Welcome to the World of Web 2.0

By Yu Cong and Hui Du

The phrase Web 2.0 came out of a Silicon Valley conference in 2004. Compared to “Web 1.0,” Web 2.0 fills the gap between a web browser and desktop applications. It brings together documents and data scattered over local computers and the Internet, and facilitates collaboration and sharing.

What Is Web 2.0?

Web 2.0 is such a new concept that many don’t know whether it is merely a buzz word or represents new technologies. It’s true that many of the features that represent Web 2.0 are still emerging, though some have become quite established.

Tim O’Reilly’s article, “What is Web 2.0” (www.oreillynet.com/pub/a/oreilly/tim/news/2005/09/30/what-is-web-20.html) provides insights behind the coining of the term. According to the free collaborative encyclopedia Wikipedia (en.wikipedia.org/ wiki/Web 2), Web 2.0 is “a second generation of services available on the World Wide Web that lets people collaborate and share information online. In contrast to the first generation, Web 2.0 gives users an experience closer to desktop applications than the traditional static Web pages.”

From a user’s perspective, Web 2.0 may be thought of as a collection of web-based information services that includes blogs, wikis, web-based office suites, and a few other emerging technologies. Blogs (short for web logs) have been around for years. To those who are not yet familiar with them, blogs are generally frequently updated with short posts on a variety of topics, often allowing readers to comment, link to posts, and subscribe to news feeds. Initially akin to personal journals, blogs have been increasingly adopted by news media and corporate communications departments as yet another way to interact with users. For an introduction to what they can do for professionals, see “Blogging 101 for CPAs” in the July 2005 CPA Journal. Popular blogging service providers include Blogger (www.blogger.com/) and TypePad (www.typepad.com/).

Everyone says wikis are going to be big. If blogs have become popular places to disseminate and collect information, just as regular webpages did in Web 1.0, wikis may have the potential to challenge e-mail as a communication platform for individuals and organizations. A wiki tracks online discussions among users and allows all content and changes to be archived and reviewed. Instead of sending “FYI” e-mails to user groups, companies can store and post information in a wiki for their employees to view and comment on. More important, a wiki can become a forum for people to exchange ideas and collaborate. A wiki can be used to define, manage, and then archive projects. Working groups can use a wiki as a centralized online point to brainstorm and make plans, track project progress, find out meeting schedules, and create documentation.

A wiki can also be used as a platform to communicate with clients and business partners. Instead of e-mailing or calling clients, a CPA could invite them to participate in a wiki set up to share ideas and concerns about a specific project. A wiki can allow a closer, more interactive, and timelier relationship with clients. Anyone who has used Google Mail’s “talk and label” features already has some firsthand experience with wiki features. These sites can help beginners start a wiki: www.pbwiki.com and www.writingwiki.org.

Web-based office suites such as Google Docs & Spreadsheets (docs.google.com) and Zoho (www.zoho.com) are the counterparts of desktop office applications such as Microsoft Office. These web-based applications provide strong collaboration, convenient access to documents, powerful version control, and easy online communication:

• Strong collaboration: Using an online office suite, a team can review, edit, and comment on the same document simultaneously from different locations. There aren’t different versions circulating; every change or comment is preserved on the hosting web server. The team leader uploads or starts the document, grants access to other team members, and stays on top of the changes and comments.
• Convenient accessibility: Because online office suites store files on web servers, documents can be accessed from anywhere. Users don’t have to carry around storage media or a laptop, or worry about the synchronization of multiple copies of a document or spreadsheet. This is particularly appealing for professionals working on multiple computers from multiple locations.
• Version control on documents: Online office suites use version control to track changes on documents. For instance, Google Docs keeps all versions of the edits and comments and provides tools to compare the differences between versions. Users can roll back a document to a previous point in time and check who made changes.
• Easy online communication: All online office suites allow users to initiate team writing via e-mail. Each product may provide unique features. For example, Google Docs and Zoho allow users to send a document to various devices, such as a personal data assistant (PDA) or cellphone. Google Spreadsheets allows multiple users to chat through instant messages when they are working on the same spreadsheet simultaneously. Additionally, all online office suites come with tools to publish documents on websites or blogs.

Using Web 2.0

The functions and services in Web 2.0 technologies reach millions of users via an open and scalable platform: the Internet. Web 2.0 services are particularly appealing to small accounting firms because they cost only a fraction of what commercially designed software for large accounting firms costs. Some tools are even free. CPAs can take advantage of Web 2.0 in the following three areas: 1) work collaboration; 2) information dissemination and sharing; and 3) information syndication. Some Web 2.0 services integrate these functions into one application to provide solutions to content management.

