As part of this year’s Top 100 Most Influential People survey, Accounting Today asked, “What is the most important issue currently facing the accounting profession?"
The full responses of all the candidates are below. The full T100 list is available
Two top issues that remain consistent in their impact on the accounting profession are the ability to attract and retain talent — especially diverse talent, and the ability to innovate and adapt in a changing environment.
First, attracting and retaining talent is crucial. We are all facing challenges related to what some are calling “The Great Resignation.” We prefer to view this as “The Great Attraction” and we are working together to position our firm and profession as one that provides vibrant and diverse career paths. We are also collaborating on how to attract more diverse talent to the profession through the Center for Audit Quality’s Bold Ambition campaign and other endeavors. Our profession does not currently reflect the diversity of the communities and businesses we serve. To be successful moving forward, we need to make progress in both attracting and retaining today’s diverse candidates and in building the pipeline for the future. Accounting is a great career path that provides purpose, while enabling professionals the ability to earn a good living, support their families and serve as pillars in their communities. Through our combined efforts with the CAQ and others, we can highlight the profession as a viable path to a successful career and life.
Second, the ability to innovate remains vital. One of the things that is stressful to people about our profession is the long hours, and we have a great opportunity to address that while at the same time maintaining our commitment to quality and professional excellence through technology, automation and other innovation. At RSM, we believe everyone can innovate, and we have been seeing great results not only from our national programs, but also from the individual efforts and innovation mindset among all of our people. I am confident we will continue to see strong progress in this area within RSM, across the profession and with our clients for years to come. The world continues to change rapidly, and our profession will continue to innovate and adapt to stay at the forefront.
— Joe Adams, managing partner and CEO, RSM US
- Staff / the future generations of accounting. This is not a profession where you can leave college and get a rockstar job like developers or marketing consultants. I look at conferences and participation in webinars and I am nervous as to the attrition rate of people retiring vs those entering the profession.
- Devaluation of services due to AI/softwares claiming to do what we do. We can systematize part of our processes - and lets be real, they are the things we don’t want to do anyway. However, we have to separate what can be automated versus what will require strategy and thinking.
— Marjorie Adams, CEO, Fourlane
The phenomenon I’m seeing more than anything is firms struggling to do more with less, and it’s a significant challenge. The talent shortage is a real concern, and its impact is pervasive. Firms in 2021 are expected to do more because clients have expanding needs, and in order to get and remain competitive, firms simply must offer more services. A big part of the “how” is answered by technology enablement, which also frees up professionals to step up into higher value advisory work.
As we move into 2022, firms will still be hiring at a suboptimal level due to the aforementioned shortage – this will push more firms into investing in a more diverse workforce and offering professional training and other perks in order to attract the best talent. And as the Big 4 begin making the tectonic shift to allow professionals to work from home, more and more firms will necessarily follow suit. None of this will be easy – but just as firms are being slowly drawn into the 21st Century with cloud technology adoption, so will they follow suit with other adjustments that are settling into hard trends.
— Sona Akmakjian, global head of strategic accounting partnerships, Avalara
Finding, hiring, and retaining staff with the right skills is becoming the biggest issue in the post-pandemic world. The exodus of accountants from CPA firms hit a pause during the worst of the pandemic, but it’s catching up now. Every firm I’ve talked to has had significant loss of staff. The strategy for most firms centers around bonuses and compensation, but there’s only a handful of people who will stay for the money and put up with the monotony. The constant battle of playing catch-up, dealing with backlog of work, the pressure to get the work done as quickly as possible, and the constant shortage of people to do the work is just not worth any amount of compensation to many staff. The typical response of firm leaders who fear that staff will be leaving is to throw more money at them, but that’s usually just a temporary fix.
Money will only go so far if people don’t feel they’re mentally challenged and getting fulfillment in their current position. People who do feel fulfilled and challenged and who feel they are growing in their current roles are much less likely to be lured away for the promise of more money. Leaders need to open up to new ways of approaching audit and new ways to approach their work.
For decades, audit has followed the same billable hours model and the same method for teaching new staff how to audit, the SALY model. This model doesn’t reward innovation because that might mean fewer billable hours for the work and, consequently, reduced fees. Even if staff were interested in innovation, they’re so strapped for time, they can’t step back and consider whether there’s a better way to do the work.
To retain the best and the brightest team members, and to ensure that audit remains relevant, we need to shift to a model that empowers team members to think innovatively about using technology in the audit. We need a model that moves the focus away from billable hour quotas to a focus on the deliverables. Instead of worrying about whether someone is putting in the requisite hours, a better approach is to make them accountable to completing the task, at a high level of professional quality, by a specified deadline. This approach works well in the remote world. If someone finds a tech tool or a process that enables them to complete the task in fewer hours, they should be rewarded for their innovation. Our current system punishes them for not meeting billable hour quotas.
What I like to do to encourage teams to try doing things differently is have them take an R&D approach to a few audits. We’ll take a blank sheet of paper and think of different ways we can achieve the objective of the audit, which is to render an appropriate opinion on the financials, taken as a whole. This approach encourages them to experiment with technology tools and to think about the big picture of what audit is supposed to accomplish.
Technology has the potential to fundamentally change the way we perform audits. We can leverage it to allow our people to use the higher-level knowledge and skills that they have acquired as CPAs. We can create firms where staff are empowered to experiment with technology, and where they are constantly encouraged to share their insights with clients and to help those clients improve their businesses. Firms with an empowered tech-focused team, value-add approach to audits are not only better places to work but are more attractive to clients.
— Alan Anderson, founder and president, Accountability Plus
Automation. Technology is changing the nature of what accountants do. No longer is it important to “do work” but rather to know “what’s worth doing.” We’re going through a transition in the tax and accounting profession where new ways of thinking create new types of firms and new types of value for clients.
With that backdrop, tax software had historically hardly changed in a decade. That changed with Corvee Tax Planning software.
— Andrew Argue, CEO and co-founder, Corvee
Rethinking our approach to talent is the number-one concern. That involves not only a recognition that we need a broader array of skill sets in accounting firms, from the traditional accounting skillsets to tech, business, project management, communication and specialized skillsets around data and analytics. Our organization needs a range of talented people to face change and seize opportunities.
We must also rethink how we develop and accelerate talent development within the industry, including rethinking traditional career paths. The macro trends around automation, AI, the centralization of business processes and outsourcing (onshore and offshore) create an opportunity to develop our professionals more quickly and enhance the value they deliver at an earlier stage in their careers. Doing that requires us to deploy new techniques for learning and development, including more individualized, customizable and self-directed learning platforms that allow our people to learn at their own pace and pursue their career pathways.
Retention and re-engagement following COVID-19 are also front-and-center issues. The Great Resignation is the result of people feeling disconnected, burned out and unsure whether they want to continue down their current career paths in the accounting industry. Our job now is to rethink how we’re going to engage those people—we’re not going back to life before COVID-19 or sticking with everyone being remote. We have an opportunity to rethink the core of our business model with respect to emerging hybrid work models that allow us to preserve flexibility, offer options and discover better ways to team and collaborate. The tech and tools we’ve been using for virtual collaboration have many benefits. Still, we also want to recognize the humanity, connectedness and vested interest in each other’s success that come with in-person collaboration.
— Matt Armanino, CEO and managing partner, Armanino
It’s impossible to ignore the extent to which firms, since early 2020, have been faced with how to effectively navigate ongoing, historic change and uncertainty, keeping client needs top of mind while pursuing opportunities for firm growth. This is the meta issue of our time. How will firms continue to evolve and change, maintain and strengthen client relationships, attract new clients, and retain and attract the best talent in the midst of an ongoing pandemic? No one could have predicted the present situation, but it stands that firms will need the right mix of deep subject matter expertise, and innovative, transformational personnel to stay ahead of industry and technology trends, and deliver services that magnify the expertise they have to offer.
— Liz Armbruester, SVP, global compliance operations, Avalara
Relevancy. Excessive regulation remains a close second, since over-regulated industries are not hotbeds of innovation, dynamism, and risk taking. In that spirit, I believe the profession should relinquish (or lose) the audit monopoly, which would allow competition to bring innovations to market. The splitting of audit from consulting doesn’t deal with the elephant in the elevator: that auditors cannot be independent if they are paid by the companies they are auditing. You simply cannot be paid to be independent. We should allow insurance companies to offer financial statement insurance, and have the stock exchanges pay and select the auditors for their listed companies. No reform would be perfect, but these changes would be an improvement over the intolerable status quo.
— Ron Baker, founder, VeraSage Institute
What value we provide to our audiences in a fast-changing, complex world is a pertinent issue for our profession and one that we collectively must address. Accountancy has to straddle the dual demands placed on it by technical and technological changes.
— Andreas Barckow, chair, International Accounting Standards Board
Talent - There is not enough talent to go around for all of the business demands facing the profession. The only way to address this is for Business Schools to continue to provide a quality education to accounting and tax students – but also once they are in the profession, to ensure that firms/companies provide opportunities where their interests and gifts are best utilized. It is also incumbent of all accounting and tax professionals to be curious and lifelong learners. Organizations should provide relevant and quality continuing education, mentorship and meaningful career advancement opportunities.
— Michael Bernard, chief tax officer, transaction tax, Vertex
In recent years, doing well by doing good was a strategy leaders could pursue to be better – better employers, better community stewards, better businesses. Today, a fundamental shift is underway. We now know that doing good is not good enough. Now, the strategy that leaders must pursue to ensure long-term, sustainable success has evolved to be more holistic, integrated and interdependent.
The past year and a half has prompted many leaders to take a fresh look at their company’s purpose, value and societal impact to ensure they are well-positioned for sustainable growth. This shift in mindset has encouraged our industry to further advance efforts in the areas diversity, equity and inclusion and environmental, social and governance. Being comfortable with change, having an open mind and seeking opportunities to advance the profession in these critical areas will be essential to build successful and sustainable businesses for the next generation.
— Wayne Berson, CEO, BDO USA LLP
Firm leaders must adapt to a client base that is changing as rapidly as the global economy itself. The diminishing CPA pipeline, the dire need for succession planning, the expansion into new services like cybersecurity, or meeting the challenges of diversity, equity and inclusion may seem like separate issues, but they are all connected to that rapid change. Expectations around the use of technology, the speed of communications, and sensitivity towards social issues may seem strange or like “nice to haves” to older leaders, but they must be prioritized if firms are to endure. If they are not addressed front and center, firms will find themselves losing clients and staff to the numerous other firms out there who will meet these needs.
