How workplace trends are affecting small businesses

It’s widely known that finding top-tier talent is a challenge many small CPA firms and other small businesses face. On the most recent episode of The Small Biz Brunch, a podcast from AICPA’s #CPApowered campaign, I chatted with Mark Astrinos, CPA/PFS about this issue, changing trends in the workplace and how they’re affecting bottom lines and company cultures. A business owner himself, he had some key insights into hiring and retaining top talent, especially when it comes to millennials. We’ve distilled three of those in this post (lets people know there is more info in the podcast).

It’s not just about the salary anymore.

A survey from the AICPA found that Americans would choose a job with benefits over an identical job that offered a salary 30% higher, but no benefits. These days, benefits – or perks – can be anything from 401(k) matches to delicious snacks in the break room. Overall, employees want to feel valued, which probably means providing more than just an appealing number on a paycheck (although, let’s be honest, that’s pretty important too).

5 busy season curveballs heading your way

Thanks to the biggest overhaul to the tax system since 1986, there’s more on your plate than usual this busy season. And while you’re managing client expectations and navigating the new federal tax laws, you have to consider accounting methods changes, Wayfair concerns and a prolonged government shutdown. It’s a lot to take on. But though this busy season may feel a bit daunting, remember that no one is better equipped to handle it than you.

As you look ahead to the task at hand, remember the famous quote by Babe Ruth: “Never allow the fear of striking out to keep you from playing the game.”

So, gear up to play the game and pay special attention to these key issues.

Data breaches are here to stay

Data breaches are constantly in the news. Last year, Marriott, Quora and Dunkin Donuts all made headlines for privacy breaches – and that’s just to name a few. With breaches happening all the time, it’s easy to feel overwhelmed. But it’s more important than ever to focus on data protection. In honor of Data Privacy Day, here are three ways to protect your clients’ data during tax season and all year long.

Develop an incident response plan

Is your firm ready for a cyberattack? In today’s world, it’s not about if you will experience an attack, but when. Having a prepared incident response plan means you and your staff know what to do as soon as you realize an attack happened. You’ll be able to respond faster and more efficiently. Your response plan will delegate responsibilities, detail how you will notify your clients and help mitigate any reputation damage to your firm.

10 resources to help you cross the tax season finish line

When I was working in a small practice, tax season always felt like a race to me. After months of preparation, I sped toward filing deadlines that were akin to finish lines. Whether the goal was to take first place or simply get it done, I wanted to cross the line as strong and healthy as possible. That meant I had to pay close attention to my pace.

A big part of good race pacing is having supportive resources and people helping you along the way. Luckily, you have the AICPA and Tax Section team cheering you on. Here are ten resources I think will help ease the pressure this tax season.

3 personal finance lessons the failed Fyre Festival can teach you

Gourmet meals. Luxury villas. Dope music. Private jets. All on a secluded Bahamian island – sounds pretty epic, right?

Fyre Festival, the brainchild of tech entrepreneur Billy McFarland and hip hop artist Ja Rule, was expected to be an out-of-this-world, glamorous music festival. At least that’s how it was sold on social media – until festival-goers arrived on the island to find prepackaged sandwiches instead of celebrity chef-cooked meals, FEMA tents in place of the luxury villas…and no music. Needless to say, no one was happy after dropping up to $12,000 per ticket to be there.

Don’t overlook this crucial part of estate planning

We live in a time when numbers are getting so large that they begin to lose meaning. Understanding just how large one million is, is hard enough; when it’s a billion? A trillion? How about 30 trillion?

We’re seeing the largest transfer of wealth in history, as $30 trillion passes to the next generations from the baby boomers over the next two decades. Those estates come in sizes big and small, but they all have one thing in common: taxes. 

In the Tax Cuts and Jobs Act (TCJA) that took effect last year, the individual exclusion from gift/estate and generation-skipping tax was temporarily doubled, and in 2019 now stands at $11.4 million. That means a married couple has an exclusion of $22.8 million to use during their lifetime or at death. Before you go thinking that means estate taxes won’t affect the vast majority of clients, think again: the state your clients live in might not conform to the federal exclusion. It’s important to understand the major tax considerations in estate planning.

