It’s great to be a CPA and have an accounting practice. It’s fantastic to be thought of as the “most trusted advisor.”
But in our new modern world, which includes being connected in the cloud, automation and artificial intelligence, it might be better to designate oneself as a “Certified Professional Services Advisor” or “CPSA” (a name I’m making up) to help individuals and businesses be more liquid, profitable and solvent.
The nature of accounting and taxation has greatly changed from a manual process to total automation, so much so that individuals and businesses want to be able to access their data 24/7. They want automation and AI to tell them what is happening. We are seeing a whole new set of advisors coming into play in accounting. Even CPA firms see this and are rebranding.
I took a look at several CPA Web sites. A good example is Deloitte, which states, “Deloitte is the brand under which tens of thousands of dedicated professionals in independent firms throughout the world collaborate to provide audit, consulting, financial advisory, risk management, tax and related services to select clients.” Notice that it doesn’t say, “Deloitte CPAs.” If I were to take out audit services, it wouldn’t necessarily be a CPA firm. It could be a plain old professional services firm that provides the same services. I could make my own firm like this, build my brand, and then go global.
Another one of my favorite examples is Armanino. This is another outstanding CPA firm. If you look at the “About” on their Web site, it illustrates my point that the services they provide can be done by non-CPA firms, except for audit.
It is all about their brand, using technology to replace entry-level positions. One helps their clients by showing them the way to be more efficient and profitable using the tools that the professional services firm teaches them to use. The entrepreneur, business or individual can focus on building their business instead of running their business — including bookkeeping, accounting and tasks that now can run automatically. One still needs the expertise of someone who understands the language of business. Typically, that is an accounting professional. Certification of some sort is desirable, and provides a standard of excellence. Here is where the new professional services firm chips away at the base of a CPA firm’s business.
On this side of the fence are firms like GrowthForce, which is not a CPA firm, but advertises that it will help companies and nonprofits take control of their finances by providing cloud-based bookkeeping, management accounting and controller services. I look at the management and controller services as being advisory services, utilizing technology tools that can analyze key performance indicators and then enable the Professional Services Advisor to give direction to the client.
AcuityComplete is another example of this growing trend of firms entering and servicing businesses in need of accounting and strategic advisory services. If you look at their menu of services, you will see that they provide it all except for attestation services.
Every business that is starting out eventually needs an accountant to help them be compliant in gathering the data and information necessary to file taxes on various levels. Additionally, the enterprise always needs to know if they are making or losing money, the statuses of receivables and payables, and to have their financial statements prepared.
Today’s business owners need advisors to educate them on the processes, procedures and systems to put in place to be able to do all the mechanical work that the accountant would ordinarily do. That is why we see an increase in these types of non-CPA firms being created. They offer the traditional accounting services plus advisory services. Over the next couple of years I expect these new firms to be created by entrepreneurs who are either CPAs or non-CPAs, but employ accountants and consultants to work for them as they attack the 28 million-plus businesses in the United States, plus many more on the global scale.
Most of these new non-CPA firms are small in nature but they will grow as they fill the void. A good example of this is Supporting Strategies, which identifies itself as a “Partner for Bookkeeping Services and Operational Support.” This is an excellent way for any young entrepreneurial accountant (a.k.a. non-CPA) or CPA to acquire a franchise and learn the steps to grow their firm.
The bottom line is the world is changing and new business models are being built. CPAs who follow the principal of “SALY” (same as last year) and focus on compliance will lose out. Millennials who harness the power of technology and don’t want to wait 10 years to become a partner in a traditional CPA firm will soon take over. I am glad that I am a Millennial in a Baby Boomer’s body.