TAX PRACTICE

You’re Missing 60% of Your Revenue

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Here are four ways to stop leaving that money on the table.

By Sandi Leyva
The Complete Guide to Marketing for Tax & Accounting Firms

Accounting firms have done a great job adopting paperless office technologies, the web and even cloud computing, so you may feel you have been doing all you can to streamline margins, become “client-centric,” as some consultants call it, and grow your practice. But I believe there is even more opportunity that very few, if any, in the accounting profession have fully identified or embraced.

MORE: Calculate Your Business Relationship Ratios | What Can ChatGPT Do for Accounting Professionals? | Generative AI: Should You Avoid It or Adopt It? | Want Better Clients? Here’s How | Get Your Name in the News | Four Ways Small Firms Can Beat Large Ones | Why You Need a Link-In-Bio Tool
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I only bring this up because I believe most CPA firms are leaving about 60 percent of their potential revenue on the table (and I can prove it). Worse, they are not sharing their badly needed financial expertise with more businesses that could be greatly helped, especially now.
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How to Boost Profits by (OMG) Sharing the Upside

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Workers of the world unite.

By Bill Penczak

About a decade ago, the managing partner of our $100 million firm and I were discussing compensation and commission for our five business development professionals. He and I were in complete agreement that there should be no cap on commission or compensation – even if that compensation level with their base and commission was at par with or even exceeded that of the partner group.

MORE: 12 Points of a Good Compensation Plan | Rate Managing Partners in Six Areas | Eight Ways Managing Partners Make a Real Difference | Five Reasons That Leaders Fail | Eleven Things Partners Must Do | Seven Keys to Becoming an Equity Partner | How to Achieve Partner Unity | The Seven Building Blocks of a Great Partnership
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“If they’re making money, we’re making money,” he said. “Why would I want to limit that?”

Anyone who agrees with that premise should continue to read below. If not, feel free to move on to the next CPA Trendlines article or the NY Times short crossword.

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Heather Satterley: You’ve Got to Meet People Where They Are

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Stop saying yes to everything and start saying yes to yourself.

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See The Disruptors

The Disruptors
With Liz Farr

Heather Satterley is well-known for being an accounting tech expert. But tech isn’t the only skill accountants need today and for the future. “You can have great technology skills, but if you don’t have people skills and those softer skills, that’s going to be a problem,” she said.   

MORE PODCASTS and VIDEOS: Bill Penczak: Stop Forcing Smart People to Do Stupid Work | Sandra Wiley: Staffing Problem? Check Your Culture | Scott Scarano: First, Grow People. Then Firm Growth Can Follow | Jody Padar: Build a Practice that Works for You, Not Vice-Versa | Ira Rosenbloom: With M&A, Nobody Wants a Fixer-Upper | Peter Margaritis: The Power Skills Every Accountant Needs | Joe Montgomery: Find the Sweet Spot of the Right Clients, Right Services and Right Prices | Marie Green: Your Bad Apples Are Ruining You | Megan Genest Tarnow: Hire for Curiosity Rather Than Compliance | Clayton Oates: One Way to Keep Clients for Life | Randy Crabtree: Follow These Three Rules to Keep Employees Happy | Erik Solbakken: Yes, You Can Work Less and Make More | Donny Shimamoto: Future Firm Growth Requires a Mindshift | Jennifer Wilson: Empower Young Workers to Build the Firm Everyone Loves | Mike Whitmire: Re-Think Your Hiring and Training Practices | Hector Garcia: Success Strategies of a Quickbooks YouTube Superstar | Blake Oliver: Why Tax Work Yearns To Be Free| Private Equity Explodes in U.K. | Brannon Poe: The Status Quo Must Go  | Accounting Nerds, Unlock Your Super Powers  | Disruptor: Jason Statts Shakes Up the Status Quo | Think Small to Think Big with Matt Wilkinson | When Financial Statements Go Extinct with Corey Schmidt | Can Geraldine Carter Save Accountants from Themselves? | Re-Inventing Accounting with Tyler Anderson

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One of those softer skills that will be a key skill for the future is problem-solving, which requires keeping an open mind to “look at not just facts and figures, but look at tools, resources, people and pull them all together,” she explained. No one can be an expert at everything, so having “a wide network of really awesome professionals” is vital for filling in any gaps “to get the job done.”  

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Stop Sending the Wrong Message to Audit Teams

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Audit is becoming further commodified. 

By Alan Anderson
Transforming Audit for the Future

Instant download:
“The New Manifesto for Accountants.“

The value of what we provide to clients has declined until it has become a commodity. That, in turn, drives our fees down.

The lack of innovation means that our clients can’t tell the difference between the audit we do and one done by the firm down the street. None of them provide relevant information or any value to our clients.

MORE: Three Fundamental Questions to Ask in Audit | How Auditors Can Beat AI | The Big Issues in Audit: Frustration, Inconsistency and Technology | Five Ways to Increase Audit Efficiency | Early Adopters Gain an Edge in Audit | Talent Retention: Five Tips for an Audit Adjustment | Six Benefits of an Internal Audit | The Ten Financial Controls That’ll Make You a Hero | Five Cash Reports You Can’t Live Without | When an Audit Is a Great Thing
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If our clients don’t see the value, then the audit is only being done to meet a regulatory or banking requirement, and in that case, the cheapest option that meets that basic requirement is the one they choose.

