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September 29, 2023


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The Largest Accounting Firms in Portland, Ranked by Number of CPAs Working There

Been a while since we’ve ranked anything, thankfully Portland Business Journal came in clutch today and gave the world a good old fashioned ranking of Portland accounting firms. The full list of 30 firms costs $30 and we don’t have money like that so we’re looking at the five we can see for free. There’s […]

How Many CPAs Are There in the United States?

669,130. That’s how many licensed CPAs there are in the United States as of August 24, 2021 per NASBA. This only counts CPAs in 54 of the 55 licensing jurisdictions, Hawaii is not included in the data. Nearly 20 years ago, the number of licensed CPAs was 639,628 (2003) and 646,520 by 2006. Interestingly, the […]

CPAs No Longer Have to Be CFOs When They Grow Up

“The Street doesn’t care about accounting functions any longer. They don’t get into the nitty-gritty anymore.” — Richard Bove, an analyst at Odeon Capital Group LLC, told the Wall Street Journal when asked why accounting expertise seems to be no longer required for the CFO role. According to data from Korn Ferry, only 36% of […]

university controllers

How Two CPAs Ended Up Back in College As University Controllers

Robert Kuehler and Alan West have a few things in common: both are CPAs, both started their careers in public accounting, both have accounting degrees, and both went back to college—not as a student or professor but as a state university controller. As associate vice president/university controller at the University of Colorado, Kuehler oversees a […]

cpa run for office

Let’s Cool It With All the ‘CPAs Should Run for Office Because Taxes’ Talk

Crazy enough to think that people will care that he can look at a 1040 and not soil himself. Should CPAs run for office? According to this gushy post at the AICPA, the answer is a resounding: YAAAAS. When you’re a CPA, you have a solid understanding of the many issues that power government: taxes, […]


Any CPAs Want to Work in Hawaii?

Any CPAs in the northeast thinking that packing up and heading to Hawaii would be just a little too rash should know that it’s not that crazy. Turns out, there’s plenty of opportunity in paradise. Here’s a brief from Hawaii Public Radio that says firms are “finding it especially difficult to find accountants with 3-to-5-years […]

Some Accounting Firms Going Out of Their Way to Discourage Employees From Becoming CPAs

You'd think with all the worrying going on in the accounting profession about talent and succession, that firms would be making it easy on the employees they do have to become CPAs. And I think, for the most part, many firms do encourage prospective CPAs with exam prep and exam fee reimbursement, time off to […]

Why I’m Going for the CPA

Caleb recently published a post posing the question, "What’s the Future of the CPA Brand?"

This question was prompted by some AICPA research showing that while the CPA brand still has a lot value, there’s a growing threat from non-CPA professionals who are providing specialized services outside the core services — tax, accounting, and audit — typically provided by CPAs.

Someone Should Audit NASBA’s CPA Headcount

Trust but verify! New statistic: How many active #CPAs are there? #accounting — NASBA (@NASBA) May 25, 2016 This is just too good. A tickmark with an explanation. And there's further explanation on the NASBA website: This statistic is derived from the national database of CPAs, the Accountancy Licensee Database (ALD), and is […]

Don’t Forget: Voting on the AICPA-CIMA Merger Starts on Monday

Over the last few years, we've watched the AICPA and CIMA hamfist the CGMA into our lives. The claim was that it would "raise the bar on management accounting" but all it really did was remind people of the cognitor fiasco from the late '90s/early '00s and invite lots and lots and lots of mockery […]

Report: CPAs Exaggerate Their Success at the Bar, Pretty Much Everywhere

Alright, you guys. Next time you have an encounter like this one that Adam Blitz writes about, I want you to contact us immediately: I recently went to an event with a few managing partners from some local accounting firms. The size of the firms ranged from eight to 30 professionals. Each firm was a […]

Could Having a ‘Pro-CPA Culture’ Backfire on Accounting Firms Desperate for Talent?

Back in October, we discussed whether the CPA exam would ever become an optional within CPA firms. The reason the topic even came up was due to the fact that while the number of accounting students continues to increase, the number sitting for the CPA exam hasn't kept up, either declining in some years or staying flat.

CPAs Admit That They’re Not Good Business People

Here's something interesting (hilarious, even) from the Indiana CPA Society's Center of Excellence: CPAs lack a bunch of important skills and they're completely aware of it. The Society conducted a survey of over 600 CPAs across 30 states and found that the profession that constantly goes on about being "trusted advisors" to businesses and entrepreneurs, […]

Will the CPA Exam Become Optional?

I'm catching up on my reading and lo and behold, here's another CHANGE IN ACCOUNTING IS SO FAST article. It's only been [counts fingers] a few weeks since we last touched on the topic, but we can't waste a good crisis, can we? No, we cannot. This particular piece is based on a speech by […]

AICPA Lays the Smackdown on Dear Abby

Here’s what went down. On July 13, Helpless Big Brother wrote: I have just learned that my sister's husband of 35 years (I'll call him George) hasn't filed their personal income taxes going back a number of years. … Apparently, he hasn't filed because of his inability to organize.1 Their professional tax preparer has met […]

Chris Christie: Friend or Foe to CPAs?

For reasons unfathomable, New Jersey Governor Chris Christie is running for president. Apparently, one loud-mouthed Republican from the tri-state area wasn't enough for this race. Anyhoo, Greg Kyte pointed us to this video of Jon Stewart welcoming Christie to the race in true Daily Show fashion, noting a strange comment from the Governor around the […]

A CPA Firm with a Chief Creative Designer? A Conversation with Adrian Simmons

Ed. note: This is another interview in our series of discussions with accountants-turned-entrepreneurs or entrepreneurs who run a business in or around the accounting profession. Whether it's an transforming an accounting firm, opening a coffee shop, or developing a mobile app, we're talking to entrepreneurs who know accounting. If you want to suggest someone for […]

Survey Says: Over Half of Small Businesses Don’t Work With an Accountant At All

Here's an interesting discovery from Xero: 53 percent of small businesses they surveyed "say they don’t work with an accountant at all." So not only are all firms the same, they're not crucial to fledgling businesses? Is this an opportunity or a barrier? Go.

AICPA Courting Beliebers Now

The world needs #CPAs even more than it needs @justinbieber. See why we're needed oh so badly: — ThisWayToCPA (@ThisWayToCPA) January 23, 2015 Fishing for RTs from Justin Bieber? The AICPA must be really hurting for ideas. Can someone remind them that the CPA exam gap is immaterial?

Why the Growing CPA Designation Gap?

AICPA President and CEO Barry Melancon recently talked about a growing concern around the number of people that are sitting the CPA exam every year. Barry stated “We have had six consecutive years of record numbers of people majoring in accounting. That’s a great thing. For the last three years, however, we’ve basically had a level number […]

PA CPAs Suggest Liquor Stores Be Privatized, Less Enthused About Legal Marijuana

Sixty-nine percent of CPAs suggested privatizing liquor stores as the best measure to close the Keystone State's deficit. Only 27% of them like the idea of legalizing marijuana. Considering the puritanical liquor laws in the state — er, commonwealth — we should accept progress where we can get it. [PICPA]

Michigan CPA Charged with Murdering Michigan CPA

We've been keeping an eye on the story of the murder of David Locey, a CPA in Sturgis, Michigan and his former employee is now being charged with the crime.  Andy Brown was initially charged with embezzling $100k from Locey's firm but now he's accused of first degree premeditated murder and felony firearm. Locey was […]

If You Can’t Trust a CPA To Say You Can Trust CPAs, Who Can You Trust?

So, not sure if you guys saw this recent Entrepreneur piece by Gene Marks (a former senior manager at KPMG, btw) but if you aren't familiar, lets take a few important bits from it before we do anything to figure out where ole Gene stands. Like this: Not many people know this about me, but […]

If You Can’t Admit You’ve Committed CPE Fraud, Then You Need to Take Another Ethics Course

I just finished a one-hour CPE course in 9 minutes. That included the time it took to log in, select the course, scroll through 58 slides, ace three questions, and get an 80% on the five-question quiz at the end. 
Oh, right. It was an ethics course.

CPAs and Entrepreneurship: Do You Have What It Takes?

Back in July, we had a discussion about hanging out a shingle in public accounting. For many of you that are just starting out in your careers the idea of venturing out on your own seems as likely as the Jets pulling off a winning season. In fact, it’s hilariously unlikely.    For some of […]

Kids Don’t Say They Want to Grow Up to Be CPAs Because Kids are Dumb

This Way to CPA has stooped to a new low, insulting children. Sure the little snot-nosed brats aren't very smart but do we really need to say that out loud? We all know the youth of America is pretty doomed as is but I'm fairly sure little kids saying they want to be CPAs when […]

A CPA’s Guide to a Successful Observance of St. Patrick’s Day

For CPAs, St. Patrick's Day is usually just one of several holidays that becomes a casualty of busy season. On Presidents' Day we were unable to engage in parliamentary procedure, on Mardi Gras we are unable to get laid, and on Valentine's Day we are unable to get laid1.

Proper observance of St. Patrick's Day requires three components: a spiritual component, a green component, and a drunken component–all of which will be easier to do this year because St. Patrick's Day falls on a Sunday. (You're not officially required to work on Sundays, but you're unofficially expected to work on Sundays. Add St. Patrick's Day, and you've pretty much got a free pass to dick around. At work.)

CPA’s Story of Quitting His Crappy Job Harkens to a Simpler Time When We Didn’t Have to Endure Verbose, Self-Absorbed Emails

Brian Dettmering is a CPA in Milwaukee that's been in the game for 30 years. These days he has his own practice, Riverwest Accounting Services that he operates out of his home. He pretty much works when he wants and takes the clients that he wants. You get the sense that he's happy with his […]

Come Hell (Caused by a Window Heat Unit) or High Water (From a Fire Hose), CPA Will Be Back at Work ASAP

The Shelby Star in North Carolina reports that a fire caused by a window heat unit at a CPA's office resulted in "moderate damage" to the building. By the grace of God (or whatever) all of Greg Blalock's files were saved "as well as most of the computers" but, you get the impression that he's […]

CPA’s Law School Dreams Are a Nightmare for CPA Wife

Earlier today, we shared a nice little story of an accountant who hustled after his dream of playing Major League Baseball. Heart-warming, really. It just goes to show you what can happen when you've completely given up on your dreams, made a practical decision because, you know, life and all, and you have a support […]

PwC Employee Embraces the Cheapskate CPA Stereotype Like No Other

It is a commonly accepted stereotype that accountants are cheapskates. Unlike Lady Gaga, they weren't born this way, rather they are shaped and molded by miser mentors and as their lives and circumstances demand. If you're one of those CPAs that fancies yourself as a savvy consumer, Kate Hashimoto will make you look downright opulent […]

Independence Questionnaires Are the Worst

I haven't had to fill out an "Independence, Integrity, and Objectivity" questionnaire since 2009. Just for kicks, I had a buddy send me a copy of one and I can't even read through it–partly because it's incomprehensible, but mostly because of the rage. Here's the first of 70 [!!!] questions: Have you performed, during the […]

Here Are Two CPAs That Are Perfect Examples of Setting a Bad Example

There are plenty of professional mentors out there for young accountants to look up to. Men and women of intelligence, integrity, work ethic, nice shoes, all that good stuff. After taking a look at this SEC Administrative Release, you can easily conclude that group does NOT include R. Jeffrey Rooks and another anonymous "accounting partner": […]

Ohio Society of CPAs Foolish Enough to Think That Congress and the President Will Heed Their Call for Bipartisanship

It's not just Ohio CPAs, mind you. NosireeBOB. It's primarily Chambers of Commerce from around the country but also the Asian American Hotel Owners Association, the National Beer Wholesalers Association, the Snack Food Association, Turfgrass Producers International, and a host of others asking "Congress and the president to immediately enact legislation that averts America’s impending fiscal cliff." Christ […]

CPA Didn’t Count on Little League World Series Mom Telling Him to Take Her Job and Shove It

Most of the time when you ask for time off, your superiors don't have much of an issue. "Sure! Enjoy yourself!" or "Go ahead. You deserve a break," they might say. On the rare occasion where your request comes at an inopportune time (e.g. looming deadline, it's their monthly get-away time with mistress/boy-toy), there can […]

Comp Watch ’12: Credentialed Accountants vs. Non-credentialed Accountants

Have you struggled to pass a certification exam? Is your reaction to colleagues that place various three-lettered credentials behind their name on their résumés a resounding "Meh"? Not too hung up on money? Great! You won't be bothered by this at all: The average reported salary of IMA members surveyed was $109,001 in 2011, down […]

What Kind of Raise Can a New CPA at a Publicly Traded Company Expect?

Looking for the right way to tell your colleague he has a hygiene issue? Not sure if dark khakis go with that dusty blue button-up shirt? Want confirmation that you haven't sold your soul to the Devil himself? Get in touch with us and we'll do our best to help without making you cry. Hello […]

Dewey Think an Accounting Firm Could Go Bankrupt?

