AICPA Financial Reporting Executive Committee Taps BDO’s Angela Newell as Chair

Angela Newell

Angela Newell

The AICPA has named Angela Newell as chair of the Financial Reporting Executive Committee, or FinREC.

Newell, based in Dallas, is a national assurance partner for Chicago-based BDO USA (FY18 net revenue of $1.46 billion). FinREC serves as the AICPA’s official voice on financial reporting matters and develops guidance on accounting for specific industries. The committee’s membership includes representation from business and industry, public practice and academia.

“Angela brings a unique skill set to FinREC, having experiences in both public accounting and industry, coupled with her deep knowledge of GAAP,” says Jim Dolinar, FinREC’s outgoing chair and a partner at Crowe LLP. Newell will succeed Dolinar after the committee’s May 2019 meeting.

In her role at BDO, Newell works with audit engagement teams to determine the appropriate accounting for a variety of topics. In addition, she has played a key role in the firm’s response to the new revenue recognition and leasing standards.

Prior to joining BDO, Newell served as vice president and corporate controller for Fiesta Restaurant Group in Dallas, and vice president of revenue assurance and corporate controller for Clearwire Inc. in Bellevue, Wash.

AICPA Survey: U.S. Business Executives Grow Gloomier About Global Economy

Business executives’ outlook on the global economy slid sharply over the past year, amid concerns about trade conflict and other business impacts, according to the first-quarter AICPA Economic Outlook Survey.

A little more than a third (34%) of survey respondents say they are optimistic about prospects for the global economy over the next 12 months, compared to 40% last quarter and 71% a year ago. Optimism about the U.S. economy has also declined over the past year but remains unchanged from last quarter at 57%.

“Trade tensions, the cooling economy in China, the looming overhang of Brexit on the United Kingdom and European Union, a series of regional conflicts – all of these have contributed to a sense of uncertainty and pessimism about the global economy,” says Ash Noah, managing director of CGMA learning, education and development for the Association of International Certified Professional Accountants, the global organization that includes the AICPA and the Chartered Institute of Management Accountants. “On the other hand, we’re seeing a bit more of a stable outlook for the U.S. economy this quarter.”

Expectations for profit and revenue growth over the next 12 months edged back up after a sharp drop last quarter. Profit growth estimates increased to 3.6% from 3.4% last quarter (the lowest rate since the second quarter of 2017), while revenue growth expectations rose a tick to 4.4% from 4.3%. Both profit and revenue growth forecasts are well below those from a year ago.

The survey polls CEOs, CFOs, controllers and other CPAs in U.S. companies who hold executive and senior management accounting roles.

Other key findings of the survey:

  • The percentage of U.S. executives who expressed optimism about their own company’s prospects over the next 12 months fell from 68% to 65%, quarter over quarter.
  • Survey respondents who said they expect their organizations to expand in the coming year also fell slightly, from 67% to 66%.
  • Some 43% of business executives cited a global economic slowdown as their biggest concern regarding rising trade tensions, up from 36% who said the same in the third quarter of 2018, the last time the question was asked.
  • Most U.S. business executives (71%) see a neutral impact to their company’s bottom line from Brexit, but the percentage who see a negative impact rose to 16% from 4% in the second quarter last year, the last time the question was asked.
  • After availability of skilled personnel, the No. 2 and No. 3 challenges cited for businesses were “domestic compensation” and “employee and benefit costs,” respectively. The latter two flipped places in the past quarter.

Study: 89 Percent of Finance Teams Yet to Embrace Artificial Intelligence

Finance teams lack the digital skillset to embrace the latest advancements in artificial intelligence, causing a negative impact on revenue growth, according to a new study from the Association of International Certified Professional Accountants (the Association) and Oracle. The study of more than 700 global finance leaders found that despite a clear correlation between the deployments of AI and revenue growth, 89% of organizations have not deployed AI in the finance function and only 10% of finance teams believe they have the skills to support the organization’s digital ambitions.

The report, titled “Agile Finance Unleashed: The Key Traits of Digital Finance Leaders” highlights that 46% of tech-savvy finance leaders report positive revenue growth, compared with only 29% of tech-challenged leaders. Furthermore, organizations that have seen revenue growth are more likely to be deploying artificial intelligence compared to those where revenues are flat or declining. However, only 11% of finance leaders surveyed have implemented artificial intelligence in the finance function, and 90% say their finance team does not have skills to support enterprise digital transformation.

