We've discussed planning for tax season in terms of how many full- and part-time preparers you need. Now, let’s discuss this in terms of capacity and turnaround time. Let’s ask why we should ever hire additional tax preparers at all, because hiring additional people only costs more money.
John Mellencamp’s hit song, “Rain on the Scarecrow” chronicle the decline of the small American farmer in the 1980s. Farmers faced economic devastation caused by new technology and emerging international competitors.
Expensive new machinery and international competition transformed farming from a sleepy vocation handed down between generations to international global commerce driven by technology and sophisticated business metrics. Farming became a real business.
Small farms disappeared as expensive machinery demanded economies of scale that could create a sufficient return on capital investment. International competition lowered prices to where new technology was required to compete with lower-cost international labor.
Farmers needed to raise the level of planning beyond pushing seeds into the ground and waiting for favorable weather. They began to pay attention to detailed yield metrics and weather patterns, planning irrigation to effectively use natural rain patterns. They used Monte Carlo simulations to plan which crops to plant and sell.
The ones who didn’t change went bankrupt or sold and retired. Musicians held a concert, Farm AID, to call attention to the farmer’s plight.
Driving to work this morning, I realized that changes in the CPA industry parallel the plight of the small farmer in the 1980s.
Better scheduling reduces WIP. A while back CPATrendlines.com published an article by a brilliant writer (me) called “The Annual Tax Season Meeting is Dead.” I based this article on years of scheduling mistakes in our firm that drove up WIP and killed turnaround. Here’s the gist of that article.
Beginning in the early 1990s, we began prescheduling personal tax meetings. We had the best intentions. Our practice was growing, and we could no longer afford to have clients call us when they got around to it. We needed to bring sanity to the scheduling of meetings. We couldn’t have all of our clients call to schedule in mid-March. Thus, we sent out postcards with prescheduled meeting times. READ MORE →
If you don’t have these measures, get them, or turn in your CEO title. If, as a value pricer, you’ve sworn off practice metrics based on productivity, you’ll learn nothing from this article. You just don’t have the numbers. Mark Cuban is on hold waiting to yell at you. READ MORE →
Your role as chief communicator is closely related to your traffic cop role. In the traffic cop role, we covered prodding clients to keep projects moving along, but there is more to client communications than just moving projects along to completion.
How many times per day do clients contact you to ask such pressing questions as, “Are my dog’s vet bills deductible medical expenses?” The answer is yes, if your vet holds dual DVM and MD degrees and your dog is classified as a dependent on your tax return. See IRS code section 999, subsection C, paragraph 666. READ MORE →
One of your roles as CEO is chief traffic cop. You keep the flow of returns moving along the information superhighway that is your workflow system. You manage the managers. You remove process bottlenecks. You soothe irritable clients.
Depending on the size of your firm, you may only have primary reviews. If your firm consists of you and a preparer, you won’t have a second level of review. I don’t consider the self-review as a review step. I consider it part of preparation. READ MORE →
The biggest training gift that you can give your staff is time management training. You may want to offer formal training, but I have never found one that was really specific to CPA firms and the daily challenges we face. READ MORE →
Your second role is trainer and coach. This role is closely related to your role as chief strategist. You can’t put the right people in the right positions without the right people. This second role is about creating and keeping the right people. READ MORE →
Please have a seat. No, not that one. Take the one next to me. All of us are here because we love you to death. We only want the best for you. But we can no longer stand by and watch you suffer. When you suffer, we all suffer as a family. We have written some letters to let you know how we feel. I’ll let your firm go first.
“Your behavior has affected me negatively in the following manner. I’m not as profitable as I should be. You are stifling the development of your staff. Your clients are upset that returns aren’t getting done on time. Your kids resemble the mailman more than you.
“Please accept the help we are offering you today. We have your bags packed, and we’ll put you on a plane to rehab at the beach. Don’t worry about scoring your next fix. We’ll help you detox safely. But you must decide right now. You must give up your addiction to doing everything yourself.” READ MORE →