to date
Some of you might be thinking, ‘Software updates? Why do that when my bookkeeping applications are running smoothly?’ Many CPA firms feel that software updates are just for bugs and new features. Sometimes, update notifications come in between a critical bookkeeping task, and skipping the update seems only logical.
Turns out, outdated accounting and bookkeeping software can easily become a hacker’s gateway into your accounting network. They are more prone to malware infections and other cyber security concerns like ransomware. Even if you are using security software, it will only turn out to be effective if it is up to date. So, always make software updates regularly to keep your security protocols up to date.
Since a lot of modern accounting software programs come with auto-update features, CPA firms can also turn it ON to keep everything updated without having to check for and install available updates manually. Or simply go for cloud software to eliminate the need to update it frequently.
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#3 Know your threats
Can you perform multiple tasks for your clients without learning about their requirements? The answer is NO! Similarly, you can’t improve your accounting cyber security without becoming cognizant of threats. When it comes to accounting security threats, CPA firms are prone to cyber terrorism, ransomware, malware, phishing scams, botnets, SQL injection, MITM, and DOS attacks.
And if you think that’s it, you’re wrong! Internal cyber attacks and bugs are just as excruciating. Unanticipated financial data sharing may also occur easily with inexperienced staff. Learn about cybersecurity threats and educate your employees about their impact and what measures they can take to prevent them.
CPA firms can also partner with a digital security service provider for inspecting employee endpoint devices for signs of irregular accounting or software activities.
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#4 Remove unnecessary data
One of the most important accounting cyber security measures for CPA firms to consider in 2022. Most organizations shred confidential documents post-use to ensure that they don’t fall in the wrong hands but the same process isn’t followed with digital documents. In fact, digital documents shouldn’t only be deleted; they ought to be wiped from disk as well.
Think of file management like an apartment. To stop it from becoming chaotic and messy, you need to do a cleanup every now and then. Set a weekly calendar reminder to regularly review and dispose of redundant financial files, unneeded applications, and unnecessary documents.
Also, ask your staff to use cleanup programs like Disk Cleanup and CCleaner to locate and remove temp files and other unnecessary data from their workstations. Removing such files will not only help you amp up cyber security but also protect your business from virtual threats.
#5 Encrypt everything
Data is the currency of the accounting world. It is crucial to CPA firms as it allows them to make informed decisions. But something worth the king’s ransom always gets the attention of thieves. Therefore, our next accounting cyber security measure is to back up your client’s financial data.
Use full-disk encryption software to shield sensitive accounting and finance data from prying eyes. Tools like Tresorit, Microsoft BitLocker, FileVault, and Kaspersky Endpoint Security are helping CPA firms convert large volumes of data into cryptic text or numbers using complex algorithms. Just make sure to install encryption software on all devices and drives.
#6 Put screen lock on computers
Another useful accounting cyber security measure for accounting firms in the United States and also the rest of the world. Most of us have used lockers to safe keep important documents and precious metals. For those who haven’t, a locker is a rotary combination lock that opens only if all notches align to form a gap. Lock screens for computers work almost similarly to it.
By using lock screens, CPA firms can safeguard business data from unauthorized access when their employees are not around. Ask your employees to set up strong passwords on their assigned devices. Also, tell them to set inactivity locks so that their PCs lock themselves after a period of inactivity. Although this whole lock screen concept may sound inessential to some, it is one of the easiest ways for your employees to keep your company’s financial information safe.
Integration two-factor authentication can also greatly help in securing sensitive accounts and emails.
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#7 Use a virtual private network
Our list of best accounting cyber security measures for CPA firms will be considered incomplete without talking about this. Virtual private networks (VPNs) are heaving into everyone’s radar these days, be it general users, accounting startups, or top CPA firms. And why shouldn’t they?
VPNs allow businesses to safeguard accounting and bookkeeping transmitted data, web sessions, personal information, and financial transactions online. It will make it hard for cyber criminals to pinpoint your network address and steal client data. Top CPA firms in the United States and Europe are already buying subscriptions to virtual private networks live like ExpressVPN and NordVPN.
These accounting cyber security tools will also help verify the authenticity of outside users (say clients) to whom access has been given.
Above are some of the best accounting cyber security measures taken by accounting professionals at Finsmart. Although it may seem difficult to understand where to begin to safeguard your CPA business from cybercrime and attacks, we recommend getting started with the easiest tips on our list.
Got any queries to ask? Send them to email@example.com and have them answered by our team of finance experts.
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Director Growth Strategy & Alliance at Finsmart Accounting
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Maanoj Shah is a finance and outsourcing expert with strong Business Strategy and Scaling-up experience. Over the last 20 years, he has incubated multiple businesses and helped build global enterprises in verticals as diversified as hospitality, technology, and healthcare.