— Joanne Barry, executive director and CEO, New York State Society of CPAs
It’s ironic that most accountants are led by clients rather than leading their clients.
— Chandra Bhansali, co-founder, AccountantsWorld
How do you stay competitive and boost profitability, while also keeping up with technology trends and maintaining relevance as a professional? Balancing these short-term and long-term demands is a crucial issue for every professional accountant. It requires strategic implementation of technology and an openness to change. And juggling the demands of today and tomorrow is a key leadership challenge.
— Sharada Bhansali, co-founder, AccountantsWorld
The use and reliance on technology is already prevalent in major audits and accounting; however, the curriculum and professional requirements have struggled to keep pace. The CPA Evolution initiative is being implemented to make sure the profession and the regulation of the profession retains relevance in the future.
— Ken Bishop, president and CEO, NASBA
The opportunities provided by technology. Financial information is already being consumed in a very different way and the rapid changes in technology will only continue to evolve that consumption. As accountants, we need to take advantage of the opportunities afforded to us by the advancements in technology. While there isn’t a specific role for us as standards setters in this evolution, the GASB would like to be as helpful as we can, and to provide leadership as appropriate, in the process.
— Joel Black, chair, GASB
The most important issue facing the accounting profession today is business transformation. This requires a fundamental change in all aspects of the firm to make them successful and future ready. Beyond changing technology, which is inevitable, firms must also adapt their leadership, talent, processes and growth strategies. They will also be challenged to embrace innovation and will require a different and more diverse team.
— Jim Boomer, CEO, Boomer Consulting Inc.
Business transformation. Technology, talent and processes during a pandemic have been both enabling and disruptive. Members of the profession who can learn and adjust to these new opportunities will sustain success while remaining future ready. The focus is on leadership, talent, technology, processes and growth requiring shifts in mindsets and operations.Too much focus is being placed on capacity and not enough on capabilities, automation and outsourcing.
— L. Gary Boomer, founder, visionary & strategist, Boomer Consulting Inc.
Talent – We can’t go back to the way we were. We can’t go back to fill all that office space we were and are currently leasing. We can’t go back to creating firm cultures the way we did in the past. Our team members didn’t just get a taste of the remote work environment. They lived it and it became the new way to do business. As owners of firms the office space issue is our problem and we’ll get past it. We’ll find new ways to develop strong cultures without coming into the office every day. Let’s protect our most valuable assets, our talent – our team members. Let’s listen to what they want and let’s work together to build stronger firms. Let’s not resist this change, let's embrace it and not run the risk of losing talent to other industries.
— Jim Bourke, Managing director of advisory services, WithumSmith+Brown
Relevance. Transformation is today’s work to secure tomorrow’s relevance. Change can be hard, but transforming how and where we deliver the profession’s work requires courage, commitment, and effort. We can and must do more, increase the value we provide for our stakeholders, and secure a future for the generation of professionals who come after us.
In doing this, we must produce valuable new knowledge in our profession through research and experimentation, the analysis and synthesis of experience, and the development and adaptation of new methods. We must also communicate effectively and build trust with our stakeholders—the public, businesses, universities, the government, and others—and perform with high ethics and duties to persuade these stakeholders to accept us as a profession worthy of their trust and authoritative in our work. In addition, the profession—along with regulators and policymakers—is being tasked with determining how to best disclose material nonfinancial information, such as ESG data on climate change, human capital management and more. These issues play a role in a company’s long-term value creation, and we know that investors are increasingly using this information to make investment decisions. And investors and other stakeholders deserve to have the same confidence in ESG and other nonfinancial information as they do in financial disclosures.
The world is changing at a pace unlike anything we’ve experienced before, and business leaders are tasked with tackling new and evolving challenges, specifically the need to build trust with a variety of stakeholders and to deliver better, sustained outcomes. As a result, more companies are making long-term, ESG-focused commitments, and these strategies need milestones that will be underpinned by the profession. Companies cannot manage what they cannot measure, and a strong focus on ESG reporting can help companies understand where they are, track progress against goals and communicate with stakeholders.
I would also like to see the profession’s expertise and integrity be part of the solution for additional investor protections and market quality relating to ESG, eXtensible Business Reporting Language (XBRL), benchmark information, cyber risk management, and other vital market information.
The role of the profession in influencing these issues beyond the financial statements partly depends on how well we meet sensible expectations for our work on financial statements. I have led in delivering on PwC’s commitment to quality, which is demonstrating to the profession and our stakeholders what’s possible. PwC has delivered what no other major firm has done: credibility with regulators, as only one of the 58 PwC audit engagements, including six interim reviews, that were subject to inspection in 2020 was included in Part 1.A of the PCAOB’s inspection report. And at PwC this past year, in delivering for boards and investors, 99+% of our public company audit reports held up in the public markets without reissuance related to material misstatements. These measures and many others are included in a PwC US 2021 Audit Quality Report that also provides timely insight into how our culture, values, people, and processes came together to deliver on sustaining audit quality objectives even during an unprecedented and disruptive year.
— Wes Bricker, vice chair, U.S. trust solutions co-leader, PwC US
I think the mindset and mental health issues are the biggest ones. We have a lot of burnt out practitioners who are dealing with the various issues related to COVID including frustrated clients, increasing compliance requirements, and the fact that the IRS doesn’t care about the burden they are placing on professionals. In a lot of cases, we are doing the work for the IRS and we aren’t getting paid for it. Our clients just need action and answers and we are the ones stepping in to provide it—which shouldn’t be the case.
— Dawn Brolin, CEO, Powerful Accounting Inc.
Building and nurturing a strong talent pipeline to meet the needs of the profession and the public interest.
— Jennifer Burns, chief auditor, AICPA
Embracing innovations that are disruptive to our current standards, delivery models and operational norms. Because the innovation and change brought about by blockchain tech will touch every part of capital markets, finance and business as we know it today – as well as threaten significant disruption of the CPA’s role in these markets and the way organizations are governed – we must embrace this change and be a part of it.
Additionally, and equally importantly, we must strive to make our businesses ones that grow, feed, sustain, empower and support the individual employee. We must strive to make our business one of positive impact on our people, clients and communities.
— Noah Buxton, managing director, blockchain and digital assets, Armanino
Talent/Successionis the most important issue currently facing the profession. This is not a new issue, but it has been exacerbated by the pandemic. There is a lot of focus on finding more people, but the bigger opportunity is around understanding what capacity is truly available, what roles and skills are needed for the future,looking beyond geographic limitations,and exploring outsourcing and automation. The biggest obstacle is mindset. This should all be seen as an opportunity instead of an obstacle.
— Arianna Campbell, shareholder and consultant, Boomer Consulting
The accounting industry is really struggling to attract and retain top talent. The industry as a whole is reluctant to change and adapt to fast-moving technologies and changing work-space dynamics. As a result, the industry is losing a lot of skilled personnel to other technology-first companies.
— Shehan Chandrasekera, head of tax strategy, CoinTracker
The most pressing issue facing the profession is two-pronged – evolving demands on accountants, and constrained number of qualified candidates choosing a career in accounting. Disruptive technologies and automation (machine learning and Artificial Intelligence) have helped existing practitioners and firms shift from low-value, redundant work to high-value, strategic services - enabling firms and individuals alike to re-imagine their future. Successful practitioners continue to transform their legacy firms from heavy compliance (tax, audit and write-up) work to high impact consulting – providing deep insights beyond the debits and credits, positioning themselves as highly valued, strategic business partners with their clients and within their organizations. But this transformation is placing pressure on hiring and training new resources. Competition for qualified candidates is heating up, while the number of individuals entering the profession is limited. Firms will be increasingly challenged to identify, hire and retain essential, next-generation talent.
— David Cieslak, EVP, chief cloud officer, RKL eSolutions LLC
The volume, quality and diversity of our CPA talent and pipeline. Making sure we have the volume we need to serve the public and the market, that those professionals have the skills and competencies, and that our talent matches our country’s complexion.
— Sue Coffey, CEO, public accounting, Association of International Certified Professional Accountants
Almost overnight, the profession had to significantly change how business is conducted to respond to the effects of the COVID-19 pandemic. Companies and accounting firms continue to deal with staffing and other resource constraints. On the positive side, it has challenged the profession to think differently by embracing change and utilizing technology to attract and retain future talent.
— Susan Cosper, member, FASB; FASB board liaison to the Private Company Council
I am always talking with CPAs. By far the biggest issue that keeps coming up is the challenge of attracting and retaining good employees. CPAs are competing not only with other accounting firms for talent, but also with companies outside the accounting profession. One thing the pandemic taught us is that geographic location is no longer a barrier to hiring, and that cuts both ways.
It’s also never been more important to make your firm “employee-centric.” With many firms, including the Top 4 firms, allowing full-time employees to work remotely will be an important way to differentiate themselves from the crowd. If you concentrate on making your firm a fun, rewarding, flexible, inclusive environment, you will have a better chance of attracting and retaining the best people. By creating that type of work environment, firms will also find it easier to make client results a shared goal among all team members.
— Randy Crabtree, co-founder, Tri-Merit Specialty Tax Professionals
Everyone knows staffing is the most critical current issue. But the bigger issue is lack of strategic future-think, due to lack of bandwidth. It’s a perfect time for competitive players to infiltrate and leave us with nothing but compliance work, while they grab the more lucrative non-compliance market opportunities.
— Gale Crosley, president and founder, Crosely+Co.
Massive numbers of baby boomers retiring, the Covid driven great resignation (or migration), and according to the AICPA 30% fewer accounting graduates last year has created a major staffing challenge across the entire profession. Many firms are seeing significant turnover and having problems recruiting high quality qualified people. That combined with the need for staff that can successfully manage emerging technologies like AI, RPA, and cloud applications is both limiting growth and negatively impacting client satisfaction. Finding and retaining talent is critically important now, in addition to developing future leaders of firms and our entire profession. Like Covid, this situation is unprecedented and will require major changes in the way that we engage the next generation of accounting professionals to successfully address this issue.
— Kevin Cumley, senior director, Sage Intacct Accountants Program, Sage
Climate.
