Rita Keller, an award-winning and widely respected voice to CPA firm management, is uniquely positioned to help CPAs and their teams face rapid and significant change.
“Be like a duck, my mother used to tell me. Remain calm on the surface and paddle like hell underneath.” – Michael Caine, actor
I continue to hear many stories about the scheduling challenge for CPA firms. Audit work is easier to schedule than tax work. Audits are bigger engagements and consume a higher volume of hours per engagement. Audits also demand more coordination with the client giving the client time to prepare for the upcoming work.
Tax work is more like a constant fire drill. Sometimes a tax return can take many hours, but most are budgeted for a few to several hours. Plus, it is difficult to know, for sure, when the client’s tax information will be submitted to the firm.
Many firms are using software to help in the task, such as Prostaff and others, but the whole process is still a challenge. Other firms have appointed a “Scheduler,” but it is an overwhelming task for one person. So much information is needed from so many people!
Here’s something that might work for you. It works best for firms that ask their teams to be skilled in both tax and audit. One and two-year staff are usually exposed to both tax and audit. They can specialize later on.
Each staff person keeps a two-week schedule. It shows what they have scheduled for the coming week and what they expect to have for the following week. It also shows open time, PTO time, holidays, etc. They submit this report to the Schedulers every Friday morning.
There are two schedulers. One experienced Tax Manager and one experienced Audit Manager for the office. These two managers are charged with knowing what their teams are doing and how they are doing. The Tax Manager and the Audit Manager meet every Friday morning. The firm administrator (practice manager) is also a part of this small scheduling committee. The firm administrator acts as the management contributor, helps balance work when needed, and/or relays communications from management.
The schedulers use the individual team members’ two-week schedules to assess who has too much work and who has room for more work, and they determine the experience level needed for new assignments. They assign work into the two-week schedules and also may move work around depending on client needs and workloads.
The firm administrator, sometimes with the help of an administrative assistant, modifies each two-week schedule and returns the schedules to the staff.
Some managers also keep two-week schedules if they are more involved in doing the work rather than supervising it.
This system makes sure that everyone has a full schedule for the next week and a good idea of what they will be doing for the week after that. Also, these two-week schedules have the number of hours indicated to do the work. The schedulers provide the hourly budgets as they assign new work or modify existing work.
I hope all of this is helpful and not too confusing. If you have questions, feel free to contact me. I will also share a handout explaining all this and a sample two-week schedule form if you request one.
Keep busy at something: a busy person never has time to be unhappy.
“Listening to both sides of a story will convince you that there is more to a story than both sides.” – Frank Tyger
This post is inspired by a novel I recently read by Lisa Gardner.
The passage was about systems. It says something like this:
The world is a system. School is a system. Your neighborhood is a system. Any group of people is a system. Well, even the human body is a system. Then a father says to his daughter:
“You don’t have to like the system. You don’t have to believe in it or agree with it. But you must understand it. If you can understand the system, you will survive.” A family is a system.
You might have guessed where I am going with this. The firm is a system, and it is made up of many sub-systems. If you are new to the firm or have been there for five or ten years, you need to understand the system, or you will not survive.
“The secret of success is to be ready when your opportunity comes.” – Benjamin Disraeli
When I talk to practitioners, I always stress that if you plan to merge up, you must still pay attention to the health of your firm. Acquirers want a profitable, efficient firm. They don’t want one that hasn’t kept pace with change.
“All you need is the plan, the road map, and the courage to press on to your destination.” – Earl Nightingale
I occasionally hear from a young CPA who has decided to strike on their own and build an accounting firm. Many people have done it, and I imagine they have been successful. I also imagine there have been several who have failed.
I always urge them to begin building the right infrastructure from the beginning. I call these tasks foundational aspects of a CPA firm. For example, standardized processes and procedures, a basic employee handbook, the most up-to-date technology, a social media plan, etc.
CPA Practice Advisor recently posted an article – 5 Tips When Starting a New Accounting Firm. I hope this will be helpful to those of you dreaming of your very own accounting firm and even those of you who need to improve the one you already have.
“Three things in human life are important: the first is to be kind; the second is to be kind; and the third is to be kind.” – Henry James
As I have for many years (decades?), I urge every CPA practitioner to get their house in order. That means having a solid foundation to build on. Acquirers don’t want to merge with a firm that is unorganized and/or dysfunctional. Future partners don’t want to buy in to something that is not attractive.
There are some very basic things that CPA firm leaders need to do to continually increase the value of their firm. Of course, CPAs must be technically competent, good communicators, and committed to client service. You are in a service business, just like a hotel or restaurant.
Beyond those basics, a couple more foundational items are needed to create firm value.
Culture – You (and your partners, if you have some) should devote your attention to creating a culture in which you want to work, providing your employees with a clear picture of acceptable behaviors that exemplify your core values. A culture built around consistent and strong core values will attract people with those same core values. If you discover employees who do not embrace your core values, they should be encouraged to go elsewhere.
Processes – Another foundational item thing you can do to increase the value of your firm is to implement processes, procedures, and policies that are well-documented in writing. This means the success of your firm is not solely on your shoulders and not dependent on just a few people. Having written processes and procedures ensures that you can easily get new employees up to speed quickly.
Happiness is not something ready-made. It comes from your own actions.
