Associations

Grant Thornton CEO Edward E. Nusbaum has worked with the firm for 28 years, but since he took over the helm, the Chicago-based firm has more than doubled its revenue in the last four years, reaching $940 million in 2006.

The American Institute of CPAs has inducted three new members into the AICPA Business and Industry Hall of Fame.

The American Institute of CPAs wants Congress to modify a little-noticed provision in the recently passed Iraq war-funding bill that the institute fears may put tax preparers at odds with their clients.

The Securities and Exchange Commission won't require amended filings to correct misclassifications of a new Financial Accounting Standards Board standard for defined-benefit pension plans, says a recent alert from the AICPA's Center for Audit Quality.The new standard, SFAS 158, requires that employers move any surpluses or deficits in their retirement benefit plan funding off the footnotes and onto the face of the balance sheet, while making an adjustment in the ending balance of "accumulated other comprehensive income."

Intentional disregard of the law is the primary contributor to the tax collection gap experienced by the IRS, according to nearly half the CPAs surveyed in an online poll by the AICPA.

Last year, I wrote a column entitled, “Do You Have a Chief Knowledge Officer?” (webcpa.com/article.cfm?articleid=14079) aimed at encouraging smaller accounting firms to think about applying knowledge management concepts in their firm operations. One example I gave was an accounting firm that had different individuals responsible for certain subject matter and practice areas so they could inform other firm members by e-mail alerts of important developments.

The Consulting Services Executive Committee of the American Institute of CPAs released a new standard on valuation services. Its Statement on Standards for Valuation Services No. 1, "Valuation of a Business, Business Ownership Interest, Security or Intangible Assets," provides guidelines to CPAs for developing estimates of value and reporting on the results. It applies to institute members who perform an engagement that estimates the value of a business, business interest, security or intangible asset for numerous purposes, including sales transactions, financing, taxation, financial reporting, mergers and acquisitions, management and financial planning, and litigation. SSVS No. 1 specifies two types of engagements: valuation engagements and calculation engagements. For valuation engagements, two types of written reports are permitted - detailed reports and summary reports. For calculation engagements, one type of written report is permitted - calculation reports. Oral reports are allowed for all engagements under the standard. SSVS No. 1 is effective for engagements accepted on or after Jan. 1, 2008. A copy of the standard has been posted to the AICPA Web site at http://bvfls.aicpa.org/Resources/Laws+Rules+Standards+and+Other+Related+Guidance/AICPA+Valuation+Standard+and+Implementation+Toolkit.htm.

Attending the AICPA Tech+ Conference was an eye opener in terms of how much now goes into a firm’s decision whether to continue as or purchase new hardware or applications, and the related security issues. It also taught me how much of an impact technology can have in unexpected ways. For example, when I got to the conference I discovered the attendees only had access to the sessions online and on a memory stick. No paper was given out and those without a laptop were at a tremendous disadvantage. Many of the PowerPoint slides shown were hard to read or changed before you could complete taking notes. Of course, I lost the memory stick an hour after it was given to me. There was also, at least initially, difficulty getting wireless access at the conference, and making a connection to the Internet in your room was an effort. But my favorite experience with technology had to do with food. At the deli at the hotel, I ordered a takeout order of two hot dogs with mustard and sauerkraut. The clerk entered my order in the computer and said the order would be out shortly. After waiting a long time, the clerk finally walked the 10 feet to the open kitchen only to find the printer there was jammed so the order was never received. The next night a reservation was made for my party of four, but when we got to the restaurant it couldn’t be found in the computer, even though a hostess remembered typing it in. These technology hiccups still bother me, but I discovered at the conference that these blips don’t bother the techies at all. A number described the initial difficulties that they had in working with Vista and Office 2007. They talked of their difficulties fondly, and with an acknowledgement that they’re even expected. All of us should adopt the techies’ philosophical view, as they fully understand that the difficulties discovered will be cured in the next version of the application or product. They don’t see it as a problem, but rather as a path to the solution. Of course, I’m a little slow, because my solution, even if a new printer is used, is to have the deli clerk yell out “Two with everything on it” when he types in my order of hot dogs at AICPA Tech+ 2008. PS:ENTRY PERIOD CLOSING SOON FOR PRACTICE INNOVATION AWARDS Practical Accountant's Practice Innovation Award is given annually to public accounting firms that take the lead in developing a new service area, improving services to their clients, or promoting efficiency in the practice of public accounting. Firms submit a brief but detailed description of the innovation (or innovations) that they believe fits the above criteria. They should detail the resulting benefits, especially any associated increase in revenue or cost savings. Most submissions are about 300 words. Winners will receive a plaque and be profiled in our September issue. Prior years' winners can participate as long as the submission is on a different basis from their award-winning innovation. Judging is by Practical Accountant's editorial staff. Submissions, with the name of the firm's contact person, must be received no later than June 29, 2007, preferably by e-mail. Regular mail should be addressed to Howard Wolosky, Practical Accountant, SourceMedia, One State Street Plaza, 27th Floor, New York, N.Y. 10004. The e-mail address is Howard.Wolosky@sourcemedia.com

Although Capitol Hill insiders such as Karl Rove, Paul Begala, Terry McAuliffe and George Will garnered marquee billing at the American Institute of CPAs Spring Meeting of Council, profession-centric issues, such as staff recruitment and the alternative minimum tax, reverberated the most with attendees at the three-day confab here.

