KPMG Expands Professor-in-Residence Program

Two accounting professors are working with New York-based KPMG (FY16 gross revenue of $8.6 billion) as the first KPMG James Marwick professors-in-residence. The new program is focused on evolving innovation opportunities and understanding challenges in the audit profession.

Assistant professor of accounting Eldar Maksymov (Carey School of Business, Arizona State University) and assistant professor G. Bradley Bennett (Isenberg School of Management, University of Massachusetts-Amherst) are working with KPMG to better understand innovation in the audit profession and identify how university accounting curriculums can change to keep pace with the rapidly evolving profession.

The professors are concentrating on the intersection of KPMG’s audit practice technology investments and standards, including emerging topics and new technologies, such as cognitive and blockchain technologies, and data and analytics.

“The KPMG James Marwick Professor-in-Residence program adds to our culture of learning initiatives as we expand our efforts to help university professors enhance their technical skills, gain industry experience and advance their workplace understanding to better prepare future leaders,” says Jackie Daylor, national MP, audit quality and professional practice.

Maksymov previously worked as an auditor with a Big 4 firm and brings a wealth of research experience to KPMG. Bennett is a former KPMG audit manager and audit practice national trainer.

“The KPMG James Marwick residency program provides professors with an insider’s view of the skills and capabilities KPMG will need in graduating students, and helps them understand the innovation process, one of our strategic priorities,” says audit partner and national audit innovation leader Shaun Budnik.

New E-Books Offer Steps Toward Future-Readiness for CPAs, Finance Professionals

The Maryland Association of CPAs and its learning and innovation center, the Business Learning Institute, have released a pair of e-books that will help accounting and finance professionals become more future-ready.

The e-books describe “five strategic and practical steps that anyone can do to become a future-ready CPA or finance professional,” says Tom Hood, CEO of the MACPA and the BLI. “The guidance applies to every role in any firm or organization. These five steps, applied through the lens of your particular expertise and experience, are what can help you anticipate change and prepare for it. It’s a new set of eyes and a new set of tools that only you can bring alive in your context of where you are professionally.”

Hood continues, “How will the disruptive forces of technology and automation affect your organization and career? This is the most important thing for CPAs and finance professionals to pay attention to right now. Forces of change aren’t something that we can or should fight. We’re not going to slow down change. We’re not going to make technology obsolete. What we can do is be ready for it. We can put ourselves in a place where the future helps us, not hurts us. That’s what being a future-ready finance professional is all about. Don’t fight change – leverage it, for the benefit of your career and organization.”

The e-books can be downloaded at no cost from the Business Learning Institute’s website. They are accompanied by an online quiz that will gauge readers’ future-readiness and provide access to additional resources that can help them become even more future-ready.

Enrollments in Undergraduate Accounting Programs Remain Strong: AICPA Trends Report

Enrollments in undergraduate and graduate accounting programs for the 2015-2016 school year totaled more than 250,000, maintaining the record high level from 2013-2014. This was driven primarily by an all-time high in undergraduate enrollments. On the demand side, accounting firm hiring of new graduates was down from the historic level seen in 2014, according to the 2017 Trends in the Supply of Accounting Graduates and Demand for Public Accounting Recruits report, released by the AICPA.

“The high number of undergraduate enrollments in accounting programs bodes well for the goal of continuing a strong pipeline of talent entering the profession,” says Yvonne Hinson AICPA academic-in-residence, senior director, academic and student engagement.

While undergraduate enrollments were at an all-time high, the report found projected master’s enrollments in accounting returning to pre-2014 levels. The last several Trends reports found a sharp rise in the number of master’s enrollments and graduates. The CPA profession has significantly lower rates of unemployment than the broader economy – particularly during economic downturns – which may have been a factor in attracting both traditional students and those changing careers to earn their master’s in accounting.

“In my experience as an educator, economic turmoil is a strong motivator for people to seek out the stability that a career in accounting provides,” adds Hinson. “The uncertain job market in the years immediately after the recession may have driven a high number of career changers to return to school for a master’s in accounting. At the same time, we saw many students pursing their master’s directly after they earned their undergraduate degree to bolster their academic credentials, raising the overall numbers during that period.”

