What do you need from your CPA?

I'm doing some research and would love input from this group. As a CPA, I am curious as to what startups and small businesses need from their CPA. Is the traditional model of tax compliance (filing returns, etc.) sufficient for your needs, or do you wish for more? I have more of a coaching/advising personality than one of a straight technician, and am trying to find my niche.

Some ideas of additional services could be software selection and installation, modeling and analysis of business plans, seminars and presentations on small business finance, etc.

Finally, do you have any stories of CPA's who have served you with excellence (or the opposite)? What set them apart in your mind?

Thanks is advance!

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Permalink Reply by Dan Miller on October 19, 2012 at 11:13am

Dan,

I just put the word out for a referral for a new CPA. Most I've worked with have been "reactive" - simply plugging in the figures for what has already happened. I'd love to have someone understand not only the financial details but to also understand my business enough to make suggestions for future strategies, product development and leverage, and unique ways I could maximize the way I get irregular income as an author. I want more of a business partner than just a technician.

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Permalink Reply by John Madison on October 26, 2012 at 4:06am

Good morning, Dan. How's the search for a new CPA going? I've been a CPA for 25 years, including being a freelancer for the last 13 years. You can get an idea of my experience in my reply to Kent below. If you think that's the kind of experience you're looking for (and don't mind me being located in VA), I love the chance to talk to you. I certainly admire your work and would welcome the opportunity to help.

Thanks.

John

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Permalink Reply by Sharon on January 26, 2013 at 1:50pm

This struck a chord with me. My husband and I run a small business. (just he and I as employees) Our current accountant we chose because he said he'd do just what you are looking for Dan.

understand my business enough to make suggestions for future strategies, I want more of a business partner than just a technician.

The reality is though.... he just reacts as business goes on. We do not get any advice or suggestions from him.

So my suggestion is.... if you SAY you will do more than just the paperwork... If you SAY that you will advise us as to the best way to pay the least amount of taxes.... please follow through and make those suggestions, TELL us what you see we can be doing different/better. Sometimes we just don't know what to ask.

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Permalink Reply by John Madison on October 23, 2012 at 6:33pm

I've been a CPA for 25 years, a self-employed freelancer for the last 13. My client list is small by design as I prefer to work all year with business owners to grow their businesses rather than preparing massive numbers of individual tax returns for 1/4 of the year. I actually outsource the tax work to focus on other things for my clients. Surely some of my job is the routine work, but the most satisfying part of my job is helping my clients build the vision they have for their companies. I've also found I can earn more each month, and with more more consistency, than a "traditional" CPA structure.

I suppose many potential small business clients would only want you to perform the "debits and credits" functions for them, but you can build your firm/freelance business to be more if you so desire. The need is out there.

Best of luck,

John

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Permalink Reply by Kent Haley on October 25, 2012 at 7:18pm

As I CPA myself, I think this is a great question. I am currently employed with the government, but am not real excited about being chained to my desk in front of the computer all day. John, what types of working are you doing for your clients? You said you outsource the tax work - does that mean you still do tax planning, but just farm out the actual tax prep? Do you do any audits, reviews, compilations?

Thanks,

Kent

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Permalink Reply by John Madison on October 26, 2012 at 3:50am

Good morning, Kent. If I had to summarize my role with my clients, I'd say I act in the controller role for several different companies. None of the companies need a full time controller, but all need more than the traditional bookkeeper role. As a freelancer (ie, I have no employees), some of the work is routine, clerical work (ex. payables, payroll, billing, etc.). But I'll also prepare the financial statements monthly, provide my analysis of them, build and maintain financial relationships on behalf of my clients (ex. banking, insurance, etc.). Also special projects come up from time to time. Recently I helped a client who's exploring another business opportunity build a model to analyize production levels and the related impact to operating costs.

Regarding the tax work, I prep all of the information at year end and forward it to a tax lawyer/CPA for the actual return prep. Some of my clients operate in multiple states and I have neither the time nor the interest in studying tax law changes in multiple states every year. I oversee the return prep to make sure it's done in a very timely manner and obviously handle any questions that arise during the return prep process. I consider this a value added service for my clients as they are entrepreneurs by nature and don't like detail oriented tasks like tax return prep.

As I have no staff (I'm even blessed to work out of my house), I don't do audits or reviews. I suppose the monthly statements I prepare could be considered compilations, but I don't issue a formal report with them. I suppose I could add staff and increase the client base so I could add services like audits, but I'd rather work with my clients than manage staff - just my personal preference.

Best of luck and let me know if you have any other questions.

John

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Permalink Reply by Kent Haley on October 31, 2012 at 6:11pm

John,

Thanks for your answer. I have about 1 1/2 years experience in tax and about 2/12 in audit, for a total of 4 years. Do you think its possible to be a self employed CPA with this much experience? It seems like most CPAs out on their own have quite a bit more.

Thanks again,

Kent

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Permalink Reply by Dan Schmidt, CPA on November 2, 2012 at 9:30pm

Kent,

One suggestion I might have is to inquire around some local small CPA firms and see if they'd like to add a part-time staff in February - April. It would require working evenings and Saturdays for a couple months, but might be a good time investment. And you could take the family on a nice vacation next summer with the extra money to help make up for the annoyance.

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Permalink Reply by John Madison on November 3, 2012 at 5:10am

Kent,

In my opinion, the question is what kind of firm to you want to build and what type of clients do you want. If you want to build a typical local CPA firm (lots of individual tax returns, maybe an audit or two, etc.), I'd think some more experience would be required. And I'm not sure governmental accounting will give you the experience you need. I'd think a local CPA firm would offer more practical experience and training. It'd give you the chance to work with mulitple clients to see how (or if) you like it.

If, on the other hand, you'd like to set up something more like I have, I think the bigger issue is finding those first clients. If you're a CPA and don't mind doing some basic, bookkeeper type work, too, you could set up a nice freelance controller company - there is surely a market for this type work (but again I think getting started is the hard part). I started out with a couple of clients and have added a couple more, but that fills my schedule. I don't need a ton of clients because I work for the same ones all year long. This may not work with your stated desire to not be chained to a desk.......I do spend a lot of time in the office. But being a freelancer, I have a very flexible schedule so I can break up the day with a nice mid-day run outside, or some other activity. Dan's reply to try some part-time work (if possible) makes sense too as it would allow you to try it out without quitting the day job!

So, what kind of practice do you want? What type of clients do you want to serve? How do you want to spend your days? Answering these quesitions may lead you to the answer as to whether you need more experience or not (and what type of experience that should be).

John

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Permalink Reply by Kent Haley on November 13, 2012 at 6:20pm

Thanks for your response. I tend to agree that i probably need quite a bit more experience . In fact, Im actually not even sure I how far i Want to go with accounting. There are very few days in which I enjoy doing accounting work, which s largely what drew me to the 48 days community - to explore other options. I would love to be self employed, but maybe acc is not the best fit.

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Permalink Reply by Dan Schmidt, CPA on November 2, 2012 at 9:27pm

Wondering if you guys might be up for a conference call sometime, just to have some real-time discussion around this topic. I'm able to set something like that up easily. I do my best thinking in groups - not sure if you two are wired that way or not. I'd send out an agenda beforehand to keep us on track. :-)