— Kevin Dancey, CEO, International Federation of Accountants
According to a recent study conducted at Howard University, “approximately 4% of new hires at CPA firms are African-American graduates, and approximately 75% of all CPAs are Caucasian.” Therefore, diversity and inclusion is an important issue that is currently facing the accounting profession. According to a study conducted by the University of North Dakota, “Diversity provides a broader pool of applicants and talent. Furthermore, employees working for organizations with high levels of diversity are 7% more likely to stay with their employers than employees working for organizations with low diversity levels. Diversity also results in 19% higher innovation revenue when compared to companies with below-average leadership diversity” (Goldberg 2019) Aside from the statistics reported here, diversity leads to improved decision-making as a result of different ideas that are generated from various perspectives that are influenced by various aspects with each person’s culture. There is a need for diversity, so how can we as a profession, get there?
— Alicia Davis, CEO, Davis Tax Consulting & Financial Services
In my view, the accounting profession must deal with the growing challenge of the talent pipeline serving the compliance, security, and risk sectors. As technology is outpacing regulations and compliance, companies are struggling to find the brain power necessary to keep up—specifically, we need personnel who are well-rounded and understand the accounting, technical, legal, and compliance complexity as well as the impact to the business. Clients are overwhelmingly becoming technological companies – look at Tesla, who, these days, is much more than an automobile manufacturer, or GE, who now connects previously simple refrigerators and microwaves through the Internet of Things. Clearly, as organizations continue to transition and expand their technological capabilities, the data management and safeguarding aspect that can impact financial accounting and internal controls will need to be a top priority going forward, as will the relevant human element serving such; however, the talent pipeline is not full, and you can’t hire what isn’t out there. I said it before that this has been on my radar for a while, and we all really do need to react.
— Avani Desai, CEO, Schellman
The professions mental health and business model. People are leaving in droves. I can’t go a week without hearing about someone else leaving the profession because of the working hours and demand. Even with all that firms are doing, getting past the mindset of a 2400 hour year isn’t going to cut it.
— Sarah Dobek, president and founder, Inovautus Consulting
The global pandemic has highlighted challenges that already existed – our deep, human longing for more meaning and connection in our lives. The physical disconnection has highlighted a disconnection that we’ve felt for many years before the pandemic – a disconnection from not only one another but from our true selves.
The traditional accounting model (and most business models in general) is based on outdated notions of “human productivity,” where our value is measured by the hours we put in, our output and increases to the bottom line. We are not machines, and profit is not purpose. We must find and reconnect with that which makes us human – purpose, meaning, creativity, and connection. We must take better care of ourselves, so we don’t sacrifice our own well-being for the sake of another dollar. We must release the pressure, take more risks with each another and let go of trying to get it all right or perfect. We must seek to understand one another as human beings, rather than workhorses or profit centers. Only then can we create a true sense of belonging and purpose in this profession. If we can’t, people will leave to find it elsewhere.
— Sarah Elliott, co-founder and principal, Intend2Lead
I believe the most important challenges facing the tax and accounting profession continue to be elevating the value it brings to clients and businesses and building a pipeline of diverse talent for the future. Our recent market research study (second half of 2021) shows the top challenge toward advancing D&I within their organization remains the limited pipeline for top talent with more than half of accounting firm respondents selecting that reason.
As businesses have become more dynamic and global, their tax and accounting needs have become more complex. In addition, changes in laws, regulations, and reporting requirements have accelerated this growing complexity. To provide real value to clients, the accounting profession needs to leverage new technologies and bring new skills to the table, such as coding and database querying. The profession needs to be thinking about where they can automate repetitive tasks and eliminate low-value ones, while upskilling their talent, so more time is spent on informing clients and business stakeholders of key considerations and implications of their decisions. I believe this evolution in focus will empower tax and accounting professionals to deliver greater value and will ultimately make accounting a more attractive career option for students. This is key as we are facing a record shortfall in the pipeline of students majoring in accounting in colleges and universities. We need to get creative on a grand scale in driving awareness of the accounting profession in high schools and make sure accounting is offered in the curriculum like it was at my high school. But it doesn’t stop with recruiting, we also need to do a better job of retaining diverse talent by investing in their professional development and leveraging their new ideas and approaches, so they can lead us into this new frontier for the profession.
— Lisa Fitzpatrick, president, Bloomberg Tax & Accounting
CPA firms are facing a monumental reckoning: The need to fast track digital transformation this past year, the influx of new laws and regulations, and unexpected phenomena like the Great Resignation call into question whether the traditional business model still makes sense. Our recent study on marketing budget benchmarking shows firms that weathered the past year’s perfect storm had quickly introduced new, lucrative services, such as Paycheck Protection Program assistance, and kept their audience engaged through digital techniques.
The question is, are other accounting firms similarly focused and equipped to stay relevant?
— Lee Frederiksen, managing partner, Hinge
It is the same issue we’ve continued to face for many decades – creating a more diverse, inclusive and equitable profession. More diversity of thought and an inclusive environment allows professional service firms to better serve a diverse client base, foster innovation, deepen our commitment to the communities in which we live and work and more importantly attract more people to the profession. As the profession continues to work to create a sustainable and robust future, finding and retaining qualified staff is consistently among the top issues facing CPA firms of every size segment and among businesses that employ accounting professionals. Ultimately, we need to encourage and entice more young adults of all backgrounds to pursue careers in accounting. We need to help them to see how a career in accounting can have purpose and provide work/life balance and to help them see a clear career path. It is incumbent on everyone in the profession to do what we can to reignite the passion and clearly demonstrate what brought us all to the profession we love.
— Herschel Frierson, chairman of the board of directors, National Association of Black Accountants
I believe that we are facing a talent shortage that is unlike any other I have seen in my career. We have such a strong value proposition yet we are seeing young people not choose our profession because they don’t really understand the entirety of a CPA’s career possibilities. We can make an impact through more involvement by CPAs in their local high schools, community colleges and universities. This is also a key to our focus on increasing the diversity within the profession, which I think is critical for the long-term. Firms and businesses have an important part to play by focusing on improving equity, inclusion and belonging among under-represented groups in their organizations.
— Tracey Golden, immediate past chair, AICPA and Association of International Certified Professionals
The most important issue currently facing the accounting profession is related to the ongoing evolution of how the profession services its clients. Central to this is defining who the “client of the future” is and what services they will need. The days of an accountant only performing services such as tax or attestation are over. It is imperative that an accountant be knowledgeable on topics such as technology implementations, data analytics, cannabis and cryptocurrency in order to better serve their clients. CPA’s have been termed the “trusted advisor,” but the industry needs to understand that the term means something different now than it did in prior generations.
— Zachary Gordon, senior manager, accounting services, cannabis, Grassi
COVID-19 – and the ongoing uncertainty caused by variants – continues to challenge the U.S. and countries around the world. Looking back at the past 18 months, despite the economic uncertainty and unprecedented disruption in business operations, companies and boards have continued to deliver transparent financial reporting. Additionally, audit teams have risen to the challenge and have continued to evolve, fulfilling their commitment to deliver high-quality audits and serve the public interest.
Looking ahead, we need to invest in the future of the profession. We have a unique opportunity to reimagine how we tell the story of our profession, because the work we do is incredibly meaningful. We must focus on how we can help make the accounting profession an attractive destination for college students – and do what we can to remove barriers to entering it.
If there are any impediments blocking the pathway into the accounting profession, and perhaps, limiting diversity, we need to transcend those roadblocks and focus on access. At EY, we staff our audits with diverse teams and at times also leverage the skills of the individuals in our Neuro-Diverse Centers of Excellence. We also sponsor various employee resource groups that provide opportunities for all of our professionals to form a community. In fact, in our latest survey, 87 percent of our US auditors said they feel included and supported by the people they work with every day – which means that while we are on the right path, there is still work to be done across the profession.
Today, individuals seek out organizations whose values align with their own personal values. It is incredibly important to continue to be very explicit about what we stand for – trust, transparency, and more. At EY, trust is the foundation of our business, and we hardwire trust and transparency into everything we do – which is why we’re leading the evolution of the audit process using technologies that give us the ability to analyze full populations of data expeditiously. Over the past five years, this adoption of a data-driven audit approach has been a significant driver of audit quality, and has transformed how we approach the planning, execution, and conclusion elements of the audit process as we continue to invest in new technologies to advance audit quality. I believe this focus on digital transformation, the implementation of AI, and the upskilling of our people to keep pace with change will continue to be critical as the profession continues to adapt and evolve.
Similarly, it's imperative that we build the future of the profession with the foundational principles of trust and transparency to ensure that businesses are operating with integrity, which we will need to continue to apply as new financial and non-financial disclosures require. This commitment across the profession will ultimately allow us to fulfill our top responsibility as independent auditors: to perform globally consistent, high-quality audits that promote trust and confidence in the capital markets.
— Kelly Grier, U.S. chair and managing partner and Americas managing partner, EY
The pending tax reform.
— Julio Gonzalez, CEO, Engineered Tax Services Inc.
Automation.
— Eric Green, founder, Tax Rep Network
Business model changes are imperative currently due to several factors. These include the following:
- The staffing shortage (now known to some as The Great Resignation). Firms must reinvent the way they recruit, train, mentor and retain team members. What once worked well no longer works. The pandemic has created more stress and frustration than before on top of an already stretched staff. People want different things now, and we must make this profession as attractive and rewarding as team members view other disciplines. We must also begin to look beyond traditional CPAs and recruit consultants, data analysts and other professionals who can greatly contribute to servicing clients. This is a tremendous opportunity. Work-life balance and virtual work arrangements are not enough.
- Client needs have changed, and the requirements are significant. Additional skillsets, offerings, and relationships are mandatory for firm growth. Many have been focused on this before now, and the pandemic put this initiative in overdrive. The Cares Act and work accountants did to keep their clients afloat during the pandemic highlighted that we, as a profession, are ideally suited to be the Most Trusted Advisor, a problem-solver, a partner with our clients as they navigate a challenging and competitive business environment. The time is now. Professionals are starting to believe in this opportunity as their clients have been thanking them for their help and commenting on how they could not have survived the year without the counsel of their CPAs and advisors.
- Pricing, relationship structure/packaging, billing, and operational changes are needed to fit the new environment. Examples of this include value billing, project billing and the move from a sole focus of the billable hour. How we go to market and structure relationships needs to be evaluated. The expectations for billable hours of staff and total hours need to be reconsidered. An advisory firm is ideally run differently than a compliance firm as the metrics used to evaluate success do not work in the same way.