3 reasons why all entrepreneurs should hire a CPA

I’ll go ahead and say it – every entrepreneur should hire a CPA. And no, I’m not just saying this because I work for the AICPA. As host of The Small Biz Brunch podcast, I’ve had the pleasure of chatting with many successful business owners – and the majority say how they couldn’t have done it without their CPA. And if someone didn’t use one, they definitely wish they had. 

Read on for three good reasons why entrepreneurs should consider hiring a CPA: 

Evolving tech could mean evolving the CPA license

Throughout 2018, you heard a lot about the changing accounting profession. The biggest driver behind all this change? Technology—what it can do for us (or to us), how to use it and the opportunities and challenges it presents.

We’re using emerging technologies to deliver our core services more effectively and efficiently, and we’re evolving the services we offer to better meet the public’s, our clients’ and our employers’ needs in a technology-driven marketplace.

And so, a couple of questions arise: Are the public, our clients and our employers better served if the CPA license and licensure process evolve to better reflect the changing marketplace? If yes, what does that look like? The National Association of State Boards of Accountancy (NASBA) and the AICPA have joined forces with state regulators, state societies, practitioners and other stakeholders to figure it out.

Tax technology: Outpacing the pace of change

The world is changing, but you already know that. As CPAs, we understand the quickening pace of technological, legislative and demographic changes because we see them influencing each step of our professional lives.

To be our best, we must out-maneuver and outsmart the changes that lie ahead before they ever happen. That means finding new ways to use technology to enhance what we do and how we do it.

The AICPA Tax Section recently released a Tax Technology Resource Center to help you do just that. Here are some of the highlights of how you can embrace technology trends and make the most of the exciting progression of our tax profession.

Plan your testing schedule with 2019 CPA Exam score release dates

The 2019 score release dates are posted and a valuable resource for candidates planning their testing schedule for coming months. There are four score release dates for each testing window. For complete information regarding scoring, please visit the Exam Scoring and FAQ pages.

The National Association of State Boards of Accountancy will release scores to boards of accountancy based upon the target score release dates listed in the tables below. Some boards may require at least one day beyond the published target release date in the table to process and release scores.

Don't look away! Blockchain isn't so bad..

I have a confession to make. Even though I get into just about anything techie, every time I see the word “blockchain,” my eyes and brain tend to glaze over. I suspect many others have the same reaction. 

Yet, we really can’t ignore it. According to Microsoft, blockchain will change the way people think about exchanging value and assets, enforcing contracts and sharing data. It’s expected to grow in importance and transform business operations – on the scale of email and websites. That means CPAs and their clients are going to feel its effects. Wanting to avoid being a “blockhead,” I dove in to see what blockchain is all about. Fortunately, Jim Barnes, a self-described blockchain evangelist, agreed to walk me through it.

No more hitting the snooze button on revenue recognition

We realize you’re busy, but that doesn’t mean you can keep hitting the snooze button on the Financial Accounting Standards Board’s (FASB) accounting standards that will soon come into effect for everyone. The accounting standard that needs your attention right now is the new revenue recognition model, issued as FASB ASU 2014-09 with subsequent amendments.

Public entities are well underway with adoption of the new revenue recognition standard, as the new guidance is effective for interim and annual periods in 2018. Private companies still have some time as the guidance is effective in 2019 for annual reporting periods, and in 2020 for interim periods. This is a wakeup call, and not an opportunity to hit the snooze button yet again.

The government has shut down, but tax season doesn’t stop

On January, 15, the IRS released an updated Contingency Plan recalling 57.4% of its employees to work during the filing season shutdown. Per the new plan, excepted employees now include those whose activities are necessary for the payment of tax refunds. These activities include:

• Processing electronic returns through issuance of refunds
• Processing Paper Refund Tax Returns through issuance of refunds
• Processing 1040X Amended Refund Returns Adjustments including Carrybacks, Amended Returns, Duplicate Filed Returns (DUPF), Correspondence, Injured Spouse Claims, Disaster Claims, F843 Claim for Refund and Request for Abatement in support of issuing refunds
• Processing Department of Defense Claims for refunds
• Manual Refund Support - Clerical
• Document preparation, screening and control of work in Image Control Team

5 retirement planning tips for tax clients

Successful retirement planning is all about strategy. Analyzing sources of income, estimating expenses, choosing investments and managing assets are vital to safeguarding long-term financial comfort later in life. However, one aspect of retirement planning is sometimes overlooked — tax planning.