Michael Cohn over at Accounting Today wonders if an accounting firm could suffer the same fate as recently departed global law firm Dewey & Leboeuf. It's a question worth asking since the entity structures for both accounting and law firms are similar and mergers are common in both industries. But really, it's not as likely (although not […]

Future ‘Digital CPAs’ Will Make the Most of Bathroom Breaks Thanks to AICPA’s New CPA Exam App

Put down the Fruit Ninja, folks, the AICPA has a new app for you to play with. Yesterday, the AICPA announced the launch of two new mobile apps: an iPad app for Journal of Accountancy and an interactive CPA exam aid that works on Apple and Android devices. "One of the most exciting developments in […]

Recently Deceased ‘Accounting Legend’ Kenneth Leventhal’s Simple Explanation for His Career Choice

Last week Adrienne asked all of you to explain, to the best of your ability, why you became accountants. There were a myriad of answers given, which she opted to highlight in her post on Monday. While many of them were fine answers (if not a little verbose), they pale in comparison to the reasoning […]

This Might Be The Most Grateful Tax Preparer In The Entire Country

It's rare we share any feel-good stories with you all so when I saw this letter of thanks printed in the New Jersey-based Daily Journal, I thought it might be nice for you to read. Let's all remember as some of you miserably trudge ever-onward toward April 17th that no matter how bad you have […]

NASBA Tool Easily Allows You To Verify If Your Colleague Is a Liar

Up until now, the easiest way to verify a CPA license was to check with the individual state boards for license information. That's great if you know the state in which the CPA in question might be licensed but what if you need to do a broad, nationwide search? Enter CPAverify, NASBA's central repository of […]

Former IRS Agent Tries To Kill Witnesses In His $11 Million Fraud Case

Listen, if you're going to file fraudulent tax returns, try not to kill anyone in the process. A San Diego tax preparer is facing federal charges for filing over $11 million in fraudulent tax returns and has now added a new charge to his ever-growing list of screw ups: witness tampering. You see, when 50-year-old […]

CPA Asks That Poor People Try to Understand the Plight of Wealthy Wall Street Types Who Are Feeling the Pinch

Alan Dlugash is a partner at Marks Paneth & Shron who specializes in "tax planning and financial analysis for high net worth individuals "and their related business entities." He's based in New York so you know Al has had some BSDs come into his office demanding the finest wealth planning advice that their money can […]

Savings Tips For Young Professionals From the AICPA

Hopefully you guys appreciate the time these folks put together to give you some free advice on putting a little away toward your future. Answers provided by AICPA National CPA Commission members Craig Steinhoff, CPA, Kelley Long CPA, Ted Sarenski, CPA/PFS, and Leonard Wright, CPA/PFS. Adrienne Gonzalez: How do you suggest young professionals who are also […]

Memo to CPAs: Those Needy Clients Are Sick of You Not Giving Them Enough Attention

Do you have needy clients? You know the type – they want to talk to you when every little thing goes wrong. They call to chit-chat for no reason in particular. They need your opinion on EV-ER-Y-THING. How are you responding to these people? Are you not returning their calls? Are you showing up late to your meetings with them? Do you just listen passively on the phone while repeating, “Uh, huh. Yes. I understand,” as you struggle with level 6-13 on Angry Birds? THOUGHT SO.

Well, they’re on to you. They sense your lack of interest. Your lack of giving a rat’s ass. And you know what? They are FED UP. There are plenty of CPAs out there that would love a client like them and MAYBE they’ll just go out and find one:

“Business is out there, but you have to market yourself differently,” [Allan Koltin, chief executive of Koltin Consulting Group] said, noting that one out of seven accounting firm clients are not happy with their accounting firm and are open to switching firms.

He urged attendees to spend time learning the personal goals of their clients. Among the factors affecting a client’s decision to leave an accounting firm, fees were ninth on the list, he indicated. “The number one factor was that the firm didn’t spend enough time with the client.”

“They don’t care how much you know until they know how much you care,” he said.

Got the message? They aren’t going to put up with your shit forever.

Business Resurging for Accounting Firms [AT]

How Do Big 4 Exiles Get Their CPE?

File this one under first world problems.


I’m starting to think about post-Big 4 opportunities and I am wondering how people maintain their CPE credits after leaving the Big 4. Since we need to take 80 hours of CPE credits every 2 years to maintain a CPA, do most employers offer trainings that give CPE credits? If not, will they give you time off and pay for the classes? I’d be very interested in hearing from you, and from the Going Concern community.

Well considering so many of the country’s employable CPAs somehow manage to meet their board of accountancy’s CPE requirements year after year, there’s got to be a trick to stay current that doesn’t involve firms forking out the cash for “experts” to school their staff on all things billable to the CPE time code. Are you telling me you have somehow escaped the wrath of NASBA and don’t get emailed weekly with new CPE offers? Congratulations.

I spoke to one of my favorite HR people at a reasonably-sized but definitely not Big 4 firm to find out what their CPE policy is and found out that most firms above 50 people pay for CPE in one way or another. According to a national survey conducted by the AICPA and the Texas Society of CPAs, 42 percent of the smallest firms paid for CPE in 2010. So unless you end up working out of some ancient CPA’s basement, you will probably not be expected to pay your own way.

Obviously, smaller firms will not be able to provide in-house CPE but you can likely get your online CPE comped, or get reimbursed for any travel associated with in-person CPE you attend. But seriously?! In-person CPE? Get with the times, man.

If you do end up needing to pay your own way (again, totally unlikely as long as you stay gainfully employed by a real accounting firm, even a tiny one), your state society of CPAs can probably provide information on their CPE offerings, or there is always NASBA (as anyone on their email list will tell you) or the AICPA.

Remember too that if you are attending conferences like AICPA Council, you get CPE for doing so, so maybe those dumb meetings aren’t so pointless after all.

CPAs Still Have a Leg Up on Computers, Smartphones Says Leader of CPAs

New AICPA Chairman Greg Anton doesn’t want you to worry; you’re all still very useful.

In his acceptance speech, Anton detailed the many ways technology is changing the profession. Automation has transformed the way financial information is collected, processed and presented, but a CPA’s value continues to lie in his or her ability to solve problems and identify opportunities for clients and employers, he said.

“As CPAs, we can decipher, disseminate and manage knowledge,” said AICPA Chairman Greg Anton. “This is what a computer or smartphone cannot do.”

[via AICPA]

Line Up For Your Own Email Address Now!

We’re getting lots of great news out of the fall meeting of AICPA Governing Council in Phoenix, AZ – some of which includes the CPA exam – but this little interesting tidbit might actually be something some of you might want to get on.

CPA2Biz (an AICPA subsidiary) announced yesterday it will offer a CPA-branded email service for AICPA members beginning later this fall. Eligible AICPA members will be able to get an email in their own name that ends with the coveted address, making it a much more professional alternative to those embarrassing Hotmail and Yahoo address some (allegedly) professional CPAs use for business purposes.

So, if Caleb were not merely an inactive CPA but an actual CPA, he’d be able to hook up [email protected]. He could then use this for everything from his private practice to his, uh, private practice (you know, like Craigslist or Match or whatever it is he does in his spare time when he’s not hitting on girls in the Whole Foods organic bulgur wheat section). Cool!

The benefits here are obvious. First, CPA is a powerful brand, and being able to identify yourself as such in your email address gives that extra bit of authority that you just don’t get from [email protected] (I made that email address up, sorry if that actually belongs to anyone out there). It also makes your email address easier to remember for clients, who should hopefully know your name and at least know that you’re a CPA, making it easy for them to memorize your CPA-branded email address.

AICPA members can order basic email, or step up to a business-class offering that includes premier security, access and easy-to-use management tools. The product was announced at yesterday’s meeting of fall Council.

“This is going to be of significant value to sole practitioners because a majority of them are using consumer email services to conduct business,” said Erik Asgeirsson, president and CEO of CPA2Biz, the technology subsidiary of AICPA. “Additionally, members of larger firms, as well as those in business and industry, now have the opportunity to own a portable professional email account. Regardless of what firm you work for or which industry you represent, it can serve you throughout your career.”

Pricing and service details will be announced in coming weeks. The offering will be the first of many to be featured on, the new firm services solutions hub for CPA2Biz.

Brazil Accountants to Join International Community of CPA Exam Kvetchers

I know this will cause a lot of Brazilians to get excited but please try to exercise some self-control.

Yes, it’s true, the CPA exam is coming to South America and since the AICPA and NASBA will start administering the CPA exam in February 2012, they’ll be in fine shape for 2014 and 2016:

Testing in Brazil will be open to citizens and long-term residents of Brazil, Argentina, Venezuela, and Colombia. U.S. citizens living abroad are eligible to test at any location.

The international administration of the exam, which will be offered in English, is the same as the U.S. exam administered by the AICPA, NASBA, and Prometric in the United States. Licensure requirements for international candidates are the same as for U.S. CPA candidates. Along with passing the Uniform CPA Examination, international candidates must meet educational and experience requirements as mandated by U.S. state boards of accountancy.

If any of our Brazilian friends have a head start on panicking over this, I suggest you start with our coverage to calm down. See you in 2012.

[via NASBA]

And I’d Have Gotten Away with It if It Weren’t for Those Blasted Accountants!

If you can get away with tax cheating, is it malpractice for your CPA to make you stop?

A Massachusetts CPA firm found out a new client was using a lame old trick. The S corporation had paid out $1 million to its owner over the years without putting it on a W-2 or treating it as a distribution from the company. Instead, the company every year booked it as a “loan” to the owners – a loan with no note, no interest rate, no security, and no repayments.

This is a time-dishonored way for people who carelessly suck cash out of a corporation to try to avoid the tax consequences – though it is less common in S corporations. It normally fails if the IRS figures it out.

The CPAs told the client that the “loan” should be reclassed as “wages” on the 2002 return to clean it up. The client owner was not excited, and talked to a lawyer to see if there was another way. After the first lawyer failed to satisfy, she talked to a second lawyer, who agreed with the CPA. The client reluctantly filed an amended return, and the owner found herself with a $500,000 tax lien.

At a national firm where I once worked, an audit partner would go from one tax person to another until he found one who told him what he wanted to hear. The client here took that approach, eventually finding a practitioner willing to prepare the 2002 return the old way. That was enough to get the client to file another amended return claiming a refund and to sue the old CPA for malpractice. That might have been a bad decision, in light of this reaction from the astonished judge:

It is surprising that Plaintiffs had the temerity to bring this lawsuit. The complaint was clearly filed too late. The record, mainly as a result of Plaintiffs’ failure to file long-overdue tax returns, is utterly insufficient to demonstrate damages. Most importantly, it is clear that Plaintiffs for many years enjoyed over $1,000,000 in income without paying any taxes on it, and they accomplished this by filing a tax return that improperly characterized the monies they received as a loan. It is close to ludicrous to claim that, by advising Plaintiffs to amend the 2002 tax return to conform with what the law and good accounting practice required, Defendants were being negligent. On the contrary, they were serving their clients ethically and well.

The judge also implied that the client might have been unwise in calling attention to the matter by filing the suit:

As a result of behaving professionally, Defendants have found themselves slapped with this expensive lawsuit. That undeserved headache, at least, is now over. The court can only hope that the IRS and the state authorities will make sure that Plaintiffs now proceed to do what everyone who enjoys the privilege of living in our beloved country is required to do: pay their fair share of taxes.

In other words: come and get ‘em, IRS!

In a world full of charlatans, it can be tough out there for CPAs who try to do the right thing. When you do, it’s nice to know at least one judge has your back.

Cite: RTR Technologies, Inc., Rosalie Berger, and Craig Berger v. Carlton Helming and Helming & Co., PC., ED-Mass., No. 09-cv-30189-MAP.

NASBA Takes the Guesswork Out of Reciprocity with Its Accounting License Library

While most of you are either in the process of getting licensed as a CPA or perfectly content to stick around in the state in which you are already licensed, NASBA reminds everyone that those of you with licenses in different states should not simply let them expire now that mobility (mostly) allows you to hold one license but work in multiple states.

From the NASBA blog (which I didn’t even know existed until now):

Mobility has meant that many CPAs no longer need to keep an active license in a state in order to practice there. But even if the license is no longer needed, there’s more involved than just letting it expire. If you don’t file the proper paperwork to let the board know that you’re voluntarily relinquishing that license, you could face disciplinary action. Without communication from you, the board may assume that you’ve allowed your license to lapse.

The distinction between reciprocity and mobility is an important one, which is why NASBA is enhancing ALL in this regard. If your work in a state were likely to be short-term, then the state’s mobility guidelines would likely cover you for the project’s duration. But if you are licensed in one state and plan to relocate to another, then you’ll need a secondary or reciprocal license from that state’s board. Most states, even with mobility, are requesting that CPAs obtain reciprocal licenses if they are making such a permanent move. Either way, if you find yourself with redundant licenses, ALL can help you relinquish them properly.

Now, NASBA wants to use their Accountancy Licensing Library tool to figure out the rules in your state for relinquishing your license, which is fine. But you can also check with your state board directly for rules on this.

Keep in mind if you relinquish your license in any state you may have to re-apply and retake the exam all over again, assuming you somehow also relinquish your other licenses in other states and have no license to transfer to that state. But who is going to do that?!

The key word here is redundancy. In this day and age, it no longer makes sense to carry multiple licenses, even if your work means you need practice privilege in states other than your own.

AICPA Outlook Survey: This Double-Dip Recession Just May Be Happening

Just in time for President Obama’s jobs conversation to a joint session of Congress, the AICPA has released its latest quarterly economic outlook survey results. Long story short: sentiments aren’t high among financial professionals surveyed.

The outlook for the U.S. economy turned negative in the third quarter for the first time since 2009 as prospects for recovery waned and concerns about a second recession rose, according to the latest AICPA Economic Outlook Survey of Chief Financial Officers, Controllers and CPAs in executive and senior management accounting roles.

The CPA Outlook Index, a broad-based composite index that captures the expectations of CPA financial executives and management accountants, declined 8 points to 58 this quarter, down from 66 in the prior period. The survey, conducted in August, tallied 1,305 qualified responses from CPAs who hold leadership positions, such as chief financial officers or controllers in their companies.

“For the second consecutive quarter, the CPA Outlook Index declined as turbulence in the political and economic environment eroded the sense earlier this year that a recovery was taking hold,” said Carol Scott, AICPA vice president for business, industry and government. “A majority of our CPA members in executive financial roles now fear a second recession may be likely.”

The decline in the CPA Outlook Index was fueled by a sharp drop in sentiment about the U.S. economy.

A whopping 61 percent majority of respondents said they think it is “somewhat likely” or “very likely” the U.S. will fall into a double-dip recession. Only 9 percent of CPAs serving in executive positions expressed optimism about the U.S. economy in the third quarter, down 24 percentage points from 33 percent who were optimistic in the second quarter.

It is reasonable to point out here that though the CPA Outlook Index turned negative this quarter, it is still above the 4-year low of 32 in the first quarter of 2009.

U.S. economy optimism plummeted a whopping 28 points from 53 to 25. Of the major index components, none changed positively quarter-over-quarter for 2011.

While the outlook for respondents’ own organizations is not as rosy as it was earlier this year, it has not dropped as sharply as the outlook for the US economy. Optimists also still outnumber pessimists, with 41% of the CPA decision-makers indicating that they are optimistic about the outlook for their own organizations over the next 12 months, while only 21% are pessimistic. Expectation for expansion also dropped again this quarter but a majority of respondents (53%) still expect to expand at least somewhat in the next 12 months. This is down from 61% who expected expansion last quarter.

Executive summary of the survey results can be found here.

Brand New CPA Has a Serious Dilemma

From the mailbag:

Does GC have any suggestions of where to get a frame for my brand-new CPA wall certificate? I searched the site, but if you’ve covered this before I must have missed it.

