How to Select the Right Time Tracking for CPAs to Maximize Realisation Rates

In the world of certified public accounting, the Realisation Rate (RR) is the ultimate scorecard. It is the percentage of your potential billable revenue (the standard value of time logged) that you actually collect in cash. When a firm's RR dips—even by a few percentage points—it means money is being left on the table through forgotten time, disputed invoices, excessive write-offs, or inefficient workflows.

The average realisation rate for accounting firms often hovers below 90%, meaning that for every $10,000 in billable work performed, up to $1,000 is effectively given away. This gap is not a failure of talent; it is often a failure of technology. Generic time trackers or legacy spreadsheets simply lack the precision, control, and analytical depth required to protect a CPA firm's most valuable asset: its time.

Selecting the right Time Tracking for CPAs is perhaps the most strategic financial decision a partner can make. This guide outlines the four indispensable steps—and the specific features—required to choose a solution engineered not just for compliance, but explicitly to drive your firm's profitability and push your Realisation Rate to peak performance.

Why Realisation Rates Depend on Smart Time Tracking for CPAs

Realisation rate shows how much of your recorded billable time actually turns into collected revenue, making it one of the most important metrics in any CPA firm. When realisation is low, it usually signals under-billing, heavy write-downs, or time that never made it onto an invoice.​

The right Time Tracking for CPAs helps you capture work accurately, price engagements better, and reduce the need for write-offs, all of which steadily lift realisation rates. Choosing this software carefully is therefore a strategic decision, not just an IT purchase.

Step 1: Define the Problem—Where Does Your Realisation Rate Fail?

Before evaluating software, you must pinpoint why your current system allows revenue leakage. Realisation leakage typically occurs at two points:

1. Billing Realisation (Time Logged vs. Time Billed): This is where forgotten time, vague entries, or managerial write-offs (e.g., discounting the bill because the time log looked excessive) occur.
2. Collection Realisation (Time Billed vs. Time Collected): This is where slow invoicing, disputed bills, or poor payment processes lead to bad debt or collections delays.

Your chosen Time Tracking for CPAs must contain features that proactively address both of these failure points.

Step 2: Feature Vetting—Prioritising RR-Boosting Capabilities

The most critical factor in realising revenue is the quality and completeness of the original time entry. Software that makes accurate, detailed time logging effortless is non-negotiable.

1. Frictionless, Automated Time Capture

Manual time logging is inherently flawed. Staff are either padding their hours retroactively (leading to client disputes and write-offs) or forgetting quick, billable tasks (leading to leakage).

• Requirement: The solution must offer automated tracking that runs in the background, logging activity against client files or applications used, and prompting the CPA for categorisation. This ensures 100% of billable time is captured, minimising the need for write-offs due to forgotten work.
• The RR Impact: Maximising the total billable time logged directly increases the denominator in your realisation calculation, ensuring you start with the largest possible base of potential revenue.

2. Multi-Dimensional Task and Rate Structure

CPA work is not monolithic; it involves distinct service lines, fee structures, and staff seniority levels, all requiring different billable rates.

• Requirement: The software must allow time entries to be coded by at least three dimensions: Client → Project/Engagement Type → Specific Task. It must also support configurable hourly rates that can be set by Employee Level, Service Line (e.g., Audit vs. Advisory), or Client Agreement.
• The RR Impact: This prevents billing errors where a Partner’s time is accidentally logged at an Associate’s rate. Accurate rate assignment at the point of entry is foundational to collecting the full value of the time invested.

3. Audit-Proof Logging and Detailed Narratives

A key reason for write-offs is client dispute—the client questions the value or necessity of the hours billed.

• Requirement: Look for features that enforce detailed, narrative-rich time entries and maintain a clean audit trail. The best Time Tracking for CPAs systems offer historical logging that includes metadata like timestamps and user IDs for every change.
• The RR Impact: Detailed, defensible descriptions of work ("Reviewed 2024 corporate tax liability projections" vs. "Admin") justify the bill, minimise disputes, and dramatically reduce the need for managers to write off time simply because they can’t verify the work done.

Step 3: Financial Controls—Locking Down Profitability

Maximising realisation isn't just about recording time; it's about controlling it against the project budget and ensuring the billing process is flawless.

1. Real-Time Budget-to-Actual Alerts

Scope creep is the silent killer of profitability on fixed-fee engagements. Time tracking should function as an early warning system.

• Requirement: The software must allow managers to set a time budget for every client engagement. When the total time logged hits a predefined threshold (e.g., 80% of budget), the system must generate an automated alert.
• The RR Impact: This triggers a proactive conversation with the client about a scope change before the team works hours that must inevitably be written off as a firm loss. It converts a potential write-off into billable scope expansion.

