Tax Season: Our Time to Shine

It’s almost tax season once again. Can you think of a better way to kick off 2013 than adopting a fresh approach to this ever important time of year?

Here’s a thought: What if we all agree to tell a new story this tax season? Instead of framing it as a time to work your fingers to the bone, embrace the notion that tax season is your time to shine. Don’t you owe it to yourself, your colleagues and your clients to let the world know that you love tax time? After all, it’s what you have studied for and worked toward throughout your career. Even better, it’s the time when the world looks to the CPA profession for its tax smarts and number savvy, problem solving know-how.

The Defining Dozen: 12 Metrics CPA Firms Should Track

This time of year, CPA firms are thinking and planning ahead for their busiest season. That makes now a good time to consider whether your CPA firm will be operating at peak efficiency. Is your CPA firm making the most of current relationships and doing all it can to expand into new ones? While there are many metrics CPA firms use to evaluate quantitative performance, here are 12 metrics than can provide more qualitative feedback. These metrics can help CPA firms measure their reach with clients and provide insight into how well processes already in place are helping to identify opportunities with clients.

An Interview with AICPA President and CEO on 2013

The following is an interview with AICPA President and CEO Barry Melancon, CPA, CGMA. He was asked to share his thoughts about some of the major issues and trends that will affect CPAs in 2013.  

 

In the coming year, we will see the first efforts of the Private Company Council. What changes can CPAs and the companies they serve expect to see?

The Financial Accounting Foundation’s Private Company Council was created to address issues affecting companies that need GAAP-based financial statements. The PCC only recently began meeting, and will be weighing in on existing standards and ones in development. Private company accounting stakeholders are expecting prompt action by the PCC in modifying GAAP to bring more relevance and simplification to financial reporting.

CPAs Play a Significant Role in Technology Adoption [INFOGRAPHIC]

According to the Digital CPA Survey, released over the weekend at Digital CPA: 2012 CPA2Biz Cloud User Conference, an overwhelming majority of CPAs say they have a role to play in technology adoption for their clients. Only 17% of CPAs say they play a minimal role or no part in helping clients embrace cloud, mobile and other emerging technologies that can improve business decision-making. Based on the survey results, the following infographic was developed (click on the image to make it bigger). Feel free to share with others.

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What is a 'Digital CPA'?

Value Pricing: Aligning Your Interests with Those of Your Clients

Selling a Business or Advising a Seller? Tips to Navigate the Fiscal Cliff

The Role of the CPA in a Crowdfunding Future

Microsoft’s Windows 8 Experiment Will Affect All CPAs

Windows 8 Presentation (Photo credit: Michael Kappel)

Remember when Microsoft was the 800-pound gorilla, the dominant software maker, the most valuable company in the world? That was about the time when Microsoft invested $150 million to save rival Apple from bankruptcy.

Fast-forward 15 years, and Apple has risen from the ashes to become the hottest company on Earth—a corporate behemoth that, for a time earlier this year, boasted the highest market capitalization in history, a claim Microsoft once could make.

Microsoft, meanwhile, has slipped from its perch on top of the corporate world and while it is still a business giant nowhere near a bankruptcy filing, the business shift from desktops and laptops to mobile devices and the cloud has put Microsoft in the unfamiliar position of playing from behind.

Preparing New Leaders Starts with Succession Planning

What does it take to be a leader in your organization? Every accounting firm should be able to answer that question. And, more importantly, the answer should be known to future leaders so they clearly understand what they have to do to advance, especially when senior partners start to retire.

It may seem like a no-brainer, but the 2012 PCPS Succession Survey for multi-owner firms reveals that only 15 percent of firms have a leadership training plan in place. Couple that with the fact that the number one perceived challenge to succession planning is that senior partners lack confidence in those moving up the ranks, and you have a major roadblock to a firm’s health, longevity and ultimate survival.

Selling a Business or Advising a Seller? Tips to Navigate the Fiscal Cliff

With about 10 weeks left in the calendar year, it would be difficult for even the most motivated business owners to complete their company’s sale by Dec. 31, unless they’re already in process.

Some owners are hustling to get that process done to avoid falling over the tax cliff set to take effect Jan. 1. But the principles of selling a business apply no matter what the calendar says, according to Scott Miller, CPA/ABV, an expert presenter for the Oct. 30 Journal of Accountancy webcast, Inside Buyout Basics and the Tax Cliff: A Timely Combination.

3 Myths of Succession Planning

Sometimes we CPAs are blind to our own advice. We spend hours every day working with clients, steering them toward financial prosperity, helping them prepare for retirement and ensuring their businesses thrive well into the future. What are we doing for own practices? Not always enough.

Although succession planning is a proven strategy for achieving long-term firm goals, the 2012 PCPS Succession Survey reveals that only 46 percent of multi-owner firms have a written, approved succession plan. In addition, six percent of sole proprietors have a practice continuation agreement however, that’s only a first step toward developing a full succession plan.