I appreciate the feedback! Thanks!

Perhaps our reader is referring to this post we did back in July where the reader was impatiently waiting for his certificates so he could decorate his cubicle walls.

Obviously we have a completely different issue here but it’s no less important. So let’s throw a few ideas out there:

1. Make like a Son of Nazareth and build the thing yourself.

2. Hand the certificate over to your young son/daughter/niece/nephew along with a box of Crayolas and hope for the best.

3. Two words: Dumpster diving.

4. Your ideas.

Should an “Accidental” Tax Lawyer Go Back to School to Qualify for the CPA?

Back again with another edition of fix my career ASAP. Today, “an accidental tax lawyer” wants to obtain a CPA to bolster his small practice. Other lawyers look at him like he’s “crazy” when he discusses the IRC but our Regretful JD enjoys all the minutiae. Problem is, he’ll have to start from scratch since he has business background. Is this plan gold or is he a glutton for punishment?

Are you suffering from a case of summer-is-ending-which-means-busy-season-is-right-around-the-corner blues and are wondering if it’s time for a new job? Does your golf game suck? Do you wear pinstripes? Email us at [email protected] and we’ll suggest something that wins.

Back to our lawyer friend:

So, long story short:

I’m an accidental tax lawyer. I studied neuroscience in college and went to law school to do patents. I took personal income tax as a summer course after my first year, was surprised that I both liked it and did well. Through the remaining two years of law school, I took corporate tax, gift and estate tax, state and local tax, natural resource taxation, two tax seminars, and averaged an A- in them all. Graduated, passed the bar and opened my own tax shop, mostly small business and non-profit formation, opinion letters for CPAs and walking taxpayers through audits. I operate on a one-stop-shop model-come to me and I’ll handle your legal and tax planning needs. I’m good at what I do, and I’ve been profitable since the first year.

Here’s where you guys come in: I think I’d really enjoy being a CPA. Other lawyers look at me like I’m crazy when I talk about the internal revenue code, but I find tax planning enjoyable and it lets me be creative. Am I crazy to consider going back and taking the courses necessary to qualify for the CPA exam? My local public university offers a graduate “Pre-CPA” program, with just the courses required to qualify for the exam. As an undergrad, I took two semesters of calculus and two semesters of inferential statistics, but the rest was basically hard science (physics, microbiology, organic chemistry, neuroanatomy, pharmacology, etc). Except for my tax law background, I’d basically be starting from scratch.

Hell, is there even a market for CPA/JDs? I don’t need to work Big Four (I like meeting with and managing my clients on a personal level. I find it very rewarding), but to keep a roof over my head I’d need to earn at least mid-five figures. If I continue with the solo practice model, I’d be able to provide accounting, tax and legal services, but I’m not sure that accounting as a value-add would be worth tuition + lost opportunity time when I’m studying instead of working.

Any advice you can offer me is appreciated.

Sign me off,
“Regretful JD”

Dear Regretful JD,

First off, if that’s the short version, thanks for sparing us the details. YEESH. Secondly, neuroscience to patents to tax is quite the interesting progression but we won’t pry…it was a woman, wasn’t it?

Now, then. Your situation. Personally I think you’re at a huge advantage compared to the CPAs out there that are thinking about going to law school. Some of you remember the post we did last year discussing that particular jump and it’s not an easy one. Law school grads, as our friends at Above the Law will tell you, aren’t exactly drowning in job opportunities these days but they are being suffocated by six-figure school debt. For you, Regretful JD, that ship has sailed. You’ve got your practice set up, enjoy the work, and are earning a steady dollar.

The problem, as you stated, is that you’d be starting from scratch. If you’re single and don’t have a grip of cash stuffed in your mattress to get you through the “Pre-CPA” program, you’re going to be living on Cup o’ Noodles and saltines smeared with dijon mustard. Are you ready to make that sacrifice? What about your clients? Are you just going to drop them or will you attempt to keep them by promising the world and more once you’ve got your CPA? Your life could be a living hell trying to juggle tax seasons and school work.

As for your question regarding “a market for CPA/JDs” our aforementioned post found that, yes, there is something to be said for the CPA and JD white-collar, one-two punch. Being able to understand legal ramifications of your clients’ decisions as well as being able to dig into the numbers and actually understand them has proven to be a great selling point.

Ultimately the decision comes down to one of logistics. Can you work, go to school and maintain your sanity and/or shred of a social life that you have left? It’s not impossible but you’ll have a rough couple of years, to be sure (don’t forget about the CPA Exam!). Those that have done it will likely say it was worth the struggle but everyone has their breaking point. What’s yours?

Also see:
Tax Lawyer Pursuing CPA Needs to Know: Take More Classes or Cram with a Review Course? [GC]
The Scam That Accounting Education Isn’t [GC]

Three Tips to Help Make Studying for the CPA Exam While Working Less Awful

Ed. note: This post is by Jeff Jardine, CMA®, CPA, PMP, Senior Consultant, Deloitte & Touche LLP and is republished from AccountingWEB.

During my summer internship at an accounting firm I noticed each night as I was heading out the door with my managers that two of our team members stayed behind and continued working.

I admired but internally questioned their dedication. After the pattern ensued for several days, I asked one of the individuals why she felt the need to stay behind every day when we had already reached our daily milestones. She explained that she was preparing to take portions of the CPA exam, and that there was no other available time besides weekends to study. I wished her well (she did eventually pass).

Her actions/dedication left an indelible impression on me, and as I entered my senior year in college I rearranged my class and personal schedules to allow myself time to study for the CPA exam so that I could take the test prior to beginning full-time employment.

Pursuing this and other certifications has made a positive impact on my career. I thus offer three tips for how to effectively study for professional accounting certifications while working:

Tip 1: Get Certified Prior to Starting Your Job
If I could pass along one piece of advice to young professionals considering an employer-required certification it would be this: If you have time between graduating college and beginning work, put 100 percent of your efforts into completing that certification prior to starting your job. Yes, it makes for a miserable summer wherein your best friends are exam prep instructors (Peter Olinto, anyone?), but in the end this method is the much preferred alternative to studying after a long day of work for months on end.

What should you do, however, if you have no such break between college and full-time work, or you are studying for an additional certification later in your career while working full-time? I fell into this latter category while working toward the CMA, which I had known since college that I wanted to take as soon as things settled down after beginning work at an accounting firm.

Tip 2: Gain Buy-in from Your Employer
After examining my schedule, I determined the most favorable times to study for and schedule the various sections of the CMA exam. Then, I spoke with my teams at work to gain their buy-in (my managers were fully supportive), and I scheduled my exams well in advance while keeping in mind client demands and team requirements. Saturdays always fill up first at testing centers, so schedule as far in advance as you can.

Tip 3: Build Studying Time Into Your Daily Schedule
Additionally, I took a day off from work prior to each exam date to have adequate time to study – though I didn’t plan on studying everything on that one day or just on Saturdays. I knew that I needed to study – at least a little bit – every day to most thoroughly prepare for the exam.

After considering my daily schedule, it was clear that the time I had the most control over was early in the morning. I decided to wake up an hour earlier each day for the three to four weeks prior to the exam to review material and churn through practice questions (which I believe is one of the most effective methods to prepare for these exams). Then on Saturdays I studied longer and more in-depth.

I took Sundays off from studying to allow things to settle in my mind while spending a day with my family. In the end, my efforts paid off. I passed each section and after finishing the experience requirement, I was a CMA.

New CPA Sick of Bare Office Walls, Wonders When Certificates Will Arrive

This just in:

I had a question regarding when you receive those frameable versions of your CPA certificate. I passed and became licensed Oct. of 2010. The [Connecticut State Board of Accountancy] just sent my SBOA CPA certificate (the fancy frame-able one). But I have seen in other people’s (who have their CPA) offices that they have frameable certificates from their state’s SBOA, AICPA and state society (i.e. CT Society of CPA’s).

When do you get the AICPA and State Society of CPA’s version of the frame-able certificate? I want to hang them up…otherwise what else is earning a CPA good for (other than that whole making a living thing).

Just for grins, I called up the State Society of CPAs in the Constitution State only to leave a voicemail with their membership coordinator. I also emailed the AICPA’s VP of Students, Academics, and Membership, so I’ll let you know if I hear anything.

And since it’s been a number of years since I’ve passed the CPA and my memory isn’t what it used to be, I can’t really speculate as to the length of your wait. If others are more familiar with the timeliness or lack thereof as it relates to your paper trophies, please inform our inquisitor by commenting below. In the meantime, maybe he should just get one of those old Farrah Fawcett posters? Other suggestions would be welcome.

Can Convicted Felons Become CPAs?

As many of you are already aware, any sort of criminal record can negatively impact your career options if you’re considering public accounting. For one Going Concern reader, his sketchy past could mean the difference between becoming a CPA and spending his life as a payroll clerk.

Here’s the question:

Suppose I am an educated, convicted felon (possession of marijuana w/ intent to distribute when I was 19, currently 22) who is taking the CPA exam in the fall after graduation from college. I expect to pass (I’ve studied long and hard) and I have a few questions for you. Do you think accounting firms would be open to hiring a convicted felon, despite qualifications and a non-fiduciary felony? Also, would a state board (NH specifically) certify me as a CPA, provided I was able to get a job and fulfill the experience requirements? Do you have any precedents or similar situations you could inform me of?

Well, let’s start with the New Hampshire application for licensure, which contains the following simple question:

Have you ever been convicted of a felony that has not been annulled or committed any dishonest act?

If yes, please attach a separate sheet, which contains a complete description of the circumstances.

What this says to me is that you should start working on what you’re going to put on that separate sheet. You won’t get points for oversharing but you may get credit for honesty and clarity.

As you pointed out, it’s worth noting a few things. First, you were 19. We all do stupid things when we are 19. Granted, your stupid things got you a felony when it gets most 19 year olds regretful tattoos or embarrassing stories but still, you were a kid. That said, you’re still a kid to some employers/authority figures, so don’t get your hopes up expecting people to automatically assume you’ve reformed yourself in 3 years.

Second, it’s not like you robbed a gas station, stole credit card numbers or ripped off your Boy Scout troop – the fact that you were once in possession of a large quantity of marijuana isn’t much of a reflection on your character as it pertains to your ability to stick to the professional code. But (and this is the part that sucks), marijuana is still illegal and therefore the Board of Accountancy will consider that fact independent of what you were actually charged for. To some, the fact that you committed any crime at all means you are not of the ethical fortitude required to be a CPA. Let’s ignore the fact that many of the people who feel this way break the law all the time; talking on their cell phones behind the wheel, speeding, and driving while mildly intoxicated after happy hour.

The general rule here is that you should be fine as long as your conviction isn’t a fiduciary one but it’s up to the state to decide. Whatever you do, don’t try to hide it, as the important thing here is proving you are trustworthy. And you may want to talk to a lawyer about having your conviction expunged or knocked down to a misdemeanor. It probably doesn’t change much for you as far as jobs go (hope you aren’t planning on going Big 4, they won’t touch you with a conviction like that) but hey, you’ll be able to carry a gun (you know, for those dangerous engagements).

Good luck!

Here’s a Video of 500+ CPAs Failing to Juggle

The woman who throws a small hissy-fit at 3:05 makes it all worth it.

So You Think Your CPA Can Dance?

Michigan CPAs, Welcome the Newest Member of the Club

Since we are totally above making disparaging remarks about strangers on the Internet, we present the following without comment from

Jessica A. Rolfe, of Yeo & Yeo P.C., 3023 Davenport in Saginaw, has received a Certified Public Accountant license and was promoted to senior accountant, providing auditing services in the firm’s Saginaw office.

Rolfe holds a bachelor’s degree from Saginaw Valley State University, and is a member of the Michigan Association of Certified Public Accountants and the American Institute of Certified Public Accountants.

Now the last time we shared one of these cheesy, free publicity “news” items, it also happened to be a Michigan CPA except that guy allegedly passed all four parts in one sitting, which the newspaper told us only happens with a lucky 4% of individuals. We’re not sure where they got that number (we suspect somewhere between their legs, towards the back end of things) but are glad to see no such claims made in this particular announcement.

We’ve said it before and we’ll say it again: if you have an announcement like this to make for the star intern in your life, please feel free to send it to us. We require at least 100 words, fact-checked claims and, of course, a Photoshopped headshot. Might I suggest Glamor Shots?

CPAs Aren’t As Optimistic As They Used to Be on the Economy

Straight from the horse’s mouth, or, in this case, the CPAs:

According to the latest AICPA Economic Outlook Survey, chief financial officers, controllers and CPAs in executive and senior management accounting roles are far less optimistic now about the direction of the U.S. economy than they were in the first quarter of 2011.

The CPA Outlook Index, a broad-based composite index that captures the expectations of CPA financial executives and management accountants, declined three points to 66 this quarter, from 69 in the prior period.

“The flush of optimism we experienced earlier this year has given way to more moderate expectations for the U.S. economy,” said Carol Scott, AICPA vice president for business, industry and government. “While the CPA Outlook Index is still positive relative to the dark days of the recession, our members are concerned about rising energy costs and inflation, health care costs and continuing weakness in demand.”

The pullback in optimism follows an upbeat assessment in the prior quarter and signals the two-year-old U.S. economic recovery has lost momentum, Scott said. The survey shows that expectations for corporate expansion and hiring have moderated and the outlook for revenues and profits declined. Concerns about inflation continued to rise, driven by higher energy costs. The outlook for capital spending remained largely flat with information technology the only sector enjoying improvement.

It’s worth noting that while optimism for the US economy declined sharply this quarter, it is still higher than it was for the 4th quarter of 2010. Slightly more than one quarter of respondents (27%) expressed a pessimistic outlook for the US economy, driven by concerns about unemployment, government debt and rising prices.

Check out the full survey here, Valium not included.

Don’t Miss the Big Surprise at the Maryland CPA Summit, June 2 – 3 in Baltimore

If you are anywhere near Baltimore and looking for something to do on June 2 – 3, have you considered checking out the Maryland CPA Summit?

I’m specifically going to check out the new CPA swearing in as I hear from a reliable source that the MACPA crew is planning something very special that I just can’t share with the class at this point. Trust me, you’re not going to want to miss it.

You can also pick up some CPE in such fun and exciting topics as healthcare reform, fair value, revenue recognition & fraud, IFRS, XBRL and more. It’ll run you $125 if you’re a MACPA member, or $325 if you are not.