CPA2Biz, the marketing and services portal of the American Institute of CPAs, has unveiled its next-generation Web site, a revamp that includes enhanced content organization and navigation tools, as well as a less clutter and easier search capabilities. The new design is the culmination of a two-year redesign effort, according to CPA2Biz president and chief executive Erik Asgeirsson.

Looking to effectively manage your next information technology project? Just ask those in your firm to segregate business activities into two areas: those that differentiate you from the market, and those where you're at parity. At Tech+, the American Institute of CPAs' annual technology and information conference, Niel Nickolaisen, chief information officer and director of internal audit at Headwaters Inc., an energy and building products firm in South Jordan, Utah, gave away his secret to making IT projects work: Invest in what differentiates your firm from others in your market, but don't re-invent the wheel on those "mission-critical" parities. Nickolaisen believes that just because you're good at something doesn't mean it differentiates you from your competitor. The challenge for businesses is to distinguish what you're good at and what makes you special in your market, he advised. Once you discover that, invest resources into nurturing that source. He described his strategy as "a model I developed after managing large failed IT projects," he said. "We do not design parity activities. We mimic best practices and are creative in differentiating activities." In other words, ask tough questions of your staff about what sets your firm apart and gains you market share, as opposed to those elements in your business that you are good at by best practice standards. Teasing out these answers can help a business create a decision filter that helps build a strategy, Nickolaisen said. When a parity is discovered, it's a primary opportunity for streamlining within a firm or company, he said, adding that most workflow automation is an example of parity, According to Nickolaisen, 40 percent of software licenses are never deployed, with a current success rate of roughly 35 percent. IT has changed, he said. Customers previously had static needs, and personnel was out of sight, out of mind. "Not anymore," he explained. "IT can and does support every known business process, and IT personnel are highly visible. We're involved now."

By 2010, there will be 10 million more jobs than there are people in the U.S., and the process of attracting, retaining, and keeping key employees motivated begins with a strategic plan that includes a formal hiring process, a commitment to building a learning culture, and competitive compensation and work/life balance policies, according to a panel at the American Institute of CPAs' Tech+ Information Technology Conference, here."You make your worst hiring decisions when you need someone now," Sage Software director of channel development Ed Kless told attendees. "You need to put a hiring process in place, and even if you work with a search firm, make them go through your hiring process as well.""Remember, if you hire the right people, you don't have to motivate them," Kless said. Angie Martin, of Dallas-based CPA firm Lane Gorman Trubitt, said that firms must develop an environment that "encourages knowledge sharing" and provides learning opportunities both internally and externally."Not all learning is CPE," she said. "Learning happens in all directions and at all levels in an organization. Ideally, 12 percent of an employee's salary should be spent on training and learning." Sandra Wiley of Boomer Consulting said that key employees aren't always forthcoming at exit interviews as to why they're leaving. "They'll say, 'It was a great opportunity' or 'I'm getting more money,' but the real reason many of them are leaving is they're not being challenged."She outlined a 10-point checklist that included such areas as mapping out career development, offering highly competitive salaries and benefits packages, and allowing employees to tailor their individual work/life balance plans. "Remember, it's not the number of hours they work, it's what they get done," she said.Taylor Macdonald, chief strategy officer at Sage, told conference-goers that there has to be some flexibility with regard to compensation. Firms have to consider things like arbitrary bonuses, employee stock ownership plans and employee recognition programs."You can't always treat everyone the same, because everyone isn't the same," he said.

Technology will have to evolve more efficiently to integrate with firms' tax practices, and not just help practitioners perform arithmetic, said tax industry and Internal Revenue Service veteran Lenny Holt at the American Institute of CPAs' information technology conference, Tech+, here.Holt, now with CCH's Firm Services Unit, said that while technology has made quantum leaps since 1986 -- when just 25,000 1040s were e-filed, as opposed to the 76 million in 2007 -- the distinction between tax accounting and other financial services is blurring, and the facility to consolidate that integration is technology."Clients using tax professionals for more than just taxes and technology is a big part," Holt told attendees during a session titled "Technology and Your Tax Practice."Tim Shortlseeve, a partner at the Rochester, N.Y.-based CPA firm of Bonn, Shortsleeve & Ray, told attendees that to hone best technology practices for tax preparation, firms must create an in-house project team and appoint a project champion -- one person with both decision-making and budget-approval powers.The project team's to-do list includes such items as evaluating workflow options, documenting new policies and procedures, and identifying changes to software. A firm must also have an IT technician, even if they have to outsource one."You have to ask yourself, are you using your current technology to your best advantage?" asked Shortsleeve. "And don't overlook training. The dollars you spend on training will come back tenfold."Other checklist items include installing multiple monitors and establishing remote access."You have to communicate the plans and expectations to everyone in the firm," he said. The session included product demonstrations from tax software publishers CCH, Intuit and Thomson.

