I spent the last three days with 19 other thought leaders and four prominent vendors in the Public Accounting segment of the CPA profession. I say the Public Accounting segment because I think too often we forget that there are many CPAs who are no longer in public accounting, but instead working in business & industry, nonprofits, government, and academia–they are still part of the CPA profession. However, I digress…
One comment that kept coming up was this concept that are two classes of CPAs, the “Haves” and the “Have-nots”. The Haves were those that could see the writing on the wall–that bookkeeping and tax compliance (and some would argue audit) is increasingly becoming a commodity service, and that eventually technology would probably automate much of these services and the need for practitioners in this area would diminish. So the Haves were those who were already starting to retool and reorient their practices to focus on more value-added services, which in many cases is the trusted advisor role.
On the other hand, the Have-nots were those who either didn’t see the writing on the wall, or those who saw it, but are choosing not to take action. Numbers were thrown around, but everyone seemed to be comfortable with saying that probably 60-65% of CPA firms were probably in this camp. It was also commented that, with the aging of the baby boomers, that many of them are planning to just ride it out and keep doing what they’re doing until they retire.
So what is going to happen? Will we just slowly see almost two-thirds of the CPA firms close up shop in the next 5-10 years? What about all of their staff? And more importantly, what about all their clients? It seems really irresponsible to me, for a CPA firm owner to not think about all their clients and staff. Yet I can see too, why should they go through all the pain of making such a significant change–a complete paradigm shift–when they are so close to retirement?
Thus I think the imperative falls upon the upcoming leaders and staff in these Have-not firms, and other Have firms who may want to capture these staff and clients, to look to the future and help ensure that there is a place for the staff and a migration pathway for the clients.
I predict that we will start to see the staff, especially the rising stars, in these Have-not firms start to leave and seek employment with the Have firms or start their own firms. I’ve already started seeing this with several people from our AICPA Leadership Academy alumni and I think it is a trend that will continue to gain in momentum.
With clients, I think it will depend, there are some clients that really just want their compliance work done. But there are others that really don’t want “just and accountant”, but really a trusted advisor–whether it’s a personal advisor or a business advisor. CPAs are well positioned for both roles.
Change is afoot in the public accounting world. If you’re a CPA, are you working for a Have or a Have-not firm? If you’re not a CPA, are you the client of a Have or Have-not firm? As the economy recovers, it is even more important that we’re all looking to the future and making decisions now that will help ready us to survive the next recession (it’s eventually going to happen again). Do you know what you need to do?