Maryland CPAs, I expect to see many of you there.

Why Am I the Only Person Under 40 at AICPA Spring Council?

So I’m here in downtown Washington, D.C. for three days of awesomeness that is AICPA Spring Council 2011. While today’s session started just past the asscrack of dawn (breakfast at 7am) and goes through evening, the first day was mostly cocktails and schmoozing, as these events tend to  be.

Here’s my question: where the hell are the young CPAs? Of the attendees, every single state is represented, some more than others. CPAs from across the country have descended upon Washington in their best monkey suit to listen to speakers like George Will and Eleanor Clift, as well as to get an update on the legislative issues that impact the profession. On Tuesday, they’ll be taking to the Hill to bring these issues directly to their Congress(wo)men.

But there is only ONE attendee (from Hawaii) who falls into our age bracket (your humble reporter excluded, of course). ONE.

Listen, I get it. You spent your last college years dealing with this kind of shit, putting on a tie and sucking up to partners and recruiters, all the movers and shakers of the industry. You worried about using the wrong fork at banquets and sat through symbolic awards ceremonies just to appear as though you are passionate about your industry. Now that you actually have a job, what’s the point?

The point is that these issues impact the profession which you will inherit one day. I’ve got nothing against middle-aged men in suits (hell, I’ve been dating one for the last two years) but one day soon, they’ll be retired and it will be up to us to take the reins and move the profession forward. How on Earth are we supposed to do that if we don’t figure out how it is done now?

There are endless opportunities here for mentoring and, better, for young CPAs to have a voice. Yes it’s somewhat symbolic. Yes you will have to wear a tie. Yes it can be stuffy and dull and a bit tedious. Guess what? It’s still important and one day, when all the middle-aged men are living their retirements out on yachts in the middle of the Pacific, you’re going to have to step up and do it anyway.

If you’d like to get involved (it’s not too late to start planning for next year), get in touch with your state society of CPAs for more information. You can find out more about AICPA Governing Council on their website.

You can follow #AICPAGC11 hashtag on Twitter to check out what we’re all up to for the next two days and please, don’t make me yell at you again. I didn’t put this monkey suit on this morning for nothing.

Does Interning Count as Experience Towards a CPA?

Today’s CPA exam question has little to do with the actual CPA exam and more to do with your career thereafter, or before if you’re already working in indentured servitude public before taking the exam.

From the mailbag:

Hi Adrienne,

I’ve been trying to look this up, but I keep ending up with vague responses. Can you get your “accounting hours” or whatever work related experience needed for a CPA license (1-2 yrs) before you pass the exam? Do summer internships count (say you interned on an audit)? Which states make you get audit work experience as opposed to states that just ask for accounting experience?

A bit confused.

For future reference, you guys can really help me out here by letting me know what state you are in (or applying for licensure in) as all states are different. Generally speaking “experience” is defined as work performed under the supervision of a licensed CPA in that jurisdiction. Even if you are unsure of which state you will be applying to, a general idea is helpful for my purposes.

You should be able to get your experience before, during or after taking the CPA exam. In some states, you have a limited amount of time to actually complete the requirements once you have passed, in others you will have to take some CPE to “refresh” passing scores after quite some time has passed (5 years).

States like Oregon, Virginia, Georgia and Kentucky will accept general experience in lieu of direct accounting work, meaning you can work in corporate finance and still get your experience requirements met.

States like Colorado and Oregon will accept work performed under the supervision of a Chartered Accountant as well. Colorado will also waive the work experience requirement completely if you meet certain additional educational experience requirements (150 units), check with the Board for exact details on this. Illinois and Massachusetts may also allow you a license without actual work experience. In Mass, you can receive a non-reporting license if you do not meet the 1 year of overall experience and 1000 hours of attest experience, meaning you can do everything but issue reports on financial statements.

States like Alabama, Florida, Illinois, Montana, and Nebraska will give you a CPA certificate instead of an actual CPA license if you have passed the exam, meaning you can put it on your résumé but will not actually be able to practice as a licensed CPA in that state until you meet the additional work experience requirements.

Currently, California does not require audit hours and you can always add them later if you decide you want to perform audits in the state.

Your best bet is to cough up $10 to access NASBA’s Accountancy Licensing Library to search through the different requirements based on which you might meet. You don’t have to know where to look, just plug in what you have (or expect you will have by the time you are ready to apply for licensure) and figure out which state would work best.

Hope that helps!

Who Would Have Guessed That Texas CPAs Would Oppose the Elimination of Oil and Gas Tax Breaks?

Next thing you know you’ll hear about CPAs in Iowa (with the exception of one with whom we’re acquainted) opposing the repeal of ethanol credits.

The Texas Society of CPAs’ Federal Tax Policy Committee addressed the issue in its “Analysis of Legislative Proposals to Repeal Certain Tax Treatments of Domestic Oil and Gas Exploration and Development”.The committee agrees that reducing the deficit is of utmost importance, but said that any effort to cut tax incentives for oil companies and raising taxes on oil and gas exploration and development should be weighed against its potential to exacerbate the current underemployment issue, and the need for a secure source of energy.

As noted in the analysis, the committee said it believes repealing tax benefits and allowances for the industry could adversely impact the state’s oil and gas industry, and the economies of Texas and the U.S.

Texas CPAs Oppose Elimination of Oil and Gas Tax Breaks [AT]

The AICPA Wants Your Thoughts on What the Future Holds for CPAs

Now is your chance to tell the AICPA exactly where you think the industry is headed in the future. CPAs don’t get many chances to be this candid about their chosen profession, so please make it count.

CPA Horizons 2025, coined “the profession’s effort to anticipate and plan for the future,” is a short survey that seeks to get professionals’ opinions on where the industry is going and the challenges it faces to get there. Participants are faced with the following directive:

Growing global competition, rapid technological development and increasing regulation are impacting the CPA profession today and will continue to in the coming years. As a result of the changing environment, how can the profession remain competitive? Will services being requested of the profession change? Will the profession’s core values, core services and core competencies remain the same or need to change to allow the profession to continue to best serve its clients and employers?

CPA Horizons 2025 is about your future and the future of your profession. It’s about forging a path to ensure both remain competitive in a rapidly changing world. Your participation in this profession-wide endeavor is vital in helping shape our collective future.

We are soliciting the thoughts of thousands of CPA’s along with other voices via this interactive survey, online discussion forums, in person forums and direct outreach to AICPA committee members, leaders in the profession and beyond. We ask for 15 minutes to help map out the next 15 years. Your 15 minutes will be on a limited # of questions that is a subset of a larger group of questions which will serve to identify what is on the Horizon impacting the profession. Your participation is important. What may the future hold? Help tell us.

Beyond answering simply yes or no questions based on pre-determined criteria, you will have the opportunity to write in your answers regarding trends, opportunities and challenges facing the profession. You will also get an entire box to fill in what you think the profession should do to remain relevant, a huge opportunity for those of you who feel the current food chain just isn’t doing it for you.

And then you get to watch a video. Frankly I’ve got to say this video was pretty depressing, showing how the U.S. is falling behind in the global scheme of things, continuously getting spanked by India and China when it comes to science, math and the economy. Ouch.

Take the survey here.

And Now…CPAs Acting Out a Scene From Casablanca

Following the ingenious reenactment of the beginning of Luke Skywalker’s father issues, the Pennsylvania Institute of CPAs has delved into the classics, bringing us a scene from Casablanca.

Personally, I’m not crazy about this one. It’s bad enough that most of you haven’t seen the film but from an artistic integrity perspective, it really should have filmed it in black and white. However, I have to admit that the overwhelming smoke and horrendous French accent were nice touches. Other commentary is welcome at this time.

More PICPA videos:
And Now…CPAs Acting Out a Scene from the Empire Strikes Back
PICPA: You Need a CPA to Get Your Breathlessly Judgmental Friend to Shut Up
Latest PICPA Video: CPAs Are Like Snuggies
Pennsylvania CPAs Insist Accountants Are Funny in New Videos. Which Are Funny

And Now…CPAs Acting Out a Scene from the Empire Strikes Back

Last year the Pennsylvania Institute of CPAs went on a video production bonanza that incorporated Snuggies, public service announcements from the 1980s and your breathlessly judgmental friends. As impressive as those videos were, putting a CPA spin on a climatic scene from the best film in the Star Wars series takes things to a whole new level.

The breathing at 0:39 and the subsequent scream are priceless, as is the cough at 0:55.

What Will Maryland CPAs Put on Their Vanity License Plates?

Of course Tom Hood had something to do with this.

Get your MACPA vanity license plate, complete with the CPA logo and tagline “CPA – Never Underestimate the Value” prominently featured. Let everyone know you are a member of the Maryland Association of CPAs. Plates cost just $25. They’re a fun way to show you are proud to be a CPA.

There’s one resident of Maryland who probably would like one of these that simply says “JDA” but we’re guessing “CPA wranglers” aren’t eligible. As for the legit CPAs out there, unless there’s a proctologist out there that’s already nabbed it, we suggest you move quick to get “ASSMAN” because it won’t last. We’ll hear your other clever suggestions now; shoot for style points.

Can a Sole Practitioner CPA Jump to CFO?

Welcome to the two-outof-three-groundhogs-can’t-be-wrong edition of Accounting Career Emergencies. In today’s edition, a CPA with nine years experience as a sole practitioner has CFO aspirations but isn’t having any luck landing interviews. Does her near-decade of running her own shop hurt her desire to rejoin the corporate ranks?

Need advice on your career? Got a co-worker saying nasty things about you? Getting impatient while you wait for the perfect time to start your embezzlement scheme? Email us at [email protected] and we’ll save you from yourself.

Back to the boss:

I am a female CPA in my mid-40s who has been a sole practitioner accountant for the past 9 years. I’m confident, aggressive and customer-focused. Prior to my accounting career, I worked 12 yrs in the Technology industry, for companies like AT&T and Motorola – in positions of increasing responsibility – my last 2 jobs were VP-level. I also have an M.S. and B.S. in Mathematics.

Here’s my dilemma, I would like to re-enter corporate America but this time on the finance side as CFO or Sr. Controller of a private company. I’ve just started talking to accounting/finance recruiters and I’m getting a luke-warm reception to my background. They return my calls, tell me I’m “unique”, but I’m not getting any interviews. I’m wondering if being a sole practitioner is holding me back?

My question for the guru is: what is the perception in the finance & accounting industry of a sole practitioner – are we considered to be a “lesser” form of CPA, unable to perform as a CFO? I’m also wondering how my “accounting as a second career” is perceived? It does appear that most accountants are kind of “born that way”, rather than deciding mid-life to become a CPA, like I have. But what can I say, I always had CFO-envy in my first career, so I decided to pursue my passions, start my own business, get my CPA, and go for what I wanted – one would think that would be looked at positively?

I’m really hoping you can provide some insights. I don’t have any CPAs to talk to, since my main interaction with my peers has been when I take business away from them. And I tried to get career advice from a female mentor program sponsored by my state CPA society – but all they wanted to talk about is flex-time and work/life balance!

In need of a reality check,

Dear In need,

So it sounds like you’re tired of being the boss without having anyone to boss? Or maybe you miss the friendly confines of corporate America? Whatever your motivation, we have a simple question for you: are you nuts? What do you hate most about having your own business? The flexibility? The money? Not having to deal with stupid co-workers? Sigh. Forget our questions, we’re here to help.

Nine years is quite a stretch to have your own practice and from the sounds of it, you’ve been successful and you had a decent run in the corporate world prior to that. Regarding the tepid reaction from recruiters, we’re curious if you’ve pressed them for reasons for the lack of interviews. These people are working for you, don’t forget, and any failure on their part doesn’t reflect very well on their abilities. Get some straight answers out them.

Now, then. The perception that the F&A industry has of sole practitioners is, well…they don’t pay much mind. We’re guessing you’re preparing plenty of tax returns, maybe a few small audits and providing financial advice to your clients. Anyone looking for a CFO wants someone that can lead and run the finance and accounting departments. Despite the twelve years of experience you have in the corporate world, your most recent experience has been working for yourself and serving clients. Not much management experience (from an f&a function or employee perspective) there. It’s not that you’re “unable to perform” but your track record doesn’t really demonstrate that you’ve been working towards that goal. Furthermore, small company CFOs these days are taking on more responsibilities including IT and HR decisions. Chances are most companies will hold out for someone with the total package. Or at least a package more complete than yours. We’re not trying to discourage you but we do see a disconnect between your experience and the position you desire.

That said, there is no shortage of small companies that need CFOs and controllers. Be sure you’re using an executive recruiting firm to assist you in your search and ask them honestly if your background is problematic.

One other thing to consider: maybe shop around to the CPA firms in your area that wouldn’t mind having your book of business. Perhaps they’d be interested in admitting you as a partner in their firm. It’s not exactly in line with your goals but it could pave the way if your CFO search runs into a dead end. Good luck.

A Multitude of Big 4 Auditors Can Confirm This

[J]ust because a person has the initials CPA after his/her name does not mean that he/she knows his/her arse from a hole in the ground when it comes to preparing 1040s.

That comes courtesy of the Wandering Tax Pro, Robert D. Flach. It got the attention of Joe Kristan, who came to the defense of CPAs everywhere but did admit that some CPAs have no business being near tax forms:

[Robert] then spends his next 10 paragraphs elaborating on our shortcomings. And that’s fine, to a point. Not all CPAs are qualified tax preparers. By the same token, not every lawyer is capable of defending you on a murder charge. But the guy you want by your side when the state wants to send you to the chair is definitely going to be a lawyer. And while not all CPAs should be your tax advisor, many of the best tax advisors are CPAs.

Case in point: many relatives and clueless friends of auditors still ask said auditors to prepare their tax returns. In most cases, a) this is a HUGE mistake and b) they don’t want to help you anyway.

AICPA Launches Clearly Pretty Awesome Campaign to Target High School Students

The following post is republished from AccountingWEB, a source of accounting news, information, tips, tools, resources and insight — everything you need to help you prosper and enjoy the accounting profession.

The American Institute of Certified Public Accountants (AICPA) has launched the Clearly Pretty Awesome Competition for high school students to introduce them to the CPA profession.

“The CPA designation offers many rewarding career paths,” said Jeannie Patton, AICPA vice president – students, academics, and membership. “College students are graduating with degrees in accounting at historically high numbers. Decisions regarding career paths are being shaped very early, many at the high school level. It’s important that students have substantial information about accounting careers before they select their majors at colleges and universities.”