Executive-level CPAs in business and industry are confident in the future of their own companies, but much less so in the prospects for the U.S. economy, according to a recent survey. While two thirds of the C-suite CPAs responding to the American Institute of CPAs' Spring 2007 Business and Industry Economic Outlook Survey expected their businesses to expand in the next 12 months, less than half have a favorable view of the economy. "Despite reservations about the U.S. economy, companies continue to have a healthy outlook on their own businesses with the next 12 months, and anticipate continued stability in terms of revenue and hiring expectations," said John Morrow, the AICPA's vice president for members in business, industry and government. Most of the surveyed CPAs, however, noted that they expect increases in revenues, not profits, which will be held down by employee costs and a limited ability to raise prices. Fully 95 percent of respondents noted that employee and benefit costs are a challenge, and staff-related issues -- including finding and retaining qualified staff -- accounted for four of the top five challenges faced by organizations. The survey, which represents the views of over 1,350 AICPA members in a wide range of industries, is available online at the institute's Financial Management Center Web site.

Sage Software today launched its Peachtree by Sage 2008 product line, a selection of software targeted at the small business market. In addition to performance enhancements, small businesses will see more user-control capabilities, along with improvements for producing more specific information output for their needs, especially in reporting, to encourage better business management. "They want to get the numbers right, and put in the effort to do that so they can make the right decisions," said Shari Willman, product manager for Peachtree, about the product line's customers at the American Institute of CPAs' Tech+ Information Technology Conference, here. The culmination of roughly 18 months of work, Peachtree by Sage was influenced by more than 100 customers in Sage's "Customer Connected Design Center," so customers could take part in identifying opportunities to enhance functionality and introduce new features. "We really changed the product considerably in 2007, so in 2008 we improved on that," Willman said. Among some of the changes in this release are 100 new fields, 50 new filters and 30 new sorting options for information within the accounting report functionality. Peachtree by Sage 2008 also includes a new Transaction Detail Report, which is a comprehensive report that enables small businesses to see key information related to any transaction from one location. More aesthetic-improvement features have been added, including a design screen that aims to offer more flexibility for adding color, logos and other information to customize the standard layout on forms such as invoices, sales orders and other transactionary documents. The software also includes a new document management function that enables small businesses to add attachments to records such as vendors, employees, inventory items, payroll checks or quotes directly within the product. The 2008 product line keeps consistent with its separate offerings for industry niches such as accounting, manufacturing, nonprofits, construction and distribution. Peachtree by Sage 2008 comes in four packages -- basic, standard, advanced and premium. Peachtree Quantum by Sage 2008, the company's top-of-the line offering that can serve up to 10 users and has access to all industry-specific features, is also available. Included with Peachtree Quantum is Peachtree Quantum Business Care, an extensive service plan that includes product updates and upgrades that become available within 12 months of the product purchase date, access to online training and one year of unlimited access to customer support. For more information, call (800) 228-0068.

Technology is on the mind of the CPAs visiting here as part of the American Institute of CPAs annual technology conference. This year, there's more to the equation, as the New York-based association has added a "plus" to its event name to demonstrate its intent to go deeper with information and perspective. Formally kicking off the conference Monday at the Mirage, after a series of optional sessions and roundtables the day before, David Cieslak, a partner at Arxis Technology Inc. in Simi Valley, Calif., and chair of the Tech+ AICPA Information Technology steering committee, said that they decided to "take this conference and strip it back to the walls." The sessions, he added, were intended to "provide a cookbook" of information to participants.

The American Institute of CPAs named Karin Wiberg to the position of director of the Office of Strategy Management. In that role, she will manage the Institute's strategic planning processes and evaluate the organization's performance. Prior to coming aboard the AICPA, Wiberg most recently served as strategic planning director at Principal Financial Group.

While such issues as mobility, Sarbanes-Oxley 404, peer review and private company financial reporting continue to impact the accounting profession, keeping the CPA pipeline filled remains the profession’s No. 1 priority, American Institute of CPAs president and chief executive Barry Melancon told attendees at the institute’s spring meeting of its Governing Council.

Although the 2008 presidential election remains 17 months away, attendees at the spring meeting of the American Institute of CPAs’ Governing Council were treated to a “trailer” of campaign issues as the former chairs of the Democratic and Republican National Committees stumped for their respective parties -- as well as aimed verbal darts at each party’s foibles.Former DNC chairman -- and current chairman of Sen. Hillary Clinton’s 2008 presidential campaign -- Terry McAuliffe told the audience that the Democrats didn’t so much win the 2006 midterm elections, as the Republicans lost it.

Two major accounting associations have announced the recipients of research grants for the 2007-08 year.