“For me, robotic process automation, advanced analytics, and machine learning are three legs of the same stool,” said John Merino, chief accounting officer at FedEx. “The combination of those technologies and the ability to deliver them in an agile manner without long lead times and extensive interface complexities creates a tremendous opportunity to capitalize on some really big efficiency gains in virtually every staff function. The big win for us is to liberate that time and move finance up the value chain in what it delivers to the organization.”

“Businesses are missing out on huge growth potential by failing to give finance teams the tools and training they need to make better corporate decisions,” said Andrew Harding, chief executive of management accounting at the Association of International Certified Professional Accountants. “Cloud and emerging technologies like AI and blockchain drive efficiency and improve insight and accuracy, enabling finance leaders to step into a more strategic role in the business and improve the organization’s data-driven decision making. To make the most of these new technologies, finance teams need to simultaneously evolve the competencies of their staff in areas such as analytical thinking, decision-making and business partnering.”

Key Traits of Digital Finance Leaders: The report identifies three common traits of tech-savvy finance teams:

  • Modern Business Processes: According to the report, tech-savvy finance leaders use advanced technologies and establish ‘operational excellence’. For example, 86% of Digital Finance Leaders have a digital-first and cloud-first mindset, which gives them greater access to intelligent process automation and technologies such as artificial intelligence and Blockchain, which are commonly delivered via the cloud. Additionally, 73% centralize finance subject matter expertise in a global ‘Center of Excellence.’
  • Data Insights: Leading finance teams are able to connect data that was previously in disparate applications to uncover new insights. They are increasingly relying on AI to uncover hidden patterns, make recommendations, and learn continually from the non-stop flow of business data. The report shows that organizations that have seen positive revenue growth are more likely to be deploying AI compared to those where revenues are flat or have declined.
  • Business Influence: Leading finance teams have been able to move beyond reporting and are using data-driven insights to influence the direction of the business. With reduced time spent on manual reporting processes and armed with accurate and timely data, finance leaders are empowered to partner with the business, recommend new courses of action and influence business strategy.

“The cloud has significantly reduced the barrier to emerging technologies and is enabling organizations to introduce new business models and unique customer experiences that drive additional revenue streams,” says Kimberly Ellison-Taylor, global strategy leader, Cloud Business Group, Oracle and former chair of the Association and the AICPA. “Common benefits that our customers experience once in the cloud include reduced costs and improved efficiency, increased security, real-time and accurate reporting, deeper business insight and better decision-making. The confluence of benefits enables organizations to spend less time on low-value, time-intensive reporting and innovate faster than their competitors.”

The Association conducted in-depth interviews with CFOs and other top finance executives at companies around the globe. Included in that extensive and diverse group of participants were the following Oracle customers:

  • Addiko Bank
  • Blue Cross Blue Shield of Michigan
  • Highmark Health
  • Hungry Jacks
  • Instacart
  • RedMart
  • Rolls Royce
  • Royal Bank of Scotland
  • Stitch Fix
  • USEN Corporation
  • Western Digital

The full report can be downloaded here.

AICPA Announces Creation of Scholarship for CPAs Pursuing their Ph.D

William (Bill) Ezzell was a strong advocate for the CPA profession, particularly for students on the path to becoming a CPA and the educators who teach them. He also firmly believed that one of the best ways to inspire the next generation of CPAs was to ensure they were taught by professors with relevant, recent real-world experience.

The AICPA Foundation created the William (Bill) Ezzell Scholarship to honor his passion by providing financial assistance to CPAs pursuing their Ph.D., the AICPA announced.

The $10,000 scholarship will be awarded annually to five outstanding accounting Ph.D. candidates who demonstrate significant potential to become mentors for the next generation of CPAs.

“This scholarship is a fitting way to honor the legacy of Bill Ezzell, who strongly believed that the accounting profession benefits from more CPAs with Ph.D.s in the classroom,” says Yvonne Hinson, Association of International Certified Professional Accountants. “The scholarship reflects both his vision and the AICPA’s commitment to ensuring the accounting profession has a strong base of accounting faculty to maintain a robust pipeline of talent entering the profession.”

The William (Bill) Ezzell Scholarship joins AICPA’s Accounting Doctoral Scholars Program, Minority Doctoral Fellowship and other initiatives to advance higher education in accounting.