These are a few examples that all come down to reassessing the existing model of the accounting firms. The pandemic has created many challenges, yet where there are challenges, we can also find opportunities. Firms that are agile and open-minded and, innovative are positioned for great success now and into the future.
— Angie Grissom, owner, chief relationship officer, The Rainmaker Companies
Attracting and retaining talent.
— Thomas Groskopf, technical director, AICPA Center for Plain English Accounting
The accounting profession is in the process of standing up a global reporting system for sustainability reporting. This process has many moving parts, interrelationships, and key decision makers. For accountants to effectively play a crucial and much needed role in helping to solve the climate crisis and other pressing sustainability issues, this system needs to be effective and interoperable. And we don’t have 20 years to wait for the system to work out the kinks.
— Jeffrey Hales, chair, SASB, Value Reporting Foundation
What did we learn during the pandemic about what our clients really value in what we do? Will we remember what we learned and continue to operate that way even if we are not forced to do so by a pandemic? Or will we return to a comfort zone of our past? We must learn from our past but not be stuck in the past.
— Roger Harris, president, Padgett Business Services
While there are several tough issues, the talent shortage/struggle is the most important one from my perspective. Some may point to rapid regulation changes, I believe it is the constant resource pressure which accentuates that pain. The talent shortage is also leading to churn across firms. This makes building deeper clients all the more difficult and is resulting in what many firms say is overpaying for middle – tier talent. The other element which makes this such a critical issue is the average age of firm leadership – leaving fewer choices for succession planning.
— Will Hill, customer proposition strategy lead, Thomson Reuters
Finding and retaining talent is without a doubt the most important issue.
— Tom Hood, EVP business engagement and growth, AICPA-CIMA
The most important issue currently facing the accounting profession is firms needing to transform their business models. Most of the dangers firms facetoday can all be rolled up into their business model. The firms that are, and will be, in a position of strength in the marketplace are actively transforming how they do business and create value for their clients. Among other things, a firm’s business model includes developing a shared vision and strategy, evolving partner compensation,creating new services that are packaged, priced and delivered based on value, hiring and developing new roles and pursuing excellence in the five areas critical to their success: leadership, talent, growth, process and technology.
— Jon Hubbard, shareholder and consultant, Boomer Consulting
As previously stated, the most important issue facing the profession is the lack of diversity. This inadvertently fosters exclusive working environments and a lack of equity throughout the profession. As the world becomes smaller, those who work in the profession must reflect the communities they serve and be inclusive and equitable in opportunity. IMA and CalCPA’s study revealed that less than half of accountants (48%) believe the profession is equitable, while 43 to 55% of female, nonwhite and LGBTQIA respondents said they have left an accounting firm because they saw a lack of equitable treatment, with at least 30% leaving due to a perceived lack of inclusion.
— Darryl Jackson, director of diversity, equity and inclusion, Institute of Management Accountants
Stress and exhaustion from a never-ending tax season the past 2 years. In the midst of this there has been some of the best adoption of cloud technologies which has fueled some new aspects of potential growth.
— Caleb Jenkins, leader, client accounting services, RLJ Financial Services
Capacity. We hear it time and again, and yet firms have been slow to adopt new technologies that automate repetitive tasks. The profession has more stressors, higher demand and a war for talent going on – my hope is that during these important strategy planning months, we see greater adoption of key AI solutions.
— Kacee Johnson, senior director, strategy & innovation, CPA.com
The most important issue is retaining team members and finding sufficient new talent. In this year of the great retirement and the great resignation, personnel strategies like those from Steve Cadigan in Workquake will need to be implemented in professional firms. While not the norm, remote work accelerated, and accounting professionals discovered they could effectively work from anywhere. It is also clear that three years of extraordinary stress in the profession from TCJA, PPP, and PPP2 is wearing professionals down. This stress is likely to continue in 2022 with the probable and pending tax changes.
Clients need guidance from the profitable, long-term set of Advisory service offerings from their CPA firm. The profession is still struggling to create and deliver Advisory Services and Client Accounting Services (CAS). We expect automation to put fee pressure on the compliance work of tax, audit, and CAS. Further, new support programs have enabled younger CPAs who want to work in the Advisory Services area to deliver services like they have more years of experience.
— Randy Johnston, CEO and founder, EVP, NMGI and K2 Enterprises
Finding the balance between the financial statement user’s desire for more granular information with the costs of providing it.
— Richard Jones, chair, FASB
The shift from purely providing compliance support, to embracing technology and automation, and transitioning to advisory roles is by far, the most important issue currently facing the accounting profession. In just the past two years, we’ve seen so many tax legislation changes and never-before-seen relief programs, all while a record number of businesses were started in the U.S. There’s no doubt that compliance work is here to stay, but where clients truly need us, is in the advisory lane. As accountants, artificial intelligence seems to be playing a larger role than ever in our more routine tasks, and we can either fear it, or accept it so that we can use it to create capacity to do the things that carry the most value to our clients (and create the most flexibility for team members and clients alike).
— Al-Nesha Jones-Holiday
Trust. The world is changing at a pace unlike anything we’ve experienced before. And companies are tackling new and important challenges, specifically the need for them to build trust with their stakeholders and to deliver better, sustained
outcomes. And trust in accounting, whether it be audit quality, tax reporting (or more!), is table stakes. And we can’t take our eye off this because the profession is the backbone for many organizations and is relied upon by the end-user of much of the information that crosses our desks.
Gaining and maintaining trust will be a critical success factor for virtually every organization. This is true whether they’re focused on audit work, ESG, data privacy, cybersecurity, tax controversy, diversity and inclusion, disruption or looking for financial results over a short- or longer-term period. Remember - market participants are entitled to the same quality of non-financial information as they currently expect from financial disclosures.
Companies that fail to put in place the processes that build trust will not win the buy-in from stakeholders that is necessary to deliver outcomes.
— Kathryn Kaminsky, vice chair, U.S. trust solutions co-leader, PwC US
IRS service detriments are imperiling the tax system. IRS leadership did an amazing job pivoting when faced with a once-in-a-lifetime COVID crisis they experienced in 2020. However, as we all know, despite its great efforts, service levels tanked. In 2016, when we believed IRS service levels had hit rock bottom, the AICPA’s annual survey of tax practitioners’ experiences with IRS service levels indicated that 21% of CPAs were satisfied with IRS. The satisfaction rate nudged up through 2019, hit a COVID wall in 2020, and is now at an all-time low at 10% satisfied.
Changes are necessary. We have advocated for changes to the penalty abatement process, and alignment of the timing of compliance actions with the time it takes to open mail and update the Master File. These steps would make a measurable short-term difference. From a longer-term perspective, smart implementation of Taxpayer First Act changes could set the agency up for success.
— Edward Karl, vice president, tax policy and advocacy, AICPA
Staffing is consistently the biggest complaint, with significant partner time being spent trying to figure out how to run and manage the “Next Normal” work environment which is being exasperated by the uncertainty of when the “post-COVID” recovery period will begin. Many firms had difficulty with management and accountability when everyone was in the office and they are not doing better now that many are permanently virtual.
— Roman Kepczyk, director, firm technology strategy, Right Networks
Its inability to find and keep great people. Why in God’s name would any smart and sane college graduate want to account for every six minutes of their day.
— Ed Kless, senior director of partner development and strategy, Sage
Continuing to instill trust with stakeholders by demonstrating extraordinary integrity, professionalism and quality. These tenets are foundational to succeed in our business. Today, how we increase the use of technology, build quality into all that we do, and reimagine how we work and develop talent are essential as we think about the future of the profession in the context of rapid digitization and the rise of ESG. It’s also impossible to separate those focuses from the imperative of advancing diversity, equity and inclusion within our firm and the profession.
— Paul Knopp, U.S. chair and CEO, KPMG LLP
War on talent – simply stated, firms should never be in a position where they can’t grow because talent is the limiting factor.
— Allan Koltin, CEO, Koltin Consulting Group Inc.
In the most immediate sense, flex work and return to office issues. Firms are trying to double down on office use and it isn’t necessary. This will have longer term effects, but in the short term, there’s going to be staffing issues even worse when firms continue to create mandates.
Longer term, firm governance and the business model changing is the largest issues. You are seeing PE money come in because it offers firms a different way to attract talent and be ready for the future. The idea of moving from a partnership to corporate model isn’t new, nor is it unique to CPA firms. The PE push will make for an interesting model going forward.
— Mark Koziel, president & CEO, Allinial Global
An acute staffing shortage impacting all aspects of firm operations from workflow to profitability. Further, the staffing shortage creates additional pressure on fragile succession plans
— Art Kuesel, president and founder, Kuesel Consulting
We have fewer people entering our profession because it is not seen as a progressive industry to work in. There is more data in every business today, more need for transparency, more opportunity for important financial insights - so every indicator shows that accountants have a huge role to play within the business community. But the profession’s slow move to progress is not attractive to a modern workforce and we are not doing a good enough job of showing the value of being an accountant in terms of career growth and healthy lifestyle. We have to show that we are a profession of knowledge workers otherwise we are going to continue facing a continued shortage of talent that can ultimately lead to decline in relevancy of accountants.
— Kenji Kuramoto, CEO and founder, Acuity
Leadership! Do we have leaders in our industry who are truly bringing us forward at the pace we need to go? I am not sure. I do hold out so much hope for our future.
We need leadership that can help us create inclusive cultures where there is a real sense of belonging by everyone. We are going through times of both massive change and uncertainty. We need leaders that can increase the conversational capacity of the people around them by holding conflict and embracing paradox.
Our industry is not inclusive at the executive level. The numbers do not lie. Until we can both encourage, embrace, challenge, and support a wider range of candidates for leadership positions, we fall short of attracting the diversified leadership we need to move our industry forward. For example, when African Americans only make up 1% of the CPA group, we are missing out on needed leadership influence. We need leadership to create a vision of a better future where our inclusivity turn the industry into a growing and thriving one.
— Brian Kush, principal, co-founder, Intend2Lead
We recently polled 600 accountants and bookkeepers on that exact question, and there was a very clear answer: keeping up with demand. This has proven even harder as the industry reimagines how and where work is done. Accountants’ value to their clients has increased far beyond keeping track of debits and credits. As clients seek more advisory and tech-enabled services, accountants need to invest in growth, from adding new services to investing in data analytics and automation, but at the end of the day it also comes down to talent and building a future-focused team with diverse skill sets.
