IPA INSIDER: February 2018 News

Listed below are the Top 10 most-read stories on the INSIDE Public Accounting blog for the month of February.

  1. Sikich Admits Three New Partners
  2. 2018 AI Predictions from PwC
  3. CBIZ Acquires Laurus Transaction Advisors
  4. Two Chicago-area Firms Merge
  5. Settlement Reached in Andersen Tax Trademark Dispute in California
  6. Mazars USA Admits Soussan as Partner in Manufacturing and Distribution Practice
  7. Five Workplace Issues We’ll Be Talking About In 2018
  8. RSM Expands Consulting Services with Acquisition of SecureState
  9. BDO USA Expands Health Care Advisory Services Practice
  10. Baker Tilly France Joins Allinial Global

Platt’s Perspective: How Much Of Your Partners’ Time Is Spent On Partner-Level Activities?

Mike Platt

Mike Platt

For years I’ve asked a simple question of my clients: “Think about all of the hours your partner group collectively spends on firm business each year. Raise your hand if you believe that more than 80% of those hours are spent doing partner-level work – however you define that.”

When I get no responses, the next offer is “70%?” A hand or two goes up. “Sixty percent?” Maybe a quarter of the hands are visible. “Fifty percent?” Without fail, about half the hands are finally in the air when presented with the 50% option. To spare the rest the embarrassment of raising their hands at levels below 50%, I stop there.

In this unscientific – but consistent – poll of firm leaders, the conclusion is that partners spend more than half their time on work that should be delegated.

The reasons are varied. For some partners, grinding through staff-level work brings them cozily back to their comfort zones. Some don’t trust the quality of subordinates’ work. Others are short-staffed and can’t delegate work. And for some, prioritizing the highest and best use of their non-billable time can devolve into “what can I check off my to-do list?” Too often, that work is not a partner-level activity that will help the firm grow.

The result of all this? Profitability may suffer. Staff engagement suffers because staff know partners will jump in and change things anyway. Strategic planning and brainstorming suffers at the partner level because there is never enough time to work on the business. Partner growth and development suffers because partners are not being challenged. Ultimately the partner’s value to the firm suffers because compensation levels are incompatible with their staff-level activities.

As client needs become more complex, partners will need to step up their game. As staffing leverage continues to grow, as it has for more than 15 years, partners will no longer be able to hide behind staff-level work. As the profession continues to evolve, firms will demand their owners meet the complex demands of the future, and continually raise the bar on what being a partner really requires.

If you want to make an impact on your firm this year, have your partner group commit to increasing their time doing partner-level work from 50% to 60%. It seems like a little step, but it is entirely achievable and will help build the confidence to keep going to 70%, 80%, 90% and beyond.

IPA Spotlight On … Eric Hansen, Chair, AICPA

Name: Eric Hansen

Title: Chair

Eric Hansen

Eric Hansen

Firm: AICPA

Accomplishments:

  • COO of BKD CPAs & Advisors, oversees firmwide operations and acts as liaison between BKD’s national office and its four regions.
  •  Became AICPA chair Feb. 1 and will serve in that capacity until May 2019.
  • An Eagle Scout, he extolled the virtues of preparation and anticipation in his acceptance speech following his election as chair.
  • Was part of the leadership team responsible for the launch the Association of International Certified Professional Accountants (Association), which represents 650,000 members and students worldwide.

What are your top goals as chair?

The way I see it, there are three actions we must take today to be ready for tomorrow. First, we must harness technology to create more value for clients and businesses by elevating quality in existing services and taking the lead in emerging areas. This includes a focus on auditing in the future, and new and emerging attest services. Second, we must embrace our role in a hyper-connected, global society, extending our influence to protect the public interest amid increasing complexity. Creating the Association was a huge step toward a platform that helps us pursue this goal. And third, we must invest in our most important asset – our people – by evolving skills and competencies, advancing learning opportunities and cultivating future leaders.

What more should be done to advance CPAs’ understanding and implementation of AI, blockchain and data analytics?

One area of focus for the Association is integrating data analytics into the auditing process to enhance quality and maintain the relevance of this foundational CPA service. The AICPA and Rutgers Business School are partnering on a research initiative to demonstrate how this integration of data analytics can lead to auditing advancements. We also must focus on developing the higher-order competencies. To that end, we launched a new version of the Uniform CPA Exam last year that places a greater emphasis on cognitive skills such as critical thinking and analytical ability. My advice here is simple. Every member of our profession needs to take personal responsibility for the development of the skills they need to succeed in the future. Don’t wait for it to come your way.

