Archive for the ‘Process’ Category

Thursday, July 9th, 2020

A Strong Foundation

“In order to achieve great results, you first need to do the deep inner work to build a solid foundation that can support your success.” – Chris McClure

Building a strong foundation, personally, is very important. It will be the guiding light that supports your success and leads you to even greater heights. As mentioned in the quote above, you have to do deep inner work.

This same theory applies to your busy accounting firm. You let yourself get so busy that the firm just molds itself around you (and your partners).

For over one-half of this year, you have been busy, busy, busy. You have quickly reacted to build a remote work environment to serve clients and to get you through the pandemic. It didn’t matter if the foundation was solid or shaky, you had to get the work done – you are essential.

Soon it will be July 15th, that new magical due date. Hopefully, you will have some time to really contemplate the foundation of your firm. Your processes and procedures are the foundation of your firm. You must be prepared to inform current staff and new staff “How we do it here.”

Perhaps you had some well-developed processes but they all went by the wayside during the last few hectic months. Refocus. Seek input from your people and your clients. Shore-up your foundation so you are prepared to move forward into the new normal.

Foundational pieces of an accounting firm, in addition to how your complete engagements and handle workflow, are: HR policies, internal accounting (billing and collection, monthly firm financial statements, etc.), technology processes, training, and marketing/sales activities.

Remember, from the quote above, “In order to achieve great results, you first need to do the deep inner work to build a solid foundation.”

  • Successful people begin where failures leave off. Never settle for 'just getting the job done.'" Excel!
  • Tom Hopkins

Monday, June 29th, 2020

Things That Don’t Matter

“It’s frustrating to keep doing things that don’t matter anymore.” – Dan Rockwell

It is amazing how many things have changed just during the last four months. March, April, May and June 2020.

You went into March just as you do for any March in tax season. Then things changed. Schools closed, universities moved all classes to online. Businesses and restaurants closed yet, work continued for accounting firms. They are essential.

You also sent your employees home and asked them to work remotely. You did it quickly and for many firms it was efficient and easy.

Now you are moving your team, in stages, back into the office. Not all will come back, they will continue to work remotely.

You have learned that it doesn’t matter anymore where people sit to do their work.

A big question you need to contemplate now is what have you always done that you no longer need to keep doing? Don’t force people back into behaviors, processes, and/or procedures that no longer seem logical.

  • I still catch myself feeling sad about things that don't matter anymore.
  • Kurt Vonnegut

Friday, February 28th, 2020

Set Clear Expectations For Your Clients

“If you expect nothing from somebody you are never disappointed.” – Sylvia Plath, The Bell Jar

I admire firms that are proactive with their clients. So many CPAs just wait on the client to call if there is an issue they need help with. Surveys have told us over and over again that clients want their CPA to be more proactive.

Be more proactive when it comes to obtaining the client’s tax information. For most firms, it is an annual, painful drama. Here’s a message one firm has sent out (in late February) to their clients. It went out in an email. It is a simple thing to do and guess what? It might help!

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Have We Received Your Personal Tax Information?

April 15th will be here before you know it! Have you turned in your personal tax information? Remember, in order to ensure a timely filing of your tax return (to avoid an extension), we must have your information by March 11, 2020. All tax organizers were sent to clients in December of 2019. If you need another copy, please let us know. Please be sure to bring us your information so we are able to get started. If you are waiting for a few items, not a problem! Bring us what you have, we will get started, and then bring in the additional information as it arrives.
 
If you have any questions regarding your personal tax return, please contact our office. Thank you for your help.

  • Treat a man as he is and he will remain as he is. Treat a man as he can and should be and he will become as he can and should be.
  • Stephen R. Covey

Tuesday, February 25th, 2020

Pay Attention to Collections

“Debt is normal. Be weird.” – Dave Ramsey

During my consulting and advisory work with firms, the collection policy topic comes up on a regular basis. I have posted about this before but I think it might be time to revisit this topic.

Collections are one of those things inside a CPA firm that is fairly simple but that seems to become complicated when you are dealing with multiple partners. My message to CPAs: You are running a business and effective collections is a basic business activity.

Here are my thoughts on CPA firm collections.

A documented, widely published Collection Policy is the foundation for good cash flow.

  • It must come from the top – all owners.
  • They need to meet, discuss all of the options and arguments then come to agreement on what they can truly live with, for the good of the firm.
  • Management drafts the document and all owners review and approve.
  • The written policy is communicated to all team members and is posted on the firm’s Intranet.
  • Everyone involved – managers, staff, controller, administrative assistants, firm administrator thoroughly understands and monitors compliance with the policy
  • AR statements should be mailed monthly to ALL unpaid accounts, with no exceptions.
  • Your collection administrator should routinely write notes/requests on the AR statements when a client is slow to pay.
  • A service fee should be applied for balances over 30 days.
  • I recommend that collection activities should be performed by a part-time administrative person (collection administrator) who is skilled in client communication and has no other priorities. This person’s role is also defined in writing and they operate within certain parameters.
  • They begin calling (not emailing) at 31 days. Some say 45 days but it is better to do it sooner. Often the client has just misplaced your invoice.
  • When the collection administrator exhausts all avenues with a particular, difficult client or when it ages beyond 90 days, it goes back to the partner in charge of the client account for collection, along with Managing Partner involvement. Work stops at the 90-day point.