— René Lacerte, CEO and founder, Bill.com
Relevance.
New business models are appearing in the profession (ex: Pilot, QuickBooks Live, etc) that are tuned in to what clients are looking for in the digital age, namely, a seamless, easy, quick accounting experience. The profession needs to adapt to changes in consumer sentiment, needs and desires in order to continue to serve and protect the public.
— Ryan Lazanis, founder, Future Firm
The most important issue in the accounting profession is the widening technology gap between digital immigrants (those who had to learn how to use technology later in their career) and digital natives (those who grew up with technology and have never known life without it). Digital immigrants must spend more resources — including their own time — to learn how to implement tech in their firms. But where do you learn to understand it? It's not in a classroom since it's moving too quickly. Technology vendors create training, but even that is not enough.
Technology is often best understood by junior staff. Sadly, pride often gets in the way of reverse mentoring in areas like tech implementation and process improvement (including robotic process automation). Further compounding the issue is that, on average, accounting firm partners are aging and opting not to retire — without ushering in a pipeline of younger talent to share their perspectives and expertise.
Firms, often lagging behind the pace of change, face new challenges, including attracting top talent, especially in an increasingly remote-friendly workplace. The decision by recent graduates on where to go after college often comes down to the tech-savviness of their prospective employer. Even the candidate's perception of the profession drives many not to get licensed or choose a different career path entirely.
To attract and retain talent, the industry must be willing to accept that adopting tech is worthwhile and necessary. The profession can’t continue to be seen with the same outdated stereotypes and must keep up. Survival of the profession depends on it.
— Megan Lewczyk, owner, Megan D Lewczyk, CPA
Staffing is the go-to answer, but the driver impacting staffing is the lack of the profession to embrace the advisory services sector and the growing gap in admitting equity partners. The price tag to partnership is getting too steep. Many younger professionals do not see their firms moving quickly enough into advisory. While compliance is a critical need, it suffers from the potential to being viewed as a commodity which makes it subject to fee sensitivity.
— Bob Lewis, president, The Visionary Group
Leaning into the future is critical to maintaining high-quality performance by US public company auditors and earning capital market stakeholder trust. First, continuing to invest in new technologies that improve data analytics and machine-learning so that audits return even more valuable information on public companies to capital market stakeholders. Second, the profession can play an important role in bringing the same confidence-enhancing results it delivers for financial-related statements to evolving investor demands on issues like climate, diversity, and governance. Finally, as our country continues to diversify, the profession can make itself stronger and even more able to deliver high-quality audits by increasing representation of underrepresented employees at all levels.
— Julie Bell Lindsay, executive director, CAQ
The audit profession is undergoing intensive scrutiny and regulatory reform in many jurisdictions across the world. What sounds good may not be practical and we all need to play our part in helping regulators understand what we do and just how important it is that we are allowed to continue to do it properly.
— Samantha Louis, CEO, Praxity Global Alliance
Technology.
— Taylor Macdonald, SVP, channels, Sage Intacct
Hyper-speed change and radical transformation of the business models and assumptions that have driven the profession for decades are a tsunami sweeping over us. Auditing, consulting services, standards themselves all have to adjust for an environment in which digital channels and processes require new ways of working and providing assurance. Employment models and pipeline shifts are intersecting and creating cross currents that will force firms and other entities to change hiring strategies and career opportunities.
— Janice Maiman, EVP – reputation and external affairs, AICPA
While not as catastrophic as originally forecast, the lockdown measures sparked by COVID-19 negatively impacted economies of just about every country across the globe. For example, the U.S. projects a $7 trillion tax gap over the next decade - an increase of 1,067% over 2019. As a result, the world’s tax authorities are doubling down on tax enforcement to make up for revenue shortfalls.
One of the reasons that the pandemic was not completely devastating from a tax revenue perspective was the expansion of the digital economy coupled with the expanded ability of governments to tax transactions taking place over the internet. Globally, regulatory authorities have embraced the digitization of tax and have incorporated technology into their compliance processes, in some cases eliminating the traditional tax return. I think the United States has just started this digital journey and we are definitely at an inflection point for both businesses and taxpayers.
- Businesses - need to acknowledge that their tax compliance obligation has expanded, and will be forever changing and evolving, and the only way to keep up is through the thoughtful and comprehensive adoption of technology solutions. This evolution is also forcing IT and accounting departments to work together - often for the first time - to ensure an indirect tax compliance strategy is created.
- State Governments - don’t have to copy the policies adopted by our global brethren, but they would do well to learn how other countries have made tax compliance in the modern era digital, comprehensive, and equitable.This shift will change what’s expected of accounting departments, and those in the profession need to be able to understand its implications. U.S. state and local tax compliance and enforcement will need to change.
— Charles Maniace, vice president, regulatory analysis & design, Sovos
While many might feel that the most important issue currently facing the accounting profession is the reduction in the number of people sitting for the CPA exam, the ongoing issues surrounding cyber security remains paramount. One scary aspect of cyber breaches is that the practitioner might never realize a security compromise for several years.
I have participated on the IRS Practitioner Group of the Security Summit since its inception. We have been trying to get the practitioner community to focus on this topic, yet many still feel that their practice is too small for the hackers to care; unfortunately, the opposite is often the case as these firms might be easy pickings.
Throughout the Covid-19 pandemic, I have been stressing to as many practitioners as possible that they need to take extra steps to secure their systems when operating remotely. This includes stronger passwords for routers and having dedicated laptops for accessing firm servers.
— Stephen Mankowski, co-chair, National Tax Policy Committee, NCCPAP
Succession. Multiple studies have put the average age of accounting firm partners in the mid to late 50’s and many of these partners will be seeking retirement and the transition of their businesses over the next decade. In addition, recent reports show that more than half of U.S. small business owners are over the age of 55 and will be facing similar issues that will require guidance and counselling from accounting and financial professionals.
— Gene Marks, president, The Marks Group
Creating a sustainable way to attract and retain people in the accounting profession, particularly in public accounting while simultaneously keeping up with the continual state of change.
— Damien Martin, partner, BKD CPAs & Advisors
The most important issue currently facing the accounting profession is the need for firms to shift from transactional compliance services to higher valued advisory services. We are at the intersection of rapid technology advancement, expanding software capabilities and fast changing legislation. Advance technologies empower accountants by reducing manual data entry, improving accuracy, speed and data quality. Firms need to think about how they leverage advanced technology tools to drive both efficiencies internally and enhance client connections.
— Jason Marx, president & CEO, Tax & Accounting North America, Wolters Kluwer
Crypto transaction data is inherently more complex than traditional data and has evolved for over a decade in absence of standard setters and rule makers until recently. It requires unique solutions to support the many complexities of crypto, such as decimal place precision, inconsistent ticker symbols, and circumstances that require traditional methodologies to be challenged and in many cases redesigned.
— Robert Materazzi, CEO, Lukka
The most important issue is staff training, retention and work conditions. Diversity and inclusion has risen highly in this category, but in my opinion recruitment and retention will be boosted by a change in the overall working conditions. It is understandable that tax or busy season hours will be high, but many firms have extended those seasons and also have set higher weekly requirements for the non-busy periods. The burden of this on a sensible work/life balance is borne by the numbers that leave the profession, and the disproportionately high amount of women accountants that leave. The issue of lower numbers of women partners is not a gender-discrimination issue, it is a work/life balance issue [for men and women] that the profession as a whole seems to be blind to, using excuses and rationale from more than a half century ago. The people going into accounting haven’t changed – the work/life balance circumstances have gotten worse and continues on that track. Much more women than men simply refuse to subject themselves to these conditions. Stronger and more directed efforts need to be focused on recruiting members of minority groups who have not been culturally exposed to public accountants or even entrepreneurs. This is starting to be recognized but I believe some of these programs need to be accelerated.
— Ed Mendlowitz, emeritus partner, WithumSmith+Brown
The looming potential talent shortage, and the staffing challenges it creates for the profession is the issue I hear most when speaking with firms. CPA Evolution is mitigating some of the risks associated with this threat and firms are also finding solutions in leveraging an augmentation strategy with artificial intelligence to address some of the challenges of staffing shortages. This is also where the opportunity for non-traditional emerging services have the opportunity to attract and retain a diverse workforce for the profession with a variety of backgrounds and skill sets.
— Kalil Merhib, VP, sales and client services, CPA.com
While the evolution of the role of accounting professionals was underway well before COVID-19, the pandemic accelerated the needs and expectations of business owners. No longer are accountants simply tasked with managing a business’s books. Their clients now come to them with questions about technology and processes, looking for insights and ideas on how to grow their businesses and be more financially stable and prosperous. Understanding that the future – and the present – of the accounting industry is advisory, accountants now must think about how they can help their clients succeed, operationally, technologically, and financially. And that’s where we like to focus - helping accountants grow and scale.
— Ariege Misherghi, VP expert segment leader, small business self-employed group, Intuit
I believe the biggest challenge continues to be the need for firms to move from transactional to advisory in order to remain relevant to both clients and staff. Younger staff are leaving firms that feel stale and “out of touch” and innovative clients are seeking advisors who can help them beyond the traditional compliance services. If firms do not embrace this change, they will continue to find themselves in the talent war for many years to come and will quickly see their growth dwindle to nothing. The reality is that we are competing with non-CPA firms now, too. Firms need to accept this as a reality and look to what they need to
offer to stay competitive and relevant. We need to embrace the “what got you here, will not get you there” mentality.
— Adelaide Ness, chief learning officer, The Rainmaker Companies
Among firms of all sizes, the biggest challenge continues to be finding and retaining qualified staff. Those applying to entry-level positions are often completely unprepared to work in a firm, and firms struggle to fill in the gaps in their education. Who is responsible for this? Look to the universities, and the curriculum as defined by the CPA Exam. College accounting programs must more quickly adapt to the changing role of accountants and the increasing importance of technology. Otherwise firms will continue to look further afield to find qualified candidates, and accounting degrees and the CPA license will lose relevance.