As a former member of AICPA Task Force on the Future of Learning, what changes do you foresee in the AICPA’s educational offerings?

Through the Future of Learning initiative, we are transforming the way learning is delivered with innovative technologies that blend text, audio, graphics, video, 3-D animation and interactivity to enhance learning. Social learning, virtual group study and interactive exercises increase engagement with hands-on application. We’re also making use of new learning models, launching a new bite-sized learning series called Human Intelligence, which is focused on the skills and competencies needed for success in the future. And then there is our leadership development. The AICPA Leadership Academy was established to address succession planning and to increase diversity and inclusion in leadership. Beyond that, we are expanding access to competency-enhancing tools and resources through the Association. Our research on the future of finance will be used to update the competency framework and syllabus for CGMA.

How do you envision the scope and reach of professional accountancy expanding in an increasingly connected world?

It is essential for today’s leaders to look beyond definitions, demographics and geographic dimensions that once constrained the scope and reach of professional accountancy. I’m a CGMA, as well as a CPA, so I’m aware of the need to serve clients and the public interest with a holistic, global focus. Public accounting’s focus on auditing and taxes remains a critical part of the business world. And the value management accounting brings to the corporate finance function is equally important. Both disciplines are likely to grow in importance as our global society becomes both more immediate and more complex. Our new Association, formed with the Chartered Institute of Management Accountants, is all about meeting the challenges of our increasingly hyper-connected world.

Final thoughts?

You and I see the rapid pace of change – in the world of accounting and all around us. What’s needed to meet the challenge such change brings is a bias for action and the courage to be bold. As my fellow Missourian, and former U.S. President Harry Truman said, “Progress occurs when courageous, skillful leaders seize the opportunity to change things for the better.” At the AICPA, I’m blessed to be surrounded by so many skilled, courageous leaders who share that bias for action. Working together, we’ll make the CPA profession even more relevant in the future than it is today.

Do you know someone else who would make a good Spotlight? Contact Christina Camara.

INSIDE Public Accounting Appoints 2018 Advisory Board Members

INSIDE Public Accounting has named six accounting firm leaders to its 2018 Advisory Board. The mission of the Advisory Board is to assist The Platt Group / INSIDE Public Accounting in identifying new business opportunities, and expanding products and services to better serve current and future clients.

The 2018 Advisory Board members include:

  • Kelly Bernakevitch, Executive VP of Operations, Finance & International, Calgary, Alberta-based MNP LLP
  • Lynne Born, CEO, New York-based Perelson Weiner
  • Lori Colvin, Chief Marketing Officer, San Ramon, Calif.-based Armanino LLP
  • Cody Page, Chief Operating Officer, Peterson Sullivan of Seattle
  • Shaun Powell, Director of Finance, Columbus, Ohio-based GBQ Partners
  • Steve Williams, Managing Partner, HMWC CPAs & Business Advisors of Tustin, Calif.

Bernakevitch is a member of MNP’s executive team and is responsible for overseeing the firm’s international interests, procurement, operations, finance and real estate groups. He previously served as the Executive Vice President, Prairies, as well as Regional Managing Partner. He was an elected member of MNP’s Board of Directors and has chaired a number of committees.

Born focuses on strategic planning and go-to-market initiatives in a variety of niche, industry and service areas that drive Perelson Weiner’s business objectives forward. She has extensive expertise in professional service firm management, specifically in the financial services and high-net-worth arena. She specializes in succession planning, change management and the design of best-in-class leadership and development programs for next-generation career growth.

Colvin started with Armanino in 1999 and leads the marketing efforts for the core accounting, tax and consulting services along with the expanding services of information technology consulting and financial planning. She has more than 25 years’ experience in sales and marketing.

Page is responsible for overseeing the business operations of Peterson Sullivan across all departments and practice areas. He works closely with the administrative directors and managers responsible for human resources, IT, resource management, accounting, facilities and office services.

Powell, director of finance at GBQ, joined the firm in 2002. Always looking for ideas to save the firm money, improve its efficiency or to provide better benefits for its employees, he knows that a company is made up of more than just debits and credits – it’s made up of people.

