Small accounting firms handle information that is extremely valuable to cybercriminals. Social Security numbers, bank records, payroll data, and tax filings can all be misused if they fall into the wrong hands. Unfortunately, smaller firms often lack the extensive IT resources of larger organizations, which makes them appealing targets.
Phishing attempts are one of the most common threats. Attackers frequently send emails that look legitimate, hoping someone will click a link or provide credentials. Ransomware attacks are also increasing. Once inside a system, ransomware can lock firms out of their own files and disrupt work during critical periods like tax season. Even cloud systems can create vulnerabilities if they are not configured properly or if passwords are weak.
Improving cybersecurity does not require a full IT department. Firms can make major progress by encrypting sensitive files, enabling multi factor authentication, and regularly updating software. Training remains essential because many breaches begin with a simple mistake, such as downloading an attachment from an unknown source. Firms should also consider creating a basic incident response plan so they know exactly how to proceed if something goes wrong. This reduces panic and helps limit the damage.
Insurance plays an important role alongside these precautions. As cybersecurity threats continue to grow, more accounting firms are seeking policies that address both cyber incidents and traditional professional liability concerns. First Indemnity helps firms evaluate these risks and secure coverage that aligns with the realities of modern accounting work.