Eligible applicants must meet the following criteria:

  • CPA required
  • Have minimum three years of professional accounting experience, with a portion of that experience being within the last three years at the time of enrollment
  • U.S. citizen or permanent resident (green card holder)
  • Earned an undergraduate or a master’s degree in accounting
  • Intend to teach and research at a U.S. AACSB-accredited university upon graduation

Those who wish to apply or learn more can visit ThisWaytoCPA.com for a full list of application materials and requirements.

The application period is open and will run through March 1, 2019. Applicants will be notified of acceptance by June 2019.

For more information or to schedule an interview, contact James Schiavone, public relations manager at james.schiavone@aicpa-cima.com or 212-596-6119.

Americans Favor Workplace Benefits 4-to-1 over Extra Salary: AICPA

Greg Anton

When it comes to finding the perfect job, a newly published AICPA survey of 2,026 U.S. adults, among whom 1,115 were employed, suggests it’s about a lot more than the money. And with 29% considering switching jobs in the next year, employers need to be ready to show them the benefits.

Employed adults estimate, on average, their benefits represent 40% of their total compensation, according to the survey conducted online by The Harris Poll for the AICPA in April 2018. However, per the Bureau of Labor Statistics, benefits actually average 31.7% of a total compensation package. Americans are actually overestimating the value of the benefits available to them. But they clearly see value in workplace perks – by a 4-to-1 margin, they would choose a job with benefits over an identical job that offered 30% more salary but no benefits.

“A robust benefits package is often a large chunk of total compensation, but it’s the employees’ job to make sure they’re taking advantage of it to improve their financial positions and quality of life,” said Greg Anton, chairman of the AICPA’s National CPA Financial Literacy Commission. “Beyond the dollar value of having good benefits, employees gain peace of mind knowing that if they can take a vacation without losing a week’s pay or if they need to see a doctor, they won’t be responsible for the entire cost.”

Nearly 88% are confident they understood all the benefits available to them when they accepted their current job. Similarly, 86% are confident they have kept up-to-date with changes to those benefits, and 86% are also confident they know where to get information about how to use their benefits. Surprisingly though, only 28% are very confident they are using their benefits to their fullest potential.

When asked which three workplace benefits would help them reach their financial goals, more than half of Americans cited 401(k) match (56%) or health insurance (56%), while around a third cited paid time off (33%) or a pension (31%). Additionally, about 21% cited flexible working hours, and 15% cited working remotely.

As seen in generational breakdown below, Baby Boomers put a significantly higher priority on health insurance and having a 401(k) match than the younger generations. Notably, of all benefits listed, the desire to have a pension saw the largest discrepancy amongst generations. More than half of Baby Boomers (54%) prioritized including it in their top three, compared to only 16% of Millennials.

Millennials, now the largest generation in the workforce, put a higher priority than both GenX and Baby Boomers on benefits that are most commonly associated with work-life balance such as paid time off, flexible work hours and working remotely. Employers competing for this talent should consider this shifting scope of desired benefits if they want to attract the best employees.

This Harris Poll was conducted online within the United States on behalf of AICPA between April 24 and 26, 2018, among 2,026 adults aged 18 or older.

Whitepaper: Deeper Insights Into Data Improves Firm Operations

Randy Johnston

A new whitepaper lays out the business case for workflow automation tools to improve CPA firm performance.

The whitepaper, Using Operational Data & Analytics to Improve Firm Productivity & Profitability, was sponsored by CPA.com, a subsidiary of the AICPA, in partnership with XCM, a provider of workflow automation. XCM is the only productivity enablement and workflow platform endorsed by the AICPA.

Performance improvement is typically driven by practice management and reporting that is done afterward, the whitepaper says, but that is no longer enough today. Firms can take advantage of real-time analytics to get better insights into business performance, leading to better decisions. Workflow platforms also enable standardized processes across departments and roles, and total transparency of firm operations. The result is a more efficient and profitable operation, the whitepaper says.

The report was written by Randy Johnston, CEO and founder, Network Management Group and K2 Enterprises, and Mark McAndrew, vice president of consulting services with XCM Solutions.