Williams specializes in consulting services to medical practices, as well as tax and financial planning. He is PIC of two practices at HMWC CPAs: health care services and information and technology services. His tax and financial planning services include tax minimization strategies, retirement planning, planning and structuring for complex business/personal transactions, and estate planning.

The Platt Group, based in Indianapolis, was founded in 2006 by husband and wife team Mike and Kelly Platt. The highly regarded publication was formerly known as Bowman’s Accounting Report. Today, IPA features interviews with top leaders in the profession on all aspects of firm management, and annually ranks and analyzes data from the top 300 firms in the nation. The Platt Group is dedicated to helping firm leaders, and their firms, achieve their ultimate potential by researching the latest trends, benchmarking leading firms and working with leaders to share and garner knowledge.

Platt’s Perspective: Will The Definition Of Success Change For Firms In The Future?

Mike Platt

Mike Platt

Ever since key performance indicators were created for accounting firms, measurements of success have been dominated by traditional metrics like growth percentages, leverage, revenue per charge hour, revenue per FTE, utilization, realization, profit margin and the ultimate target – net income per equity partner.

In recent years however, conversations have turned to targets of a different nature – staff satisfaction, investment in the future, re-imagining the business model, bench strength, succession planning, staying relevant and transformational change, to name a few.

As we enter a new year, it’s the appropriate time to look at the old and the new, and question how the profession’s definition of success may change over time.

How are firms marrying the traditional metrics with the top-of-mind issues listed above? Who will “win” the new game, and how will that be measured? What are the new goalposts that will define future performance and overall success?

Some suggest that traditional metrics no longer meet the needs of the profession, and point to benchmarks such as net income per equity partner as no longer relevant. Others vehemently oppose this notion, arguing that no targets are achievable without a solid business foundation that generates acceptable / suitable / achievable profits for partners.

A middle ground is needed – one that accounts for not only traditional performance metrics but also perceptions of staff, partners and customers and the firm’s impact on the lives of those it touches. At the 2017 PRIME Symposium, firms began this exploration of new measurements to assess the well-being of the firm as well as partners, staff, clients and communities they serve. IPA is committed to building on this holistic approach going forward to help firms achieve the balance between the objective and subjective indicators of success.

In the meantime, I challenge everyone to consider how the definition of success might change for your firm in the coming years. What do the current partners think? What do the next generation of partners think? How big is the perception gap between the two groups? Our goal is to understand that gap and bridge it to build a shared vision of success in the future.

IPA INSIDER: January 2018 News

Listed below are the Top 10 most-read stories on the INSIDE Public Accounting blog for the month of January.

  1. IPA Spotlight On … Karen Love, PKF Texas
  2. HCVT Admits Five Partners
  3. Six CPAs Charged In Scheme to ‘Steal the Exam’ for KPMG
  4. CliftonLarsonAllen Acquires NSBN LLP
  5. Blockchain & Bitcoin: Why the Accounting Profession Should Take Notice
  6. Winding River Consulting Graduates First Managing Partner Bootcamp Class
  7. AGN International and DFK International Form Strategic Alliance
  8. Wipfli Acquires Chicago-area Firm
  9. KBKG Welcomes Wallace, Relocates NYC Office
  10. Calif. Accountancy Board Recommends License Suspension

IPA Spotlight On … Michelle Thompson

Name: Michelle Thompson

Michelle Thompson

Michelle Thompson

Title: MP and CEO

Firm: Richmond, Va.-based Cherry Bekaert (FY17 net revenue of $173.8 million)

Accomplishments:

  • Election by my partners to be the fifth MP and CEO of our 70-year-old firm.
  • Selection as the managing partner of audit and assurance in 2011.
  • Admission to the Cherry Bekaert Partnership in 2001 after nine years of public accounting experience.
  • Establishing the firm’s risk advisory services group in 2001.

You’ve said your vision is to be successful “through transformation and innovation.” How is innovation encouraged at Cherry Bekaert?

Cherry Bekaert fosters a culture of innovation by supporting new ideas and projects proposed by our people – from receptionist to partner. Our goal is to harness the diverse talent, experiences and ideas that live in the culture of our firm. Through our funded innovation committee, we collect, evaluate and select projects for testing, execution and implementation.  We encourage solutions that deliver efficiency in our processes, growth in our product/service capabilities and loyalty in our clients

You’ve also spoken of forming a close partnership with technology to lead the firm into the future. How is the firm using the latest technologies, such as AI, blockchain etc., to improve services to clients?