The number of undergraduate degrees awarded in the 2015-2016 academic year (57,119) remained strong, totaling the second highest on record and representing a 5% increase from 2013-2014. While master’s degrees awarded (22,405) saw a decline from the historic level seen in 2013-2014, they were also the second highest on record. Combined, there was an overall projected decrease of 2,258 accounting degrees awarded in 2015-2016.

The 2016 Bureau of Labor Statistics Occupational Handbook, found that employment of accountants and auditors was expected to grow at an 11% rate from 2014-2024 – which is faster than average and represents an additional 142,000 jobs. According to the BLS Handbook, solid demand for accountants may lead to good prospects for entry-level positions, with strong competition for jobs at the most prestigious accounting firms and businesses. The handbook also notes that the job prospects are particularly bright for accountants and auditors who have earned their CPA license.

The full Trends report is available on the AICPA’s website.

CFOs Mixed on Allowing Workers to Earn CPE Credits During Business Hours

Employers want financial employees who are well informed on the latest regulations, business trends and best practices. but they are not always willing to let their teams pursue continuing professional education (CPE) opportunities on company time, according to a new survey from recruitment firm Robert Half Finance & Accounting.

The survey reports that only 26% of CFOs allow all employees to fulfill CPE requirements, which come from NASBA, while at work; another 24% say it depends on the employee. Half of firms rarely or never let any staff take classes during business hours.

“Businesses do themselves a disservice by prohibiting employees from taking CPE courses during company time,” says Robert Half senior executive director Paul McDonald. “Webinars, seminars and online courses, some as short as 10 minutes, allow professionals to earn the needed credits and help their employers by staying on the cutting edge of industry trends.”

McDonald added investing time in staff members’ ongoing education offers lasting benefits. “The better informed your employees are, the fewer technical, compliance and ethical mistakes they’re likely to make,” he says. “Moreover, a generous training program that includes allowing staff to obtain continuing education during work hours shows support for professional development and is a powerful recruitment and retention tool.”

Robert Half Finance & Accounting offers four tips for requesting to earn CPE credits during the workday:

  1. Be your own best advocate. Build a business case for how the company will benefit from the skills you acquire.
  2. Start small. If your boss frowns on continuing education during work hours, choose sessions that can be scheduled during your lunch hour.
  3. Emphasize the big picture. Let your boss know how CPE classes will enable you to bridge a gap in your department’s knowledge base.
  4. Evaluate different options. While some CPE courses are online and others in-person, offerings from providers, including professional organizations, are evolving.

AICPA Acquires Accounting Pilot and Bridge Project

AICPA recently announced that it acquired the Accounting Pilot and Bridge Project (APBP) from Dan Deines. The APBP, a program that trains high school educators to teach a higher-level accounting curriculum, was founded in 2006 by Deines who will continue involvement with the program, providing direction and training to the instructors who teach educators.

The AICPA had been involved with the APBP as a sponsor, working with state CPA societies to expand the reach of the program. They will be providing additional guidance and support to strengthen the community of teachers who have been trained to teach the course. In 2016, the AICPA assisted with five training sessions with six state societies and plan to expand the program this year to 14 trainings, with 20 state societies, reaching over 350 high schools teachers.

“By bringing the Accounting Pilot and Bridge Project in-house at the AICPA, we now have a formalized path to recruit highly motivated, talented high school students into the accounting profession on a national level,” says Barry Melancon, AICPA President and CEO.

After going through the APBP program, teachers can use a curriculum that is considerably more advanced than what is generally offered at the high school level. It consists of a combination of financial and managerial accounting, and is comparable to a college entry level accounting course.

