Monday, October 25th, 2021

2021 Top Issues

“Everybody gets so much information all day long that they lose their common sense.” – Gertrude Stein

I always look forward to reading the AICPA PCPS Top Issues Survey results.

The PCPS CPA Firm Top Issues Survey gathers insights from practitioners in firms of all sizes to understand the significant issues facing firms across the country. 

The survey responses are broken down by firm size, with separate lists released for sole practitioners and for firms with 2 to 5, 6 to 10, 11 to 20, or 21 or more professionals. The AICPA and its Private Companies Practice Section (PCPS) team use the biennial surveys to pinpoint areas where new tools and resources may be needed to help practitioners address current challenges. Below are the results. Follow this link to read the commentary and learn about resources for firms to use.

SOLE PRACTITIONERS:

  • Keeping up with changes and the complexity of tax laws.
  • Keeping up with COVID relief programs, such as PPP, EIDL, ERC, etc.
  • Challenges when working with the IRS.
  • Seasonality/layering of deadlines.
  • Keeping up with changes in technology and managing associated costs.

2-5 PROFESSIONALS:

  • Keeping up with COVID relief programs, such as PPP, EIDL, ERC, etc.
  • Keeping up with changes and the complexity of tax laws.
  • Challenges when working with the IRS.
  • Seasonality/layering of deadlines.
  • Finding qualified staff.

6-10 PROFESSIONALS

  • Finding qualified staff.
  • Keeping up with changes and the complexity of tax laws.
  • Keeping up with COVID relief programs, such as PPP, EIDL, ERC, etc.
  • Challenges when working with the IRS.
  • Developing the next generation of firm leadership.

11-20 PROFESSIONALS

  • Finding qualified staff.
  • Developing the next generation of firm leadership.
  • Keeping up with COVID relief programs, such as PPP, EIDL, ERC, etc.
  • Keeping up with changes and the complexity of tax laws.
  • Challenges when working with the IRS…. and… Effective staff utilization & management

21+ PROFESSIONALS

  • Finding qualified staff.
  • Retaining qualified staff
  • Keeping up with COVID relief programs, such as PPP, EIDL, ERC, etc.
  • Developing the next generation of firm leadership.
  • Effective staff utilization & management… and… Managing work/life balance initiatives.
  • "We are not in the information age anymore. We're in the information management age."
  • Chris Hardwick

Friday, October 22nd, 2021

The Clock Is Ticking – Flashback Friday

“I took a speed-reading course and read War and Peace in twenty minutes. It involves Russia.” – Woody Allen

The major due dates have passed. Now, you have two months to get a lot done.

Read this flashback post about not wasting valuable time!

  • "The key is in not spending time, but in investing it."
  • Stephen Covey

Thursday, October 21st, 2021

Don’t Hesitate to Say Goodbye

“When I go to a party, nobody says hello. But when I leave, everybody says goodbye.” – George Gobel

In working with CPA firms, I have observed that so many CPAs like to cling to work. You can’t keep growing and expanding your skillset if you keep doing the same things while still doing the familiar things.

When you become a Senior, you have to leave much of your staff work behind. When you become a Manager, you have to say goodbye to some of the clients and the type of work you still love to do. You have to say hello to some new skills. The same thing applies when you become a partner. At that point in your career, you have to definitely say goodbye to doing the work and embrace the role of partner. Partners need to be bringing in business, enriching client relationships, and mentoring young people.

Occasionally, I read a post by Seth Godin that says so much to me about CPAs. The following is one of those posts.

WHAT WILL YOU LEAVE BEHIND?

Twenty years from now, you will have new skills. New customers. A new title and a new kind of leverage.

All of this forward motion requires a less celebrated element–all the things you’re not doing any longer.

To get a new job, you’ll need to leave the old job behind.

When you have a child, you’ve initiated a process that leads to an adult…

Often, we try to pretend that growth comes with no goodbyes, but it does.

Perhaps we can go in with our eyes open, understanding that what we begin will likely end. And when we plan for it, we’ll do it better.

  • "That money talks, I'll not deny. I heard it once it said, 'Goodbye.'"
  • Richard Armoour

Wednesday, October 20th, 2021

Don’t Give Up

“‘Oh well’, said Miss Marble, ‘it’s just perseverance, isn’t it, that leads to things.'” — Agatha Christie

The Agatha Christie crime sleuth, Miss Jane Marple, consistently solves murder cases by demonstrating perseverance.

