Platt’s Perspective – What Just Happened?

Michael PlattAs we look back at the headlines from 2008, the collective refrain from businesses, accounting firms and individuals across the globe is, “What just happened?”

 Volatility. Deflation. Meltdown. Credit crunch. Recession. Depression? “201(k).” Scandals. Layoffs. Bailouts. Foreclosures. Bankruptcies. Climate change. War. As a nation, we’re exhausted, confused and anxious.

Whole institutions appear to be collapsing around us. The auto industry, the housing industry, manufacturing, construction, the financial industry. State governors are caught in scandals. Faith in institutions is teetering on the brink of massive distrust.

“Trust me” is a phrase that many people have grown quite skeptical of – and rightly so. Just like Charlie Brown trying to kick the football, over the past few years we have all slowly gained confidence in our institutions, and Wham! Inevitably, Lucy plucks the ball from the tee and poor old Charlie again lands flat on his back.

As public accountants, you may not have all the answers, but you do hold the key to one of the few trusted relationships that are still solid. You know your clients and have a unique opportunity to listen to them now. You bring a deliberate, structured approach to business decision-making and can help calmly create a roadmap forward. Clients are anxious and scared and they want someone to listen to them. Call them. Take them to lunch. Sit in on their management meetings. Get the “face time” now that will reassure them that you are on their side, because it is hard for them to see that anyone is looking out for them right now.

Within the profession, the situation is confusing too. In continued discussions with CPAs and consultants, we know the accounting profession is also going through its own share of angst. Clients are leaving. Projects are being delayed. Receivables are up and aging. Layoffs are reality.

Personal investments are down. Some firms will be experiencing negative growth for the first time in years. Business development is critical once again.

Younger accountants have never seen a cycle like this. They need guidance just as much as clients do. Those of you with a little more grey hair and experience need to bring a long view to your firm – a perspective that spans the ups and downs of economic cycles to help mentor and guide those who are still a bit green.

Practitioners we are talking to are using words like, “deliberate,” “structured,” “methodical” and “rational” to describe how they are approaching their client base and their own plans. Take heed. Hunker down, make a plan and continue with a clear vision for your firm. Don’t lose sight of the value that you bring to your clients.

In this issue of IPA, we explore some of the issues and challenges that lie ahead for the profession. We look at the economy, the new Obama presidency, continued consolidation of IPA Top 100 firms, and some of the opportunities that are directly in front of us. We hope this sparks some dialogue within your firm as to how to take some of the challenges ahead and turn them into business opportunities.

We wish all of you a renewed sense of opportunity and hope in the new year. We wish to thank our staff, the many partners, consultants, MPs and individuals who have over the past year, helped us along the way. We look forward to better times, to a more prosperous economy and to the positive changes that we are hopeful for in 2009.