Professional accountants, Xero and Intuit

Mike Block for Quickbooks-Xero Blog writes: As I PARTLY detailed, in my BestQuickBooksCPA website, I had a very long and amazingly close insider relationship with two Intuit CPAs and their top assistants. Here are only a few things they wrote to me:

1. Former Intuit CEO Steve Bennett: Keep raising hell when Intuit does something wrong!
2. Intuit CEO Brad Smith, shortly after Steve hired him and told him to contact me before reporting, “…told by many Intuit executives … that you have been quite open to taking the time to assist Intuit, are a tremendous voice of reason and are one of our most impactful and innovative Professional Advisors.”
3. Brad Smith later, ”You’re fantastic Mike. Absolutely fantastic!”

That is why I am now uniquely qualified to say that Xero is amazingly oriented towards professional accountants, while Intuit has a long history of undermining, discrediting disregarding, damaging and taking advantage of us, with contradictory actions. That is why professional accountant clients now account for two-thirds of new Xero users, which substantially cuts Xero costs.

Here is why Xero professional accountants and users keep more than doubling annually:

1. Consistent professional accountant orientation
2. Free accountant copy, client collaboration, support
3. Big discounts for Xero Partners, no discount for others
4. Public accountant listings, in number of client order
5. Funding for events promoting Xero
6. Expanded editable Google searchable profiles attract clients
7. Inclusion of Xero website posts in profiles
8. You must pass a test to be a Xero Certified
9. No Xero title conflicts with the CPA abbreviation
10. Xero has a fast free integrated WorkflowMax workflow program for partners. They are massively updating it and integrating with work papers, as part of a free Practice Suite.
11. The QuickBooks ProAdvisor program head left Intuit for Xero over Xero’s professional accountant orientation.
12. Free industry-standard RESTful add-ons interface, so professional accountants better server clients, with twice as many add-ons annually.
13. No per user charges
14. Free updates (often major) every three weeks 
15. Unlimited free support 
16. Forums that let us vote on feature requests, to guide developers 
17. Unlimited web access included, with collaboration increasingly encouraged.

Each one of the above good practices corresponds to the correspondingly numbered bad Intuit practice below:

1. Ads for bookkeeping and taxes without a professional accountant
2. Charge for Accountant Copy and web listing, though we fix QuickBooks messes, answer questions and cut taxes
3. Lower prices for large retailers than ProAdvisors
4. No listing based on number of clients – the main list is by location
5. No funding for events promoting QuickBooks
6. Limited editing of profiles
7. No inclusion of posts in public profiles
8. There is no test to be QuickBooks ProAdvisor. 75% of QuickBooks ProAdvisors buy titles. An Intuit survey showed that all complaints against ProAdvisors related to these so-called QuickBooks ProAdvisors. A later survey showed that these diploma-mill ProAdvisors costs professional accountants and QuickBooks users around $1 billion a year, while badly damaging the quality of QuickBooks support. When I kept complaining, a Senior VP tried extortion (If you keep on like this I will not be able to get anyone to work with you.). There was never an apology or discipline over this.
9. QuickBooks Certified ProAdvisor abbreviates to QuickBooks CPA
10. QuickBooks rejected advanced users begging for a workflow manager for eight years. They twice released out overpriced skeleton products, but had to withdraw them and start over. One employee admitted that they recently bought a workflow program due to competition from Xero. However, this program came from a company that had a website for less than 7 months before Intuit bought them and was giving away their program free. After the Intuit purchase, Intuit began charging $99 a month for essentially the same program that you could still get for nothing on the workflow company website.
11. The QuickBooks ProAdvisor program head left Intuit for Xero over Intuit’s lack of professional accountant orientation.
12. Developers can pat $1,000 a month or more to use an often substantially changed (major code revisions needed) proprietary add-ons interface, so professional accountants cannot serve clients as well. A top developer recently wrote, Demise of the Third Party QuickBooks Developer. QuickBooks lost 70% of add-on links in 21 months.
13. Substantial per user charges 
14. Free updates occur around monthly. The QuickBooks desktop gets expensive updates annually, which Intuit cripples in as little as 30 months. We generally get major upgrades only when Intuit faces serious competition. For example, when Microsoft competed Intuit gave us a free QuickBooks Simple Start, for little more than it took to kill Microsoft. We recently got a major advance in automatic or semi-automatic QuickBooks bank and credit card entry downloads. This happened now only due to Xero competition, since I fully detailed this to top Intuit executives in 2005 (they then said it was a great idea).
15. Expensive paid support, mainly from those who do not know QuickBooks or English
16. No forums that let us vote on feature requests, to guide developers
17. Intuit delayed collaborative web server access to the QuickBooks desktop program for four years, though this left professional accountants unable to effectively economically support larger clients. During this so-called “beta program” (beta tests always require secrecy), it let three companies advertise that they had the only legal QuickBooks desktop hosting. This probably violated antitrust laws (Intuit testified it violated these laws by conspiring with Microsoft to make QuickBooks only use Internet Explorer. It also did not contest it conspired with leading tech companies not to hire each other’s employees.). Intuit then made QuickBooks desktop web server collaboration far more expensive and limited, by requiring QuickBooks hosting only if companies paid it $18,000, plus $5,000 a year, plus $5 a month per user. It also made hosting applicants (who had no assurance they would be able to host) turn over substantially all financial, customer and security data. Brad Smith, Intuit CEO, personally authorized me to publicize the legality of unlicensed hosting for many years, based on an expected change to the Intuit license agreement. Not making this change double-crossed me personally. It also let Intuit strong-arm compliance by threatening prosecution for copyright violations, which the disclosed documents proved. It even makes you and every CPA, using a QuickBooks file on a local network, guilty of criminal copyright violations. You also guilty of such criminal violations each time you visit a client and use their copy of QuickBooks for a short time.

I know this list is now ridiculously long. However, it is only a part of what I now know, so I will soon add to it. The biggest tragedy to me is how much I once actually respected, championed and even loved the entire Intuit team. Their ten operating values were most important, starting with:

Intuit Integrity

I now see they dropped four values from their operating values. They also refer to Integrity in a much less absolute way. They should do this, as Intuit Integrity is an oxymoron (like giant shrimp).

Scott Cook once got badly needed publicity over integrity, when he was starting Intuit. Now we know that he twice knowingly, deliberately and personally, conspired to violate antitrust laws. This may relates to Intuit insiders, led by Scott, wanting to keep dumping a billion dollars a year in stock, while buying only discounted option stock. That is why the stock market has been deciding and predicting the winner of the Intuit Xero war for five years.

Yes, Xero is up more than 4,000%, about 15 times as much as Intuit (courtesy of Yahoo Finance).  That is why many of the most prominent professional accountant friends that Intuit once had are quickly shifting clients to Xero. We do not demand a free ride. We simply want what is best for our clients.

The most important factor, however, is more of us increasingly realize that the lack of small business accounting program competition has been terrible for us and for our clients.