African-Americans comprise just 3 percent of CPAs nationwide — but Dr. Frank K. Ross is working to help change that.After a 38-year career with KPMG, where he held such posts as mid-Atlantic area managing partner for audit and risk advisory services and managing partner of the Washington, D.C., office, Ross retired and now serves as director of the Howard University School of Business’ Center for Accounting Education, an entity that is focused on boosting the number of minorities in the accounting profession.
The center holds seminars, workshops and executive education sessions, as well as providing scholarships, funded in part by proceeds from the sale of Ross’s autobiography, Quiet Guys Can Do Great Things, Too: A Black Accountant’s Success Story.
Ross also sits on the board of Pepco Holdings, and Cohen & Steers Mutual Funds Group, and chairs both companies’ audit committees. He also serves on the board of several nonprofit organizations, as chairman of the Hoop Dreams Scholarship Fund Inc., and as treasurer of both the Greater Washington Urban League and the Howard University Chartered Middle School for Mathematics and Science. He also is a visiting professor of accounting at Howard.
Recently, he spoke with WebCPA editor Mike Cohn about the CAE, what needs to be done to recruit more minorities into the accounting profession, and how to help them advance their careers once they’re there.
What is the overall mission of the center?
Ross: When I retired from KPMG, the center set its mission around trying to look for ways to increase the number of minorities in the accounting profession, not necessarily focusing on recruitment, but on the area of upward mobility and retention, having them stay longer, as well as passing the CPA Exam earlier in their careers and then moving within the profession.
The center’s mission really has two key parts. First is to increase the retention and upward mobility of blacks in the accounting profession. We do that by focusing on programs to increase the numbers passing the CPA Exam and providing leadership training that will help improve their performance from Day One, as well as help support them in a nurturing network, which helps them stay longer with their firms. We supplement what the firms, corporations and professions do. We’re not trying to replace or duplicate the firms’ programs.
Do you find that the firms have effective programs in place to increase the recruitment and retention of minority students?
Ross: I think all the major firms have set that as a goal for themselves, and as a result they are all trying to come up with programs. I don’t know of any one firm that has found the answer of how best to do it. But they’re all committed to trying to improve the number of blacks and minorities as we advance in the profession.
Are you finding that minority students now have more desire to enter the profession?
Ross: I think the numbers are increasing. I know the American Institute of CPAs is updating their study and that probably will be out in the next couple of months. But I do see the numbers increasing. At Howard University, for instance, the number of accounting minority students has gone up over the past couple of years, so the minority students are finding the accounting profession interesting.
But I think what needs to happen is that they need to see more success stories. They need to see more African-Americans become partners and take on leadership roles within the firms. Once they see that, they’re going to then start to believe that it’s possible for [them] to do it, too.
Do the large firms, midsized firms or smaller firms need to do more?
Ross: I think the Big Four firms are definitely leading the way. Then I think the Grant Thorntons, RSM McGladreys, BDO Seidmans, the national firms, are also stepping up and starting to do more.
Then I think you have a handful of other firms like Plante & Moran that are regional, or maybe national and not as large, doing it, but for the majority of other firms, it’s one office, if at all. It hasn’t filtered down to the entire profession.
Do you get much support from larger or smaller firms?
Ross: The support of the center comes primarily from the major firms, along with the major minority-owned firms. We have what we call “stakeholders.” They’re the ones that fund our program. And that consists of about 17 organizations, including the AICPA and the National Association of Black Accountants. It includes quite a few black-owned firms, as well as most major accounting firms. It does not have small, white-owned accounting firms. We would love to reach out and have a much broader support base, but we have not been successful at this point.
Do your students tend to join these firms, or do they become sole proprietors or team up with each other in partnerships?
Ross: Most of them, if not all of them, go into existing firms or they go into corporations or Wall Street firms or government. Very few start their own practice right away. Once they get a couple of years’ experience, I think some of them may then start their own practice, but it’s not a large number. Most of them go into the big firms or big corporations and move along with those corporations along their career path. Some of them leave the major firms and join one of the existing minority-owned firms. That can happen.
Is there a large presence of minority-owned firms?
Ross: There is a good-sized number. NABA has what’s called the NABA Division of Firms. There are some very large firms, in the sense that they have a couple of offices and over a hundred-plus professionals working for them. That’s $10 million plus, maybe much larger. Some even have $100 million in billings.
Some of the firms include Williams, Adley & Co. in Washington, D.C. In California there is TCBA, which has offices in three or four cities, including Torrance on the West Coast and Atlanta. You have Mitchell & Titus, which has hooked up and become a member firm of Ernst & Young. There’s McConnell Jones Lanier & Murphy, a very large firm out of Houston that does not only audit and tax, but also consulting work.
Do many of your students tend to go to one of these firms first, or do they opt for a Big Four firm first?
Ross: I think they tend to go into one of the larger firms first, and then from there they either end up going into corporate America or they go into one of those minority-owned firms. But the graduates coming out of schools tend to go to Wall Street. A lot of our graduates are joining Morgan Stanley, JP Morgan, Credit Suisse, and a lot of them go with the major corporations: Microsoft, McDonald’s, Johnson & Johnson. Or they go with the federal government: the Government Accountability Office, the Treasury, the Labor Department. So the minority students coming out of one of these schools have opportunities to go to not just the Big Four firms now. They can go into major corporations, major financial institutions, or into government.
Are there particularly popular areas that your students are attracted to these days?
Ross: A lot of them are still interested in auditing, but some of the areas that have attracted them are forensics and the advisory type of services that the major firms are providing. And, of course, a lot of them are still interested in going into the tax area.
What do you think firms should be doing to increase minority recruitment and retention and improve diversity?
Ross: One of the things the center is going to be doing is sponsoring a couple of studies around that issue, of retention and upward mobility. What you need to do is make certain that you give them the best experience immediately once they join the firm so that they can grow.
They need to work with the best people. They need to work on the best developmental assignments so that they can develop as fast as anyone else. They need to have proper mentoring, and the mentor needs to be somebody that is looking out for them, that is going to become an advocate for them, somebody that is going to make sure that their assignments are the best assignments, not just counseling them. And then the firms need to have a nurturing environment where they can feel comfortable and feel that they belong and they can perform.
And then finally they need to see people advancing up to the higher levels of the firms. If they see more people at the partner level, in leadership positions, running practices, making key decisions, they then will say, “If they can do it, I can do it, so therefore I have a chance.”
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