The many issues that need attention inside a busy, growing accounting firm must be attacked in the same way. Simply persevere!

Firm Administrators/Practice Managers, now that October 15th has passed, are facing a formidable list of things to do.

One administrator shared a list of things that need to be addressed before year-end:

  • We need to become truly and wholly paperless.
  • We need to hire a Tax Manager!
  • We need to hire an additional administrative professional.
  • Our website needs to be updated!
  • We must upgrade our phone system.
  • We are adding a new server (we are not in the cloud yet!).

Plus, just the daily occurrences that need attention from any firm administrator.

Many of you are facing similar challenges as the year draws to a close. It won’t be easy but keep in mind Miss Marple’s quote, above. Perseverance pays off!

  • "Success comes from curiosity, concentration, perseverance, and self-criticism."
  • Albert Einstein

Tuesday, October 19th, 2021

Your Personal Efficiency

“It’s not enough to be busy, so are the ants. The question is, what are we busy about?” – Henry David Thoreau

How efficient are you? Have you given it much thought? So often, we simply get into the habit of doing things a certain way and it becomes so comfortable that we don’t give a thought to exploring better ways of doing routine things.

Many years ago I took an extensive time management course. It lasted several weeks and was a foundational part of continual self-improvement for me.

Some of the tips/tactics were challenging and some were very simple, as stated, but quite challenging to carry out.

My favorite:  Never touch things twice.

Sounds simple, right? Back then, I had an “in-tray” on the corner of my desk. I would take things from the “In” tray, review them and decide to respond or procrastinate. I also had another stack, near the inbox where I put things to deal with later…. it kept growing and growing!

I adopted the one-touch method:  Act on it, delegate it or trash it. Honestly, it really helped. Sometimes I had to deal with dreaded things but it was better than having them hanging over my head like a dark cloud.

Give this method a try as you deal with paper items and now, mostly digital items.

Dr. Travis Bradberry, Coauthor of Emotional Intelligence 2.0, tells us that to be successful at this you have to master the tyranny of the urgent. The tyranny of the urgent refers to the tendency of little things that have to be done right now to get in the way of what really matters. The key is to delete or delegate or you will find yourself going for weeks without addressing the important stuff. Sound familiar?

Other tips from Bradberry:

  • No is a powerful word
  • Check email on a schedule
  • Avoid multitasking

  • "The shorter way to do many things is to only do one thing at a time."
  • Mozart

Monday, October 18th, 2021

Culture Must Be Nurtured

“A culture is not invented. A culture constantly evolves..which is why it must be nurtured.” – Simon Sinek

I read the above quote by Simon Sinek and knew I had to write about CPA firm culture again. As you know, I have written about it many, many times. I have written about a marketing culture, a learning culture, an inclusive culture, a flexible culture, and more!

As Sinek notes, a work culture constantly evolves. If you don’t pay attention to your culture, make it a priority and nurture it, it will form on its own and might not be something you intended or are proud of.

You can use the search box on my website to find all the posts I have written about culture.

  • "'How was you day?' is a question that matters a lot more than it seems."
  • Seth Godin

Friday, October 15th, 2021

How To Talk To Clients – Flashback Friday

“Be brave enough to start a conversation that matters.” – Margaret Wheatley

First of all, happy October 15th!

This Friday I hope you have time to read my blog post. It stresses the importance of helping beginners on how to talk to clients.

Have a great weekend!

  • "Conversation about the weather is the last refuge of the unimaginative."
  • Oscar Wilde

Thursday, October 14th, 2021

Salaries

“These men ask for just the same thing, fairness, and fairness only. This, so far as in my power, they, and all others, shall have.” – Abraham Lincoln

I always get questions about salaries for the CPA profession. Firms want to know what other firms are paying by level – Staff, Senior, Manager, etc. I even did a limited survey myself but was disappointed by the response.

Yesterday, I read a post by goingconcern addressing CPA salaries in eight cities: Baltimore, Cincinnati, Detroit, Indianapolis, Louisville, Milwaukee, Oklahoma City, and St Louis. The author used various sources.

There are three salary percentiles.

