Art of Accounting: Exciting sharing meeting

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Last week we had our annual Partners’ Network Power Breakfast. We decided to make this a sharing meeting and asked six colleagues to share their experiences in their practices, getting into their own practice, and using techniques for getting new clients and the discussions were amazing. Here are some highlights.

Shari Canell, a CPA in Freehold, New Jersey, told of how she had to be “forced” to start her practice. It was not something she wanted and she turned down the opportunity a few times until she had no choice but to proceed.

Shari started her career in private for a few years and left to become a full-time mom. When she wanted to return to the workforce, she got a three-day-a-week job with a CPA who patiently taught her whatever she needed to know. After a number of years she was asked if she was interested in eventually acquiring the practice — numerous times — and each time she said she did not want to be an owner or a partner. She was happy with the way things were going.

At some point, her boss got seriously ill and eventually died. Before that, she reluctantly agreed to acquire the practice. By that time she knew all the clients and was really running the practice. She took on the other key employee as a partner and her practice has grown pretty well with some very sophisticated client work.

During her period of indecision she met Marty Abo, a well-known accountant in our area who advised her and pushed her into becoming a businesswoman. They met when they sat together at one of our Partners Network CPE programs. When she prepared what she would say at last week’s breakfast she called Marty to find out if it was OK to mention his involvement. Not only did he say yes, but when I called him to thank him I found out about two of his great checklists. Now I will be adding them to my tax season checklist file, bringing the checklist total to over 80 items. These will be distributed at the end of January for free to readers of my column here.

The next speaker was James Matthews, a CPA in East Brunswick, New Jersey. His story was quite different. He wanted to develop a practice and purchased a bookkeeping franchise. He had a 10-year contract and was building his practice separately, so he had a pretty good practice by renewal time and did not renew. He wanted to merge upward, but after meeting more than a half dozen practitioners, he decided to remain alone and started hiring staff.

Fast forward a few years and he adopted as his exit plan to keel over at his desk, which his wife wasn’t too fond of. As luck would have it, one of his young staff members was a real go-getter and evidenced the qualities Jim felt would be perfect to carry on after him, so Jim offered him a partnership. The practice today is on a healthy growth track.

Michael Nulty, a CPA and Jim’s partner at Matthews and Nulty, spoke about what he did that he felt Jim would like, and it worked. He also talked about the weekly morning networking breakfast group he joined and his success with that. He also is very successful getting clients from Facebook and the weekly Tax Tip Tuesdays they post during tax season. He writes them and also monitors the “likes” and comments. He then follows up, which he says is the key to being successful with social media. He also indicated that many of the referrals he gets are better clients than the referral sources. Hmmmmm!

Gino Mallamachi, a CPA in Morganville, New Jersey, is the consummate showman. He doesn’t talk, he performs. His office is a veritable playground for clients and their children, who insist on going to the accountant with Mommy or Daddy. Gino’s firm does about 750 tax returns and his key staff person of over a dozen years received the highest grade on the CPA Exam the year he took it. Gino handed out an analysis showing the source of his last 230 new clients: 66 came from Facebook and 102 from existing clients. The balance was spread over seven sources, including the breakfast networking group he belongs to. The client referrals are precipitated by a $100 discount certificate he periodically distributes to clients. It works!

Gino also has a hobby called Mallamachi Tours. He conducts all-expenses-covered tours to Italy and has completed more than 60 tours. He loves this and only recently has started to make money. If you want a trip of a lifetime to Italy, check out http://mallamacitours.com.

Michael Slotopolsky, a CPA in Morganville, New Jersey, started his career with me in 1979. He left my New York City practice when I left and joined another firm for five years. He then left to join a firm that wouldn’t credit him with the many new clients he was getting. He described a few horror stories, including one where he was sued by the national firm he ended up with as a partner after a series of upward mergers by a firm he had joined. When he decided to leave, he took the clients he brought in and was sued. After $100,000 in legal fees, he settled the case by paying $100,000.

This was a bad nightmare created by a small-minded large firm trying to bully him, because they could. Also, they ended up netting zero because their legal fees of about $100,000 were offset by the $100,000 settlement they received. This meant spirited action caused harm to a small colleague where they couldn’t have benefited. This turned out to be a blessing since he was forced into his own practice with one of the staff people he trained. Today, after 14 years he and his partner have an extremely successful 25 person practice.

The final speaker, Salvatore Collemi, a CPA in Marlboro, New Jersey, is an auditor’s auditor. He is an outsourced technical partner serving smaller firms that have not yet reached the point where they could afford a full-time quality reviewer. His SEC background and his experience working with many firms provided him with a range of services and industries that most smaller firms could not hope to acquire — yet they instantly have when he walks in their door. Sal brought along a PowerPoint presentation and when he reached the 25-minute limit I gave him, the attendees were upset he had stopped. It doesn’t happen too often when accountants attend an auditing CPE program and want it to continue, but that’s what happened. However, Sal left us his PowerPoint so it could be reviewed fully and serve as a reference source.

I also spoke to some extent, but I was enthralled with what each person told us. I know them all well and knew bits and pieces of their stories. But hearing them tell it in an organized manner gave me insights I wasn’t aware of.

The two-hour CPE program flew by and proved that a program with personal experiences presented by colleagues with short vignettes in a well thought out manner can be valuable to fellow professionals. Also attending were three young staff members from my firm, and they thanked us for the view into the profession this program gave them. I am grateful to my six friends for sharing their unique experiences. It also proves that CPE can be exciting.

If anyone would like to duplicate this format in their state society or with a group of colleagues, contact me for further information. I would be pleased to assist you.

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, and “Managing Your Tax Season, Third Edition.” Ed also writes a twice-a-week blog addressing issues that clients have at www.partners-network.com along with the Pay-Less-Tax Man blog for Bottom Line. Ed is an adjunct professor in the MBA program at Fairleigh Dickinson University teaching end user applications of financial statements. 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 emendlowitz@withum.com.

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Client strategies Practice management Succession planning Continuing education Ed Mendlowitz