— Blake Oliver, founder & CEO, Earmark
Competition from VC-funded “accounting”companies and private equity purchasing traditional firms. I don’t think the average practitioner understands the impact this capital will have on how everyday consumers will purchase and consume accounting services. Not to mention the competition for both customers and talent. Lot’s of capital is coming into our space that will improve, change and accelerate a firm's ability to adapt to a more customer centric, efficient and effective organization. Those without capital or those who chose to not reinvest in their firms to automate and upgrade their systems and processes will be left behind. Unfortunately, firms are very profitable today and really busy so it’s hard for them to see and understand the need for radical change.
— Jody Padar, vice president of partner development & strategy, Botkeeper
The great resignation. Or call it the great opportunity for smart firms to attract great talent from anywhere, AND, call it a great escape by breaking away - from the offices-overheads-overwhelms associated with traditional ways of how firms functioned – to facilitative-flexible-freedom driven future - to uncover-unlock-unleash new value to reform the very business models of accounting firms.
The urge to go “back to the normal” can be so overwhelming that accounting firms can easily miss the tell-tale, clear signal of the times – that people have experienced, very closely, the new definition of what life-work a(not work-life) balance means. Pandemic forced people to work from their homes, and more importantly, the sheer survival threat gave them a much deeper understanding of what really matters to their lives. It can be as simple as being able to physically see their loved ones all day while working from their homes. Such experiences have given people a deeper understanding – and new definitions – of what they truly value in their lives.
If for all these years “life” existed “alongside work”, now people know “work can exist alongside life”.
Being able to work from anywhere and yet producing the same or even better results from their work, people need that flexibility to produce the results expected of them, without having to adhere to structures that were assumed to help produce those results. The profession is largely driven by the laws governing business and the deadlines which makes it impossible to avoid peak workloads jammed in some periods of the year. It is therefore all the more important, to at least, provide people the flexibility to let them produce work while they live their life. If not done, the real talent, which is always in short supply, will go to competition within and outside the profession. And irrespective of what the promises of technological advances are, it is the talent that generates new accomplishments from technology. Hence, anyone who believes technology can help overcome talent shortage needs to review one’s definition of what talent is.
For smart firms, this is actually a huge opportunity to attract great talent that is looking for a better professional experience not bound by traditional work-life balance definitions, and for unlocking the true value of professional satisfaction and fulfillment that comes from being able to better help clients survive and thrive.
— Hitendra Patil, head of customer success, AccountantsWorld
Last year, I said it was keeping the pipeline of new CPAs full and keeping the profession focused on the future. Those are even more important today.
— Carl Peterson, VP, small firm interests, Association of International Certified Professional Accountants
First, the accounting profession, like most professions, is struggling to get young people to become accountants. There is tremendous competition for college graduates and there are lots of alternative professions. Second, the last and the current administrations are very tax policy centric. Keeping up with what federal tax changes that might be enacted is critical and complicated. Clients are constantly looking to advice on how to react to real or possible tax changes. Third, state governments are very active in discussions about changes to their own taxes. State and local taxes are often a very significant part of a client’s tax burden.
— Scott Peterson, VP, U.S. tax policy and government relations, Avalara
I worry there are not enough buyers to take over all the firms being sold by retiring baby boomers. We risk losing the local / small firm if we don’t create more supply of small firm entrepreneurs.
— Jeff Phillips, CEO, Padgett Business Services
Pipeline and future capacity in light of shrinking college enrollments and the great resignation. DE&I and the evolving business model of the profession are also at the top of mind.
— William Pirolli, chair, AICPA; co-chair, Association of International Certified Professional Accountants
Staffing issues are going to be the biggest driver of change in the profession in the immediate term. Staff scarcity is currently forcing fast adoption of new technology, and cultural change within firms. Coupled together, these pack a powerful force for rapid change. We are seeing firms with remote teams, hybrid work arrangements and automation of routine tasks with cloud-based applications. While some of this is motivated solely by better technology, many firms are initiating these new ways of doing business in order to meet staffing requirements.
— Brannon Poe, founder, Poe Group Advisors
Talent is the issue that has eclipsed almost everything else in the business world. The so-called ‘great resignation’ and ‘war for talent’ have stressed the accounting profession to the point where current leverage models are decreasingly viable. Further, we continue to struggle to attract young professionals into the field, especially those from Black and Latinx communities.
Talented people will always be the lifeblood of a professional services firm, and the past year has taught us that people want something different from their employers. They want flexibility, balance and jobs that are personally fulfilling. I believe the accounting profession can provide these things and continue to thrive. We can be the forward-thinking innovators that our clients need and our people want.
Just look at remote work and new models for flexibility. At Grant Thornton, we have learned that with the right support, our people can serve our clients with excellence from anywhere. This is why Grant Thornton created a flexible work policy that delivers exceptional results without requiring attendance in our offices or at client sites for many business situations.
— Bradley Preber, CEO, Grant Thornton LLP
The most important issue facing the profession is the shift in business dynamics – after decades of focusing solely on financial measures, the future is non-financial; it’s human capital, ESG, etc. Our profession must ensure we have the skills to lead in these spaces. The addition of non-financial measures also requires us to stay on top of rapidly-evolving advocacy issues. The regulations and guidelines for these non-financial measures are currently being developed and we must ensure our profession has a seat at the table when crafting the framework around these measures.
— Anthony Pugliese, president and CEO, Institute of Internal Auditors
The most frequent source of pain for many CPA firms right now is accessing the talent necessary to provide services,followed closely by partner succession. However, the biggest issue facing the profession are the profound changes that are occurring and will happen due to technology, the changing economic environment, andcompetition from outside the profession. Many firms are not positioned well to adapt.
— Terrence Putney, CEO, Transition Advisors LLC
In our profession, the services accountants can provide are rapidly changing. We’re seeing firms offer advisory services where you might need to have a conversation with a small business client around business planning. This takes different skills than doing something like a tax return where you can follow and complete a step-by-step process. If you’re having a business planning conversation with a client, there’s more coaching involved, so soft skills around emotional intelligence and empathy are critical to how you interact and build relationships with clients. While technology is only half the equation of being able to advise and guide clients, it’s the human and technology elements combined that make the role of an advisor so powerful.
— Ben Richmond, U.S. country manager, Xero
Most urgent: Burnout and morale which is going to require firms to carefully assess their clientele to consider the longer-term cost/benefit of keeping certain customers. The sooner firms do this the better—like 2021/2 is pretty critical. Delay will dilute firms’ ability to thrive sufficiently over the next 2-3 years.
But most important: Perceived relevance with competition coming from many places/angles (consulting competition from every direction such as industry-specific resources and technology-based solutions e.g. Conservis for ag sector; AND automation/off-shore competition from big guys like Besos e.g. Pilot) are going to blindside the majority of CPA firms who aren’t watching these rising disruptions. Unfortunately most (not all) CPAs are “too busy” putting out fires (covid, staffing, etc) to do what they need to right now to avoid large-scale disruption by changing in some key ways (shifting business models, securing revenues, and carefully using/guarding resources) to best their new competition and remain highly relevant.
— Michelle Golden River, owner/president, Fore LLC
Staffing continues to be the biggest issue facing the profession, and the pandemic has only exacerbated this pain point.
— Darren Root, GM, Rootworks LLC
Keeping up with the changing regulatory complexity while still enjoying the work.
— Ric Rosario, president and CEO, CAMICO
This is one of those questions that is impossible to answer with one response. All the following are strong nominees.
- Labor shortage. Virtually all firms, especially those smaller than the Top 100 struggle mightily with an inadequate supply of good staff. Most firms under $15M don’t have enough people to get the work out, which causes them to turn away opportunities and at times, inadequately service the clients they have. This is a decades-long problem for CPAs and no letup is in sight.
- Covid may be the trigger to this next one, but the issue is remote work. Bringing in business, nurturing client relationships and developing/mentoring staff are all critically important to any firm’s success. But how can firms be effective at them when done remotely vs. face-to-face? For a hundred years, the CPA profession has achieved excellence in all areas of their practice by face-to-face communication. Firms must adapt but they don’t know how. They are learning on the fly.
- Affluence. Yes, I’m serious. The average partner at the typical, medium sized CPA firm earned $521,000 in 2020. Life is good but how long can it last when pressing issues threaten the long-term future of CPA firms: Shift from compliance to consulting, technology advances and a dire shortage of future partners are issues that most local CPA firms are ill-equipped to address. Affluence holds back firms’ efforts to address these issues passionately and proactively.
— Marc Rosenberg, president, The Rosenberg Associates
Our biggest challenge right now is a societal one — and that’s a labor shortage and a hyper-competitive market for talent in the US.
The accounting profession is not alone in facing this challenge. Every industry is being affected by a confluence of longstanding trends — including demographic shifts and record-breaking shocks to the supply of key talent, along with the impact of the COVID-19 pandemic on our economy and society. As a result, we’ve seen a change in businesses’ relationship with their employees. The pandemic has strained all of us, contributing to burnout and challenging the balance of work and personal responsibilities. Economists have reported record levels of resignations among our broader workforce.
While we can't control these trends, what we can do is listen to our people and innovate so that we provide an experience that allows us to both retain our talented people — and attract new talent to our profession. And our people are telling us they want flexibility around where and how they work.
To offer that flexibility, we’re doing something no one else in our industry has done to date. I’m proud to say that PwC is the first US professional services firm to offer client service employees the option to work virtually and live anywhere in the continental US. We will offer fully virtual roles to our client service employees (40,000), and also enable our current US client service staff to live anywhere in the continental US. If an employee opts into a virtual role, they will
primarily work virtually, unless they are occasionally needed in the office or at a client site for key events.
At the same time, we know one size doesn’t fit all. Many of our people prefer to work and collaborate in person. And we know some clients will want us back at their sites, now or in the future. That’s why our teams are preparing plans that accommodate all of this — the mix of working styles, locations and schedules — so we can deliver quality and respond to what our clients need, while offering the flexibility our people want.
These are not short-term moves. They’re intended to be ongoing options for our people. Nevertheless, we will continue to evaluate and innovate — as we do with all of our policies, benefits and flexibility. We have the people, capabilities and the technology to deliver the quality our clients expect and deserve — while meeting our clients where they want to be met.
We’ve learned a lot during the pandemic. Frankly, I think many leaders were surprised by the success possible in a virtual environment. My goal is to take the best of what we learned from this difficult time into the future — offering a differentiated experience around flexibility so we can recruit and retain great people.