Dispelling the following three common myths may help further grow succession planning’s role in practice management. It may also help CPAs reap a succession plan’s full benefits—client and staff retention, a more comfortable retirement and the peace of mind that comes from being prepared for the future.

What is a ‘Digital CPA’?

There’s no question technology is having a huge impact on how CPAs and their clients conduct business, but the adoption rate isn’t uniform within the profession. Some practitioners are taking a wait-and-see approach. Others are sticking their toes in the water. And still another group is fully embracing technology and all that it promises—integrating innovation throughout their firm’s processes and workflows and becoming digitally present in today’s online world.

At CPA2Biz, we use the term ‘Digital CPA’ to describe the latter category. The Digital CPA harnesses the power of the cloud, the broad use of mobile devices and a carefully calibrated online presence to attract clients and build new service lines. It’s inevitable the entire profession will arrive at this same place one day – and that day isn’t far off.

Value Pricing: Aligning Your Interests with Those of Your Clients

The days of providing services first and billing later are dwindling. As this blog post by Jim Boomer, CIO of Boomer Consulting, Inc. indicates, an increasing number of accounting firms are moving into the digital age and transitioning their practices from billing in arrears to value pricing strategies, in order to better align their interests with those of their clients.

Billing: Where's the Real Client Value?

Accounting firms have been billing for, well, forever. Billing may make sense to you as a practitioner, but it may not to your clients.  The truth of the matter is, clients are often baffled by that final bill―which can result in them questioning the real value of your services, or even worse, causing them to look for a better deal elsewhere.

Clients explain the scope of their project (taxes, auditing and the like), firms do the work, tally up the hours spent by partners, junior associates and administrative assistants and send out a bill for services rendered. However, as most firms can attest, a client's reaction to that bill is rarely, “Well that's not so bad at all!” Instead, it will result in an angry client creating perceived indifference between the firm and the client—the number one reason why clients leave. It isn’t about the price, it’s about the surprise of the price. Then before you know it, the client leaves.

Optimizing Your CPA Firm for Local Search

More than 167 million people will shop online this year. Social commerce sales are expected to total $9.2 billion by the end of this year and could climb to $14.25 billion in 2013 and $30 billion in 2015. Consumers are not just shopping for the latest gadget; they’re buying everything from groceries to professional services, including those offered by your CPA firm.

Expanding Your CPA Services to the Government

In today’s economic climate, even with budget cuts on the horizon, the U.S. government is the largest consumer in the world. Yet, for many businesses -- small businesses in particular -- the thought of doing business with the federal government can be headache-inducing. Last year, the federal government spent more than $850 million on financial services. Just more than half of this was spent with CPAs; the remaining half was spent on other financial services, including debt collection.

The demand is there, but is it possible for a small CPA firm to capture a portion of this market? While well-established Fortune 500 firms have a definitive advantage in the contracting industry, the federal government has taken steps to level the playing field and create a more small-business-friendly environment. Two examples of this are small business goaling and set-aside contracts. 

4 Pieces of Advice to Help Clients Collect Money Faster

Imagine having more than 1 out of every 3 dollars you’ve earned tied up and inaccessible.

That’s money you can’t use to advertise, to develop new products and services, or to hire employees.

For many business owners, that scenario is a day-to-day reality as they sit with 40 percent or more of their assets tied up in accounts receivable. Obviously, when it comes to money that your clients are owed, they want to collect as quickly as possible.

4 Simple Ways to Boost Your Online Presence

It’s important for any CPA firm to have a strong presence online. According to Local Search Usage Study: Bridging the Caps, From Search to Sales, 70% of consumers go online first for local business information. Are potential clients finding your firm? Not only do you want to be easy to find in cyberspace, but you also want to present yourself as an expert and trusted financial advisor. A simple website is a start, but is not enough to give you an edge in today’s competitive environment. In order to find new clients, and keep the ones you already have, focus your efforts on ways to boost your online presence. I have found that even small efforts go a long way toward a more prolific online presence.

Here are four steps to raise your online credibility and widen your client base in the process.

National MAP Survey Provides Insight to CPA Firms

It’s valuable to have a perspective on the current state of firms, no matter your role in the CPA profession. Knowing the existing best practices in areas such as staffing, training and technology is important. The 2012 PCPS/TSCPA National MAP Survey, which is being fielded now through July 20, provides you the opportunity to expand your knowledge base on these hot topics. This comprehensive look at CPA firms’ key strategic data is the largest firm practice management survey project of its kind. Contribute your answers to the survey and you’ll have access to the results when complete.

A unique benchmarking tool, the PCPS/TSCPA National MAP Survey reveals key performance indicators broken down by firm size and region so that it’s possible to make meaningful comparisons among firms. It also assesses how firms are doing and spots emerging trends.