High school teachers who have completed APBP will receive support from the AICPA as they work to implement the course in their state, including:

  • Access to online teaching resources
  • Daily lesson plans and assignments
  • Pre-written exams with answer keys
  • A textbook, including teacher’s notes and Power Point presentations
  • Scholarships for high school students who took their accounting course from an APBP trained teacher

The potential impact of the APBP is substantial: Research conducted by the AICPA has shown that high school students’ first accounting course has a large impact on their decision to pursue accounting as a major and career choice. Their research has also found that 44 percent of high school students have either taken an accounting course in high school or plan on taking one.

“The level of enthusiasm I’ve seen from teachers interested in going through the training and high school students who are eager to take a more advanced accounting class is a clear sign that this program is effective. AICPA ownership will help grow the program and continue its success well into the future,” says Deines.

New Version of CPA Exam Tests Critical Thinking, Analytical Ability

The AICPA, National Association of State Boards of Accountancy (NASBA) and Prometric have announced the successful launch of an updated version of the Uniform CPA Examination.

The next-generation exam, which began testing April 1, has added additional assessment of “higher-order cognitive skills that test a candidate’s critical thinking, problem solving and analytical ability,” the AICPA says. The exam also makes greater use of task-based simulations to assess these higher-order skills. Research shows that CPAs are now performing tasks that rely upon these skills earlier in their careers.

“The roles and responsibilities of newly licensed CPAs are constantly evolving, so it’s crucial for the CPA Exam to stay ahead of the curve. The CPA Exam now better reflects the knowledge and skills essential to today’s profession,” says Michael Decker, AICPA vice president of examinations.

Among the most important changes to the CPA exam:

  • Exam blueprints that contain about 600 representative tasks across all four exam sections are available on the AICPA website. The blueprints have replaced the Content Specification Outline (CSO) and Skill Specification Outline (SSO) as CPA candidates’ primary source of the content and skills that they will be tested on.
  • The exam remains composed of the four existing sections – auditing and attestation, business environment and concepts, financial accounting and reporting and regulation.
  • Any combination of passing exam sections prior to April 1 and passing exam sections on or after April 1 (within the 18-month window following passing one section) will count toward licensure.
  • Total CPA exam testing time increased from 14 to 16 hours – four sections of four hours each.
  • A new, 15-minute standardized break during each section that will not count against a candidate’s testing time had been added.

For candidate convenience, the 10-day extension of the testing window introduced in April 2016 will continue in the third and fourth quarters of 2017. The 10-day extension will not be available during the current April/May testing window to allow the AICPA to follow the standard-setting process and analyze exam results to set new passing scores. To provide sufficient time for the process, scores will be released only once following the close of each testing window.

In addition to the changes to the CPA exam that have already occurred, the AICPA is working on an improved user experience, which is expected to launch in 2018. More information on that project will be announced later this year.

Detailed information on the exam is available online at www.aicpa.org/cpaexam and https://nasba.org/exams/the-next-version-of-the-cpa-exam/.

Deloitte Helps Prepare Gen Z for Audit of the Future

Big 4 firm Deloitte and the Deloitte Foundation hosted the 2017 National Audit Innovation Campus Challenge at Deloitte University, awarding students of Morehouse College first place for their idea to develop an application to automate the audit risk assessment process.

The winning idea involved developing an application to improve the effectiveness of the risk assessment process by using artificial intelligence to identify non-financial data from external sources such as social media, journals, periodicals and newsfeeds, among others. This data, used in combination with public and non-public financial data, would contribute to the auditors’ ability to identify risks of misstatement in a company’s financial statements. The software continuously curates data and learns through direct feedback from auditors.

Under the guidance of the faculty advisors and subject matter leaders, student participants were presented with a glimpse of how innovative technologies can be applied to the audit profession in new ways. The experience highlights how an evolving audit profession requires a workforce that can tackle business challenges more effectively in a world of continuously evolving technologies, while also providing auditors with increased opportunities to deliver value for the capital markets.

Student teams from 33 top colleges and universities participated in the event, with six teams advancing to the final round. Students from Pace University earned second place. The University of Pittsburgh, University of Southern California, College of William and Mary, and University of Wisconsin-Madison were awarded honorable mentions.

