Recession hits revenues at small firms hardest

But bigger firms more likely to cut staffing.

New data from the PCPS CPA Firm Top Issues survey shows firms generally faring well through the recession. About 10% to 25% of firms, depending on size, report "no impact" from the recession.

QUESTION: What has been the greatest impact your firm has encountered during this economic crisis?

Still, the AICPA reports:

Based on the survey results, CPA firms appear to be weathering the storm remarkably well. When asked about the economy’s greatest effect on them, a solid proportion of firms with 20 or fewer professionals picked “no impact.” In fact, almost 25% of sole practitioners chose this answer. And a number of firms, including more than 10% of firms with 10 or fewer professionals, said that additional client services were one result of the economic crisis. It would seem that there are bright spots for some of the smallest firms even in uncertain times. Firms of all sizes did agree, by varying percentages, that the two most serious considerations for them were strains on accounts receivable and reductions in revenue. Firms with 21 or more professionals were the only ones to report issues with layoffs or staff reductions, although even in this group the problem seems to be minor.

More at

Survey Results: CPAs Are Not Quite Ready for FASB’s GAAP Codification

Early results are suggesting that most organizations remain unprepared for the biggest chgange in GAAP in 50 years.

After years in the making, the Financial Accounting Standards Board (FASB) on Wednesday, July 1, will launch the new GAAP (Generally Accepted Accounting Principles) codification.

That said, today's results from working CPAs and finance managers are all the more interesting:

Don’t be alarmed if you’re only dimly aware of the GAAP codification project. Apparently other CPAs are too. One poll showed only about one in three accountants had looked into it. Another found less than half of all CFOs and senior comptrollers had even heard of the codification project

To be sure, GAAP itself isn’t intended to change, but its structure and presentation is changing significantly. Will you be ready? Join the survey here.

Still, it’s probably the biggest change in the structure and organization of GAAP “in over 50 years,” according to Mara Bruce, audit manager at Schneider Downs, the regional CPA firm based in Pittsburgh, Pa.

While it isn’t intended to change U.S. GAAP, this reorganization will change how accountants refer to guidance in financial statements and any underlying memos and research, Bruce said. “It’s time to start to learn to navigate through the codification, so you aren’t left in the dark.”

“U.S. GAAP will be completely reconfigured in a way that will vastly improve the ease of researching U.S. GAAP issues, superseding existing authoritative literature, including FASB’s original pronouncements,” FASB Chairman Robert Herz has said. “Preparers and auditors of financial statements need to familiarize themselves with the changes so that they are ready for
the switch.”

Join the survey; get the results.

Accounting Firm M&A Deals Surge in New York Metro Area

Through the first six months of the year, RF Resources has tracked 21 merger or acquisition deals in the New York metro area, compared with 26 in all of last year.

Source: RF Resources

"We expect that the number of deals in 2009 will exceed 2008," CEO Robert Fligel reports in his exclusive and authoritative "deal sheet" bulletin to clients. "So far his year, RF Resources has identified 21 CPA firm deals in the New York Metro Area representing a 75% increase over last year at the same time." (see chart upper right)

[Slide Deck] NetSuite Tees Up ERP Financial Planning Module

Teams with Adaptive Planning

NetSuite Inc., a leading vendor of on-demand, integrated business software suites for mid-market businesses and divisions of large companies, has announced plans to offer a new Financial Planning module to complement NetSuite’s leading on-demand accounting / Enterprise Resource Planning (ERP), Customer Relationship Management (CRM) and Ecommerce capabilities.

Here's a look at their slide deck:

According to the company:

NetSuite with the new module will give companies of all sizes, cost-effective and timely access to highly sophisticated planning and “what if” modeling capabilities typically only available to large corporations willing to invest millions of dollars and months, if not years, implementing on-premise enterprise software.