  • 25th percentile: New to the type of role, still acquiring relevant skills.
  • 50th percentile: Average experience, has most of the necessary skills.
  • 75th percentile: Above-average experience, has all needed skills.

For example, here is the listing for an entry-level tax accountant in Cincinnati:

  • 25th percentile: $41,000 -> $39,975
  • 50th percentile: $50,250 -> $48,994
  • 75th percentile: $59,500 -> $58,013

Read the post here. I think you will find it very helpful.

  • "If we expect others to rely on our fairness and justice we must show that we rely on their fairness and justice."
  • Calvin Coolidge

Wednesday, October 13th, 2021

What Employees Want

“We can – and need to – focus on the right things now, so employees know the company is prepared to invest in their success.” – Sharlyn Lauby

According to a recent survey from Sharlyn Lauby (@HRBartender) the top two reasons employees would leave an organization are:

  • Increased opportunities for advancement.
  • Better compensation and benefits

This survey was not specifically for the CPA profession but I would guess that your current employees want the same thing. Lacking these two factors might cause some people to find other employment opportunities.

I was surprised that lack of flexibility was not one of the reasons people would leave but maybe because employers have, in general, embraced flexible work arrangements for almost everyone.

Do you know the reasons why your team members might leave your firm? Maybe it is time you did your own survey.

Young people entering the CPA profession today want to know what their career path would look like. Are you prepared to give them a clear picture of how that works at your firm? As to better compensation and benefits, I have found that most CPA firm employees are fairly satisfied in that area although I believe starting salaries should be enhanced as much as possible.

  • "Money is usually attracted, not pursued."
  • Jim Rohn

Tuesday, October 12th, 2021

The Bonus Dilemma

“Whenever there is a hard job to be done I assign it to a lazy man; he is sure to find an easy way of doing It.” – – Walter Chrysler

You have heard me say it often: I’ve been around a while.

One thing that I have lived through during my 30+ years in CPA firm management is the bonus plan saga. It is like a nightmare that keeps repeating itself (like in the movie Groundhog Day):

  • As a firm grows, it begins to hire more people.
  • At first, there is no bonus plan. People get paid for their over-all performance.
  • Then, a partner has a great idea, “Let’s put in a bonus plan! It will inspire our people to do better.”
  • And then, the ones who don’t get a bonus become jealous.
  • And then, CPA firm leaders feel guilty because they are not being fair to everyone.
  • The ones who do get the bonus usually are the top performers, however, some others may get a bonus because they are creative, intelligent people who can figure out how to “work” any bonus system ever designed for a CPA firm.
  • Eventually, (and it doesn’t take too long) the plan begins to demotivate people.
  • Then, the bright idea becomes: “Let’s do away with our bonus plan and build it back into their salaries.  We’ll reward top performers with larger compensation increases.” Thus, everyone gets an unexpected raise.
  • Several years later, “Let’s put in a bonus plan!” – – – same thing all over again, eventually it is dropped again because it really doesn’t work very well and it creates a huge amount of administrative work in tracking, measuring and analyzing.

I’ve actually been through this saga about 4 times during my career.

I have very mixed emotions about bonus/incentive plans relating to basic job performance.  However, I am very much in favor of incentives for special efforts like bringing in a great new client or recruiting a top-notch, experienced CPA to the firm.

Many partners and managers resort to incentives because they think they’re smart enough to create the perfect carrot. Doesn’t usually work that way in CPA firms.

Here’s what often happens inside the firm.  If you provide incentives for billable time you will get lots of billable time. Also, every client engagement will be over budget. You want them to get billable hours, yet you want them to perform the engagement more efficiently in less time than last year. It sends mixed messages.  We don’t live in a single-variable world – especially inside a CPA firm.

Much of the challenge with developing a highly productive team does not depend on incentives.  It relates back to having skilled, effective managers.  Winning firms have managers (and partners) who continually communicate, coach, and train the younger people in the firm so that everyone understands their role and the importance of quality, timely client service.  That is what will earn them a bigger paycheck.

While some bonus plans can demotivate your people, good managers do not. Good managers motivate.  Embrace the challenging activity of continually interacting and communicating with your team members.

  • "You know what Gordie Howe got for a signing bonus? A team jacket!"
  • Ed Lauter