— Tim Ryan, chair and senior partner, PwC US
The most critical issue facing the accounting profession is hiring and retaining talent. Companies are struggling to build a pipeline of qualified diverse talent due to biased recruiting processes and a decline in interest in the accounting field among high school and college students. Additionally, the accounting profession is being impacted by AI, which is rapidly increasing the need for accountants to upskill continuously. AI is also creating a need for more diversity among scientists, researchers, and academia to ensure new technology is equally beneficial to its users and is without bias toward those impacted by it.
— Guylaine Saint Juste, president and CEO, National Association of Black Accountants
Ensuring that the information provided to financial statements users is relevant and useful in making investment and capital allocation decisions. From a standard- setting perspective, that means continuously focusing on understanding the evolving needs of financial statement users.
— Hillary Salo, technical director, FASB; chair, Emerging Issues Task Force
The most critical issue that the accounting profession is struggling with is staffing to properly serve clients while appropriately managing risk mitigation protocols for their respective firms. The staffing issue is a direct result of many complex sub-issues creating a perfect storm for the accounting profession at this time ranging from issues encompassing the need for greater Diversity, Equity, and Inclusion programs; the baby boomer bubble bursting resulting in the loss of so many industry Thought Leaders to retirement all at once, and simply not enough newly minted accounting graduates to meet the growing demands of accounting firms of all sizes nationwide.
— Peter J. Scalise, federal tax credits & incentives practice leader for the Americas, Prager Metis CPAs
From my perspective the most important issue currently facing the accounting profession is the shortfall of resources and talent available. Firms are finding themselves continually scrambling to find top talent. This has been particularly challenging in today’s current employment market. If not resolved, the insufficiency of resources has the potential to increase risk, jeopardize quality, and distract firms from focusing on delivering value-added advisory services to their clients.
For the astute firm, this could be a catalyst for digital transformation. To overcome this issue, a progressive firm can focus on automating task-oriented roles, introducing intelligent automation solutions such as AI, ML, and RPA, to augment their professionals technologically with information to accelerate the production of their compliance work product. By moving in this direction, a firm will be able to shore up the quality of its work while simultaneously recalibrating its professionals to focus on the more advanced value-added advisory services that their clients would be eager to consume.
— Peter Scavuzzo, CEO, Marcum Technology, chief information & digital officer, Marcum
Capacity restraints – ties to DE&I, technology, outsourcing, and attracting young talent.
— Gary Shamis, CEO, Winding River Consulting
The profession is facing many significant issues. We are still in a pandemic that has upended our clients and companies as well as the way we work. Diversity, equity, and inclusion (DEI) continues to be a challenge facing the profession. 2021 marked the 100th anniversary since John Cromwell became the first Black CPA. While we have made some progress, there is still a long way to go.
Still, I believe the most important issue facing the profession is ensuring the future relevance of the CPA. Technologies such as artificial intelligence (AI) and robotic process automation (RPA) are already being used more and more in the profession and will continue to advance at an ever-increasing pace. Widely cited research by the University of Oxford warns of a future where accountants and auditors face a 94 percent probability of having their jobs computerized, and tax preparers face a 99 percent probability of being automated. Many will take issue with such a study, but I strongly believe that technology will dominate audit, tax, and accounting services functions by 2027.
For CPAs to ensure their relevance, they will need to expand from current compliance services to focus on providing strategic insight to their clients and companies. Trust has been and will continue to be a cornerstone of the profession; however, to ensure relevance in a world of automation, we need to move CPAs toward becoming the Most Trusted AND STRATEGIC advisor to businesses. This shift is at the core of the Illinois CPA Society’s 2020 Insight Special Feature, “CPA Profession 2027: Racing for Relevance.”
— Todd Shapiro, president and CEO, Illinois CPA Society
Staffing. There is a lack of qualified staff for firms and the number of accounting graduates is dropping year to year. I believe however, that we can offset this shortage if firms actually adopt the technology automations that are already available and if they leverage outsourcing vendors who can help them utilize offshore staff.
— Donny Shimamoto, managing director, IntrapriseTechKnowlogies LLC
If the last decade was all about financial accounting change, this decade is about expansion of the profession into non-financial reporting. While accountants need not immediately become subject matter experts in all ESG topic areas, they need to leverage their unique skill sets to enhance the reporting of sustainability information that is decision useful to Boards and management and then communicated to investors. For preparers this includes improving data collection, processing and reporting of ESG information. For assurance professionals, this includes expanding the horizons of providing assurance, into areas including human capital, environmental information and many more.
— Marc Siegel, board member, Sustainability Accounting Standards Board
Adapting CPA firm business models to address changes in talent (recruitment, retention and development); pricing models; service offerings and technology.
— Lisa Simpson, VP, firm services, Association of International Certified Professional Accountants
The talent shortage and its impact on growth and succession.
— Joel Sinkin, president, Transition Advisors LLC
The most important business issue we face is the speed of business driven and enabled by technology. Business moves faster and technology has enabled more competition. As a profession, we must support our clients’ business objectives. We cannot impede progress; we must support it within the parameters and with the discipline required by our field. These are not all complimentary issues. If we are able to achieve this level of support for our clients, we have the opportunity to elevate the profession above tax and audit, above bookkeeping. We have the opportunity to help partner with our clients to be strategic drivers of their businesses and provide greater levels of value.
— Alex Solomon, co-president and co-founder, Net at Work
The most important business issue we face is the speed of business driven and enabled by technology. Business moves faster and technology has enabled more competition. As a profession, we must support our clients’ business objectives. We cannot impede progress; we must support it within the parameters and with the discipline required by our field. These are not all complimentary issues. If we are able to achieve this level of support for our clients, we have the opportunity to elevate the profession above tax and audit, above bookkeeping. We have the opportunity to help partner with our clients to be strategic drivers of their businesses and provide greater levels of value.
— Ed Solomon, co-president and co-founder, Net at Work
The amount of investment going into technology that side-steps the accountant. Rather than being the ones to launch & advise VC-backed companies, many of the innovative fintechs we see were launched by engineers, not accountants with a deep understanding of the problem.
Our profession is quick to dismiss the doom & gloom narrative, but can be slow to develop an understanding of the underlying tech itself. We need to be the ones to champion a more productive version of our profession.
— Jason Staats, partner, Brenner
The accelerating speed of change and the need for aggressive innovation.
— Marc Staut, shareholder, chief innovation & technology officer, Boomer Consulting
I know staffing is top of mind for every firm, but in my view staffing challenges are an acute symptom of a larger systemic issue which is adapting to change. I talk a lot about the concept of unlearning, which I believe many firms and leaders need to do. Unlearning is the process of examining the old paradigms and thinking that may be holding us back and replacing them with new thinking that informs behavior as well as decision making from that point forward. The speed at which change is occurring and the sheer volume of change affecting the profession is mind-numbing and show no signs of slowing. The firms and practitioners that will continue to thrive will be those that are able to balance agility in reacting to change with being forward thinking, as well as unlearning and replacing outdated paradigms under which decisions are made.
— Carrie Steffen, co-founder and president, The Whetstone Group
There are so many risk issues currently impacting the profession - for example the impact of the economy on claim frequency and severity (especially on attest claims); the constantly changing laws and standards; the increase in regulatory activity; the impact of a remote/hybrid work environment on accounting procedures and methodology, etc. – that it’s hard to focus on just one.
But I think an area of great concern has to be the risk of a data security breach. As aggregators of data, CPAs are prime targets for cyber criminals. In the past year alone, there has been a significant uptick in data breaches, especially ransomware and social engineering schemes. A breach can result in not only a claim alleging substantial monetary damages and regulatory enforcement activity against a CPA firm but a network outage causing client service interruption and irreparable reputational damage to the firm and profession.
— Stan Sterna, vice president, Aon
What I hear most from our members is that they have, or are planning to, withdraw from their auditing and attest clients in future years. They explain that the regulatory and rules changes are simply to much for them to keep up with, both in terms of ability and cost. It would be unfortunate to lose those people who are fine practitioners, from the audit and attest world. We must find a way to help those practitioners find their way back to the audit and attest world, which is essential for a vibrant audit and attest future.
— Mark Stewart Jr., president, National Conference of CPA Practitioners
In earlier years I would have said relevance. But the COVID crisis is proving that accountants are more relevant than ever to businesses and individuals. Accountants are the economic "first-responders."
Going forward, accountants will need to evolve rapidly to keep up with the pace of change in the post-pandemic economy.
But that means more than just corporate culture and new fintech apps. It means a new way of thinking about what accountants do. More than ever, business owners and individuals are looking to their accountants for not just advice, but leadership; not just record-keeping, but vision; not just compliance, but courage.
— Rick Telberg, CEO and founder, CPA Trendlines Research
Without a doubt, it’s mental health. The whole pandemic and resulting series of legal changes wreaked havoc on a profession that was already dealing with long, demanding hours. This did not stop dedicated accounting professionals from sacrificing their own time (and well-being) to assist their clients in a time of great need.
Personally, to help throughout the pandemic and alleviate the research requirements imposed on these accounting professionals, I held live Q&A sessions with my network to share best practices and navigate the ever changing landscape of PPP loans and business challenges due to COVID-19. Some of these sessions had up to 1,000 live attendees..
The mental health struggles for our profession are real. People are getting burnt- out and leaving the industry permanently. This is causing a variety of other issues, with one being lack of available talent.
Things have to change. People are going to have to be encouraged to take more breaks and time away from work. Clients need help, but firms have to also enforce boundaries with clients to protect their people. Better systems, processes, and technology should also be utilized in firms where they’re not up-to-date to help with the workflow and workload.
Furthermore, the discussion around mental health needs to be more open. It’s better than it used to be, but it’s not enough. Therapy, taking a day off for mental-health, and more should be conversations that aren’t taboo. We have a great profession and we need to take care of our professionals mentally to keep them in it for the long haul!
— Katie Thomas, owner, Leaders Online
The decline in the number of new CPAs and in the number of accounting program enrollments at colleges is a major concern for the growth of this profession. According to a 2019 AICPA Trends Report, the number of new CPA Exam candidates hit a 10-year low. Part of that can be addressed with diversity, equity and inclusion initiatives, but more needs to be done to inform students and young professionals about the new job functions that exist in the industry. Recognizing this, all accounting professionals need to do a better job in articulating the many benefits that the profession offers. As the role of a CPA has evolved into one of strategic advisor, the declining enrollments become even more of a concern. It will take a concerted effort by all stakeholders in this profession to increase the CPA pipeline and encourage the next generation of accounting professionals to not only remain in the industry but ensure the profession’s sustainability and relevance for years to come.