Also, consider having your firm administrator send a welcome letter to every new client that includes a copy of your collection policy.

The bottom line – all partners must agree to follow the published procedures, if they cannot, they must keep working on the policy until they CAN all agree.

  • If you think nobody cares if you're alive, try missing a couple of car payments.
  • Earl Wilson

Friday, October 11th, 2019

Down to the Wire

“Boredom is a choice. Like tardiness. Or interrupting” – Mike Rowe

Another due date is approaching. Usually, in public accounting, the same thing happens with every deadline, whether it is Spring or Fall.

There is a last-minute push to get that final return out the door. It is hectic and stressful for everyone. Deadlines in most firms are dreaded, especially by the administrative team.

The accountants breathe a sigh of relief. Things are off their desk and it is time for the celebration to begin at 4:30 in the lunchroom. While the party is ramping up and pats-on-the-back are exchanged, the administrative team is still frantically working. They are processing those last returns, they are waiting on Last Minute Larry (client) to stop by to sign something or they must actually get in their car and deliver something to a client.

Progressive firms have worked on this issue and devised a proper scheduling system so that tax returns and other projects do not hit the reviewer’s desk with little time to spare. Reviewers keep the flow moving steadily so that the admin team does not have to rush around at the last minute (and miss the after-party, as usual).

Usually, this scenario is blamed on the client. Why not establish a more aggressive system for obtaining client source data? Why not outplace clients who are repeat offenders? Clients can be trained.

 

  • An expert is someone called in at the last minute to share the blame.
  • Sam Ewing

Thursday, June 20th, 2019

Keep It Simple

“Simplify, simplify.” – Henry David Thoreau

Recently, we joined a group of friends for dinner at a nearby restaurant. It was one of those restaurants that provided a menu that weighed about two pounds and seemed like a coffee table book. The hostess seemed to struggle to carry eight of them as she led us to our table. These types of restaurants always make me wonder who they are trying to impress.

This visit was different.

They have a new, simple menu that you open, lay it flat and that’s it. A front cover, two facing pages inside and more choices on the back. Most of the offerings we were used to were included.

Maybe restaurants are trying to impress people with their expensive looking menus but I was more impressed with the simplicity and ease of ordering.

How many things are you making more complicated in your firm just because you have always done things a certain way? Now is the time to simplify! Technology will make it happen.

  • Customers require the effective integration of technologies to simplify their workflow and boost efficiency.
  • Anne M. Mulcahy

Thursday, June 13th, 2019

Small Firms Can Also Use AI for Audit

“Be faithful in small things because it is in them that your strength lies.” – Mother Teresa

I work with a lot of smaller firms. They are always looking for ways to stay competitive and to take advantage of as much technology as possible. Sometimes small firms assume they can’t compete with what the big national and regional firms are doing.

In a recent article via The Journal of Accountancy, Samantha Bowling, CPA, CGMA tells the story of how her 15 person firm is using artificial intelligence to identify high-risk transactions as part of its auditing process.

One line caught my attention. It is an important issue for small CPA firms. Do you still have servers on site? Bowling says, “We used to have seven servers on-site. Now everything is in the cloud. We used to be able to remote in to our servers before, but it was slow. The remote access is much better in the cloud. It’s night and day. I’m excited because I’ve never had access to this much technology.”

Just because you are a small firm doesn’t mean you have to think small! Read this article!

  • Great things are done by a series of small things brought together.
  • Vincent Van Gogh

Wednesday, May 1st, 2019

After Tax Season Debriefing

“Questions are never indiscreet, answers sometimes are.” – Oscar Wilde

Every year, in late April or early May, CPA firms have a debriefing to uncover the good, the bad, and the ugly of tax season. What worked well, what was a disaster and how do we do better next year? You can read some suggestions on my blog of several years ago.

This year, Roman Kepczyk, Director of Consulting for Right Networks shares a Tax Season Debriefing Checklist in his article in CPA Practice Advisor.

Maybe this checklist will help you structure your debriefing in a more production format.

  • Some men see things as they are and ask, 'Why?' I dream things that never were and ask, 'Why not?'
  • Robert F. Kennedy

Monday, April 15th, 2019

What Are The Minimum Hours You Expect Staff To Work?

“Better three hours too soon than a minute too late.” – William Shakespeare

The number of hours you expect your team members to work, throughout the year, is something that should be clearly communicated. Some firms expect significantly increased hours during February, March and half of April and also during the Fall busy season. More and more firms are adopting a four-day workweek during the summer months.

Kimberly Hawkins of Thomas, Head & Greisen (Anchorage AK), allowed me to share how their “Seasonal Schedule” works. I think it is rather creative and very reasonable compared to most CPA firms.

At the bottom of this page is more information from Kim about how they handle holidays, PTO days, etc.