The Clearly Pretty Awesome Competition calls for students to devise a job (other than certified public accountant) using the acronym CPA, such as “curb paint applicator” or “city park accordionist.” To enter the competition, students are encouraged to visit Start Here, Go Places and register using the site’s FutureMe tool, and then submit their entries, along with an explanation as to why being a real CPA is a better option than the job they created.

A panel of judges will select the finalists on November 18 and 19. The top submissions will appear on Start Here, Go Places for public voting beginning on November 29. The AICPA will announce the winning entry on or about December 15, and plans to incorporate it in a national advertising campaign.

There will be 1st through 5th place awards:

• 1st place: A laptop for the student, $3,000 grant awarded to the student’s school in his or her name, use of the entry in the ad campaign, and a poster for school display;

• 2nd place: A laptop for the student, $1,500 grant to the school in the student’s name and a poster;

• 3rd, 4th, and 5th places: An iPod touch for the students.

The competition is open to full-time 15 to 19 year-old students who are enrolled in a high school in the 50 states, District of Columbia, Puerto Rico, Guam, the Northern Mariana Islands, American Samoa or the U.S. Virgin Islands. The AICPA will accept entries until Nov. 17.

About the AICPA:
The American Institute of Certified Public Accountants is the national, professional association of CPAs, with 369,000 CPA members worldwide in business and industry, public practice, government, education, student affiliates and international associates. It sets ethical standards for the profession and U.S. auditing standards for audits of private companies, nonprofit organizations, federal, state and local governments. It develops and grades the Uniform CPA Examination.

The Role of a CPA in an IPO: Open Thread

Back with another edition of “Accounting Career Couch” a undergrad senior wants to hear about some experiences the working stiffs of accounting world have had with initial public offerings.

Need advice on your next career move? Want to educate some rubes without coming off like a total jerk? Looking for a way to broach your co-workers body odor problem while not making it too personal? Email us at [email protected] and we’ll help you let everyone done gently.

Meanwhile, back on campus:

Hello Caleb,

I am an undergraduate senior, and I have a presenta Special Financial Reporting Topics course. My group chose “The Role of a CPA in an IPO”, and I was wondering if this topic has been discussed on your site before, if not, could you make a post so I can gather related information, issues, success/failure stories, and personal experiences in order to complement my research? It seems this topic does not get a lot of coverage, and I believe it would be interesting and beneficial to all your readers.

To our recollection, this is a topic that has not been discussed on GC, so our reader’s inquiry makes for a good jumping off point.

If you’re not familiar with initial public offerings, then you can get the wiki cliff notes here and the SEC’s own fast answers under “I.”

Form S-1 outlines (check out the gory details below) everything a company needs to submit in order to register its securities and there are plenty of ways a CPA can assist a smooth and pleasant experience. If you’re client has less than $25 million in revenues and isn’t registering more than $10 million in securities, Form SB-1 can be used in lieu of the big boy.

Generally, when a company files its S-1, the SEC usually has lots of questions about the financial statements and the accompanying information. The back and forth can be grueling and if your client isn’t organized or financially savvy the temptation to strangle someone and everyone can be high. But hey, if you manage to stick it out with them to the filing date, there’s usually a pretty good party and your client should be grateful for your service.

So at our reader’s request, anyone with recent (or not so recent) experience working on IPOs is invited to share their war stories – the good, the bad, etc.


Earning the Right to Say, “You can trust me. I’m your CPA.”

The following post is republished from AccountingWEB, a source of accounting news, information, tips, tools, resources and insight–everything you need to help you prosper and enjoy the accounting profession.

“That was strange,” I thought as I hung up the phone. I’d just spent the last thirty minutes on the phone with a client talking about, of all things, which B-school his daughter should attend and what major concentrations she should consider.

This didn’t fit my view of accounting as it did not involve auditing transactions or pushing numbers around on a spreadsheet. They didn’t teag in undergraduate school. Yet, some 25 years after receiving a diploma with a Bachelor of Science Degree in Accounting and some 22 years after earning the right to call myself a CPA, here I was being asked to advise a client on a very personal matter not even remotely related to accounting.

How did this happen? In a word – trust. Over the years, I had earned the trust of this client on enough accounting, financial, and tax related matters that he now trusted my advice on such matters as where his daughter should attend college. As I let that sink in, I was blown away by the realization that trust leads to influence.

Because CPAs usually are very active in their communities, they have a very well-developed network of contacts and referrals. And because CPA’s are trusted, when they refer a client to somebody in their referral network, more likely than not, that client will end up working with that referral.

A colleague of mine – also a CPA – related the story of sitting with a client who recently had sold his business and had in excess of $100 million to invest. The client had never seen this much cash and was unsure what to do. The CPA recommended the client talk to a wealth management specialist and the client agreed. After the wealth manager had explained his core values and approach to investing, the client turned to his CPA and asked for his thoughts. The CPA responded that he was a believer and that all his personal and retirement savings were invested with this wealth manager. The client turned to the wealth manager and said, “If it’s good enough for him (the CPA) then its good enough for me. How do I get started?”

Do you think that afternoon the wealth manager was really glad to have the CPA as a referral source? I’ll guarantee it. The endorsement from the CPA and the client’s trust of that endorsement not only gained the wealth manager a substantial client – it also greatly shortened what would normally be a very lengthy sales process.

Whenever I see a public opinion poll about most trusted professions, the CPA always is at or near the top. There are several reasons why CPAs are viewed so favorably. CPAs are viewed as having a great deal of competence, able to remain unbiased, able to constrain emotion from affecting decisions, and possess an aura of independence and fiduciary responsibility – meaning we generally treat our clients affairs as we would treat our own.

One area where sound, practical advice is indispensible is finance. Against this backdrop of favorable opinion and opportunity, when a CPA delivers a valuable financial service and honors his word, trust is developed in spades.

During August of this year I read an article written by a business owner about the relationship with his CPA. The owner wrote that his CPA is the benchmark he uses to measure all other consultants. He goes on to explain his CPA has three attributes he appreciates as a valuable resource. Those attributes are knowledge, experience, and what he terms the “we” factor. That is, his CPA considers himself part of the team.

When the CPA makes a recommendation, such as getting rid of non-performing assets, adjusting personal lifestyles, or finding another service provider for payroll, legal services, software, investment advice, leasing agents, business brokers, or banking relationships, this business owner is going to follow that advice. He has no reason not to follow it.

In many client relationships, the CPA is counted on to be a trusted business advisor, to be available when the entrepreneur needs advice, to be the quarterback of the team of professionals who help to guide the company. Through contacts with other professionals and other clients, the CPA can be an excellent source of information when a business is unsure of the path to follow or when it needs services it has not used previously.

When a client trusts his CPA enough to entrust decisions affecting his own children – such as where to go to college and what to major in or how to invest $100 million of new found wealth – how much more do you think that client is going to trust his CPA on decisions that affect normal day-to-day business operations?

For those of you reading this article who might be potential referral sources, the ones I trust most with my client’s are the ones who put the needs of others ahead of themselves. If I receive any indication that a service provider is the least bit self-serving, they are never going to see a client through my referral… and they might even receive a negative review if overly unworthy of trust.

In this regard, actions speak louder than words. Show me that you are worthy of my trust and my client’s trust through many small actions over time. Show me the consistency of your character and that you understand putting the needs of others first is the most certain way to experience personal success. Tell me the truth, not what you think I want to hear. The world is full of yes people. We need more people willing to say what they think. If you are truthful, authentic, and trustworthy in your dealings with others, then you probably are somebody I will feel comfortable referring to a client and there is a 95 percent probability you’ll gain a new client or customer.

With a few exceptions, the CPA profession has done a good job of caring for and nurturing public trust. As a result, when public surveys are done, CPAs are viewed at or near the top of all professions in terms of honesty and trustworthiness. This trust creates influence and that influence is powerful. As such, trust has to be a highly regarded and protected asset.

Our words carry weight. As professionals and trusted advisors our words carry substantial weight. Futures can be and are changed by the words we speak. We have the ability to elevate dreams and ideas – or crush them – with the power of our words. So we must choose them carefully and make sure the substance of our thoughts and words rise to the level of fiduciary care we are sworn to uphold.

Local CPA Ups Ante on Client Service

What have you done for your clients lately? Worked through the night to meet a big deadline? Great job. Attended a bar mitzvah? That’s nice. Saved them oodles of dough by navigating a tricky divorce? You’re a rock star.

But until you’re willing to part with a kidney (or better), you’re a basically a chump compared to Jeff Waters.

You see, Jeff likely does everything that most CPAs do – bend over backwards for idiot clients; helps them deal with nosy IRS agents; explains why an incompetent Congress is likely to bungle the estate tax and so on and so forth.

But when his clients, the Fitzgeralds, were in one day chit-chatting about 1099s, a more serious problem (failing kidney serious, not heart attack serious) came up:

The week before standing in Waters’ office, the Fitzgeralds were told a kidney was available for [their daughter] Kelly, but at the last minute, the transplant had to be cancelled because the kidney turned out to be damaged.

“I thought, any problem I have pales in comparison to something like that,” Waters remembers. “I told (Fitzgerald), ‘I can’t even imagine you’re here today doing taxes when something like that happens.'”

Fitzgerald told him, “Well, we just learned to never get our hopes up. We just need to find another B positive donor.”

“That’s when it clicked,” Waters said. “I knew from my LifeSource Donor Card that I was B positive.”

And you can take it from there. Of course Jeff gave his kidney away. All he had to do was put on a cape and re-re-convince some pushy medical staff, “Waters says medical staff repeatedly told him not to feel pressured to go through with the transplant,” and like we said, he went under the knife and made it happen.

We realize not everyone is jumping at the opportunity for voluntary surgery and some are bound by religious whathaveyous but just think about it. Do you really need two kidneys?

Wheaton Accountant Does Taxes, Donates Kidney for Client [Wheaton Patch]

Small Business Legislation Could Be a Boon for Small CPA Firms

The following post is republished from AccountingWEB, a source of accounting news, information, tips, tools, resources and insight–everything you need to help you prosper and enjoy the accounting profession.

Included in the Small Business Jobs and Credit Act of 2010 – passed by the House of Representatives September 23 and the Senate September 16 – is the creation of a $30 billion lending fund that will utilize healthy cconduit to increase lending to small businesses – a provision that will generate $1 billion for the treasury, according to officials.

The fund also will provide $1.5 billion in grants to support at least $15 billion in new small-business lending through already successful state-run programs.

Among the $12 billion in tax breaks are a 100-percent exclusion of capital-gains tax on small-business investments made in 2010 and an increase in the maximum deduction for start-up expenditures in 2010 and 2011 – from $5,000 to $10,000.

“Naturally, any change in tax law stimulates our business in that we must provide the analysis of the bill and relay that information to our clients who may be affected,” Perry C. Barnett, CPA, partner responsible for business services for Gainesville, GA-based Rushton & Co. LLC, told AccountingWEB.

Douglas C. Smith, CPA, CVA, a partner with Lawrenceville, NJ-based Bartolomei Pucciarelli LLC, told AccountingWEB that he anticipates a significant increase in tax planning this year due to the provisions outlined in the bill, as well as modest improvement in the business of many of the firm’s clients.

“Almost any new tax legislation is a benefit to our firm, but fortunately, many of the provisions of the bill will benefit our clients, as well,” he added. “Since we are advocates of advanced planning, this bill provides us with the opportunity to make our clients aware of the upcoming changes and perform tax-planning engagements to guide them in implementation.”

While he does not see any significant changes in the firm’s accounting or auditing services as a result of the new legislation, Smith stated there will be consideration of additional accruals of penalties assessed on timely filing of information returns, as well as some impact on deferred taxes as it relates to the accelerated bonus depreciation provision.

The bonus depreciation provision is the most expensive tax break in the bill, weighing in at $5.4 billion over 10 years, but carrying an initial cost of $38 billion in its first two years, according to an analysis conducted by CCH Inc., a Wolters Kluwer business based in Riverwoods, IL, that provides tax, accounting, and auditing software and services.

The bill extends – through December 31, 2010 – 50-percent first-year bonus depreciation that had expired at the end of 2009. The extension is retroactive to January 1, 2010. The bill also extends through 2011 bonus depreciation allowed for property with a recovery period of 10 years or longer, such as personal property used to transport people or other property.

Small businesses will be allowed to write off up to $500,000 in capital expenditures in tax years 2010 and 2011. Under current law, the maximum deduction for tax years beginning in 2010 is $250,000.

Two other provisions in the bill that Smith believes will benefit his firm’s clients are: self-employed taxpayers will be allowed to deduct health-care costs for payroll tax purposes on 2010 returns, and participants in 401(k), 403(b), and 457 governmental plans will be permitted to roll over pretax account balances into a Roth account.

If an amount is rolled over in 2010, the amount is included ratably in income over a two-year period beginning with tax year 2011, according to the CCH analysis. The legislation also allows participants in state and governmental 457 plans to contribute deferred amounts to designated Roth accounts, effective for tax years beginning after 2010.

“Whenever we as CPAs are presented with the opportunity to educate our clients, it is a good thing,” Smith said. “There are many planning opportunities contained in the bill – ranging from the timing of a sale of small business stock, to planning the acquisitions of new equipment to take advantage of the expanded depreciation provisions, to planning the start of a new business that takes advantage of increased deductions for start-up expenses.

“Additionally, with benefits such as the deduction for health insurance when calculating self-employment income, out clients should be able to put a little extra money in their pockets, too,” Smith added.

Barnett agreed that the start-up expenses and the self-employed health insurance changes will benefit his firm’s clients, as well. However, he added that the continual increase in reporting requirements, especially the new requirement for filing Form 1099 scheduled to begin for 2011, could burden some small businesses.

“Based on this law and those in the works, each client will have to maintain a huge database of all vendor payments,” Barnett said. “We see this as a giant logjam for both the business and the IRS.

“The greatest impediment to business moving forward is being confident of what the tax laws are going to be in the future,” he continued. “Until Congress realizes that their indecision in estate taxes and personal income taxes is one of the greatest concerns of everyone, they will not get the economy on track.”

The House approved the bill in a 237-187 vote, while the Senate passed the bill by a 61-38 margin after Republican senators George LeMieux of Florida and George Voinovich of Ohio crossed party lines to support the legislation.