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IRS and FTC Cybersecurity Expectations of Tax Practitioners

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Your tools for a cybersecurity compliance check-up.

By Donny Shimamoto
Cybersecurity for Accountants

In August 2019, the IRS published its list of “Security Six” steps to protect taxpayer information.[i] These described the six “basic protections” that it expects tax prepares to utilize.

MORE:  How Hacker-Proof Is Your Firm? | Unleashing the Power of Technology: Transforming Accountants into Trusted Advisors | Future Firm Growth Requires a Mindshift | AI, OCR, NLP & CPAs: Oh My!   |  Accounting Nerds, Unlock Your Super Powers  | Early Adopters Gain an Edge in Audit | Dustin Wheeler: For Serious CAS Success, Hire Tech Teams | CSR for CPAs: The Missing Ingredient | Donny Shimamoto Explains How ‘Agile’ Applies to CPA Firms |  Staff Retention for Remote Workers | Why the Future is in Risk Advisory |  Ready for Non-CPA “CPA” Firms?
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These include:

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Bill Penczak: Stop Forcing Smart People to Do Stupid Work

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Challenge your people and keep the work interesting or risk losing them. 

Subscribe to CPA Trendlines podcasts anywhere: Apple, Google, Spotify, iHeart, Deezer, Amazon Music and Audible, Player FM, Audacy, Gaana (India), and Boomplay (Africa).

The Disruptors
With Liz Farr

Too many accounting firms have “smart people doing stupid work,” according to Bill Penczak, a veteran sales and marketing professional. The founder and chief insights officer for Mica Ventures said to think about the effort it takes to get an accounting degree and get your CPA, and contrast that with the years of mindless work that many new hires are required to do, especially if they go into audit, he said. “One of the reasons why there’s such a talent shortage is because the market has figured this out,” and no one wants to do that stupid work, Penczak said.

MORE PODCASTS and VIDEOS: Sandra Wiley: Staffing Problem? Check Your Culture | Scott Scarano: First, Grow People. Then Firm Growth Can Follow | Jody Padar: Build a Practice that Works for You, Not Vice-Versa | Ira Rosenbloom: With M&A, Nobody Wants a Fixer-Upper | Peter Margaritis: The Power Skills Every Accountant Needs | Joe Montgomery: Find the Sweet Spot of the Right Clients, Right Services and Right Prices | Marie Green: Your Bad Apples Are Ruining You | Megan Genest Tarnow: Hire for Curiosity Rather Than Compliance | Clayton Oates: One Way to Keep Clients for Life | Randy Crabtree: Follow These Three Rules to Keep Employees Happy | Erik Solbakken: Yes, You Can Work Less and Make More | Donny Shimamoto: Future Firm Growth Requires a Mindshift | Jennifer Wilson: Empower Young Workers to Build the Firm Everyone Loves | Mike Whitmire: Re-Think Your Hiring and Training Practices | Hector Garcia: Success Strategies of a Quickbooks YouTube Superstar | Blake Oliver: Why Tax Work Yearns To Be Free| Private Equity Explodes in U.K. | Brannon Poe: The Status Quo Must Go  | Accounting Nerds, Unlock Your Super Powers  | Disruptor: Jason Statts Shakes Up the Status Quo | Think Small to Think Big with Matt Wilkinson | When Financial Statements Go Extinct with Corey Schmidt | Can Geraldine Carter Save Accountants from Themselves? | Re-Inventing Accounting with Tyler Anderson

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Besides making smart people do stupid work, Penczak said many of the firms he works with are realizing that they need to do a better job with mentoring and career development, as well as simply having more conversations with their people.

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With Fresh Funding, IRS Shows Service Improvements

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man talking on phone and smiling

Welcome to the 21st century.

By CPA Trendlines Research

It turns out that all it took was money. Funded better, the IRS performs better. It’s as simple as that.

MORE: Research: Accounting Pros Cautiously Optimistic about Generative AI | How Auditors Can Beat AI | How Tax Practitioners Became Cybersecurity Risks | Why the U.S. Must Act Now to Protect Our Online Privacy | Top Tax Vendors Caught Red-Handed Selling Private Taxpayer Data
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Look at the accomplishments as of the end of the filing season:

  • Three million more phone calls answered.
  • Phone wait times cut from 28 minutes to just three.
  • 140,000 more taxpayers served in person.
  • 80 times more returns digitized than in 2022.
  • Entire backlog of 2022 returns cleared without error.
  • New online filing and notification options offered.
  • Tax preparers can file 1099s in bulk.
  • New direct deposit refund enabled for amended returns.
  • 35 Taxpayer Assistance Centers opened or reopened.

The improvements are possible thanks to funding provided under the Inflation Reduction Act, and the IRS deserves credit for accomplishing so much in so little time. The IRA was passed on August 16, 2022.

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