The whitepaper describes the following benefits of a workflow management system that is properly designed and implemented. Such a system will:

  • Drive growth and scalability of the practice for maximum profitability
  • Increase production and human capital capacity
  • Enhance communication and collaboration across offices
  • Offer complete visibility to production measures, resource allocation, as well as scheduling requirements for disciplines such as tax, accounting, audit, client accounting services and operations
  • Measure and report performance to optimize effectiveness
  • Manage client experience and satisfaction
  • Deliver controls that ensure high-quality outputs and accountability
  • Integrate with current implemented technologies to provide one central repository for information

“Why would you handicap your firm by not providing your team the best management workflow technologies available? Do you have bigger problems to solve than making your team as effective as possible? If you want to have a world-class professional services organization in the modern environment, you must use world-class management technologies,” the report says.

Learn more at CPA.com/Workflow

 

McKeever Honored with AICPA Gold Medal Award of Distinction

Lester H. McKeever Jr.

Lester H. McKeever Jr.

The AICPA has announced that Lester H. McKeever Jr. is the recipient of the 2018 AICPA Gold Medal Award of Distinction, the highest honor granted by the AICPA.

Since 1944, the award has been bestowed upon CPAs whose influence on the accounting profession has been especially notable. Lewis Sharpstone, a member of the awards committee, presented McKeever with the award at the fall meeting of AICPA’s governing council.

“Mr. McKeever rose from working part time for the nation’s first female African-American CPA to working to advance diversity within the profession on a national level and in his home state of Illinois,” says Sharpstone. “He serves as an example of the impact CPAs can make on their community, the profession and their colleagues.”

McKeever has served as chairman of the Federal Reserve Bank of Chicago, chair of United Way Chicago, chair of the Chicago Urban league and board treasurer of the University of Illinois.

For his more than 25 years of volunteer service to the Illinois CPA Society (ICPAS), McKeever has been recognized with their Lifetime Achievement Award. In 2016, ICPAS renamed their awards for members working to advance diversity in the profession after McKeever. His volunteerism at the national level has included terms on the AICPA’s Small Business and Minority Business Development Committees.

A list of previous recipients is available on AICPA’s website.

AICPA Honors 4 Members with Sustained Contribution Award

The AICPA has announced that four members have been honored with the Sustained Contribution Award.

The annual award recognizes CPAs who have contributed measurably to the AICPA and the accounting profession through their dedication to volunteer service. Each recipient has participated in a volunteer committee, task force or resource panel for 20 years or longer and has served at least once as a chair of an AICPA group.

“This year’s recipients have dedicated significant time into shaping the accounting profession through their efforts with the institute,” says Ryan Screnar, chair of the AICPA’s award committee. “Their continued efforts over the years serve as a model for all volunteer members.”

The following CPAs were recognized during the fall meeting of the AICPA’s governing council:

  • Clark Monroe Blackman II, Kingwood, Texas
  • Albert Ray Denny, Wichita, Kan.
  • Annette Nellen, San Jose, Calif.
  • William R. Pirelli, Warwick, R.I.

Since the AICPA began, member volunteers have contributed to the Institute and the profession by participating in approximately 180 different volunteer groups.

AICPA Announces Graduates of 10th Annual Leadership Academy

The AICPA has announced that 41 young CPAs from around the country have graduated from its rigorous, four-day 2018 AICPA Leadership Academy.

The academy gives participants access to advanced leadership training, networking activities and presentations from some of the profession’s top thought leaders. This year’s event was held in Durham, N.C.

The 2018 class discussed key issues and interacted with influential leaders in the profession including Eric Hansen, chair, President and CEO Barry Melancon and Mark Koziel, executive vice president of firm services.

“The academy has brought so much clarity and insight to what it means to be an effective leader,” says 2018 Leadership Academy graduate Kelly Mann, a senior manager at Seim Johnson of Omaha, Neb. “It has helped me understand what my most important values are and how they impact my decision making. I have also learned how important consciousness and reflection are to good leadership and how I can bring these lessons back with me, to benefit my firm and the people and organizations I support.”

The 2018 Leadership Academy attendees were recommended by their employers, state CPA societies or both. Candidates submitted resumes and a statement explaining how participating in the Leadership Academy would impact them personally and professionally. They also wrote an essay on the topic, “The future will bring significant changes to the accounting profession. What do leaders have to get right, in order to successfully lead?”