“This is about helping small business owners grow their operations, hire more workers, and help improve our economy,” LeMieux said in a statement. “Small business is the backbone of our economy, creating two out of every three jobs in our country. They need tax relief; they need access to capital. This bill will help achieve those goals and will not raise taxes or add to the national debt.”

The Path to CFO: Is the CMA Credential Just as Important as the CPA?

Many of you soldiering in public accounting have aspirations of one day achieving the pinnacle of many a numbers junkie’s career – Chief Financial Officer. You may think that becoming a CFO will mean hobnobbing with other C-suiters, first-class flights and access to exclusive swing joints but in all likelihood, it will consist of long hours, political maneuvering and maybe burning a few bridges.

While there are many paths to ascending to such a heralded position, one has to wonder if the skill set obtained in public accounting will really prepare you for all the demands and headaches that will inevitably come with a CFO position.

Because so many accounting grads get their start in public accounting, one ofobtaining the CPA credential. There’s no question that obtaining your CPA is a must for anyone that intends on spending a significant portion of their career in public accounting and little debate about the advantage of having those three letters on your résumé when you start looking outside public.

Tthe timing of that move may determine what kind of path you have ahead of you in order to land that coveted CFO gig. If you manage to stick out life in public until partner or in some cases the director or senior manager level the path is more clear. You may jump right into it immediately or you assume a position that reports to the current CFO and be groomed to assume the big chair at the appropriate time.

But what if you’re just starting your career and you’re fed up with public already? Or what if you’ve gotten laid off and you took a job in private. Are your dreams crushed at this point? What’s a wannabe CFO to do?

Speaking with John Kogan, CEO of Proformative, an online resource for finance, accounting and treasury professionals, obtaining the Certified Management Accountant credential is something that often gets overlooked.

“It’s the Rodney Dangerfield of finance certifications,” John told GC, “it doesn’t get enough respect.” The argument for today’s CFOs to have a CPA are being made and statistics have shown that more and more CFOs are, in fact, CPAs. The most recent data we can find shows that in 2009, 45% of Fortune 1000 CFOs were CPAs, up from 29% in 2003.

However, the viewpoint of “Warren Miller” in the comments of Francine McKenna’s guest post at FEI Blog on the subject, is that accountants usually make terrible CFOs:

[A]ccountants tend to make lousy CFOs because (a) they see everything as an accounting problem, (b) their ignorance of finance AND of human nature (where incentives are concerned) can be breathtaking, (c) they look backwards, and (d) they are conflict-avoiders. If accountants wanted to deal with the ambiguity of the future, they’d have never become bean-counters.

In addition, most accountants LOVE “rules.” They avoid conflict by hiding behind rules. They are go-along/get-along people. I’m fond of saying this: “If accountants had been running our country in 1776, we’d still be working for the King.”

So if the gamut of accountants are ignorant about finance matters, does the CMA provide a bridge to closing that knowledge gap? John Kogan thinks so, “The CMA designation wants to be the ‘CPA’ for finance professionals,” he said, “but it’s so far from being that.”

When you look at the two sections of the CMA exam on the Institute of Management Accountant’s website, you certainly get the impression that the CMA could be the “CPA for finance professionals” based on the curriculum:

PART I – Financial Planning, Performance and Control
• Planning, budgeting, and forecasting
• Performance management
• Cost management
• Internal controls
• Professional ethics

PART II – Financial Decision Making
• Financial statement analysis
• Corporate finance
• Decision analysis and risk management
• Investment decisions
• Professional ethics

So why isn’t the CMA a more coveted credential? John Kogan claims it’s due to poor marketing on the IMA’s part, “The CMA [credential] has similar requirements, not identical but similar, and they don’t enjoy the reputation of the CPA,” John said. “The CMA is getting its butt kicked because it doesn’t market itself well.”

You can easily make the argument that the AICPA has the distinct advantage of partnering with the Big 4 – firms that’s primary purpose is to serve as CPAs – on marketing and promotional efforts while the IMA has no apparent equivalent.

That being said, our recent conversation with IMA Chair Sandra Richtermeyer shed some light on the careers that are available for accountants moving into a financial role that the CMA designation complements well. She was of the notion that the CMA is simply not about cost accounting and John Kogan agrees, “I think anyone who knows anything about [the CMA] knows that the [designation] is broader than that, it’s just that very few people know what the heck it’s about,” he said. “Without a doubt, the skills that the IMA are teaching and certifying are corporate finance skills.”

If you consider yourself to be on the path to CFO Rockstar, maybe you have the CPA locked up but what’s next? Having the CPA credential may make you an attractive candidate on paper but it’s won’t guarantee success with the wide range of knowledge that CFOs need. So, while it may not hold a candle to the CPA in terms of prestige, the skills and knowledge that fall under the CMA are essential for any successful CFO.

C-Suite CPAs Remaining Pessimistic on the Economy

This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.

Following up from our brief mention yesterday, senior level CPAs have turned much more pessimistic about the economy. And somewhat surprisingly, they are partly concerned about deflation.

Just 21 percent of CPAs serving as C-suite executives said they are optimistic about the US economy, way down from 40 percent who were optimistic in May and the lowest level since April 2009, according to the American Institute of Certified Public Accountants and the University of North Carolina’s Kenan-Flagler Business School’s latest Quarterly Economic Outlook Survey. What’s more, pessimists outnumbered optimists by a two-to-one margin.

Even more worrisome, 78 percent believe US business conditions will not return to pre-recession levels until 2012 or later.

This sentiment seems to parallel a number of recent economic and corporate reports.

Altogether, 40 percent were pessimistic about the economy, up from 25 percent in the last quarter.

“Our survey signals the nascent economic recovery that buoyed expectations last quarter is stalling,” said AICPA Vice President for Business, Industry and Government Carol Scott, in a press release accompanying the survey’s findings.

What are these numbers crunchers worried about? Unemployment and a tight credit market, to name two.

The survey found that CPAs are much less concerned about inflation these days. This is not surprising, given the economy’s lackluster pace, the high unemployment rate and the inability of companies to raise prices.

Interestingly, 20 percent are now concerned their organizations will be impacted by deflation in the next six months.

This is further proof that deflationary fears are not just coming from a fringe group of radical thinkers, but are now entering the mainstream.

One silver lining from the survey: Nearly one-quarter of the survey participants are upbeat about the prospects for their own organizations. Still 55 percent of survey respondents do not anticipate their organizations’ employment levels returning to pre-recession levels in the next year, compared with seven percent who anticipate staffing levels returning to normal in the next year.

Accountants Still Don’t Have the Warm Fuzzies About the Economy

“Uncertainty about the sustainability of the recovery continues to limit planned investment and hiring.”

~ Professor Mark Lang on the results of the AICPA/University of North Carolina’s Kenan-Flagler Business School survey of CPAs in leadership positions.

(UPDATE) CPA Status and Promotions: What Is Your Firm’s Policy?

With all the news on raises, promotions etc. etc., a reader got in touch, asking the following:

Can we start a thread to discuss when you need the CPA designation if you want to move up at various firms by practice (audit, tax, specialty groups, etc.) and what exceptions there are?

The idea jumped off of a recent comment on yesterday’s post discussing E&Y’s raises keeping pace with PwC:

From what I can derive, PwC was bleeding staff in the early part of the year to the best of my knowledge, requires more time to get promoted up the ranks (3 years to senior compared to 2 at all other firms) and the requirements are higher (must have passed the CPA exam). The higher raises, at least from PwC’s perspective, may be their way of staying competitive with the market because, without higher pay, PwC is not competitive. E&Y may also be attempting to compensate but I am not entirely sure what for.

So three years to earn a promotion to SA at PwC isn’t news to us and some – dare we say, many – may argue that should be the standard timeline for associates in the Big 4/second tier firms. You can debate that all you want but what about the CPA requirement? If PwC does in fact require their associates to have their license before making SA, that’s nothing if not a motivation to finish the CPA ASAP. At the same time, there are many SAs that don’t have their license that do excellent work but for whatever reason are still stalling on obtaining the CPA.

The reader continues by asking:

For instance, if you have an Enrolled Agent, can you still make manager if you’re in tax, etc. [?] I’m also curious about any place that will demote anyone of a certain level who hasn’t gotten their CPA in the last couple of years. KPMG has threatened it for managers in tax who are qualified to sit for the exam (U.S. accounting degree with enough hours), but I wonder if that’s more empty talk.

That’s the first we’ve heard of a demotion for not having a CPA but frankly, that seems appropriate. If the manager has an EA, then perhaps that’s a suitable exception, although the idea of a Big 4 tax manager without a CPA just doesn’t seem right. For many, the lack of the those three precious letters means the end of their careers at the Big 4, so it’s definitely an issue.

So indulge our reader and let us know your firm’s policy regarding promotions and CPA license status. Does it matter? Are there exceptions? Should your performance make up for your uncanny ability to fail FAR? Talk it out.

UPDATE: We obtained a copy of the KPMG policy mentioned above and it appears to be FSF with a few exceptions for those that are “CPA Eligible” and certain “waivers.” Also there’s this, “In circumstances of noncompliance without appropriate waiver, professionals may be subject to disciplinary action, including but not limited to demotion or termination from the firm.”

KPMG Tax Promotion Policy

So You’re a CPA Thinking About Law School

We try to encourage you to think about your careers here at GC every once in awhile; present you with some options or ideas that maybe you haven’t considered before. We’ve covered several credentials out there that you can obtain and we’ve also touched on the pros and cons of the PhD.

But this time we’re going to get really crazy and give you the lowdown on an idea that we know many of you have had (including your humble editor) and that is the consideration of going to – gasp – law school.

For whatever insane reason, you can’t shake the idea of committing three years of your life and borrowing tens of thousands of dollars to live on PB&J, ramen noodles and frozen pizzas. Oh and of course there’s studying, tests and everything else that comes with returning to school.

But think about the benefits; you’ve got the CPA and if you were to get the JD, maybe you’ll top it off with an LLM and it’ll be smartest thing you’ve ever done. Think about the money! The prestige! The hot lawyers that you will bed and wed! It will all be worth it, right?

Well, maybe? If you spend even a little bit of time reading our sister site Above the Law, you might get the impression that the last thing you should ever do is go to law school. There’s an ncertain job market out there. You may end up with a huge debt load that can take a lifetime to pay back. And we’ve been told by a fair amount of our lawyers simply, “It’s just not worth it.”

Considering all that, we wanted to get some first-hand perspective, so we put the feelers out to a few CPAs turned lawyers to get an idea of their experience so those of you considering law school can make a more informed decision.

We spoke to three CPAs turned attorneys, Eric Gullotta who has his own practice in Sonoma, CA, Steve Farrar of Smith Moore Leatherwood in Greenville, SC and Timothy Gagnon who has in own practice in Needham, MA.

Messrs Gullotta and Gagnon both specialize in estate planning and taxation while Mr Farrar is a litigator who defends lawyers and accountants in malpractice lawsuits.

The three men agreed that their decision to go back to law school was worth it but that the process is certainly a challenge, “It was a tough three years. Probably the hardest thing is getting re-oriented with being a student after being out for awhile,” Mr Gagnon said.

Motivation and Benefits
Gullotta and Gagnon both believe that the biggest benefit that they’ve enjoyed by obtaining the law degree is that clients recognize the value that a background of a CPA can add to providing legal services. “The amount of respect and trust that clients put in you when you are both a lawyer and a CPA is really unbelievable,” Mr Gullotta told GC. “Being able to see the tax effects of legal transactions is really amazing and you can really bring value to your clients when you are able to negotiate or structure deals with tax effects in mind.”

Steve Farrar had a very different thought process before he returned to school. He went back because he was interested in being a trial lawyer, “I went back to law school with the intent to try cases,” he told us. While he was interviewing, most firms wanted him to consider working in a more transactional capacity but he found a firm that was willing to let him work in litigation and it turned out to be a perfect fit, “I’ve been ecstatic. While you might hear stories about people being burned out, I enjoy every minute of it.” And the biggest benefit for him? “This is going to sound hokie when I say it but I enjoy the theatrical chess match of going to trial.”

Back to School
But before getting to all the benefits of CPA/lawyer superstardom, there is the little matter of going to law school. While many lawyers we’ve talked to have said that the law school you attend is everything, it really depends on what you’re looking to accomplish with the degree. As Eric Gullotta told us, “it’s important to know what you what to do. If you want to work in [a large city], you’ll have to go to a reputable law school. If you want to practice locally, hang the shingle out, then you can go to slightly less prestigious school that is more practical for your situation.”

And being a CPA could possibly put you at an advantage when applying to law schools, “The interesting thing is that because you have experience and have a CPA, it can help you get into some of the better law schools,” Tim Gagnon said. “They’re looking to diversify their class, age, experience and you could bring something that diversifies the class that they can’t get out of somebody that just got out of undergrad.”

But there’s got to be drawbacks right? Besides all the lawyer jokes, Steve Farrar mentioned losing flexibility in his schedule, “The best way I can explain it is that I have multiple busy seasons but I never know when they’re coming.” For Tim Gagnon, it sheer volume of continuing to keep up-to-date on the changing rules, “It’s hard enough to keep up on one but you put the two together and you really have a lot of information to cover.”

Oh, and then there’s the practical (and possibly more important) stuff, “Higher malpractice insurance,” according to Eric Gullotta.

So, are your aspirations for law school a good idea? Hard to say. Knowing what you want to do with the degree seems to be the key to making a decision. If you are thinking that a law degree will be the solution to your self-perceived lackluster career to date, you could find yourself very disappointed.

However, if this is a career that you truly want then it sounds like there isn’t any shortage of success stories. Choose wisely.

LeBron James’ CPA Needs to Get to Work

“Wouldn’t you love to be Mr. James’s tax accountant right about now?”

~ Rob Lieber

AICPA: CFOs Want More Input from Auditors on IT Matters

This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.

Certified Public Accountants are increasingly being asked to solve information technology problems for clients and prospective clients, according to a survey by the American Institute of Certified Public Accountants.

But that raises a potential conflict of interest of the sort that led the Securities and Exchange Commission to keep auditing and IT consulting separate. The pressure for auditors to help provide IT solutions will persist nonetheless, says the AICPA.

“The tide has really turned this year with the economy and increasing regulations,” said Joel Lanz, co-chair of the AICPA’s Technology Initiatives task force in a prepared statement.

