Farm-Aid for Accountants?


Rain on the keyboard, blood on the mouse: Changes in the accounting business recall the plight of the small farmer in the 1980s.

By Frank Stitely
The Relentless CPA

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.

More by Frank Stitely: WIP-ing Clients Into Shape |  How the Annual Tax Meeting Died  |  Whittle Down WIP | Maximize Your Role as Visionary | The Land Mines in Tax Returns | Give Your People the Resources They Need | 4 Tips for Managing Advanced Preparers | The Right Way to Assign Staff Projects | Workflow for Dummies | How Effective Project Management Makes Your Life Easier
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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.

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WIP-ing Clients Into Shape

https://cpatrendlines.com/2019/09/18/wip-ing-clients-into-shapePresent draft tax returns for their approval.

By Frank Stitely
The Relentless CPA

Poor scheduling isn’t the only way WIP gets out of control. Clients cause WIP to grow by not answering questions or approving drafts on a timely basis.

MORE: How the Annual Tax Meeting Died | Whittle Down WIP | The Tax Practice Traffic Cop | How to Coach Your Staff | How to Create Good Managers
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Do you think you can’t control client behavior? Think again.
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How the Annual Tax Meeting Died

Businessman shaking hands with grim reaperThink clients really want those meetings? Move them out of season and charge for them.

By Frank Stitely
The Relentless CPA

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.

MORE: Whittle Down WIP | Maximize Your Role as Visionary | The Land Mines in Tax Returns | Give Your People the Resources They Need | 4 Tips for Managing Advanced Preparers | The Right Way to Assign Staff Projects | Workflow for Dummies | How Effective Project Management Makes Your Life Easier
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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.
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Whittle Down WIP

piles of paper, decreasing in sizeIt's cheaper than adding capacity.

By Frank Stitely
The Relentless CPA

Want to increase profitability and client retention? Manage projects effectively.

MORE: Maximize Your Role as Visionary | How to Be the Chief Communicator | How to Teach Reviewing and Time Management | 4 Steps to Take Before Next Tax Season | 3 Tips for Handling Rookie Tax Preparers | What Goes Into a Client Project?
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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.
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Maximize Your Role as Visionary

woman ladder binoculars city view outlook vision success climb AdobeStock_57204649.jpegDo the things that only you can do.

By Frank Stitely
The Relentless CPA

Your final role as CEO is visionary. This differs from your role as strategist, as the visionary role deals with the long-term future of your firm.

MORE: How to Be the Chief Communicator | The Tax Practice Traffic Cop | The Land Mines in Tax Returns | How to Teach Reviewing and Time Management | How to Coach Your Staff | Give Your People the Resources They Need | 4 Steps to Take Before Next Tax Season
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This is the fun part, if you really relish your role as CEO. Consider your firm a blank canvas on which you can experiment endlessly.
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How to Be the Chief Communicator

Man on the phone in officeIf you follow this plan, you'll have the time and reap the benefits.

By Frank Stitely
The Relentless CPA

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.

MORE: The Tax Practice Traffic Cop | The Land Mines in Tax Returns | How to Teach Reviewing and Time Management | How to Coach Your Staff | Give Your People the Resources They Need | 4 Steps to Take Before Next Tax Season | How to Create Good Managers | 4 Tips for Managing Advanced Preparers | 3 Tips for Handling Rookie Tax Preparers | How to Hire and Manage Great Admin Staff | The Right Way to Assign Staff Projects
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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.
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The Tax Practice Traffic Cop

illustration of traffic lightAuto-nagging isn't always enough.

By Frank Stitely
The Relentless CPA

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.

MORE: The Land Mines in Tax Returns | How to Teach Reviewing and Time Management | 4 Steps to Take Before Next Tax Season | Some Uncommon Advice on Hiring Full-Time Staff | What Goes Into a Client Project? | The Value-Pricing Con Job | The 21st-Century CPA Firm | Ruthlessly Efficient Workflow Management
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I live in 15-minute increments during tax season. There are four things I do over and over and over again:
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The Land Mines in Tax Returns

Woman reading paper document at office desk in front of computerData entry errors = public beheadings.

By Frank Stitely
The Relentless CPA

Your next role as CEO is reviewer. There are two types of review: primary and secondary.

MORE: How to Teach Reviewing and Time Management | How to Coach Your Staff | How to Create Good Managers | How to Hire and Manage Great Admin Staff | Managing People: The Heart of Effective Project Management | Tammy’s Tale of Tax Season Tardiness | Beware the Leeches and Consultants | The Value-Pricing Con Job | The 21st-Century CPA Firm | Ruthlessly Efficient Workflow Management | The Annual Tax Meeting is Dead. Clients Killed It.
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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.
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How to Teach Reviewing and Time Management

Businessman sitting in office and reading documentsAvoid “what’s the status of” hell.

By Frank Stitely
The Relentless CPA

Let’s discuss two training issues in detail: teaching time management and teaching review skills.

MORE: How to Coach Your Staff | Give Your People the Resources They Need | 4 Tips for Managing Advanced Preparers | The Right Way to Assign Staff Projects | Workflow for Dummies
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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.
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How to Coach Your Staff

Confident businessman analyzing chart and explaining it to co-workerAlso, don't let your managers hoard work.

By Frank Stitely
The Relentless CPA

To recap, your first role as CEO is chief strategist. That means putting the right people in the right roles with the right resources.

MORE: Give Your People the Resources They Need | 4 Steps to Take Before Next Tax Season | 3 Tips for Handling Rookie Tax Preparers | Some Uncommon Advice on Hiring Full-Time Staff | What Goes Into a Client Project? | Value Pricers Ignore Half the Pricing Puzzle | CPAs Can’t Help You
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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.
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Give Your People the Resources They Need

Woman scanning a documentSeriously consider your rate of return.

By Frank Stitely
The Relentless CPA

We have talked about putting the right people in the right places. Let’s discuss giving them the right resources.

MORE: 4 Steps to Take Before Next Tax Season | How to Create Good Managers | How to Hire and Manage Great Admin Staff | Managing People: The Heart of Effective Project Management
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Little angers me as much as getting cheap when it comes to giving staff what they need. Here’s an example from my wife’s career as a federal government contractor.
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4 Steps to Take Before Next Tax Season

Young businesswoman working on laptop computer with growth chart in backgroundThink of yourself as a CEO.

By Frank Stitely
The Relentless CPA

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.

MORE: How to Create Good Managers | 4 Tips for Managing Advanced Preparers | The Right Way to Assign Staff Projects | Workflow for Dummies | How Effective Project Management Makes Your Life Easier | 2 Lessons Clients Taught Me | No Consultant Can Solve Your Biggest Problem
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“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.”
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How to Create Good Managers

Young woman lying on the desk at office and holding magic wand in her handYour deadline is April 5, not April 15. Here's why.

By Frank Stitely
The Relentless CPA

Good managers are a special breed. They possess that most valuable, difficult and rare of skills – the ability to review others’ work.

MORE: 4 Tips for Managing Advanced Preparers | 3 Tips for Handling Rookie Tax Preparers | Some Uncommon Advice on Hiring Full-Time Staff | What Goes Into a Client Project? | Value Pricers Ignore Half the Pricing Puzzle | CPAs Can’t Help You | The Agile Accountant
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Review skills require deep technical knowledge combined with an extraordinary attention to detail. And that’s not all. They need dazzling communication skills to be able to deliver criticism gently.
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