The More Things Change …
There is also strong continuity between my father and me. Sure, much has changed in 90 years, but many of the basic premises of being a public accountant have not. When I started my first job in 1963, much of what I did was similar to what my father did when he started his first job in 1930. We handled write-ups and payroll taxes, prepared financial statements and tax returns, and occasionally advised clients on their accounting systems and controls. We also reviewed financial statements with clients and tried to relate them in such a way that clients could be better equipped to run their business, minimize taxation, and invest appropriately based on their individual goals. We positioned ourselves to be the first contact when they had a financial, business, or even a personal problem. We were their trusted advisors.
Our fees were based on the write-ups, tax forms, and other deliverables we prepared, but the value was in the advice we gave them, our availability, our knowledge base of the totality of their lives—not just their business. We even knew most of their employees, who would confide in us about what was going on in the business, making us better advisors.
My job—as compared to my father’s—did not change much until the early 1970s, when I started using a tax service bureau, the early 1980s, when I got a personal computer, and then in the early 1990s, when I started converting my clients’ bookkeeping to small business software that ran on the clients’ own computers. My write-up work ended; so did my payroll tax work, once I migrated that to the large payroll processing companies. What did not change were the personal relationships—being the first person the client calls. What happened was that my physical work changed, much of it migrated to the client’s staff or the payroll service; but I provided more advice and counsel. In today’s complicated business environment, my role grew to become more critical and more valued.
Accounting firms expanded into other services needed by their clients and owners. When this started, these were referred to as “nontraditional services”; today, these services are expected and standardized. The change, however, hasn’t been universal. Many smaller firms have not expanded that much, and many of the larger firms that have expanded haven’t effectively spread that information throughout their firms. In some respects, therefore, much of the larger firm staff is no more knowledgeable than that of the smaller firms that did not expand their services.
Today’s CPA firms are looking at services that clients need, and are preparing to provide them. These services include cybersecurity, e-commerce consulting, digital and cloud migration implementation, asset and wealth management, risk management, cost segregation and transfer pricing studies, international tax, culture and reporting consultations, and outsourced accounting and back office services. The write-ups that I and my father drafted—the ones I was embarrassed to say that I did when I started my own practice in 1969—are now part of a trend of large firms offering these services, as more and more companies look to reduce their overhead by outsourcing these noncore, but essential, services to accounting firms.
… The More They Stay the Same
Some other critical areas have not kept up over the decades. The educational system is lagging behind the reality of business. When I first got involved with sustainability accounting issues less than 10 years ago, maybe 25 of the Fortune 500 issued such reports. Today almost all do, yet many accounting programs do not include courses on this. As another example, today’s cost accounting textbooks are not much different than my father’s, while the wealth of most the giant corporations now comprise intangible assets that overshadow book value. I also know that most all of the techniques, number crunching, and bean counting have moved toward the cloud, AI, data analytics, robotics, and other timesaving technologies. Certainly, many other things have also changed in 90 years. But the core values, trusted relationships, counseling services, and being the first person clients call when they need the right advice—these things have not changed.