5 Ways to Lose Money on Your Engagements

As CPAs we are experts in determining profitability and well aware of the components that go into it.  We do a great job coaching clients in the manufacturing or construction business on the factors they need to manage in order to improve or maintain margin on a product or construction job. Yet despite our coaching, many great clients continue to experience eroding margins year to year. Their attention to what it takes to manage profitability seems to fade away. For us who are CPA firm business owners, we are no different. Owning a business, including a CPA firm, is full of distractions, time demands, fires to extinguish, dates and people to manage, new compliance demands and complexities, etc. Like our clients, we know what we should be doing, but the pressures of the busy season somehow cause us to take our eye off the ball.

Here is my list of the top five ways to erode the profitability of CPA firm engagements.

Why Social Media Participation Can Be Good for CPAs

CPAs may justifiably be wary of sharing personal and professional information on social media sites such as Facebook, Twitter and LinkedIn.  After all, many CPAs spend their days verifying facts in the form of numbers – and adding “notes” in financial statements when there is any question of the veracity of those facts.  How then could these same CPAs be comfortable tweeting about the newest changes in the LIFO accounting procedures or writing a blog post on whether book authors should deduct their home office on their income tax returns?

Welcome to the brand new world of online relationship building, where being willing to “put yourself out there” on social media can help you connect with current and prospective clients.

Use Video to Showcase Your Firm’s Personality

Lights. Camera. Snooze.

Video is a great medium for firms to educate and inform staff, clients and potential employees. But sometimes the content can be a little mundane. Why not take those formal interviews and how-to series to the next level?

Pull back the curtain and let people know what you are really like. 

Put a face to your firm. What are your employees passionate about? Is volunteerism important to you? Showcase your staff or fellow CPAs giving back to the community, like the Virginia Society of CPAs and the Illinois CPA Society did in their CPA Day of Service videos.

 

Five Ways to Lose Your Best Clients

There are 29 million private businesses in this country, and every one of them needs their CPA like never before. Today’s complexities and post-recession external forces have made even the simplest business decisions difficult. As practicing CPAs, we face the very difficult dilemma of getting all the calendar year financial statements and tax returns out in a timely manner or seizing the time to capitalize on the opportunity to get deeper with clients and provide the value they seek from us. We all know what we should be doing, but the pressures of the busy season always seem to override them.

For decades practice management surveys consistently revealed that the main reason clients leave their CPA is a perceived indifference on the part of the CPA/CPA firm. CPAs care passionately about their clients. So what is it that we do to give our clients the feeling that we don’t?

CPA Firms are at a Crossroads - 2012 and Beyond

As I travel the country meeting with small firm owners, I am finding that most have weathered the recession. Most firms report flat revenue or very moderate growth (1-3%). Firms have done a good job sharpening the pencil and controlling expenses effectively, and this has enabled them to keep their bottom lines respectable. They are running lean and mean today; but what about tomorrow? 

Stick with Clients You Can be Grateful For

Now that last year’s tax returns are done, it is time to start getting ready for next tax season. This includes making sure you get enough CPE hours, plan engagement letters, review office processes and reconsider your fees.  It also is a great time to review your client list.  I attended a 1040 update seminar several years ago where the speaker made an interesting suggestion:  Let each person on your staff recommend (with justification) one client to be fired each year.  And be sure your receptionist weighs in!

Succession: It’s Not Only About The Golden Years

Polls in CPA Letter Daily offer an insight to the readers’ opinions about topics taking place in today’s world.

Last week’s poll question, with nearly 500 responses: Does your organization have a formal succession plan in place?

• Yes, my organization has a formal succession plan in place. - 23.71%
• Yes, but it is an informal succession plan. - 21.99%
• No, but my organization plans to develop one. - 18.93%
• No, and we do not have plans to create one.- 35.37%

There’s a saying that the best time to plant a tree is twenty years ago. The second best time is now.

For many years, the AICPA has been encouraging firms of all sizes to take a serious approach to and place a heavy focus on succession planning.  With 44,000 firms in the U.S., combined with an aging population, it’s simply an imperative. I’ve seen many firms that are so busy taking care of “today” that they never get around to planning for tomorrow.

Image via Wikipedia

Recently, Apple demonstrated the importance of having a succession plan when CEO Steve Jobs stepped down, amid health concerns. His sudden announcement triggered a plan that was put in place well before his health forced him to step down. This preparation allowed Apple to seamlessly transition to new leadership and continued success. This plan was well communicated to employees and investors for months, reducing the potential for negative reactions. Examples like this, unfortunately, are the exception, rather than the rule.

In the last month, another event led me to believe that awareness regarding succession planning is both timely and needed, especially in the case of an unexpected life event.