Numbers tell stories ...
Numbers are simply depictions of the good
and bad interactions of these three core concepts. As CPAs, we often get caught up in the
creation of a sheet of numbers, but this is not
where our strengths as an industry lie. Our
strengths are found in our ability to use and
interpret numbers to help our clients make
better business decisions.
I know you’ve heard that before. We never
seem to offer our clients what we are actually
best at. Let’s dive deeper into the end result
of our great work, which is to help our clients
make better business decisions, not give them
a big sheet full of numbers.
BY jason Blumer
And so should CPAs
The title of this article is the tagline of our firm. It’s a constant
reminder of the purpose behind our industry and our firm. The
numbers we deal with every day are outcomes of relationships,
processes and knowledge.
practicenews
clients’ businesses is to help them install a
customer relationship management system.
This could be a cloud-based software system
that tracks all customers and contacts, the
interactions with them throughout the whole
company, and how these interactions could
have been achieved more effectively and efficiently. And knowledge is best leveraged
when it is accessible at the right time. Tools
such as a CRM system that are maintained
properly will provide this knowledge proactively, instead of making you look for it when
you need it.
We often do the same things we’ve always
done (to our detriment) because we have not
harnessed the innate knowledge deep within
our companies.
RELATIONSHIPS
When I talk about relationships, I’m talking
about the relationships inside of the client’s
business. These are the interactions that are
causing transparency and accountability that
lead to dollars, or the loss of dollars, in your
client’s pockets. These relationships can also
be known as the “culture” of the company.
Truly, the culture of a company has a life of
its own and is separate and distinct for each
and every client you serve (no matter how
big they are). Be aware of this fact so you can
address their numbers from the standpoint
of their culture.
through your client’s business. We, as our
clients’ trusted advisors, can help our clients identify these processes, make them
tangible, document them, visualize them,
delegate them, monitor them and ultimately
improve them.
Unless we help our clients identify these
processes, our clients are outlaying cash for
so many “solutions” that can actually cause
more problems than they solve. Addressing
your client’s processes as the core foundation of their business can bring them greater
awareness to the ultimate numbers that show
up on their profit and loss statement at the
end of the month.
If you build a home, you will begin with
the unseen foundation first. If you don’t get
that right, then the beautiful columns on the
front of your home will eventually crack or
fall down. And if your foundation is not put in
correctly, then no matter how much money
you spend on those beautiful columns, they
will continue to break and crack. Address the
foundation of your client’s business just like
you would your own home.
AICPA ISSUES GUIDE
TO NEW CPA EXAM
The American Institute of CPAs’ Examinations Team has published a guide to the
major changes that will appear on the
Uniform CPA Examination starting on
January 1, which will include a new release of authoritative literature, based on
the FASB Accounting Standards Codification. CPA candidates will be able to prepare with a new tutorial and sample tests
that will be posted on the AICPA Web
site in the fall. A new online calculator will
also be introduced with the exam.
A new candidate performance report
will provide candidates with information
about the strengths and weaknesses of
their exam performance. New content
and skill specification outlines will also
go into effect, and International Financial
Reporting Standards and other international standards will also be included on
the test. There will be a new format for
the research tasks, and scoring weights
for different portions of the exam will
change. The section structure and section time allocations will also be altered,
with the time increasing on some sections, and decreasing on others. A new
spreadsheet will be introduced, along
with a new question format in the form of
shorter task-based simulations.
The guide to the new CPA Exam can
be found at www.aicpa.org.
PROCESSES
The understanding of processes should be
foundational to your clients before they spend
money in any way (and before you offer any
counseling and consulting services). CPAs
have a seat at the client’s table to help them
understand this. Whether it’s purchasing a
new computer system or hiring a new staff
member, understanding how the process will
be improved or hindered by this cash outlay is
an educational opportunity for you, the CPA
practitioner.
When I talk about processes, I’m talking
about the intangible flow of information
Jason Blumer is “head creative dude”
and managing shareholder at Blumer &
Associates in Greenville, S.C. Reach him at
jason@blumercpas.com.
KNOWLEDGE
Knowledge is another intangible asset that
we fail to focus on, both in our own firms
and with our clients. Lead your clients to
capture the “relationship intelligence” floating around in their companies by helping
them understand the value of the collective
knowledge of their staff, their processes,
their history, their patents, their education,
their contacts, and anything else that brings
value to their business and work. Ultimately,
these intangible assets can turn into goodwill
if their business is ever purchased. When I
talk about knowledge, I’m talking about the
knowledge of the organization as a whole, not
an individual owner or a department.
Possibly, a “knowledge audit” could be
done to capture the knowledge of the organization. The creation of this knowledge audit
will hopefully lead to an improvement of the
best practices of the company, and how to
improve over their competitors.
One way to harness the knowledge of your
TRANSFORMING OUR FIRMS
So how do we actually make money focusing
on the relationships, processes and knowledge that we are truly supposed to be delivering to our clients? After all, it seems like
we get a check from a client every time we
deliver a compilation or an audit report or
a tax return. But I believe our clients want to
pay for the understanding that comes from
those deliverables, not the reports themselves. They just don’t know how to tell us
this. And, truly, I don’t believe we know the
difference either.
I believe we can transform our firms into
practices that create new and productive services that drive heavy value to our clients. But
how? We have to know what they need first,
by studying their relationships, processes
and knowledge. Then we have to create a
service to extract this information for our clients. Then give that new service a name (and
maybe a logo), and a price tag. Then begin
your “beta testing” with your clients. Some
new services will work, and others will not.
Document what you’ve learned and continue
this innovation firm-wide. Everyone should
be involved, and every staff member should
have a seat at the table of making your firm’s
offerings better.
You will not always like what you discover
about yourself or your firm. But this stretching will make you a better firm owner and it
will improve the transparency you have with
your staff and your clients. I believe you will
ultimately learn that numbers tell stories, and
that you can bring these stories to life for your
firm and your clients! AT
FASB, GASB AND FAF TWEETING
The Financial Accounting Foundation, the
organization that oversees both the Financial Accounting Standards Board and
the Governmental Accounting Standards
Board, has joined Twitter to expand its
communications outreach. To follow the
FAF, FASB and GASB activities, visit www.
fasb.org, and click on the Twitter logo at
the bottom left of the home page.
VISA BOOSTS SMB NETWORK
SAN FRANCISCO — Visa Inc. has unveiled a
number of upgrades to its 100,000-mem-
ber online small-business community,
the Visa Business Network. The enhancements include business goal toolkits; a
small-business mentor program; and a
Q&A forum. For more, visit www.visabusi-
nessnetwork.com.