Building the best toolbox for the future requires investment and a willingness to try new things, some of which might not work. We will test new technologies that apply artificial intelligence, data analytics or blockchain capabilities and put some of them into full production. These technologies allow us to change how we work and give us greater insights into our clients more quickly and frequently than ever before. They increase our horsepower. But in the end, people trust people. Our goal is to create a partnership with technology where our people are the interface and technology is the engine.

Do you face any special challenges as one of only three female MPs in the top 30 firms in the nation?

I face the same challenges that every other MP faces – how to care for your people, create value for your clients and rapidly and responsibly respond to external and internal forces to create a sustainable and thriving firm. However, I do realize that people are paying attention to that difference. Rather than seeing it as a challenge, I view it as an opportunity. More women enter this profession than men, yet very few women hold top leadership positions. So, I carry an additional responsibility of being a positive role model for other women in our firm and in the profession. I take that responsibility very seriously.

What are your growth plans for the firm over the next five years?

Our mission is to make a difference for our people and our clients. Growth creates opportunities for our people – whether it’s expansion into new markets or the addition of new service offerings. Growth in our service offerings and capabilities is driven by the needs of our clients in this fast-paced, ever-changing world. Through this lens we will continue to pursue our growth strategy of building critical mass in existing locations, strategically evaluating and entering new geographic locations and enhancing our stable of service offerings.

Final thoughts?

These are exciting times in our profession. Over the next five years, the profession is likely to change more than it did in the previous 20 (or more) years. Our CPA designation will continue to differentiate us from other professions but we will need to learn new skills, embrace new technologies and change in a way we never have before. I can’t wait!

Do you know someone else who would make a good Spotlight? Contact Christina Camara.

IPA INSIDER: Advice to Managing Partners from the Trenches

If you’ve ever felt frustrated motivating partners, and managing their range of personalities and egos, perhaps there’s some comfort in knowing you’re not alone.

INSIDE Public Accounting asked MPs to offer insights to their role as firm leader.

More than 70 MPs responded to IPA’s survey, sharing candid feedback on challenges faced and solutions found, the frustrations and rewards, the misconceptions and realities.

In this download, IPA uncovers just what MPs think of the position.

MPs answer questions such as…

  • What one thing do you wish someone told you when you became MP about the reality of partner motivation?
  • What one thing do you wish someone told you about aligning the firm behind a common vision?
  • How do you balance gaining consensus from the partner group with the need to make decision quickly?
  • How would you change your firm structure?

Download the report. 

The 2018 IPA Accounting Firm National Benchmarking Surveys Are Open For Participation

The 2018 INSIDE Public Accounting (IPA) Annual Survey and Analysis of Firms is now open to all accounting firms in North America. The results of the annual survey is the IPA National Benchmarking Report, the IPA 100, 200 and 300 firms ranking, and the coveted IPA Best of the Best firms. If you would like to participate, please contact our office.

DEADLINES FOR SURVEY SUBMISSIONS – FIRMS WITH FISCAL YEAR-ENDS OF…

…May 2017 through December 2017: May 4, 2018
…January 2018 through March 2018: May 31, 2018
…April 2018: June 15, 2018

THE 2018 IPA SURVEY AND THE INTERNAL OPERATIONAL SURVEYS ARE OPEN FOR PARTICIPATION

Your firm must complete the IPA Survey and Analysis form in order to participate in any of the Internal Operational Surveys (Firm Administration, Human Resources and Information Technology). If you would like to participate, contact our office.

Gain a competitive advantage and grow your firm with industry insight from the independent benchmarking leader in the nation.

BENEFITS OF PARTICIPATION

  • The opportunity to be included in the largest annual management of an accounting practice (MAP) survey in the country. To be benchmarked with more than 540+ firms nationwide and potentially be ranked among this year’s top firms in the: IPA 100, IPA 200, IPA 300 and the coveted IPA Best of the Best Firms in the nation.
  • If you participate in the survey, you will receive a complimentary copy of the August 2018 issue of the award-winning INSIDE Pubic Accounting newsletter. This issue highlights the annual IPA 100, 200 and 300 firm rankings, along with a detailed financial and operational analysis of the rankings.
  • An electronic complimentary copy of the 2018 Executive Summary, of the IPA National Benchmarking Report. If you participate in any or all of the Internal Operational surveys, you will also receive a complimentary executive summary when published in the fall.
  • You will receive preferred pricing on the 2018 IPA National Benchmarking Report, the Internal Operational Reports and other benchmarking items. You may pre-order your reports now.
  • You will get preference for selection in articles written by IPA throughout the year, (an excellent opportunity to market your firm).