As a CPA, you’re already helping your tax clients with their retirement planning needs, but are you doing enough? Take a moment to review these tax considerations to make sure you’re exploring all the options with your retiring clients. Then listen to this AICPA podcast for a deeper dive into the topic.

Looking at tax as part of retirement planning

How some taxpayers are getting grounded

Jane has a problem. She has tickets to fly to Europe next week, but her back taxes may be standing in her way.

Jane owes more than $75,000 in taxes, fees and interest to the IRS. She was aware of this substantial debt but had no idea that she could lose her passport because of it. She doesn’t understand what’s going on or what she can do.

Jane isn’t alone. The number of people receiving a Notice CP508C is growing, and more than 362,000 Americans are facing passport revocation due to significant tax debt.

One of your tax clients could be next.

How to avoid gift card fraud this holiday season

Everyone has a friend or relative that is difficult to purchase a gift for. I’m sure you’re thinking of one after reading that sentence! That’s why gift cards are so popular –the person gets to pick out something they know they’ll like. It’s really a win-win situation. However, in recent years, scammers caught wind of the lucrative gift card market and have come up with schemes to target consumers.

AICPA Insights reached out to Howard M. Silverstone, CPA/CFF, a forensic accountant and member of AICPA’s Fraud Task force to learn how Americans can protect themselves from gift card fraud this holiday season.

AICPA Insights: I only recently heard about gift card fraud a few weeks ago. How long has this scam been around?

Reflections on 2018: A year of change and opportunity

Barry Melancon, CPA, CGMA, President and CEO of the American Institute of CPAs (AICPA) and CEO of the Association of International Certified Professional Accountants (the Association), reflects on the success of the past year and the opportunities ahead in 2019.

Last year, you used one word to sum up 2017: change. How would you sum up 2018?

The change and disruption we saw in 2017 continued in full force into 2018 – it just became faster and more complex. The unprecedented pace of innovation and interconnection of new technologies, unstable business and political environments and changing workforce demographics are transforming the accounting profession and the role we play as trusted advisors to the individuals, businesses and communities we serve.

And as bewildering as change can sometimes seem, I think it’s actually promising for the future. These extraordinary times present nearly limitless opportunities for our profession, allowing us to dramatically reimagine the work that we do to become even stronger, more trusted and more vibrant. But to realize that opportunity, we have to be willing to challenge convention - to go beyond the way we’ve done things, beyond expectations, beyond comfort zones. That’s been a central theme of our work in 2018, as we’ve helped our members prepare for and embrace the opportunities on the horizon.

‘Twas the night before tax season

'Twas the night before tax season, when all through the states,

The nighttime felt heavy, and folks were up late.

The children were nestled all snug in their beds,

While Dad stared at forms with immeasurable dread.

And Mom in her PJs, the cat in her lap,

Had just settled in for the tiniest of naps.

The world is your classroom: Build your 2019 learning plan in minutes

Picture it: A knockerupper and a powdermonkey walk into a packed bar. To their surprise, there’s only one barstool left. The knockerupper looks over at the powdermonkey and says, ‘Are you gunning for that seat?’ to which the powdermonkey responds, ‘Don’t look so alarmed.’

Okay. Admittedly, the punchline would probably make more sense if knockeruppers and powdermonkeys were still relevant professions today. But that’s kind of my point. Because this joke illustrates an imperative, timeless truth:

Lifelong learning is no joke.

AICPA representing you in 2018

2018 was a busy year for the AICPA’s Advocacy team. We were invited to testify before key congressional committees, provided written testimony to legislators and regulators and submitted over 60 comment letters to federal agencies and accounting standard-setters, including the Department of the Treasury, the Internal Revenue Service (IRS) and the Financial Accounting Standards Board. We also supported state CPA society activities in their legislatures.