• Work collaboration: Consider this example to illustrate how Web 2.0 technologies can be used for work collaboration. A CPA working on a project for a client starts a wiki to plan the project and use it as a platform to communicate among team members and the client. The team uses the wiki to schedule meetings, inform each other with updates, and discuss approaches to problems. The team also shares the project information with the client at the wiki and lets the client come to the wiki to track the project progress and participate in development. When it comes to preparing documents for the project, the team collaborates by using Zoho Writer to draft word-processing files, Zoho Sheet to perform common spreadsheet functions, and Zoho Show to put together presentations. All of the files are hosted at the Zoho website, where team members (and the client) log in to edit and review. Team members can accomplish all of these at any time or place, whether in the office, at a client’s location, or at home; all that is needed is Internet access to the wiki and to an online office suite’s website.
• Information dissemination and sharing: Web 2.0 also provides a platform for information sharing and communication at a distance. A typical example is blogging. The interaction, focus, and in-depth discussion of blogs go beyond the functions provided by traditional websites. Blog-hosting services make it easier for beginners to start their own blogs with all the expected functionality. “Blogging 101 for CPAs” (July 2005 CPA Journal) summarized several helpful blogs for up-to-date accounting information. For example, “The Analyst’s Accounting Observer Weblog”(www.accountingobserver.com/ blog/) keeps up with accounting issues in the news. For those who need help on spreadsheet or accounting applications, “Daily Dose of Excel” (www.dicksblog.com/) provides hands-on tips. Other popular accounting blogs include: “The CFO Blog” (www.cfo.com/blogs/?f= header) for general financial accounting issues, “CPA Sense” (cpasense.blogspot.com) for CPAs’ interests, and “Inside Sarbanes-Oxley” (www.insidesarbanesoxley.com) for internal auditing matters.
• Information syndication: RSS (really simple syndication) is a major aggregator technology that can be used to pull pieces of information together. Wikipedia (en.wikipedia.org/wiki/RSS) describes RSS as “a family of Web feed formats used to publish frequently updated digital content, such as blogs, news feeds or podcasts.” By using RSS, users can instantly have data feeds from several syndicated sources collected, grouped, and stored in one place. The ability to instantly syndicate data is particularly attractive for mobile workers. Even though this technology has so far focused mostly on text content from news feeds and blogs, there are no technical barriers to using this technology with databases and other information sources.

Impact on the Profession

Many professionals may not pay a lot of attention to gaming-style user interfaces on webpages; or those fun websites for making and sharing music, videos, and pictures; or the innovative software developments that feature open-source, perpetual beta versions, and heavy user involvement in development. They may not follow the “cool” Web 2.0 stuff that mainly entertains the younger generation and provides some convenience to people’s everyday lives (e.g., Google Maps).
Nevertheless, the following characteristics of Web 2.0 will have a fundamental impact on the accounting profession:

• Corporate information systems are becoming more complex than ever because companies are integrating business applications from multiple and varied systems. Data are generated and integrated from numerous sources. Users become major contributors to data, which is generally unique and hard to recreate. To use a Web 2.0 term, businesses are increasingly “mashing up” applications and data to provide easier access and better information to users. For example, many companies’ information systems have already integrated data from their own ERP systems, their vendors’ systems, and their customers’ feedback
• The World Wide Web is being used as a platform to collaborate and share information in many new ways. Web applications are becoming a forum to discuss problems, contribute ideas, and provide solutions. These web services have become useful and popular because they enable people to connect to each other; and the benefits of this network effect grow even more powerful when more people use them.
• Users will experience a new kind of web with much improved user-interfaces. Instead of hyperlinked pages that require shuffling from page to page, pop-up windows will show detailed information and disappear when no longer needed. Improved user-interfaces rely on a group of web technologies called AJAX (Asynchronous JavaScript in XML) that allows the web browsers to get and display data more efficiently.

Why do all of these new developments matter? There are two reasons. First, companies are changing the way they do business using Web 2.0–based technologies. Because corporate information systems combine business applications and integrate data from a variety of resources, both internal and external, auditors will have to deal with much more complex information systems in order to assess system reliability and assure information accuracy. Second, accounting professionals can use new Web 2.0 technologies to exchange ideas, share information, and communicate with clients and colleagues.

Yu Cong, PhD, is an assistant professor in the department of accounting at Towson University, Towson, Md. Hui Du, PhD, is an assistant professor of accounting in the department of accounting and business law, college of business administration, at the University of Texas–Pan American, Edinburg, Texas.

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