Multiple emerging technologies are transforming the audit and creating exciting new opportunities, Deloitte says. Workflow automation, artificial intelligence and analytics have enhanced a number of the labor-intensive, manual processes traditionally associated with an audit, freeing up auditors to offer better judgments and deeper insights.

“As technology disrupts business at an unprecedented rate, the next-generation of talent will need to possess proficiency with emerging technologies and data analytics to help develop more innovative solutions to business challenges,” says Mike Fucci, chairman of Deloitte and the Deloitte Foundation.

Dixon Hughes’ Evans Elected to The PhD Project

David Evans

David Evans

Charlotte, N.C.-based Dixon Hughes Goodman (FY16 net revenue of $394 million) announces that David Evans, regional MP of the firm’s South region, has been elected to the board of directors of The PhD Project, which helps minorities attain their PhD in all business disciplines and become the business professors who will teach the next generation of leaders.

“We are truly committed to the advancement of diversity, not just in our firm, but in the business and academic communities where we live and work,” Evans says.

“We are thrilled to have David as a new board member,” says Bernard J. Milano, president of The PhD Project. “DHG has been a sponsor since 2008, providing $255,000 to date. Their support shows they are committed to serving their diverse client base by supporting programs aimed at diversifying the corporate ranks.”

The firm says, “Over the past nine years of involvement with this organization, DHG has seen significant results. Our relationship with The PhD Project directly aligns with our mission of building valuable careers with our people and helping our clients achieve their goals.”

Since its inception, The PhD Project has been responsible for the increase in the number of minority business professors from 294 to 1,358. Further, 270 minorities are currently enrolled in doctoral programs.

Historically, very few minority college students study business as an entrée to a corporate career. Diversifying the faculty attracts more minorities to study business and better prepares all students to function in a diverse workforce, the PhD Project says.

CPAFMA Announces that the AAAPM Designation is Now the PAFM Designation

The Association for Accounting Administration became the CPA Firm Management Association (CPAFMA) for many reasons, all of which are applicable to CPAFMA’s certification program.

To better align with the association’s new name, CPAFMA has officially changed the name of its Accredited Administrator in Accounting Practice Management (AAAPM) designation. The designation will continue to transition from a designation of AAAPM to PAFM, Public Accounting Firm Manager.

Certification for firm managers enhances the status and the position within the industry, and creates a significant professional recognition for those managing accounting firms who achieve the PAFM designation.

Suggestions to Recruit and Retain the Future Leaders of Your Firm

Mike Platt

Mike Platt

Attracting and retaining talented staff is top of mind for firms across the country. In a recording of a recent webinar, Mike Platt, publisher of INSIDE Public Accounting (IPA), offers ideas on keeping under-40 CPA professionals involved, engaged and excited about their work.

Retaining this critical demographic has never been more important. IPA’s annual survey of more than 550 accounting firms shows average turnover among all non-Big 4 firms is nearly 14%. At firms of $75 million or more, it’s even higher, at 17%. While some turnover is healthy, extra emphasis needs to be focused on making sure the right people stay.

Access this recording to hear results of an extensive survey/study of more than 700 professionals aged 21-40 on their key motivators and “stay factors.” IPA partnered with ConvergenceCoaching to conduct the research survey, which uncovered what young professionals like (and don’t like) about their jobs, and how the firm can position itself to appeal to this key demographic of future leaders.

This webinar will offer analysis from the research study, “The Road to Retention: Motivators and Drivers for Young Public Accounting Professionals.” Learn:

  • The best and worst parts of working in public accounting, according to Millennials (21-33) and Gen X professionals (34-40).
  • The top reasons they would make public accounting a long-term career.
  • The types of financial information they would like leaders to share with them.
  • How often they prefer feedback about their performance.
  • Their ideas on how different generations can work together more successfully.
  • Their top firm weaknesses and strengths.

Get a better understanding of what role you can personally play within your firm to retain young professionals, encourage a culture of openness and transparency, and involve young staff in firm initiatives.