Our efforts produced results. Here are just some of them:

Guidance on meals and entertainment deductions

4 things your clients don’t know affect their taxes

This year is coming to an end, and there’s one thing we can all agree on: 2018 was a doozy for tax practitioners. Between tackling a challenging busy season, reading up on the Wayfair ruling and navigating the constant stream of tax reform guidance, there’s been a lot to keep up with. But while you were making heads or tails of the changes to tax, your clients had their own list of challenges keeping them up at night.

Whether they got married or divorced, retired or sent a child off to college, their financial realities shifted and not just because of tax reform.

3 lessons “It’s a Wonderful Life” can teach you about revenue recognition

What happens when a small business fails to comply with important regulations? In the classic movie It’s a Wonderful Life, a local building and loan association is in danger of failing its bank audit because of a major—but innocent—mistake by one of its officers. Are your clients in the same kind of danger as Bailey Building & Loan?

They could certainly face unnecessary disruptions if they underestimate the impact of the significant new Financial Accounting Standards Board (FASB) revenue recognition standard and aren’t ready to tackle implementation as the rules become effective. (FASB Topic 606 is effective for nonpublic entities for annual reporting periods beginning after December 31, 2018.) Here are three lessons the movie can teach practitioners and clients before it’s too late.

It’s beginning to look a lot like tax busy season

Washington, D.C., got its first taste of winter just two days after the AICPA National Tax Conference this year. In some parts of the capital, it was just a dusting of snow. For those just north of the city, it was a blanket. While CPAs bundled up, drank hot cocoa and anticipated the wonder the season always seems to bring, they were reminded of the cold months ahead where the days are shorter, but the workdays are much, much longer.

The first sign of winter is also the first sign of busy season. It’ll be here before you know it, and with tax reform implementation in full swing, you’re going to need more than a wool coat and an ice scraper to get you warmed up and out on the road in the morning.

A recipe for success: Experiences to keep your clients coming back

You’re staying at a hotel in a city you’ve never visited before. After you check in and unpack your bags, you realize you’ve forgotten your pajamas and it’s too late to shop. You walk down to the lobby and mention your predicament to the front desk clerk. Sympathetically, she offers a solution. She tells you to have a seat and serves you a cup of hot tea and a perfectly warm and melty chocolate chip cookie. After just a few minutes, another staff member approaches you with a package of blue cotton pajamas. She explains they’re offered to you complementary for your stay.

Increasingly, consumers are valuing their overall customer experience much more than any tangible product or service they may receive. It’s what keeps them satisfied and coming back for more. You, too, have an opportunity to create exceptional and memorable experiences for your clients. What are you doing to keep them coming back for more? Here are three things to consider as you strive to go above and beyond for your clients:

40 trends that the Auditing Standards Board has outlived

Everyone gets pretty nostalgic on their fortieth birthday. But what if you are the Auditing Standards Board? How would you celebrate? We decided to take a light-hearted look at the trends that have come and gone over the last four decades. Join us for this ride back in time.

 Communications. In 1978, auditors didn’t have smartphones to communicate with clients. They used CB radios. Before long, the shorter car phone antenna became the status symbol of choice. Away from the car? Just page me (on my beeper). Motorola introduced a game changer in 1990: the bag phone. Soon, tech savvy CPAs were carrying a bag phone in one hand and a PalmPilot phone in the other. Fortunately, someone saw one of these CPAs in an airport and invented the Blackberry.

Americans want employers to show them the benefits

Today, the perfect job is about more than the money. Americans want employers to show them the benefits. New original research conducted by The Harris Poll for the American Institute of CPAs (AICPA) found that Americans value having a job with benefits more than one with a higher salary. Neal Stern, CPA and member of the AICPA’s National CPA Financial Literacy Commission, spoke to AICPA Insights about the survey results and shared what you should keep in mind with respect to your own workplace benefits.

According to the survey, Americans are four times as likely to choose a job with benefits over an identical job that offered 30 percent more salary but no benefits. What’s your reaction to this?