With NetSuite and the new Financial Planning module, companies have at their disposal an end-to-end business management solution to support the business from strategy, to planning and execution in real-time. Unlike costly and cumbersome on-premise enterprise solutions, the Financial Planning module for NetSuite provides dynamic, real-time drill-down from top level results enabling users to review plan vs. actual variance, isolate the organization responsible for the variance, and drill down into the actual transactional details contributing to the variance. These product features can help companies streamline business processes, improve financial agility, strengthen collaboration and the ability to drive better-informed, strategic decision-making.

“With this new Financial Planning module, NetSuite fills a gap in the business performance management landscape,” said Michael Fauscette, GVP Software Business Solutions at IDC. “Available on-premise tools come with higher overhead, while spreadsheets offer little benefit when it comes to collaboration across a distributed organization. With the new Financial Planning module, NetSuite delivers strategic visibility to organizations that will help them change the way they do business.”

“By implementing NetSuite and the Financial Planning module, we have been able to link together strategy, planning and execution,” said James Jones, Director, Financial Planning and Analysis, KANA Software. “We can continuously monitor actual performance while rapidly analyzing multiple ‘what-if’ scenarios, which allows us to be far more nimble and effective in making both tactical and strategic decisions.”

“Companies who make rapid, well-informed decisions, and execute with discipline, win in the market place,” said Jim McGeever, CFO of NetSuite. “By delivering sophisticated business management, planning and modeling software via an on-demand model, we are providing midsized companies and divisions of large corporations with a set of capabilities previously reserved for elite enterprises. In so doing, we’re not only helping to make our customers more productive, but we’re also enabling them to more effectively compete with – and in many cases outperform – their larger rivals.”

With NetSuite and the new Financial Planning module, mid-sized companies and divisions of large enterprises have a cost-effective alternative to the high price tag of on-premise enterprise solutions and the chaos of multiple spreadsheets thanks to a Software as a Service (SaaS)-based delivery model, relatively quick implementation timelines and ease-of-use that empowers the business user rather than requiring specialized IT skills. And best of all, businesses can get strategic value by having a single source of data and metrics delivered in real-time, enabling better decision making.

Capstone Marketing and Bay Street Group LLC introduce ‘Seven Keys to Successful CPA Firm Management’

Seven Keys to be Shared in Webinar Series

CHESAPEAKE, VA, JUNE 23, 2009 - Bay Street Group LLC and Capstone Marketing, two leading marketing and market research firms to the CPA profession, have joined forces to conduct a ground-breaking and comprehensive investigation into the critical success factors for today's accounting firm.  The Seven Keys to Successful CPA Firm Management,, is based on research conducted over the past year including thousands of survey responses and interviews with leading authorities.

The Seven Keys are:

1.            Leadership,

2.            Technology,

3.            Marketing & Business Development,

4.            Client Satisfaction,

5.            A Great Place to Work,

6.            Learning Organization, and

7.            Strategy Execution.

"Our research identifies the best practices and common characteristics that separate the competitively successful firms from the not-so-successful," explains Jean Caragher, Capstone Marketing.  "We're calling them 'The Leaders vs. The Laggards.'"

"Leaders enjoy above-par, even world-class, performance in the generally accepted metrics of practice management," continues Rick Telberg, Bay Street Group LLC, "including revenue growth, profit margins, technical excellence, client satisfaction, staff morale and tenure, and professional reputation and brand value.  Leaders clearly do things differently. And they clearly get superior results. "

"Leaders," for instance, are 19 times more likely to show superior revenue growth than "Laggards."

Details of the research will be unveiled in a series of monthly webinars starting Tuesday, July 14, 2009, at 1 pm Eastern, with "Leadership: New Rules for the New Normal."

In "Leadership: New Rules for the New Normal," Caragher and Telberg will reveal:

  • Essential Qualities for Accounting Firm Leaders in Today's Economy
  • How to Be a Leader if "Leader" Isn't in Your Job Title
  • Key Skills Every Accounting Firm Employee Needs to Know
  • Bridging the Generation Gap in Today's Workplace
  • Why Teams Don't Work, and How to Fix Them
  • What's Wrong with Every Firm's Compensation System

Registration for the one-hour webinar on Leadership, July 14, is now open at Price: $79; or $449 for the entire seven-part series, a 20% discount.