— Ralph Thomas, CEO and executive director, New Jersey Society of CPAs
The most important issue currently facing the profession is what I call the “race for relevance.” The business environment is disruptive and fast moving, and we live in a “VUCA” world filled with volatility, uncertainty, complexity and ambiguity. The challenge is in ensuring that professionals are adequately equipped with the skills they need in the future – data science, analytics, and visualization (including statistics and applications coding), and the ability to develop and successfully communicate long-term strategy. This requires new thinking on education and post-graduate training, which the profession has so far been moving toward only gradually. We need a greater sense of urgency in upskilling our profession to remain relevant and influential, now and well into the future.
— Jeff Thomson, president and CEO, Institute of Management Accountants
The advancement of diversity, equity, and inclusion (DEI), and strengthening the pool of diverse talent through upskilling, reskilling, and other investments, continue to be among the most important issues and opportunities facing the profession. The business landscape is dramatically shifting. Among the changes, is unprecedented interest from investors, asset managers, proxy advisors, consumers, and other stakeholders, for companies to incorporate DEI into their core strategies. DEI is also incredibly important to the work we do, and we need teams that reflect diversity of thought and perspectives to help solve our clients’ most challenging issues. I believe the auditing and accounting profession has the opportunity to lead in DEI—and our $75 million MADE commitment represents this bold vision for the profession.
In addition to MADE, we are continuing our collaboration with educational institutions to help prepare students of all backgrounds for a career in business and accounting. Within our own organization, we are making ongoing investments in new technologies critical to the accounting and auditing profession—including our global cloud-based audit platform, Omnia, and our global tax platform, Intela—and providing training opportunities to help our people learn about these technologies and their business applications.
— Joe Ucuzoglu, CEO, Deloitte US
A significant challenge for the accounting profession that both myself and my peers often discuss is staffing. More specifically, staffing as it relates to building up and inspiring the next generation of accounting professionals.
We are noticing less interest from young people in the accounting industry. To correct for this, we need to look at many facets, including shattering the “traditional” stigma of what accounting is and is not, reducing the unsustainable number of hours accountants work during the busy season, highlighting the role of the accountant as a technologist, facilitating opportunities for training and apprenticeship, and leveraging technology so that firms can scale without the headcount previously needed.
Through my efforts in speaking up and championing the industry, I hope to inspire a new generation of accountants to see many non-linear and exciting career paths!
— Twyla Verhelst, head, accountant channel, FreshBooks
The most important issue currently facing the accounting profession is maintaining relevancy as a profession in a rapidly evolving technological world among current and future young CPA talent.
— Anthony Vinci, director, Office of Financial & Operational Risk Policy, Financial Industry Regulatory Authority
The explosion of digital assets and the related tax issues have taken front and center stage for tax and accounting professionals alike. The IRS has issued enforcement letters and opened audits to thousands of taxpayers, they have served John Doe Summonses to exchanges to hand over tax information for prior years about their users, and there have been a number of headlines about IRS criminal prosecutions associated with digital assets. However, in return - the industry has
received very little guidance about how to report digital asset transactions. A Revenue Ruling and some FAQs are the only guidance that CPAs, crypto investors and exchanges and custodians can rely on to guide their reporting efforts.
These last couple of months, the Treasury and IRS have worked with Congress to introduce legislation to compel businesses supporting digital asset trading to report Forms 1099-B in order to provide the IRS and the taxpayer with clarity needed for tax preparation purposes. But the recent infrastructure bill included broad language around new reporting requirements, rather than introducing legislation explicitly focusing on centralized exchanges and custodians for whom it is intended.
As the cryptocurrency environment continues to grow and evolve, in order to comply with regulatory requirements, investors need clear direction on what information they are required to report to the IRS, and the industry needs a clear definition of the role of “broker” as it is used in evolving legislation to mandate reporting standards.
At Sovos, we’ve worked hard to remain at the forefront of all cryptocurrency movements from Congress and the IRS to ensure our clients are protected from any consequences. Through our active participation in the WSBA, the Chamber of Digital Commerce and the ABC we have been able to provide thought leadership to lawmakers and associations influencing the rulemaking process.
There is an interconnectedness on this matter globally, and our clients, as well as other major players in the crypto industry are seeking clear guidance on reporting standards and requirements.
— Wendy Walker, solutions principal, Sovos
There is a disconnect between CPAs being “The Most Trusted Advisor”, and not acting like an advisor at all.
— Kyle Walters, partner, L&H CPAs and Advisors
The intense competition for talent, and the impact of technology.
— Charles Weinstein, CEO, Eisner Advisory Group
Relevance and impact – our clients need our help now more than ever and many members of our profession are not staying current on new trends, tools, or methods of delivering services that make a difference. We are also facing a huge shortage of staff and will likely not have people to take over manager level roles in the very near future.
— Geni Whitehouse, countess of communication, Even a Nerd Can be Heard, The Impactful Advisor, Solve Services, www.bdcocpa.com
The Great Resignation! I don’t believe most firm leaders are really worried about it, but they should be. The business model has not changed fast enough and now our team members have a clearer vision of what they personally want their work to look like in terms of hours, connection with people, flexibility and true life/work balance. The opportunities for them to leave—not just their firm but the profession—are readily available. We simply have to make our profession more inclusive and welcoming. We are behind and we have a lot of catching up to do.
— Sandra Wiley, president, Boomer Consulting Inc.
The biggest issue facing us is the attractiveness of the profession as compared to other career options. This starts with getting high school graduates to choose accounting as a major as they enter college, and then keeping those students on the 150-hour path, winning accounting graduates over to our lower-paying entry level jobs, and then keeping them in the profession once they join a firm and find all of the aspects of the business model and traditional mindsets that simply have to change. The potential loss of all of this bright young talent is my #1 worry for our profession – which offers so much promise. We are waking up to this as a systemic issue and one that needs each of us to take immediate action, but the change is glacially slow and we’re still losing ground.
— Jennifer Wilson, co-founder and partner, ConvergenceCoaching LLC
Hyper-commoditization that is driven by: Scaled tax and bookkeeping organizations like H&R Block and Pilot, technological advancements that significantly reduce manual entry, the fusion of General Ledger platforms with professional services (e.g., Wave Advisors and QuickBooks Live) and a trend toward the international outsourcing of accounting services.
— Joe Woodard, CEO, Woodard Events
I can’t narrow it down to one issue. All of these are important, in my opinion. First, our profession, along with many other professions and industries, is facing a talent shortage. The number of college students entering accounting has declined in the last several years. Second, the type of skill sets that we need in accounting today are different than when people of my generation were entering the profession. Technology plays a much larger role today which requires a different set of skills. We have to help develop our young talent to have the skills they need to succeed and be able to add value to our clients. Finally, similar to what I mentioned last year, we are constantly challenged with keeping up with and adapting to rapid change and disruption. We have had the challenge of developing our entry level professionals in a remote environment, where on the job training is more difficult. These changes along with the staffing shortages have widespread impacts on the way we operate within our firms and the way we help our clients.
These challenges aren’t likely to go away in the near term, so we must be able to quickly adapt and implement new processes to respond to the “change de jour.” We also have to focus on development and retention of our employees.
— Candace Wright, chair, Private Company Council
Grappling with the pandemic took precedence over almost everything, including the ability to undertake a measured, honest assessment of the issues that accounting firms need to resolve. Now, as we start to move forward and head out of crisis mode, we have a chance to recognize these issues and start to find long-term solutions. Specifically, we need to make ourselves more attractive to the next generation of practitioners at the college level and find ways to retain practitioners that recently joined accounting firms who are questioning their decision. Moreover, the accounting profession must become more representative of our society as a whole. We must cultivate diversity not as a means to a statistical end, but because diversity will make our firms and our profession stronger. That means supporting the careers and well-being of people of color in every way possible, because we know burnout is high among our Black, Latinx and Pan-Asian colleagues. At the same time, we must collectively prioritize our work-life balance, especially in a post-pandemic hybrid environment. Finally, on the tax side, we must figure out a way to alleviate the challenges of a busy season that never seems to end because of increasingly complicated federal and state tax systems and compressed deadlines. Tackling these priorities will take a team effort and ample investment from leaders across our profession, but I firmly believe it can be done — and we can emerge from this pandemic stronger than ever.
— Jamie Yesnowitz, principal, state and local tax leader, Washington national tax office, Grant Thornton
The Great Resignation is certainly bringing employment practices to the front of issues facing the profession. After working remote for extended periods of time, many organizations are struggling with how and if to bring employees back to the office. Many employees have discovered they prefer to work remotely and on a more flexible schedule. As pressure to return to the office increases, the risk of losing team members will increase. We’ve all learned how to work and learn remotely and the challenge will be how to retain the positives of what worked but yet bring teams together. For those that continue remote, challenges will revolve around maintaining team collaboration and a sense of belonging.
— Diane Yetter, president and founder, Yetter Consulting Services & Sales Tax Institute
COVID has presented many challenges in growing and sustaining accounting practices. It’s important that firms ensure the safety of their employees. Because of attacks on Asians, Asian employees may prefer to continue working remotely. It’s also important for firms to adapt to working in the new remote environment. Everyone in our firm has the choice to work from home. This poses challenges for building community and culture and also increases information technology risks.
Firms also need to adapt to the challenges of COVID. In our firm, we have been responsive by quickly launching new service lines, including small business funding. It has been a Zoom world and this has worked to ensure regular and effective communication with our clients about their work and news about new services added including small business funding. I have also used Trello, a visual way to help manage projects and organize tasks during this period. I have recently created a song about Trello’s use to the tune of Coldplay’s “Yellow.” “I found an app to help me track to-do’s. Everything that’s due. Yeah, it’s called Trello.
— Steven Zelin, managing member, Zelin & Associates CPA
How to move as fast as the modern world --- we saw the world flip upside down over the span of a few weeks last year when COVID hit. Accountants who can act fast and help people navigate business changes in real-time will make a meaningful impact in the growth and recovery of our economy.
— Martin Zych, CEO, Jirav