Neal Stern: I find it encouraging that so many Americans recognize the value workplace benefits bring to an overall financial plan. Some benefits, like health insurance, protect you from exposure to tremendous expenses that could seriously derail your financial wellness. These benefits often come at a lower cost than what it would take to buy the coverage on your own. This is largely because of employer subsidies and possibly more favorable pricing through a group, which leaves you more breathing room in your monthly budget. Looking beyond the financial benefit of a broad benefits package, it’s hard to over-estimate the value of peace of mind you get from being free of the worry of catastrophic expenses from an accident or illness.

Wine, cheese and revenue recognition for everyone

If you think the Financial Accounting Standards Board’s (FASB) new revenue recognition standard is only applicable to those in the wine and cheese crowd, think again. The standard impacts companies of all sizes, from specialty shops to corporate lenders. You don’t need to be in an industry with specialized revenue to turn your attention to the new standard. At the Center for Plain English Accounting, we’ve been receiving questions from practitioners on their client’s behalf for some time now. We picked out a couple and provided answers to help you understand the new standard (ASC 606).

How to identify performance obligations under the new standard.

Question: My client runs a direct sales gourmet cheese business. Individuals who join the Cheese Club pay a monthly membership subscription fee of $49.95 and receive $49.95 each month in “Mozzarella Moola” to spend whenever they please. Members of the Cheese Club also receive 25% off all purchases and receive exclusive early access to purchase new products. In this scenario, what are the performance obligations?

3 tasks your organization can automate to save time

By now, you’ve heard how automation can save you from the boredom of copying and pasting all day. But you might still be wondering what processes your organization can automate to save time. Look no further. Here are three areas finance and accounting professionals can look at as automation opportunities.

Credit applications

Still running credit checks manually? There’s a solution for that. With automation software, your customers can go from application to decision in a matter of minutes, often without any direct involvement from you.

4 tips to identify audit client risks

This blog post is the second in a series on risk assessment, a significant audit quality issue. View the first blog post here. 

Anyone who owns a home has had some experience with lawn care. Maintaining a healthy lawn is easy when you have a lush field of bluegrass, but when things start to get patchy, that’s where the real work comes in. That’s when you have to get a good understanding of what is going on with your lawn and what might be causing the patches. Only then can you pick the right treatment.

Auditing a set of financial statements is no different. To perform an effective audit, you must first gain an understanding of your client and identify their specific financial reporting risks. Until these steps are complete, you have no basis for planning the rest of your audit procedures.

Think sustainability’s unsustainable? Think again.

As a CPA, you build strong relationships with your small business clients, so you’re not surprised when one of your clients, who is running a startup, asks for a meeting to talk about her goals for the coming year and beyond. She is looking to enable growth by attracting new investors, to continue recruiting quality talent and to differentiate the company in the marketplace by giving it a competitive edge going forward. You want to help, but where do you start?

Rethinking the business  

While such goals can sometimes seem daunting, you know that there are simple steps she can take to improve her chances of achieving all three: Make changes that ensure her company is operating in a sustainable manner. There are some direct results of embracing greater sustainability. These include fostering innovation, driving financial performance and improving risk management, according to a Harvard Business Review article. Other benefits include improved brand image, greater appeal to employees and investors and increased ability to comply with regulations. 

Your life. Your terms: Four steps for reducing stress and reclaiming your life

Life is stressful, there’s no doubt about it. But you have the choice to maintain a different perspective, instead of letting stress overtake you every day. Here are four steps to reduce stress and live a well-balanced life:

Step one: Get clear on your purpose

Living life on your own terms requires clarity of purpose. Do you know what matters to you most, and why?  Consider the life wheel. There are eight buckets on the wheel: family, work, money, personal growth, health and wellness, spirituality, community and living environment. You must decide which three or four are most important to you, and why. Time is limited, which means you can’t weight all life areas equally. When you know your “what” and your “why,” you’ve got power—the power to dial up the time and energy for what matters most, and the power to pull back on what doesn’t.

5 tips to help small business clients prevent cyberfraud

Imagine you’re at work on a typical Monday morning. Suddenly, an email from the CEO hits your inbox. It’s marked ‘urgent,’ so you open it right away. She needs you to wire $15,000 to one of your regular vendors ASAP. You make the wire transfer, and head to the break room to refill your coffee. There’s just one problem – that email wasn’t really from your CEO. And that bank account where you sent the funds? That’s not your vendor’s account. You just sent thousands of dollars to a cyber criminal. Uh oh.