For further information contact Jean Caragher, Capstone Marketing,, 757.673.6826 or Rick Telberg, Bay Street Group LLC,, 914.674.4531.

CPAs Tell Clients: Put Your Money in Cash, Gold, Bonds

The AICPA is reporting that a significant number of CPA financial planners - 40 percent - are strongly recommending that their clients hold larger cash positions.

  • Thirty percent are recommending commodities such as gold and precious metals.
  • Eighty percent of CPA financial advisors surveyed are strongly recommending their clients move toward a mix of growth and income securities, according to the survey.
  • Sixty-five percent are also recommending more fixed-income securities.

Lyle K. Benson, Jr., CPA/PFS, founder of L.K. Benson & Company, Baltimore, Md., said the behavioral changes in wealthier Americans illustrate the need for a greater emphasis in financial planning. "We are reassessing our clients' risk tolerance and when necessary reallocating their current portfolio assets," Benson said.

CPA Personal Financial Specialists are advising clients to rebalance their portfolios, reassess their tax planning and control their expenses and cash flow. What that means for individual choices about asset classes and portfolio decisions depends on what the individual's investment goals are, what their risk tolerance is and how much of their net worth is available for investment, according to Benson.

"Now more than ever, our clients are seeking our financial expertise to guide them through these uncertain economic times," said Benson.

  • In anticipation of future tax increases, 67 percent of CPA financial advisers said their clients are accelerating capital gains, according to the survey.
  • Half of clients are increasing contributions to qualified retirement plans, such as 401(k)s and IRAs.
  • In terms of wealth transfer, nearly 60 percent of CPA financial planners are recommending paying medical and / or education bills directly for family members and
  • 50 percent of CPA financial planners are recommending gifting devalued assets.
  • Sixty-four percent of personal financial specialists foresee a small increase in the benchmark Standard & Poor's 500 over the next six months.
  • Slightly more than half, 53 percent expect a small increase in bond yields, while 62 percent anticipate a small decrease or no change in commercial real estate values.

Clients are saying that they're dining out less frequently and ordering less expensive wines and premium liquor brands. Many are having items repaired, rather than purchasing new ones and they're taking fewer or less expensive vacations.

  • Ninety-one percent of the CPA financial planner survey respondents serve individual clients with a net worth valued up to $5 million.

CPAs holding the Personal Financial Specialist credential are experienced professionals who are in the best position to help their clients to stay on track with their financial plans even when the economy takes unexpected turns.  PFS credential holders have the education and expertise to help people develop financial plans that anticipate and protect against downturns.

  • During the last six months, 57 percent of CPA/PFS clients have been reviewing their portfolios more frequently, according to the survey.

Are You Ready for GAAP Codification?

The biggest change in 50 years is coming.

by Rick Telberg

After years in the making, the Financial Accounting Standards Board (FASB) on Wednesday, July 1, will launch the new GAAP (Generally Accepted Accounting Principles) codification.

Don't be alarmed if you're only dimly aware of the GAAP codification project. Apparently other CPAs are too. A recent reader poll in the AICPA CPA Letter Daily showed only about one in three accountants had looked into it. A few weeks ago, a Grant Thornton survey found less than half of all CFOs and senior comptrollers had even heard of the codification project.

Is your organization keeping up?

Join the survey; get the answers.

(Free. Confidential)


(VIDEO) Social Media and Web 2.0 Session at the MDBizExpo 2009 – Part 1 of 6

[Video] Now Posted: Social Media and Web 2.0 Session at the MDBizExpo 2009

Bill Sheridan acts as moderator.

The panelists, from the left, are: Francine McKenna (, Alexandrea De Felice (@AICPA_JofA), Rick Telberg (Bay Street Group LLC),  Will Burns (Maryland Chamber of Commerce), and Edith Orenstein (Financial Executives Institute).

Panels discuss the numbers of CPAs moving to social media, the opportunities, costs and risks, Part 1 of 6 parts.