Archive for the ‘On My Mind’ Category

Friday, December 1st, 2017

Busy Season Begins

It is December 1.

For years, we considered the beginning of “busy season” – we used to call it tax season but that term is no longer comprehensive enough – to be January 2.

Some firms would even require employees to begin working extended hours immediately after the New Year holiday, whether they truly had full schedules or not.

Firm leaders would often struggle to keep people busy after April 15th. They longed for more projects that could be scheduled from May to December. These days, from my observations, busy season continues throughout most of the year.

In my recent discussions with various firms of all sizes and locations, busy season begins in December. Firms are engaging their clients in much needed tax planning and those appointments plus completion of other tasks that have to be done before January, add some additional stress to the holiday season.

Firm leaders are challenged with allowing their employees to take extra time off during December when some clients need attention right up to the last minute on December 31.

This came to mind because of the recent news that American Airlines allowed too many pilots to schedule time off during those last two weeks of the year and perhaps 15,000 flights were in danger of being cancelled. It seems they have worked it out by paying the pilots additional money to cover the holiday rush.

Maybe that is a solution for you. You might have some employees who would work more hours during those last two weeks of December (for additional dollars) so that other employees could have time off for family activities.

Let the scheduling games begin!

Thursday, November 23rd, 2017

Thanksgiving Blessings

Happy Turkey Day to all my wonderful readers, followers, clients and friends. I count all of you among my many blessings! Enjoy your day with family and friends. Find some quiet time over the 4-day weekend to think about, and count, all your blessings.

ThanksgivingHappyTurkeyDayColorfulArtsyAHW_250x230Thanksgiving

Wednesday, November 22nd, 2017

Happy Thanksgiving!

“As God as my witness, I thought turkeys could fly.” – Mr. Carlson, WKRP in Cincinnati

I hope you will enjoy your 4-day weekend and a special time of year with family and friends.

Have you seen Seth Godin’s Thanksgiving Reader? I hope you will use it tomorrow. Here’s a little bit about it from Godin:

I’m delighted to point you to the Thanksgiving Reader . The file you’ll find there is free, it’s printable, it’s sharable and it might give us something universal and personal to do this Thanksgiving.

The idea is simple: At your Thanksgiving celebration (and yes, it’s okay to use it outside the US!), consider going around the table and having each person read a section aloud.

During these ten or fifteen minutes, millions of people will all be reading the same words, thinking about the same issues, connecting with each other over the essence of what we celebrate. After all the travel and the cooking and the hassle, for these ten or fifteen minutes, perhaps we can all breathe the same air and think hard about what we’re thankful for.

It’s free to download and share. I hope you’ll let some people in your life know about it and incorporate it in your celebration this year. There’s no commercial element involved—after all, it’s Thanksgiving. 

Please share. 

Also, here’s a link to my Thanksgiving tradition – watching this classic clip. 

  • Thanksgiving dinners take eighteen hours to prepare. They are consumed in twelve minutes. Half-times take twelve minutes. This is not coincidence.
  • Erma Bombeck

Tuesday, November 14th, 2017

Programs to Advance Women to Leadership Roles in CPA Firms Seen as Bolstering Talent Acquisition, Survey Finds

“Women who seek to be equal with men lack ambition.” – Marilyn Monroe

Here’s a recent press release from the AICPA. Since “women in accounting” are very important to me, I wanted to be sure to share this with my readers. I have bolded some points that were important to me.

CHICAGO (Nov. 9, 2017) – U.S. CPA firms that use advancement programs for promoting women to leadership positions overwhelmingly view them as effective tools in recruiting and retaining talent, according to new research by the American Institute of CPAs (AICPA).

Mentorship is by far the most popular advancement program, with 45 percent of firms using it, the 2017 CPA Firm Gender Survey found. Sponsorship, in which influential firm leaders take a more formal role in guiding promising employees to career opportunities, professional development and promotions, is used by 12 percent of firms.

“There are two important takeaways here: 1) firms that use these programs have seen a beneficial impact on attracting and retaining talent,” said Melissa K. Hooley, CPA, CGMA, chair of the AICPA Women’s Initiatives Executive Committee. “And 2) firms that are taking active steps to promote women and minorities likely will have a competitive advantage when it comes to securing talent.”

Advancement Program

Percentage of Firms Using It

Of That Group, Those Who Say It Has an Impact on Attracting or Retaining Talent

Mentoring

45%

87%

Sponsorship

12%

97%

Gender Initiative

11%

85%

Minority Initiative

2%

90%

Combined Diversity & Inclusion

6%

90%

Women comprise nearly half of all accounting graduates entering the profession, but remain underrepresented at the partnership level and other leadership positions. The survey shows little change in this area from studies done in years past, which have typically found less than one-quarter of the partnership ranks made up of women. As was the case two years ago – the last time the CPA Firm Gender Survey was conducted – the percentage of women partners was found to be highest at smaller firms.