It’s a scheme called executive impersonation, a type of business email compromise (BEC) scheme mentioned in an SEC alert issued last month. Unlike a typical scam email, which may have poor grammar or overly suspicious requests, BEC scams are convincing because the criminals spend time figuring out the corporate culture and common phrases and terms used by employees. CPAs should take note, because scammers could try to perpetrate a similar fraud against their small business clients.

The secret to less copying and pasting – Robotic Process Automation

Remember the last time you copied information from one system and put it into another? Wasn’t that three hours of Ctrl+C and Ctrl+V fun? It wasn’t? Sounds like you might want to look at robotic process automation (RPA) then.

The name is long and slightly intimidating, but the actual use of RPA isn’t. Despite the name, the technology is accessible and easily integrated into your existing platforms. It increases efficiency and reduces mistakes. This means you can be more productive and can spend more time using your higher-value skills like data analysis.

So how can you get started using RPA?

Licensure under fire in the states

A powerful narrative is taking shape across the country that could define the future of licensure. State legislators are coming together to challenge the necessity and value of occupational licensing. 

So far, there have been no direct challenges to whether CPAs should be licensed. However, there’s a national anti-licensure legislative strategy that does not distinguish between occupations and learned professions such as CPAs.

The changing legislative environment means we risk losing licensure as a means to protect the public. That would mean no licensed architects, no licensed engineers and no licensed CPAs. We’ve spent decades ensuring that only qualified and educated professionals can hold out as CPAs. Clients trust CPAs to act as their fiduciaries because they know the profession is well regulated.

AICPA Announces 2019 CPA Exam Score Release Dates

The 2019 score release dates are now available on aicpa.org/cpaexam.  For complete information regarding scoring, please visit the Exam Scoring and FAQ pages.

The National Association of State Boards of Accountancy will release scores to boards of accountancy based upon the target score release dates listed in the tables below. Some boards may require at least one day beyond the published target release date in the table to process and release scores.

Americans’ financial satisfaction reaches new high—can you feel it?

For the fifth quarter in a row, the typical American’s personal financial satisfaction reached an all-time high, according to the AICPA’s Personal Financial Satisfaction Index (PFSi). A record number of job openings, along with the stock market’s bullish performance though Q3 (Oct 1) - despite volatility - boosted Americans’ financial positions. With all these positive records, you may be wondering what it means for you.

3 spooky small business myths, busted

At this time of year, there’s plenty of “spookiness” to go around – the new Halloween movie, haunted houses, people incessantly arguing about politics on Facebook (just to name a few). Luckily, starting a small business doesn’t have to be something that makes your hair stand on end.

To calm potential entrepreneurs’ fears of starting a small business, I wanted to learn about some of the most popular myths – and hopefully put them to rest. Amy Wang, CPA and senior manager of the Tax Advocacy & Policy team at the AICPA and Margaret McNab, founder and co-organizer of the Freelance League of North Carolina, joined me on #CPApowered’s new podcast, The Small Biz Brunch, to discuss just that.

Myth #1: Side Hustles Aren’t Taxable

Tax identity theft: A horror story

Halloween used to scare me. I was sure that monsters — specifically zombies — were out to get me. But I’m not afraid anymore because I faced down a nameless ghoul who did more actual harm to me than any imaginary monster could ever do.

It all started one fateful day when an identity thief used my name, Social Security number and birth date to file a fraudulent tax return, netting the fraudster a $4,000 refund. While it was an excellent payday for the thief, it was the start of some major headaches for me.

By the time I found out what happened, I was on the hook for more than $14,900 (including supposed unpaid taxes, penalties and interest). Fresh out of grad school with high student loan debt, rent and health insurance payments, I was completely unprepared to weather this storm.

Are you the analytical type? A cool, new path is emerging.

 

As a CPA or CGMA, you excel at getting into the weeds. Whether it’s a reporting discrepancy or buried tax provision, you will find it. More importantly, you know how to arrange those weeds to form a bouquet that helps your client.

