The secretary typed the report in the morning. I often wondered what my boss Mr. Ruben did, and whether there have been any changes in that in the half century since I started?
There have been no changes—or to state it more clearly— there should have been no changes. Here’s why.
My boss took the typed financial statement to the client, sat down with him for an hour or so, and talked about the business. On some basis, the statement was the admission ticket to the discussion.
What happened was that Mr. Ruben would discuss the previous month and the year-to-date results. They would review any differences in items from what was normal or what was expected. They would also compare this year to the previous year or two and possibly the next year or two. They would look at trends that were either starting, developing or continuing.
Taxes were always an issue, so Mr. Ruben would discuss the projected taxes and determine whether it was on target as well as the potential to reduce them. If time permitted, they would discuss the client’s plans for the future, any new products in the hopper, the need for additional financing, bank loan covenants being met, and bank charges if the client was factored or had rigid compensating balance arrangements.
They also discussed key employees, adding or reducing personnel, new equipment needs, whether moving was a thought, and any plans the owner had—if any—to sell their business, buy another one, groom a successor or retire. While they were at it they discussed the client’s personal wealth accumulation, his investment portfolio, whether the business’s value was growing, and whatever else the client was involved in and wanted to discuss, share, vent or get an outside informed opinion on.
So, that is what Mr. Ruben did, and my question to my readers is, “Is this what you do?” I know I and a lot of my partners do this. If not monthly, then at least four or five times a year. This is the way you form relationships and bond with a client. This was so 50 years ago, and also when my father did it in his practice 30 years before then. And neither Mr. Ruben nor my father lost clients because of inattention, or because something was going on they did not know about.
This is how they became their clients’ “Trusted Advisors” long before that term was ever coined by a professional association. If you are not doing what they did, then I suggest it is time to start. It is things like this that have made me successful and made my job a joy.
Edward Mendlowitz, CPA, is partner at WithumSmith+Brown, PC, CPAs. He is on the Accounting Today Top 100 Influential People List. He is the author of 24 books, including “How to Review Tax Returns,” co-written with Andrew D. Mendlowitz, published by www.CPATrendlines.com and “Managing Your Tax Season, Third Edition,” published by the AICPA. Ed also writes a twice-a-week blog addressing issues that clients have at www.partners-network.com. Art of Accounting is a continuing series where Ed shares autobiographical experiences with tips that he hopes can be adopted by his colleagues. Ed welcomes practice management questions and can be reached at (732) 964-9329 or firstname.lastname@example.org.