2. Live WIP Visibility and Approval Workflows

Delays in timesheet approval and invoicing directly impact the collection realisation rate. Slow invoices are disputed invoices.

• Requirement: Look for a robust timesheet approval workflow where managers receive automatic daily reminders and can approve time from their mobile devices. The software must provide a real-time Work-in-Progress (WIP) dashboard showing the monetary value of unbilled time.
• The RR Impact: Accelerating the time from work completion to invoice submission minimises the time a client has to forget the work, increasing the likelihood of timely payment and reducing write-offs for aged WIP.

3. Seamless Integration with Core Financial Tools

Manual data transfer between time tracking and your billing platform (like QuickBooks, Xero, or accounting practice management software) is a recipe for error.

• Requirement: The chosen Time Tracking for CPAs solution must offer seamless, bidirectional integration with your existing accounting and invoicing software.
• The RR Impact: This eliminates administrative errors that lead to billing discrepancies, which are a major cause of client disputes and subsequent write-downs.

Step 4: The Human Element and Strategic Insight

The best software is useless if staff refuse to adopt it or if the data isn't used to inform future strategy.

1. Prioritising Ease of Use (Adoption)

A clunky, complicated interface leads to delayed, inaccurate time entry—the primary enemy of high realisation.

• Requirement: The interface must be intuitive, mobile-friendly, and require a minimal learning curve. If staff find the software fast and simple, they will use it daily, not weekly.
• The RR Impact: Daily logging ensures the highest possible accuracy and detail, which directly translates to defensible, billable hours.

2. Realisation-Focused Reporting and Analytics

The software must provide the strategic reports necessary to coach staff and correct pricing.

• Requirement: Insist on a solution that provides immediate access to Realisation Rate Reports broken down by: Partner, Service Line, and Client.
• The RR Impact: This data empowers firm leadership to identify who (or what service) is consistently generating low realisation, allowing for immediate corrective action, whether that means revising pricing, providing staff training, or renegotiating client contracts.

Solution Deep Dive: Time Champ for CPA

Solutions like Time Champ illustrate how these capabilities are unified in a single platform. For CPA firms, Time Champ provides a potent combination of automated data capture and robust financial oversight:

• Automated Accuracy: Its core feature of passive time capture guarantees that all billable time is logged, resolving the most common source of realisation loss (forgotten minutes).
• Client Project Structuring: It enables granular task and project coding, ensuring time is always associated with the correct fee structure and client agreement.
• Oversight Tools: The platform provides the necessary dashboards for managers to view project status and budget consumption, allowing them to intervene before scope creep forces a write-off.

By focusing your selection criteria on the features that directly prevent time leakage and provide financial transparency, your investment in Time Tracking for CPAs becomes a powerful asset for maximising realisation and cementing the financial health of your firm.

Frequently Asked Questions (FAQs)

Q1: What is the ideal Realisation Rate for a CPA firm?

A: While firms should always aim for 100%, a healthy, achievable target for most full-service CPA firms is generally 85% to 92% or higher. Rates below 85% indicate systemic problems with time capture, billing efficiency, or pricing strategy that require immediate correction through technology and policy.

Q2: How does automated time tracking prevent write-offs?

A: Write-offs often occur because managers cannot verify vague time entries. Automated time tracking ensures entries are: 1) Complete (no forgotten minutes), and 2) Specific (linked to applications or client files). This defensibility means there's less reason for the manager or the client to dispute the hours, reducing the impulse to write down the bill.

Q3: Should we prioritise a dedicated time tracking system or one built into practice management software?

A: The decision depends on firm size and complexity. For maximising realisation, prioritise the tool that offers the deepest integration and the most robust time capture and reporting features. Many of the best Time Tracking for CPAs solutions are powerful, dedicated platforms designed to integrate seamlessly with the major practice management and billing tools, ensuring specialised time functionality isn't sacrificed for an "all-in-one" solution.

Q4: How often should we be running Realisation Rate reports?

A: You should have real-time visibility into your current WIP and budget-to-actual data, which provides an ongoing realisation pulse. Formal, detailed Realisation Rate reports (broken down by partner and service line) should be reviewed by firm leadership monthly or quarterly to identify trends and adjust pricing and resource allocation proactively.

Q5: Can the software help improve client communication and reduce disputes?

A: Yes. By providing highly detailed, transparent time entries, the software allows you to send clients clear, itemised bills that communicate the value delivered. When clients understand exactly what work was done and why it took the time it did, disputes decrease, leading directly to a stronger collection realisation rate.