We have what we call a seasonal schedule. Our work weeks range from 50 hours during tax season, to 32 hours during the summer and late fall. During our 32 hour work weeks, staff schedule a day off, which is typically a Monday or a Friday. This is our schedule for this year:

Seasonal Schedule 2018-2019-Minimum hours we would like someone to work due to the seasonal nature of our business:

Wk # Begin Date End Date Std Hrs
1        10/1/2018 10/6/2018           50
2        10/7/2018 10/13/2018         50
3        10/14/2018 10/20/2018       40
4        10/21/2018 10/27/2018       32
5        10/28/2018 11/3/2018         32
6        11/4/2018 11/10/2018         32
7        11/11/2018 11/17/2018       32
8        11/18/2018 11/24/2018       32
9        11/25/2018 12/1/2018         32
10       12/2/2018 12/8/2018          32
11       12/9/2018 12/15/2018        32
12       12/16/2018 12/22/2018      32
13       12/23/2018 12/29/2018      32
14       12/30/2018 1/5/2019          32
15       1/6/2019 1/12/2019            40
16       1/13/2019 1/19/2019          40
17       1/20/2019 1/26/2019          40
18       1/27/2019 2/2/2019            45
19       2/3/2019 2/9/2019              45
20       2/10/2019 2/16/2019          50
21       2/17/2019 2/23/2019          50
22       2/24/2019 3/2/2019            50
23       3/3/2019 3/9/2019              50
24       3/10/2019 3/16/2019          50
25       3/17/2019 3/23/2019          50
26       3/24/2019 3/30/2019          50
27       3/31/2019 4/6/2019            50
28       4/7/2019 4/13/2019            50
29       4/14/2019 4/20/2019          40
30       4/21/2019 4/27/2019          40
31        4/28/2019 5/4/2019           40
32       5/5/2019 5/11/2019            40
33       5/12/2019 5/18/2019          40
34       5/19/2019 5/25/2019          40
35       5/26/2019 6/1/2019            40
36       6/2/2019 6/8/2019              32
37       6/9/2019 6/15/2019            32
38       6/16/2019 6/22/2019          32
39       6/23/2019 6/29/2019          32
40       6/30/2019 7/6/2019            32
41       7/7/2019 7/13/2019            32
42       7/14/2019 7/20/2019          32
43       7/21/2019 7/27/2019          32
44       7/28/2019 8/3/2019            32
45       8/4/2019 8/10/2019            32
46       8/11/2019 8/17/2019          40
47       8/18/2019 8/24/2019          45
48       8/25/2019 8/31/2019          50
49       9/1/2019 9/7/2019              50
50       9/8/2019 9/14/2019            50
51       9/15/2019 9/21/2019          40
52       9/22/2019 9/28/2019          45
53       9/29/2019 9/30/2019            8
Year End Total                             2080

If a holiday is on a Monday and that is the day staff take their Seasonal Day, they can choose another day in the same week (Sunday – Saturday).  Staff can only have one Seasonal Day in a week.  I’ve also attached our Seasonal Variance Schedule.  If staff work on different projects, for example, 990’s, they may choose to take their Seasonal Days in different weeks, with approval.  Our staff takes PTO by days, so if they are on vacation during a 32- hour week, they only have to release 32 hours of PTO.  Once staff has selected their day off we add them to our vacation calendar and also to ProStaff.  ProStaff pushes an appointment to our Outlook calendars, blocking off our Seasonal Days.  We add this to the vacation calendar so we can easily see at a glance everyone out of the office that day.  Our staff also update their status in PM showing they are taking a Seasonal Day.

  • If one advances confidently in the direction of his dreams, and endeavors to live the life which he has imagined, he will meet with a success unexpected in common hours.
  • Henry David Thoreau

Monday, March 18th, 2019

Ghosting

“Our feet are planted in the real world, but we dance with angels and ghosts.” – John Cameron Mitchell

Maybe your firm has done it. I know a lot of firms where it happens. Someone interviews with the firm for an accounting position. You interview them and end with the normal “We’ll get back to you” comment. But no one does get back with them. You have made the decision to hire another candidate but you don’t get back with every one you interviewed to let them know. Someone dropped the ball.

Maybe payback can be expected. Applicants and employees are now ghosting their employers in greater numbers. Per USA Today:

Workers are ‘ghosting‘ interviews, blowing off work in a strong job market. … A growing number are “ghosting” their jobs: blowing off scheduled job interviews, accepting offers but not showing up the first day and even vanishing from existing positions – all without giving notice.

I have heard some amazing stories from firms. Many of the cases are people in administrative positions. They report for the first day and then never show up again. One firm even told me a new admin person left at lunch on the first day and never came back. It sounds amusing (when you are not involved) but it is not that unusual any longer.

Here’s a great article via Suzanne Lucas @RealEvilHRLady.

Make sure your firm has systems in place to facilitate the interview and selection process so no one feels ghosted.

  • Monsters are real, and ghosts are real too. They live inside us, and sometimes, they win.
  • Stephen King