The full 2018 Leadership Academy class is listed below in alphabetical order:

  • Paul Arab, Home Federal Bank of Tennessee, Knoxville, Tenn.
  • Chris Bell, Arkansas Electric Cooperatives, Inc., Little Rock, Ark.
  • Ashley Bryan, Threaded Fasteners, Inc., Mobile, Ala.
  • Joseph Caplan, Mazars USA LLP, Edison, N.J.
  • Jenna Christensen, Eide Bailly LLP, Mankato, Minn.
  • Kenesha Coleman, AbbVie Inc., North Chicago, Ill.
  • Sara deJuliis, Albero Kupferman & Associates LLC, Wilmington, Del.
  • Audra Dixon, Ernst & Young LLP, Denver
  • Samantha Doe, Kositzka Wicks & Company, Alexandria, Va.
  • Kamal Eko, Aronson LLC, Rockville, Md.
  • Josh Elder, Peters & Chandler PC, Oklahoma City
  • Ben Field, Benjamin H. Field CPA, PC, Phoenix
  • Verenice Flores, Fair Anderson and Langerman, Las Vegas
  • Kyle Graham, Tanner LLC, Salt Lake City
  • Natalie Heacock, Patrick Lumber Co., Portland, Ore.
  • John Hermus, Sheehan & Company CPA PC, Brightwaters, N.Y.
  • Chris Hervochon, eviCore Healthcare, Bluffton, S.C.
  • Ryan Johns, Altman Rogers & Co, Anchorage, Alaska
  • Deena Keasler, Topp McWhorter Harvey PLLC, Hattiesburg, Miss.
  • Alexandrea Keller, Williams & Company CPA’s, Onawa, Iowa
  • Katie Krblich, Charles A. Krblich PA, Fort Lauderdale, Fla.
  • Lijah Lokenauth, Tampa General Hospital, Tampa, Fla.
  • Danny Manimbo, Schellman & Company, Broomfield, Colo.
  • Kelly Mann, Seim Johnson, Omaha, Neb.
  • Damien Martin, BKD, Springfield, Mo.
  • Ashley Miller, Plodzik & Sanderson PA, Concord, N.H.
  • Maddie Miller, Wipfli LLP, Bozeman, Mont.
  • Bayaan Oluyadi, CohnReznick, Roseland, N.J.
  • Kenneth Omoruyi, Schlumberger, Houston
  • Sarah Peltakian, Raimondo Pettit Group, Irvine, Calif.
  • John Perkins, Accuride Corporation, Evansville, Ind.
  • Aaron Peters, Peters & Associates PC, Falls Church, Va.
  • Leanna Polidoro, Matrix Financial LLC, Wellesley, Mass.
  • Byron Porter, PwC, Houston
  • Michelle Schumacher, Microsoft, West Fargo, N.D.
  • Andrew Somich, Rea and Associates, Cleveland
  • Garrett Stenhouse, DiSanto Priest & Company, Warwick, R.I.
  • Melanie Urwiller, Lenhart Mason & Associates, LLC, Casper, Wyo.
  • Lauren Williams, Johnson Lambert LLP, Raleigh, N.C.
  • Gary Wood, Compere Robinette CPAs, Ozark, Mo.
  • Katie Zahner, Brown Smith Wallace, Creve Coeur, Mo.

CPAs’ Role in Sustainability Takes on Greater Significance; AICPA Develops New Tools

In this fiercely competitive economic climate, companies are increasingly aware of the importance of managing and reporting on their financial, social and environmental risks and opportunities – often referred to as the triple bottom line, according to the AICPA.

Furthermore, in order to rely on this information, investors are looking for this reported sustainability information to be independently assured.

The AICPA has therefore developed a new toolkit that provides resources to help prepare CPAs to meet these growing sustainability-related demands. The free toolkit includes the following:

  • CPAs – The preferred choice for assurance on sustainability information. This brochure helps CPAs articulate the value of CPA assurance to clients by outlining the differentiating factors, including adherence to rigorous assurance standards and practice guidance.
  • Key sustainability terms defined. This document helps familiarize CPAs with key sustainability-related terminology.
  • Sustainability: The world wants it. Can you deliver? This fact sheet highlights the growing demand for sustainability assurance services as well as the comprehensive sustainability assurance guidance available to CPAs who wish to provide such services.
  • Seven steps to implementing the Sustainable Development Goals (SDGs). This document introduces the SDGs and highlights seven steps companies can take to implement the SDGs.

“Four of the top five global risks are sustainability-related, according to the World Economic Forum. So, it is critical for companies to manage these risks and opportunities effectively, and to accurately report and seek credible assurance on their sustainability-related information,” says Amy Pawlicki AICPA vice president, assurance and advisory innovation