Now, with software spouting numbers on everything from revenue and sales to “likes” and clicks, a new business opportunity is opening up, one that lets you use that great analytical mind to serve clients who desperately need help with getting a grip on all that data.

“CPAs are ideally positioned to be able to step in and do that type of work.” said Dan Griffiths, CPA, Strategy and Leadership partner at Tanner LLC. Griffiths ought to know. In addition to Tanner’s tax and audit practices, the firm has stretched its accounting arms to carry a range of specialty consulting services such as strategic planning, cybersecurity and, now, data analytics.

4 strategies to capture the growing Hispanic market

As CPAs, we’re always interested in numbers, so let me share an interesting statistic: The United States Census Bureau has projected that  groups now considered ethnic minorities will make up the majority of the population by 2042 with Hispanics being the second largest racial or ethnic group and second fastest growing.

According to market research by Nielsen, there are about 57 million Hispanics in the U.S., or 18 percent of the population, making them an important demographic to any business – including CPA firms. Is your firm ready to engage with these potential clients and staff? There are a few insights that can help CPA firms connect with this burgeoning business and talent market.  

5 cybersecurity frameworks accountants should know about

You’ve seen all the news stories: Cyberattacks are happening almost daily, and they can have devastating consequences. You know you need to protect your organization’s data. But where do you even start?

A cybersecurity framework can guide you in the right direction. These frameworks help you design a cybersecurity risk and controls process that is right for your organization. Whether you’re interested in helping set up your own organization’s cyber program, or you’re interested in providing assurance on other organizations’ cybersecurity systems, you should be familiar with different cybersecurity frameworks and what types of companies they’re best for. I’ve listed a few common ones you should know about below.

Yellow Book meets yellow cake and all sorts of delicious changes

While I’m not a good baker, when I talk to CPAs who are new to the governmental auditing area and need to understand what the “Yellow Book” is, I often explain using the analogy of a multi-layered cake. The bottom layer of the cake is the AICPA auditing standards, which are the basis for most Yellow Book audits. The second layer of the cake (let’s make it a yellow layer!) adds standards issued by the Government Accountability Office (GAO), known as the “Yellow Book” or Generally Accepted Government Auditing Standards (GAGAS) that build upon the AICPA rules. Finally, if your client gets federal funds, there may be a third layer of the cake that consists of compliance auditing requirements.

The big news for auditors right now is that the GAO has issued a 2018 revision to the Yellow Book which will change the ingredients for the middle layer of the cake. If you audit federal, state or local governments, or not-for-profits, whose audits are subject to the Yellow Book, you should begin updating your recipe card so your cake turns out right. 

Life lessons learned while training for the IRONMAN® triathlon

On August 19, 2018, I checked something off my bucket list: I completed the IRONMAN® Mont-Tremblant triathlon – a 2.4 mile swim, a 112 mile bike ride and a 26.2 mile run. I wasn’t particularly fast — it took 15 hours and 40 minutes to finish — but it was an amazing day in beautiful Quebec, Canada, that I will never forget.

As an adult, I developed a love of running to help stay active and reduce stress. When I turned 40, I got into triathlons to mix it up a bit. For many years, I wasn’t very athletic. So it was pretty shocking to many that I had undertaken such an intense activity.

Now, having run countless miles, I’d like to share some of the lessons I learned while training and running. I find they cross over into my everyday business life.

See the future, without a flying DeLorean

Unless you’ve recently installed a flux capacitor in the family mini-van, you probably can’t predict the future. But human nature is insistent in its curiosity, so predictions do persist. Weather, gambling, investing…many things we do and experience prompt a desire to know what’s coming next.

The Association of International Certified Professional Accountants recently announced the Watchlist, a semi-annual list of trends, technologies and possibilities that could affect the accounting profession. The list is divided into three areas: things happening now, things that might happen soon, and things that might happen eventually. Each topic is related to how CPAs do their work, and a few of them might actually surprise you.

Unlike Marty McFly’s sports almanac, the Watchlist isn’t predestined. That aside, both do the same thing: use data to make predictions. But a small problem creeps in: what data do you use?