“The public seldom forgive twice.” – Johann Kaspar Lavater
When I first joined a CPA firm, I was actually amazed at the lengths the partners and staff went to assure that the work they did for the clients was absolutely correct. At that point in my life, my work experience had always demanded: “do it right the first time.”
In the accounting firm, my administrative work was proofed and reviewed. The work performed by the accountants was checked, reviewed, corrected, reviewed again, (corrected again, if need be), quality reviewed, and then checked by a partner before they signed off. I was amazed at the review steps that were part of everyday life in an accounting firm.
I was, and still am, puzzled by the fact that more focus isn’t put on doing it right the first time. When things are checked and reviewed so much, I imagine it is easy to hurry through a task and just hope your reviewer will catch any mistakes.
Once in a great while, a mistake happens. Oh, no! It is a small mistake and you have all experienced them. It is usually the wrong address used when mailing something. A simple typo in a communication to a client. A label affixed to an envelope that is crooked (remember, everything going to a client must be perfect, it is the little things that matter). Have you ever mailed a tax organizer to a dead person? The family is not pleased.
However, rarely, a more major mistake slips through the review process. The client brings it to your attention. You apologize profusely to the client and go about correcting the error. They seem to understand. They are loyal and forgiving. They don’t even consider leaving the firm.
That is why making mistakes when serving CPA firm clients is so rare and why so much caution is applied to the processes. Because if you make another mistake with that same client, you will probably lose the client and damage the firm reputation.
Keep today’s quotation, above, in mind and develop training methods that encourage your team to do it right the first time.
If you don't have time to do it right, when will you have time to do it over?
“I think that technology is much more mysterious to the people using it than, say, the automobile was. This isn’t an original observation, but a lot of the smart devices people rely on now really do feel like magic to a lot of us.” – Author: Charlie Jane Anders
Firms are finally beginning to see some progress in clients adapting to technology. Clients are (although it has been slow) finally accepting a copy of their tax return via SafeSend and other digital methods.
My clients and other firms I know are still often offering a paper copy if a client requests it. Maybe it is time to stop this practice. The world is becoming more digital.
If your firm is to grow and prosper, it has to have some standards and reap the benefits of the expense they spend on technology. In these times of difficulty finding workers, technology helps you get more done with fewer people. Give your clients a “next year warning.” Something like, “Next year we will not be furnishing paper copies.”
As with almost everything inside a CPA firm, there will be some exceptions – but PLEASE limit the exceptions. If a client is elderly, ask permission to send their return to a relative who can assist with printing. Most computer-adverse older people have someone who helps them navigate technology.
Will you lose a few clients? Probably. But when they go to another CPA firm they will find that firm also delivers only digital copies. (That’s my dream, anyway!)
“I follow three rules: Do the right thing, do the best you can, and always show people you care.” – Lou Holtz
You expended a lot of effort in establishing the firm’s paperless processes/procedures. Most of your partners follow the rules. For some partners, you do this and that – print things off, provide paper, etc. How will you get ahead by making so many exceptions to the rules?
My grandson, Sam, when he was at that pre-school age always had a question. That question was, “Is that a rule?” For example – Grandma says, “Sam, please put your shoes in the closet.” Sam asked, “Is that a rule?” When I say yes, it was a rule. He mildly said, okay and put his shoes in the closet. Evidently, his mom and dad stressed that there were certain rules for behavior.
There are certain rules for behavior in CPA firms, too. Is it a rule that we review on screen? Yes, it is a rule. Is it a rule that we have our time in by 9:00 am the following day? Yes, it is a rule. Is it a rule that we have our billings done by the 5th of the month? Yes, it is a rule. You get the drift.
Firms make too many exceptions. Once my IT Manager said something that has stuck with me over the years. He said, “We are governed by rules but we operate by exception.” Oh, my! Don’t operate your firm by exception.
I advise my clients to not establish rules if they are going to break them. Partners will agree in a meeting to a specific process/procedure/guideline and then some leave the meeting with no intention of following that “rule.” A prime example is: We will stop work at 90 days if a client has not paid our fee. If partners cannot truly agree don’t establish the rule – policy – procedure.
I love the quote, above, by Lou Holtz. I had the wonderful experience of hearing him speak several years ago. It was one of the most motivating speeches I have ever heard.
If you obey all the rules you'll miss all the fun.
“Without changing our patterns of thought, we will not be able to solve the problems that we created with our current patterns of thought.” ~Albert Einstein
In public accounting, working long hours and achieving chargeable hour goals is considered the way to providing quality client service.
You believe that your client service (your work) is better than your competitor. Your competitor thinks the same about you.
So, to provide the best service you ask your team to show more effort and work more hours. You will never accomplish your goal of great service by expending more effort.
Instead, look at your systems. Providing the most timely and accurate work means continually changing, updating, and modifying your processes and procedures.
Are you still inputting data rather than having it done through technology? Are truly paperless? Are you delivering your product digitally? Are all of your admin team members highly skilled in using technology to streamline their work? The same applies to your staff. Are they continually finding ways to expend less effort and still end up with the most accurate final product?
Think about this comment from Seth Godin: “How do we do this work?” is a much better question than, “Who isn’t trying hard enough?”
Almost all quality improvement comes via simplification of design, manufacturing… layout, processes, and procedures.
