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Art of Accounting: My tax reviewer wanted a ‘more important’ role

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At some point in my practice I had to ask a staff person if he would want to specialize in taxes. The first time occurred over 35 years ago when my main tax reviewer left for a position with another firm where he would be “more important than just a tax reviewer.”

What precipitated his leaving was a meeting in which I told him we wanted him to do more research and planning and less reviewing and training. I said he could hire an assistant whom he could train to take over more of what he was doing so he would be freed up to move to the next level. I also told him I would personally supervise him to bring him forward. He indicated he wanted to stop reviewing immediately and we should hire the assistant and train him. When he left that meeting, I knew he was going to leave but figured it would be after tax season. This was in late December when we had our performance review, and he received a very good raise. We liked him and had high hopes for him.

Three weeks later, in mid-January, he gave us the obligatory two weeks’ notice and he left January 31. Seven weeks later he called and asked if he could return. We told him his job was filled, but he could work on a per diem basis through tax season and until he got a job. We knew it would not be possible for him to get a job then, and it would look terrible if he said he was let go during the heat of tax season.

What happened was quite simple. His new job was for someone to do the heavy research and planning needed in the heat of tax season. He was not qualified for that. They did not need another reviewer. Considering the high salary he was hired at, the head-hunter who placed him gave a two-month guarantee, but he was let go before the firm had to pay the search fee. We took him back for a number of reasons:

1. We were able to use him to prepare our complicated returns.

2. He was a good and diligent worker and extremely competent for what we would assign to him.

3. We liked him.

4. He had a family and we wanted to help him so he would not be without a paycheck.

5. We wanted to spare him the embarrassment of looking for a job at that point in tax season. Also, we were nice people.

When he gave notice, we immediately replaced him with an audit person who had three years’ experience and who had earlier expressed an interest in moving to the tax department. Also this person was simply brilliant and we knew he could rise to the occasion. He had started with us out of school and we trained him, so he knew our systems and procedures, and our staff and clients. He did very well with us. When I left that firm in 1988 to join with Peter Weitsen, he also left and went to a much larger firm where he eventually became a tax partner.

The guy who left and then returned seem to settle in with us. He was more relaxed since he had much less responsibility but did very well with the extended tax returns and we got a lot of work out that would have sat around the office until September. It was a win-win. However, in mid-June he pointed out that it looked like he was staying with us. Instead of the per diem basis, he asked if we could hire him back permanently with the benefits he was getting, including medical coverage and holiday, vacation and sick days. We then told him that it was time for him to get the job he wanted, and he left a few weeks later.

The firm he joined gave him the title he wanted but had him primarily reviewing tax returns—they just called it something else. And he eventually became a partner there, never reaching the research and planning that he wanted to do. Instead of that he oversaw a group in the tax department spending most of his time reviewing and training, and doing the administrative oversight a partner needs to do. But he was happy because he had the right title and then became a partner. I knew all of this because I kept in touch with him.

About a year after he joined the firm where he eventually became a partner, I ran into the partner who hired and fired him when he left us the first time. I asked how it was possible for him to be doing so well at the new firm when the partner and I did not think he had it. The reply was “reduced expectations!”

He was excellent at what he was doing, but on some level we did not believe he had the ability to advance to the next level, although we were willing to give it a try. He misjudged his role and, while he ended up with a successful career, the firm that hired him placed him in a perfect role. They just called it what the staff person wanted it to be. Sometimes perception is more effective than reality.

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. 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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Tax practice Employee retention Partnerships Tax research Tax returns Tax season Ed Mendlowitz
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