Ed. note: We’ll be off on Monday for Memorial Day. Enjoy the long weekend!
How’s tax reform coming along?
There seems to be some confusion in the Trump Administration about some pertinent details in their tax plan. Kate Davidson and Richard Rubin report in the Wall Street Journal:
White House budget director Mick Mulvaney told a Senate committee that the administration’s tax plan doesn’t bank on any revenue stemming from faster economic growth. Four floors below that hearing, Treasury Secretary Steven Mnuchin gave a contradictory answer to a different Senate panel, insisting that the administration’s tax plan will partly pay for itself with economic growth.
The open contradiction between two top economic advisers to President Donald Trump showed just how unsettled their tax agenda is, even as Republicans say they’ll be able to complete a historic revamp of the U.S. tax system by the end of 2017.
Come on, guys! Huddle up for 5 minutes and get on the same page, write it on your hand, something! No one’s worried about you for cheating a little bit for a Senate hearing. You remember who your boss is, right? Tax reform is hard enough without miscommunication among people on the same side.
The article quotes Missouri Senator Claire McCaskill: “It just defies understanding,” which seems to be the go-to comment on any Trump policy.
Dan Hood writes in his Accounting Today column that he stumbled upon an interesting metric in accounting firms that I don’t recall seeing before: staff to partner ratio.
For the seven firms over $1 billion in revenue in the profession (the Big Four, RSM, Grant Thornton and BDO), the ratio of staff to partners is 18; for all the other firms, it drops to 10, regardless of whether they’re just under a billion in revenue, or just over the $37 million threshold for the list. That intrigued me enough to do the same calculation with some of the firms in our Regional Leaders list who were below that threshold, and the number quickly dropped to between six and seven staff members per partner.
Naturally, partners with more staff have the opportunity to delegate work and do more partner stuff. At larger firms, because partners have more time to do partner stuff, I feel like the firm’s leadership has to come up with new partner stuff all the time. Some of this new stuff is probably worthwhile but some of it probably isn’t. The stuff that isn’t probably gets delegated to non-partners so partners can find something better to do.
Of course, the big firms have big clients and lots of partners spend their time working through client problems, both technical and personal. To me, that seems like a pretty good use of their time but then firm leadership wants partners to serve on committees or be “champions” or “heads of” or to chair this or that and hassle everyone about donating to the United Way. It’s strange because big firm partners don’t really have to worry about running the business like most business owners do. Sure, they’re owners of the business, but they very much live in their own little bubbles within this large ecosystem of other partners living in their own little bubbles. It’s almost as if they’re not really owners, just extra fancy employees that have to go to a lot more meetings.
Maybe that’s what all this boils down to: Big firms have all the extra staff so partners have time to go to more meetings. It’s a wonder why anyone would want to be a partner. I suppose if you could delegate your meeting attendance to someone else, it might be okay.
Accountants can be heroes, too
Mark Imhoff is CPA but also “The Dog Guy,” a groomer who “volunteers at the New York City Animal Care Center and provides discounted grooming services to pet owners in low-income areas.” Gosh, that’s nice. If every accountant who stole money from their employer instead helped animals in need, the world would be a much better place, and I’d have to find something else to write about.
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The featured job of the week: Tax Manager with Kirsch Kohn & Bridge in Los Angeles.
Previously, on Going Concern…
In other news:
- G.M. Accused in Lawsuit of Deceit on Diesel Truck Emissions
- Work Friends Make Us More Productive (Except When They Stress Us Out)
- Judge Orders UPS to Pay $247 Million for Illegally Shipping Cigarettes
- Mark Zuckerberg tells Harvard grads that automation will take jobs, and it’s up to millennials to create more
- Wall Street’s Endangered Species: The College Jock
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