Firm Size

Percentage of Women Partners

Two to 10 CPAs

42% (43%*)

11 to 20 CPAs

30% (39%)

21 to 99 CPAs

26% (27%)

100+ CPAs

21% (20%)

*Results in parentheses from 2015 CPA Firm Gender Survey

Among other findings of the survey:

  • An analysis of job titles found that women maintained parity or better with men in CPA firms through the senior manager level, after which the ratio declines
  • The larger the firm, the greater the gender gap in equity ownership
  • Only 47 percent of firms have a succession plan and only two percent have a formal gender component in those plans
  • Some 89 percent of firms say they have instituted some form of modified work arrangements, with flextime and reduced hours being the most prevalent

Survey methodology:  The CPA Firm Gender Survey was conducted online by MKTG Incorporated for the AICPA’s Women’s Initiatives Executive Committee from Aug. 3 to Sept. 11, 2017. Some 492 qualified respondents, drawn from CPA firms of varying sizes and regions within the United States, participated.

For more information about gender initiatives and other resources, visit aicpa.org/womenlead.

  • Because I am a woman, I must make unusual efforts to succeed. If I fail, no one will say, “She doesn’t have what it takes.” They will say, “Women don’t have what it takes”
  • Clare Boothe Luce

Wednesday, November 8th, 2017

Cheating

“I would prefer even to fail with honor than win by cheating.” – Sophocles

A headline via Fast Company caused me to ponder a familiar situation in an accounting firm. The headline – Is Your Workplace Encouraging Employees To Cheat?

Here’s the lead in paragraph:

Your company prides itself on having a culture of high performers who thrive under pressure. But could that very culture be encouraging employees to cheat?

Leaders of CPA firms, I ask you that question.

Think about it, if you reward the way many firms have rewarded employees for years, they are probably cheating. Of course, in the CPA world we don’t come right out and call it cheating.

If you reward for chargeable hours, they will give you more chargeable hours. (They record more hours than it actually takes them to complete the client work.)

If you reward for improved realization, they will give you improved realization. (They record fewer hours than it takes them to complete the client work.)

The result is that you never have a real picture of the effort (and time) it takes to complete a client’s engagement. On top of that, your employees are really uncomfortable and feel pressure to give you what you want.

It’s a common issue. The solution is to become better managers of our people. If you do still bill based on time (and many of you do), Ask for honesty and lighten up on the pressure.

  • In athletics there's always been a willingness to cheat if it looks like you're not cheating. I think that's just a quirk of human nature.
  • Kareem Abdul-Jabbar

Wednesday, October 11th, 2017

You Don’t Always Have to “Give In”

“Our greatest weakness lies in giving up. The most certain way to succeed is always to try just one more time.” – Thomas A. Edison

Accounting firms, in recent years, have gone to great lengths to be more flexible, to be more understanding, to be more tolerant, compassionate and caring towards their valuable workforce.

All that is good. However, firm leaders, and accountants, in general, are non-confrontational so it seems like they eventually give in to almost any request.

arrow-down-4-xxlYou dumb things down, you go to great lengths to make things simple and easy. You strive to eliminate any discomfort and stress. You want people to have fun and enjoy their work.

I have observed that this fear of offending any team member leads to more work getting done by those at a more experienced level in the firm. Leaders not only fail to set high expectations, they fail to set any expectations. An environment evolves where partners and managers are doing the work and the staff are looking for work.

Many experts tell us that young people want to know exactly what is expected of them. Thus, they can judge when they are making progress on their career path.

I believe that there are still talented people working in the CPA profession who want to be challenged, who want to learn more and do better. They want assignments that are not boring and cause them to stretch to a higher level of performance.

Develop a culture of high performance and high expectations. Create a reputation of being extremely professional, well-disciplined and knowledgeable. You don’t always have to give in to lowering your standards. It is a downward spiral.

  • Failure at some point in your life is inevitable, but giving up is unforgivable.
  • Joe Biden

Wednesday, October 4th, 2017

Afraid

“Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy.” – Dale Carnegie

Accountants are going to be replaced by robots. That’s not a fact.

13Some or even many of the things that accountant do now will be computerized (or robotized, as it is sometimes referred to now). That probably is a fact.

Don’t be afraid of the changes to come. Embrace them.

Yes, I am old enough to remember “the old days.” Certified Public Accountants used:

  • 13-column columnar pads
  • Lead pencils
  • Mechanical pencils (an expensive one, you bought yourself was a status symbol)
  • Lots of lead and eraser replacements for those mechanical pencils
  • Large pink erasers
  • Adding machine tape
  • Staples
  • Staple pullers
  • Paper
  • White-out
  • Desk top and handheld calculators
  • Green-bar paper for the one printer in the office

Accountants embraced computers – moving from the single-operator mainframe type to the PC (introduced over 35 years ago).