Technically, your planning practice could be better

Is there even a day that passes anymore in which you don’t read, hear or watch a story about the wonders of technology? New apps, new computer systems and entirely new technologies are emerging and being put into practice at dizzying speeds. Cutting through the noise and knowing which technologies are best for your planning practice can be complicated, but ignoring the value technology can add to your practice carries a heavy price in lost efficiency and opportunity.

Are you still driving a manual?

Spreadsheets used to be the go-to tech for organizing and assessing a client’s finances and your resulting financial plan. Handy but labor-intensive, spreadsheets were and are prone to errors and omissions. Other old-school trappings like physical copies of client’s financial data, wills or healthcare directives presented other problems related to security, inaccessibility or loss of the paperwork due to disaster or misplacement.

Smishing – what you need to know

When I first saw the word smishing, I assumed it was some new lingo the kids came up with to further stump us adults. But then again, this is coming from someone who didn’t know what ‘on fleek’ was until it was no longer cool to use. (It’s okay if you still don’t know what that means.)

Jokes aside, smishing is a very serious matter – and since October is Cybersecurity Awareness Month, it’s the perfect time to discuss it.

What is smishing?

According to Experian, a credit reporting bureau in the U.S., smishing is yet another tool used by cybercriminals to obtain personal information and steal identities. You’ve probably heard of ‘phishing,’ which is an attempt to get people to provide sensitive information via email, like credit card numbers or passwords. Smishing is a mashup of SMS (short message service) and phishing.

What do your clients really want? Ask!

If you have a small firm, you know how much of your valuable time can be eaten up with things that don’t generate revenue, such as administrative duties and staffing headaches. So, the thought of doing one more thing might seem overwhelming. But what if it’s the one thing that catapults your practice to the next level?

“We talked about doing a client poll a million times, but never seemed to find the time,” explains Jim Davidson, CPA, of Davidson and Nick CPAs in Naples, Florida. “This past year we had a lot of new staff. We wanted to know what clients thought we did well, and what we didn’t.”

What Jim learned didn’t exactly surprise him, but it did give him some good ideas. After 30 years of practicing in a town known as a retirement mecca, it wasn’t a revelation to learn clients were looking for estate and trust planning. But Naples is nearly bursting with those services already. Surely his clients are getting them elsewhere?

3 ways small firms can turn challenges into opportunities

The thing I enjoy most in my role as Chair of the AICPA is the time I get to spend talking to members from across the profession about the issues most important to them. What’s clear to me is we’re all facing the same challenge of staying ahead in a fast-changing world. But we’re unique in how we confront this challenge.

This is especially true with small firms and sole practitioners, which play a powerful role as trusted advisers for their clients and communities. Firm owners wear many hats — human resources, business development, marketing and service providers. As the pace of change speeds up, it’s hard to manage the day-to-day and prepare for the future.

Cybersecurity facts tax practitioners need to get right

How many emails does your firm receive in one day?

Whatever the number, there’s a good chance a chunk of it is malware. According to a 2018 report compiled by Symantec, Corporation, one in 412 emails contained malware in 2017. For businesses with less than 250 employees, this rate jumped to one in 376 emails. When you consider just how many emails the average office worker receives in a week, things can look a little scary.

Cyberattackers represent a growing and evolving threat to CPA firms. Perpetrators are seeking sensitive client information, financial records and firm data like PTINs using any method available to infiltrate your defenses. And a lot of times, it works.

Understanding how to ward off these attacks is half the battle. Learn how to dispel common misconceptions about cybersecurity so you can be better prepared to face down any threat to your data.

4 ways to strengthen culture in your firm

Fall has finally arrived. The change in season is the perfect time to evaluate your firm’s inner workings and maybe even switch up your routine. Are your staff and clients happy? Are you fostering a work environment where staff feel energized, supported and have growth opportunities available to them?

People need the right blend of opportunities, challenges and accomplishments to achieve optimal success. And when the environment is right, growth can flourish. We asked three successful firm leaders how they’ve nurtured their firm’s cultural climate. This is what they said:

1. Define your desired culture and core beliefs.