“As small and medium-sized companies increasingly place IT under their chief financial officers, it’s becoming much more of a broad scope of responsibility,” added Ron Box, Lanz’s co-chair.

With a renewed focus on IT-related issues, the survey makes clear that CPAs need to be literate about information technology in order to collaborate effectively with clients and their IT partners.

Data security clearly is driving the new interest, and CPAs believe the issue will persist in importance for years, the survey suggests.

The biggest surprise from the survey, Lanz told CFOZone, is the fact that “CPAs are not only providing guidance on financial issues, but there is an expectation by audit committees that CPAs could advise on different IT governance issues. CPAs are now commenting to audit committees about business operations in addition to pure financial issues.”

It’s not that CPAs are expected to be the technology expert, but the expectation is that the CPA is able to provide business insight and IT guidance which then enables their clients to effectively leverage their technology to enhance the businesses value, he added.

Is this simply recreating the problem that led to the separation post-Enron and WorldCom of audit services from consulting, much of which was IT oriented? There’s the potential for a conflict of interest here, and a slippery slope toward bad audits as result. SEC rules specifically say audit firms cannot provide IT consulting services on matters that relate to financial reporting for the same client. And the audit committee must sign off on other types of consulting services.

Lanz concedes that CPAs will have to be careful. “It is a fine line,” said Janis Parthun, senior technical manager – IT, for AICPA, but she added that CPAs can help companies avoid problem here. “Sometimes audit committees do need some education in these areas and this is where they can reach out to CPAs that have some understanding of IT to give the audit committee options to make the right decision.”

Lanz adds says that the AICPA has helped on this front with some recent guidelines. “Recent standards provide CPAs with specific criteria for when they need to communicate with audit committees, as well as the type of communication required,” he said.

A spokesman for the Securities and Exchange Commission declined to comment on the trend.

Small Businesses Need Accounting Help + Accountants Want Opportunities = This Should Be Easy

With all the uncertainty out there, more and more small businesses are cropping up. As anyone who has started their own business knows, there are plenty of decisions to be made, including your accounting method. While that answer may come easy, at some point small business owners have to ask themselves honestly A) Do I know squat about accounting? B) If no, do I hire someone full time or do I contract the work out as needed?

First, if you’re not versed in accounting and taxes are you really going to take the time to learn everything you need to know at the behest of growing and refining your business? Have you seen the tax code? You want to take advantage of everything you can, right? Best to call an expert.

Secondly, if you do decide to get some help, are you willing to pay for someone to keep the books, file tax forms, manage the payroll, etc. etc. full time? Are you going to pay them a salary, benefits, supplement their daycare, give them vacation? If you’ve got the resources to bring someone on, that’s great, start interviewing people. But what if you’re still in the early stages? Finding a CPA firm that can provide those crucial services for you can save a lot of headaches.

On the other hand, if you are already an accountant, maybe this growth in small businesses is your opportunity to get a little entrepreneurial yourself. CPA firms are the most profitable small businesses out there and somebody has to help those business owners keep their debits, credits and tax forms straight; it might as well be you.

Three Social Media Trends That Will Never Catch on with Accountants

CPAs have pretty much dominated social media and infested the blogosphere to the point that when I tell people that I cover accounting news for a living, I don’t have to explain just what on Earth accounting news is. That’s a step in the right direction but the reality is, some web and/or social media trends may never catch on with accountants. I’m suggesting three but fairly sure there are plenty more; if you know of one, do share.

Foursquare Paranoid stoners and anti-Big Brother types aren’t hip on it either but I guarantee you Foursquare will not catch on among CPAs. Who is dumb enough to track their own billable hours where everyone (and the boss) can see? What fun is checking in at the office day in and day out?

Get Satisfaction Listen, I know the smaller firms and personal, hometown CPAs are all about client satisfaction. Some of the mid-tier firms might also give some type of shit about the level of service they provide to their clients and how effective they are in doing it. But as a general rule (and especially for the larger firms), they really don’t actually want to know if they are delivering it or not in the direct manner that Get Satisfaction provides. If you aren’t familiar with how the site works, check out Comcast (several Comcast agents, actually) against the pissed off subscribers who lost their digital channels after the 2009 conversion but as a direct result of Comcast’s decisions. Can CPAs handle that sort of brutal, misspelled, angry honesty? Doubt it.

Blippy Though most CPAs love to hear the promise of yet another tool meant to make their lives easier, the remote chance that their credit card information may accidentally, kinda sorta end up on Google might make them a tad Blippy-adverse. And hey, while you’re at it, see what your friends are buying (while exposing what you are at the same time), what fun! I think they’ll pass. Hell, who would want Facebook for their bank statement, CPA or not?

Strip Club Owner, Sans High School Diploma, Blames His Accountant for Tax Troubles

When you own a strip club there are certain things that you understand. Things like, knowing that there is large portion of the male species that will pay women to take off their clothes regardless of the fact that sex is not happening. And while this is going on, they’ll imbibe lots of booze. And eventually, they may get hungry and with the last sliver of will power they have left, pull themselves away to pay $5.99 for a prime rib buffet. AND since there’s no windows in the place these men will stay in your strip club and spend money until you throw them out or they’ve spent every last dime. Oh, and poles are imperative.

On the other hand, there are things that strip club owners are less savvy about. One of these things may be tax compliance. Accordingly, many proprietors find a local accountant, they swap services, everyone wins.

However, every once in awhile this traditional arrangement may run awry. Kevin Moury, owner of Kittens (NSFW), is suing his accountant, Michael Walsh, for negligence in preparing his returns that resulted in “criminal charges, penalties, costs, fines, loss of income, medical expenses, loss of life’s enjoyments, emotional distress and mental anguish.”

Okay, before we continue, we have to ask – “loss of life’s enjoyments” and “medical expenses” because of a CPA? Where do we draw the line people? Next thing you know, accountants will be blamed for the collapse of the entire financial system…

Anyhoo, Moury pleaded guilty in October to “federal charges of falsifying tax returns and failing to report substantial cash income.” He spent one night in jail, got nine months of house arrest and had to pay back taxes of $88k, etc. etc.

This all came up because Moury apparently thought it was a-okay to deposit money from various revenue streams like fining dancers for tardiness or bolting early, massages for customers, and Jell-O shots (you know, the usual stuff) and then not report it as income. Obviously the IRS was not cool with this, prosecutors threatened to go after his wife and daughters (all employees at Kittens, btw) and that got him to plead guilty.

As a result of his guilty plea, Moury lost a sweet $90k/year gig as a “superintendent of environmental management” (which sounds a lot like “boss of the garbage collectors” but whatevs) and this resulted in lost future earnings of $1.3 million, allegeth the lawsuit.

Regardless, this shit ain’t fair and the accountant needs to be held responsible (his attorney the allegations or “groundless”) and Moury’s attorney isn’t shying away from the stupidity defense:

The lawsuit claims Moury’s lack of formal education — he didn’t finish high school and has a high school equivalency certificate — led him to rely on Walsh to accurately report his income and prepare his tax returns.

“Mr. Moury gave his accountant anything and everything for his business, his real estate and the salary from his job with Methuen,” Cote said. “He signed the returns, but did he looked at them? No. Is he responsible? Yes.

Strip club owner blames accountant for his tax woes [Eagle-Tribune]

Cash-strapped Clients Could Force Accounting Firms to Come Up with Creative Cost Savings

Because times weren’t already cheerful enough around GT, they recently released a study which found that businesses are generally pessimistic about raises and bonuses this year.

From the press release:

The firm surveyed 496 U.S. CFOs and senior comptrollers from March 22 through April 5, and found that 53% plan no salary changes in the next 6 months, while 32% plan to decrease and 15% plan to increase. On the bonus front, there is also equal pessimism, 47% plan no change, 44% plan to reduce, and only 8% plan to increase.

Well – that certainly sucks.

We know raises are the last thing on the minds of higher-ups at GT, but come on, really? Imagine being a no-name staffer at GT grinding away on a report about how your clients are a collective group of Negative Nancy’s. With headcount discussions ongoing in several GT offices, one would be – and should be – concerned.

The freezes in salary and bonuses don’t really apply to the accounting firms because – as it has already been discussed here in great length – money should be flowing your way this summer. The underlying concern with this report is this – if your client isn’t giving its own employees a bump in pay, there’s no bloody chance your firm is getting a bump in fees, either.

Any and all resources will be applied to minimizing any talent exoduses from occurring.

So how will the firms find enough cookies in the jar to “support the current pipeline?” I checked in with a Big 4 auditor in New York who had this to share:

During casual conversation with my mentors, word is the firm will be pushing for leaves of absence again this summer for everyone who has not completely passed the CPA. The hope is for a decent percentage of staff members to do this to save on salaries.

Makes sense-ish. Temporarily cut staff salaries during a relatively quiet audit period. Will this be enough to cover raises and bonuses while client fees remain stagnant? Heavens no but it’s a start. As always, let us know if you learn of ways your firm plans to pinch pennies.

Three Key Reasons Why CPA Firms Are the #1 Profitable Small Business

This morning we kicked off our certification series that may or may not get you motivated to find some additional letters for your business card. However, if you’re more interested in your getting your name (with letters behind it, natch) getting on the sign/in the window sooner rather than later, there’s good news as well. Forbes 20 Most Profitable Small Businesses list came out last week (on April 15th no less) and accounting related services took three of the top five spots.

Offices of CPAs #1 – Average pre-tax margin of 17.1% and; the trifecta of “pricing power…low overhead and marketing scale,” gave CPA firms the top spot in Forbes list.

Other Accounting Services #3 – Average pre-tax margin of 15.5%; The list states that this includes, “accounting, bookkeeping, billing and tax preparation services in any form, handled not necessarily by a Certified Public Accountant.” Of course many CPA shops do offer these services so it’s not something you should dismiss outright.

Tax Prep. Services #5 – Average pre-tax margin of 15.1%; Forbes took a page out of John “I hate my old accountant” Stossel and asks “Who likes doing their taxes?”

Yeah, being the boss is tough but for accountants its a path that many take, as FINS reported last week, citing the AICPA “Roughly three-quarters of the country’s 44,000 tax businesses are one-person shops, according to the American Institute of Certified Public Accountants (AICPA).” And it’s not like everyone is going at it alone. If you’ve got one or more colleagues that you trust (and can stand to be around for hours and weeks on end) a partnership is always a solution.

And while this is great news for you entrepreneurial types, you can’t forget what you’re getting yourself into – you will be responsible for the outcome of the business, succeed or fail. As much as you hate the bureaucracy, politics and all around song and dance of the larger accounting firms, the failure of those firms are completely out of your control. But then again, maybe that’s why you took the risk in the first place – so you can be in control.

The Most Profitable Small Businesses [Forbes]
Hanging Your Own Shingle: Starting a CPA Business [FINS]

Accounting News Roundup: Accounting for Healthcare Reform Begins; Should Small CPA Firms Partner with Large Firms on Projects?; Lawsuits Against Accounting Firms Rising Fast in UK | 03.28.10

The healthcare party is over – now comes the (accounting) hangover [FT Alphaville]
Now that healthcare reform is behind us, the matter of sorting out the impact on corporations now falls to the accounting professionals in those companies as the first quarter winds down this week.

FT Alphaville notes that AT&T, for one, has already filed an 8-K that states that it will “take a non-cash charge of approximately $1 billion in the first quarter of 2010 to reflect the impact of this change.” The change that the company is referring to is the “Medicare Part D subsidy” which, under the new law, is no longer eligible for a write-off against a company’s taxes. The subsidy is given to companies to help to pay prescription drug benefits to its employees.

FTA cites a report by Credit Suisse that shows many companies’ (including Goodyear Tire, International Paper and The New York Times) first quarter earnings will be impacted significantly by new healthcare legislation. And it also appears that it will cause companies to take a second look at the benefits they currently provide to employees, as Ma Bell stated in its filing that it “will be evaluating prospective changes to the active and retiree health care benefits offered by the company,” as a result of the legislation.

Why solos and small firms shouldn’t “partner” with larger CPA firms on projects [Fraud Files Blog]
Tracy Coenen recently had a large firm approach her to see if she’d be interested in helping them out with some “Fraud Risk Assessment services.”

The larger firm asked her if she would be interested in “a partner/subconsultant” arrangement. Tracy explains why this isn’t a good situation for solo practitioners like herself, “[T]he consulting firm doesn’t have the know-how necessary to provide their client with the services they need. But they’re not about to let something silly like competence stand in the way of collecting fees! They will find a way to do it.”

Tracy says that the larger firm will ask you to discount your billing rate, train their staff, and ultimately, give them the secrets to your practice, “Don’t lose money by discounting rates, training someone else’s staff for those discounted rates, and creating a competitor for yourself who uses your proprietary methodology.”

U.K. Accounting Suits Reached 5-Year High Last Year, Study Says [Bloomberg BusinessWeek]
The number of lawsuits filed in the UK against accounting firms in the past year is greater than the last five years combined according to Bloomberg. The thirteen suits filed in 2009 is more triple than the four suits filed in the previous five years. Although the number of suits is considerably smaller than the 61 suits filed after the collapse of Enron, et al. in the 2002-2003 time period, Jane Howard, a partner at Reynolds Porter Chamberlain LLP, is quoted that it’s not clear whether things are just getting started, “What is still hard to tell is whether this sudden rise in claims will subside quickly or whether accountants will face a higher number of claims over the coming years.”

The Recession Taught Some CFOs That They Need to Pay Closer Attention to Miserable Employees

Plenty of lessons came out of the financial crisis. For some it was that Big 4 auditors are irrelevant. For others it was that we need one set of high quality accounting standards ASAP. Aaaannnd for others, it was that the SEC needs to get better at pretty much everything.

For CFOs, it appears that at least some of them learned that miserable employees are a drag. Robert Half Management Resources surveyed 1,400 CFOs and 27% of them said “they learned to place greater focus on maintaining employee morale.”

It’s likely that this isn’t a lesson learned by just CFOs. Plenty of CPA firms have probably realized that a bunch of morose auditors and tax pros hanging around doesn’t make for a happy shop and are looking to improve their cheerleading skills going forward. KPMG has already brought back the Standing O, PwC, Ernst & Young, and Grant Thornton have all guaranteed merit increases for this year so there are signs that your happiness is no longer an afterthought.

CFOs Advise Keeping Employees Happy [Web CPA]

CPAs Spanked by SEC for Porn Site Audit

Let it be known that if you are peddling porn and engaged in online pimping, you do not want the SEC on your back.