CONFIDENTIAL DATA – WHAT YOU CAN EXPECT FROM INSIDE PUBLIC ACCOUNTING 

All confidential firm data, including salaries, compensation, income, etc., will be held in strict confidence. Salaries, compensation and sensitive data, such as income, revenues by niche, etc., will NOT be shared or publicized. We take extreme pride in our ability to collect this data to assist the profession and are now celebrating nearly three decades of surveying accounting firms across the globe.

Please contact IPA at survey@plattgroupllc.com with any concerns or questions. IPA conducts a thorough review of each survey submission for commonly missed areas and for any and all errors. IPA will contact the person / contact named on the submitted survey form for any and all clarifications / updates. Some data, such as firm name, MP(s) name, firm net revenue, and organic growth may appear in the IPA Newsletter (if accolades are given).

IPA ASSOCIATION PARTNERSHIPS: INSIDE Public Accounting is pleased to partner with the following associations to provide survey and benchmarking services for their member firms: Alliott Group, CPAmerica International, DFK International, INPACT Americas, HLB North America, LEA Global, Moore Stephens North America and PrimeGlobal. Please contact The Platt Group / IPA with any questions at (317) 733-1920.

INSIDE Public Accounting Again Partners with Association for Accounting Marketing; Nominations Open For 2018 Marketer of the Year

INSIDE Public Accounting (IPA) is seeking nominations for the Association for Accounting Marketing’s (AAM) 2018 Marketer of the Year (MOY) award. Nominations will be accepted through Jan. 22.

The annual award, presented at AAM’s Summit, recognizes a marketing professional who has demonstrated exemplary performance in the profession of accounting firm marketing. To be eligible, nominees must have held a senior-level marketing position in an accounting firm for at least three years, although not necessarily at the same firm.

“This is the fifth year IPA has sponsored the award, which complements our commitment to shining a spotlight on excellence in the profession,” says IPA Publisher Kelly Platt.

Past Marketer of the Year award winners include Laura Kucera of New York-based Citrin Cooperman in 2017, Rhonda Maraziti of Princeton, N.J.-based Withum in 2016Eric Majchrzak, of Tucson, Ariz.-based BeachFleischman in 2015, and Randy Mowat of Calgary, Alberta-based MNP in 2014.

All nominations should be submitted online http://bit.do/MOY2018 no later than Jan. 22. Nominations are not anonymous, and self-nominations are welcome. Previous nominees are encouraged to re-nominate.

The nominees will be judged on accomplishments, strategic thinking, tactical development, attention to detail, communication, financial impact and leadership within the firm and community. All nominees will then be required to complete an online application no later than Feb. 12.

The 2018 MOY Award will be presented by IPA at AAM’s 2018 Summit, set for May 14-17 in Portland, Ore.

Please contact Christina Camara at moy@plattgroupllc.com with questions about the award. For information about AAM and the 2018 summit, call AAM at (443) 640-1061.

The Platt Group publishes the award-winning INSIDE Public Accounting newsletter and the Annual Accounting Firm National Benchmarking Report. The Platt Group also surveys and publishes annual reports for the accounting profession in Human Resources, Firm Administration and Information Technology. Grow your firm, become more profitable and improve operations with IPA. IPA provides resources, analysis and tools to transform your firm. To learn more about The Platt Group and IPA, please call (317) 733-1920 or visit www.insidepublicaccounting.com.

The Association for Accounting Marketing (AAM) promotes excellence, and elevates the professional stature of marketing, business development and other practice growth professionals to the accounting profession, directly impacting members’ professional development and careers through education, networking and thought leadership. Founded in 1989, AAM has more than 700 members, comprised of marketing professionals, business developers, CPAs, consultants, service providers, educators and students. To learn more about AAM, please call (856) 380-6860 or visit www.accountingmarketing.org.