They embraced software – Lotus 1-2-3 and later the Microsoft suite. Tax software (and all the other extensive list of softwares used by accountants), replaced much of the manual work. Yes, accountants changed how they worked and what they used to get the work accomplished. They no longer filled-out manual time sheets.

CPAs had to hire people with the appropriate technology skills, different kinds of people. Someone who could only prepare a tax return by hand or complete accounting work on a columnar pad was no longer needed.

Now, CPAs are facing another, more-rapid change into an expanded world of technology. You will need to hire different kind of people and current employees will have to learn new skills.

It’s been done before. Don’t be afraid.

  • Nothing in life is to be feared. It is only to be understood.
  • Marie Curie

Tuesday, October 3rd, 2017

Acting

Remember that children, marriages, and flower gardens reflect the kind of care they get. – – H. Jackson Brown, Jr.   

If you have a job, especially if you have a job in the CPA profession, acting is probably, or should be, part of your skill set.

Sometimes you get a less-than-enjoyable client assignment. If you are new to the CPA profession, you probably act like you are pleased with the assignment and are learning something meaningful from the experience.

If you are more experienced, you might not be such a good actor and tend to whine about the assignment.

No matter what your experience, you never let the client know that you dread the assignment or project.

Clients need and expect you to care about them. It is natural that you care more about some clients. But, with some clients, it takes more acting than it does with others.

Read Seth Godin’s take on “Appearing to care.”

  • If you care, that's great. If you don't, at least right now, well, it's your job. That's the hard part.
  • Seth Godin

Wednesday, September 27th, 2017

Understanding Blockchain

“Blockchain is the foundational technology of transactions.” – Karim R. Lakhani

You have been reading about it, hearing about it and probably wondering about it.

I continue to be curious about blockchain and want to know more. If you want to know more and to understand it better, here is a great video to watch:

HBR Whiteboard Session: How Does Blockchain Work? The session is conducted by Karim R. Lakhani, professor of business administration at Harvard Business School. He makes it understandable!

I found it very interesting and valuable. It’s nine minutes long and gives you five points to help you understand how blockchains work. Time well spent for you as a CPA.

 

  • Transactions were always private. Now, we are going to make them open and public.
  • Karim R. Lakhani

Thursday, September 21st, 2017

Disruption, Future-Ready and All That Jazz

“Everyone thinks of changing the world, but no one thinks of changing himself.” – Leo Tolstoy

I enjoyed a recent post by Gail Perry, Editor-in-Chief of CPA Practice Advisor, titled, CPA Tomorrowland.

Gail talks about the word disruption and how often it is included in CPA conversations. As she notes, it is not disruption in small letters, it is DISRUPTION in capital letters and it is happening SO fast. Changing FAST is not something most CPAs are not used to.

  • A McKinsey study suggests that 49% of work currently being done by accountants is likely to be automated.
  • Accenture reports that 21% of organizations have blockchain in production and that 40% of basic accounting work will be automated or eliminated by 2020 – in 3 years!
  • The AICPA and state society leaders are pushing members to quickly move from personally doing compliance work (let AI and bots do that) and evolve into business consultants.

What makes all of this very interesting and puzzling to me is the fact that so many consultants, media and profession leaders are strongly advising that the older CPAs need to get out of the way because they are not suited for this new world of CPA-ing.

In my work consulting work with firms, I have observed that automation has been increasing inside firms for years. Sure, there might be a bigger and quicker leap in the coming years but most well-managed practices with savvy (and usually mature) leadership will make that leap.

Successful, older CPAs do not love grinding out compliance work. In fact, many older CPAs (partners), don’t even know how to use the elaborate software and automated systems the firm has now.

I have observed that in multiple partner firms, the more experienced CPAs (older) are the ones ALREADY consulting with clients. The next generation (managers and “next” partners) have been groomed to be production units. They don’t network, they don’t bring in business, they don’t go to management conferences or keep on top of current trends – they are too busy grinding.

I recently asked a CPA how many of their eight partners were already spending the majority of their time consulting. The answer was two! The others have become complacent and comfortable doing compliance work.

Before you push your older, more experienced partners out the door, identify which ones are already consultants. Be sure they are working very hard at training younger partners and next leaders on how to really consult with, and advise, clients. They need to develop the skills necessary to help their clients become more profitable and successful.

We want retiring partners to transition the client relationships. It is a whole lot more than getting the client to call Joe Young rather than Bob Old, when they have a problem.

As for the automation part, here’s what Nick Chandi notes in his article on Forbes – How AI Is Reshaping The Accounting Industry: “..since accounting professionals will still remain as the final approvers of all the tasks performed by the AI, they will keep control of any sensitive information they want. As long as they have everything backed up to the cloud, they are good to go.”

CPAs are going through some very exciting times. The CPA profession is interesting and challenging and unlike many outside the profession believe, it is never, ever boring.

  • Change is inevitable, except from a vending machine.
  • Robert C. Gallagher