WebCPA reports that Stephen Corso of Las Vegas and Brian Rabinovitz of Oak Park, CA got the SEC smack down in a Nevada federal court for filing materially false and misleading financial statements from 1999 – 2002 (that’s quite a backlog) and that audit staff – under the boys’ supervision – omitted important info and violated the sanctity of auditor independence during audits of

While the enforcement doesn’t go into specifics, we’re happy to. bills itself as the world’s premiere source for – wait for it – beautiful female adult entertainers. Not to be outdone, Exotics also boasts a veritable cornucopia of escort options including “BDSM & fetish providers, exotic dancers, strippers, sensual and erotic massage specialists, TSTV and other adult entertainment.” It’s that “other that really scares me. Self-billed as the Quicker Pecker Upper (kid you not), the site headline right around the time the SEC brought the heat was “Better than Wives, Girlfriends, and Porn” – and apparently above performing audits according to GAAS?

So, who wants to wildly speculate as to how audit staff violated auditor independence?

Here’s the 2005 release from our friends at the SEC:

[T]he accountants fraudulently participated in audits of Exotics-Nevada’s year-end financial statements and in a review of its quarterly financial statements and failed to conduct those engagements in accordance with GAAS, as required. The Commission also alleges in its complaint that, among other things, the accountants prepared or created many of Exotics-Nevada’s books and records and then audited the financial statements they created. According to the complaint, they also caused their firms to issue false audit reports which, together with the underlying financial statements, were incorporated in Exotics-Nevada’s public filings with the Commission.

Now listen, little auditors, you don’t shit where you live and you don’t audit your own statements. Audit sampling? I could see how it would be hard to resist in this particular instance.

CPAs Disciplined for Porn Site Accounting Fraud [Web CPA]
SEC Complaint

CPA Suing Craigslist Vindicated by New Reviews

In Tuesday’s QOTD someone did not have kind words for Leo Kehoe, a Queens CPA. Specifically, “Watch out for this fraudulent scumbag! … He will botch up your tax returns and forget to submit them.” Scumbag? Fine. “Botch up” and “forget to submit” are also tolerable. Stuff like that happens (right?). What no CPA needs or wants, is their name associated with “fraudulent.”

Anyway, someone had a bad enough encounter with Kehoe that it demanded these words for anyone searching out both a CPA and perhaps some NSA coitus.

Mr Kehoe should be able to rest a little easier now as the Gothamist reported yesterday that a certain someone or someones has a completely different opinion on his services, “Leo Kehoe is a great CPA. He charged me a lower fee than what I had payed with someone else and he did a much better job,” and this one from yesterday, “Leo Kehoe: Much better than Cats. I’m going to see him again and again!”

Depending on your point of view, the “Cats” compliment may be worth far more than the $4 million that Kehoe isn’t likely to get but since accountants seem to be hung up on money far more than cultural comparisons, we expect him to continue moving forward with the lawsuit.

Accountant Sues Craigslist Over Negative Rant [Gothamist]

Do CPAs Really Love Their Jobs?

A friend of GC pointed us to the image below from (link to entire thing below) that shows the latest “Best Jobs in America”. This particular version ranks CPAs as having the 6th best job in all the land.

The methodology broke down like this:

Top 260 – Jobs that have been projected to grow 10% in the decade and require a Bachelor’s degree; Median pay below $65k for experienced workers was excluded as were jobs that had less than 10,000 positions nationwide.

Top 100 – Eliminated jobs that did poorly (based on growth in online wanted ads) during the recession and grouped jobs with similar responsibilities.

Top 50 – 35,000-ish workers were surveyed to “rat their jobs on quality of life factors such as flexibility, stress, and personal satisfaction.” They were then ranked by “current employment, long-term growth, pay, and security; projected openings; and quality of life factors.”

Top 10 – “Interviewed industry experts and people in each profession.” Rankings were made based on those interviews.

Our source has some questions for the group, “Why are CPAs always ranked so high? Job security? Pay if you stay in long enough?”

Important questions. It simply could be that the people that put these “Best Jobs Lists” interview the Exuberant Accountant every time. You can’t get that many consistent liars in these surveys can you? Or, maybe, just maybe, lots of CPAs really, honest-to-God — gasp — love their jobs. It’s not that we don’t believe that it’s possible but it’s difficult when you hear constant belly-aching.

So if you’re loving your life as a super hero CPA and you’ve got reasons you feel like sharing with the group, please do so. Or if you’re confused like us and have some wild-ass guesses that will be fine too.

Best Jobs in America [Focus]
Three Signs That It Might Be Time to Get Out of Public Accounting

Three Signs That It Might Be Time to Get Out of Public Accounting

Busy season is rounding the corner and, if you look carefully, you might be able to see the light at the end of the tunnel. Squint. No I swear, it’s there.

My posts this week will shift from social media to the potential job market. As a public accountant, you should always be cognizant of the fact that you have the ability to continuously develop your strengths and mold your career path. Want to pursue of a career in hedge funds? Network within your firm to be staffed on the right engagements. Need to add tax experience to your resume? Seek out a rotation.

Here are three signs that you should get you thinking about exploring your options.

1. You’ve got your CPA – This might go without saying, but many people enter the public accounting industry with the “two years and done” mentality. Pass the CPA, earn some experience stripes, and get the *$@% out. There’s nothing wrong with this, but don’t expect to $100K jobs to be jumping into your lap. The average salary bump for younger staff from public to the private sector can range from 5-10%, usually topping out around 15%. If this isn’t enough of a bump to seriously consider a private job, don’t lose sight of the quality of life improvement a new job can bring. No, not the smoke and mirrors your firm is promising you. The real deal.

2. Someone you know is interviewing – Believe it or not, the job market is actually improving. The hiring freezes on many financial firms is now limited largely to supporting roles (i.e. HR folks like myself). Hedge and private equity funds are picking up their hiring as the markets begin to thaw. Recruiters are not wasting their time with interviewing individuals for the sole purpose of interviewing. So take note next time your senior staff member has three doctor appointments in a week; perhaps you should be “coming down with a nasty bug,” too.

3. Recruiters call – and you listen – Speaking about recruiters, be prepared for an onslaught of calls. Their timing is no coincidence. The private sector has been shuffling around over the last few months (remember when your client contact suddenly went MIA?), and as the cycle goes, the newly opened private jobs will inevitably be filled by auditors and tax accountants from public. Listen to the cold, scripted calls; be open to a pay increase and better work hours; reclaim your weekends. It can’t hurt to listen to the (substantiated) claims that you’re undervalued in today’s market.

Newsflash: you are grossly undervalued.

SHOCKER: Accountants Have a Conservative Outlook on the Economy

Surprise, surprise! CFOs, controllers, and CPAs are only slightly skeptical about the economic outlook these days. Surely it’s not because our industry has been pounded harder than others, in fact we’ve weathered the storm better than most.

The fourth quarter AICPA-UNC Business and Industry Economic Outlook Survey sheds some light on where CPAs’ heads were at in Q4 2009:

Expectations among Certified Public Accountant executives for the U.S. economy remained pessimistic in the first quarter as the recovery proved sluggish amid signs of potential growth in manufacturing and a slightly improving outlook for organizations, according to a new nationwide survey conducted by the American Institute of Certified Public Accountants and the University of North Carolina’s Kenan-Flagler Business School.

“It is good to see signs of optimism, especially from the manufacturing sector,” said Carol Scott, CPA, AICPA vice president for business, industry and government. “Unfortunately 40 percent of our CPA members in business and industry — chief financial officers, controllers and CPA financial professionals – are now telling us that they do not expect their business to return to pre-recession levels until 2012 and beyond.”

Such a conservative bunch, those little accountants.

Interestingly enough, the latest survey shows a shift in the collective thinking of CPAs, who had shown uncharacteristic optimism in previous 2009 survey responses. What gives, guys? Know something we don’t that you’d like to share with the class? Perhaps reality has finally bit down and left a mark on a traditionally recession-proof industry.

In a recent “unscientific” straw poll of AICPA Insider readers, CPA Trendlines’ Rick Telberg shares CPAs’ top 10 concerns, not surprisingly dominated by the number one concern for accounting professionals, the economic outlook. Firms are cutting costs and slicing away the “flash”, meaning no stupid tchotchkes for you!

Will this back-to-basics approach change CPAs’ outlook for the quarters ahead or simply keep everyone afloat until things do genuinely begin to look up? If nothing else it means better service for clients and maybe a little less fear for accounting practitioners who are ultimately the ones who have to deal with any shift in the industry outlook. Clients will always be around, it’s the qualified professionals I’m a tad worried about.

We’ll let you know what happens with the next survey but are not afraid to wildly speculate that respondents will continue to pull back the optimism and stick to conservatism as usual.

Pennsylvania CPAs Insist Accountants Are Funny in New Videos. Which Are Funny

The Pennsylvania Institute of CPAs is tired of everyone thinking that accountants are humorless, soulless, number crunching (did we mention green eyeshade wearing?) nerds, so they decided do something about it.

The PICPA has developed two videos to show everyone that not only are CPAs important business advisors, they can be creative and yes, funny. Despite where you fall on the comedic spectrum (Brian Regan, Chris Rock, Lewis Black, Larry the Cable Guy, Seinfeld, whatevs) you’ve got to admit that this is by far the best attempt at plugging the services that CPAs can provide out there. It doesn’t go the emotional route like Grant Thornton’s campaign or just miss the mark completely like BDO. This is purely for comedic value and it’s refreshing.

Granted, the PICPA is a professional association and not a firm so we aren’t expecting any firm to go with a Big Foot parody or 80s drug ads but let’s keep this angle fresh in our minds, shall we, accounting firms?

Accounting News Roundup: Haiti Relief Passes Senate; Accounting Job Surge? CPAs Basically Control People’s Lives | 01.22.10

Senate votes for faster tax breaks for Haiti gifts [WaPo]
As expected, the U.S. Senate unanimously passed legislation yesterday that allows taxpayers to deduct donations made for Haiti relief efforts. You have until the end of February to donate so that it may be included on your 2009 return.

Maybe it’s bad legislation but we’ve been over that.

CPA Jobs Set for Surge. But When? [CPA Trendlines]
That’s the question, isn’t it? Rick Telberg, who has done a great job of tracking the Bureau of Labor Statistics on accountants, points out that while the latest BLS forecasts a 22% increase (279,400 jobs) by 2018, there’s no indication that it’s happening now:

[M]any tax, accounting and finance professionals are still slogging through the Great Recession. The Association for Financial Professionals, for instance, reported that about one in four respondents say their organizations will contract in 2010. At the same time, a PricewaterhouseCoopers survey of private companies found 43 percent of CEOs and CFOs still budgeting no expansion over the next 12 months to 18 months. The data just seem to reinforce economic uncertainties and a weak outlook.

The BLS is looking past the past the recession for the jump in opportunities but just when the hell will that be? Just because the economy isn’t contracting currently, doesn’t mean it won’t in the future and this “recovery” has been tepid at best.

Theismann to CPAs: You Are the Conscience of America [Web CPA]
Joe Theismann gets it. He knows that without all of you out there in CPA land, your clients don’t stand a chance. They’d be finished. Finished!

“You’re the conscience of America,” Theismann told conference-goers. “You are the survivors in tough times. With accountants, I’m not looking for someone to file taxes and do my financials. I can do that myself online. In your position you can basically control people’s lives.”

So get out there and control somebody’s life. Joe Theismann is expecting it.

Is David Paterson Trying to Pander to CPAs?

DavidPaterson.jpgGood news haters of all thing red tape! There is a pesky little fee in New York that goes into effect on December 31 that will require all tax preparers to pay $100 and register with the state tax department.
In case you haven’t heard, Paterson and the rest of the crew up in Albany have a bit of budget shortfall on their hands and need every dime they can get. Well! Your trusty New York State Society of CPAs has lobbied their asses off and gotten you out of this particular case of government meddling:

A bill signed into law by New York State Governor David Paterson provides an exemption from the state’s new tax preparer registration requirements for CPAs, including those who hail from outside the state.

The New York State Society of CPAs had advocated for an exemption for all CPAs from the registration requirements and had earlier succeeded in getting CPAs who were licensed in the state from being subject to the requirements.

Those state society fees do get you something! Call them up and thank them. And thank the Guv, while you’re at it.
New York Exempts CPAs from Preparer Registration [Web CPA]

CPAs Can Be Heros Too

hero.jpgCPAs clients’ have high expectations. Not only do you have to provide timely, exceptional service, you never know when your client might go off the deep end. And we’re talking your typical, frantic phone call, going off the deep end. We’re dealing with ‘My life is over, I can’t go on’ deep end:

[Barry] Schimel recounted how one of his clients was suicidal, so they spent 10 hours driving around talking about the clients’ problems until he got the client back home and safe. He believes the job of the accountant is to make the client successful and more profitable. “Your role is to turn obstacles into an opportunity for clients,” he said.

Not only does Schimel have clients that are in personal distress, he also has some that got the short end of the stick in the smarts department:

Another client was a trash-hauling company that didn’t know it was being charged extra at the dumping station because its drivers remained inside their trucks while the load was being weighed. Once Schimel’s firm pointed this out, the supervisors soon made sure their drivers got out of their trucks, lightening the scales.

This Schimel guy might be our personal hero. A CPA that literally saves lives and doesn’t rub their clients noses in shit when they do something stupid. Who knew this was even possible? Young CPAs, this is your idol.
How to Be a Hero to Clients [Web CPA Debits & Credits]

CalCPA Is Doing About Everything It Can to Motivate You to Reactivate Your CPA

the-big-lebowski-bridges-dude.jpgThe California Society of CPAs understands that some of you are lazy. You don’t work for a company that provides enough CPE (and the cheapskates won’t send you to Vegas for a week) and self-study is out of the question, so your license becomes inactive.
So CalCPA is trying to get you back on the fast track to active status by offering the CPA Active Pass.
This will allow you to get the “inactive” from behind those precious letters and you can wear all of your CPA attire again without having to explain that you’re technically not an active CPA. Details-shmetails.
The CPA Active Pass allows you attend 80 hours of live CPE courses including webcasts, which is the real bonus so you won’t even have to leave your house.
No more excuses people.
CalCPA Helps Inactive California CPAs Reactivate [Web CPA]
Earlier: Arnie Signs 150-Hour Rule for California