A changing landscape presents challenges, opportunities

While it may not represent the best of times for the Scranton, Pennsylvania-based – and wholly fictional paper company Dunder Mifflin, made famous in “The Office” – the changing landscape 

of the accounting profession is an exciting time.  The days of ordering paper by the truckload are long gone and the accounting game is faster than ever. 

Michael A. DeCataldo, CPA/PFS, CFP, MST, Managing Partner at Sansiveri, Kimball & Co., L.L.P. in Providence, sees a changing landscape for the profession of accounting dominated by technological advances, all designed to not only move information faster, but with the immediacy that clients now demand. 

“Technology is clearly transforming how we do business,” he said. “Firms that survive will be paperless and rely on 24/7 connectivity. The successful accounting firm will be the one that uses technology to move away from historical reporting of financial statement data and tax return preparation to a firm that brings new ideas to their clients, assists them in growing their businesses and is proactive in business and tax planning.”

DeCataldo says Sansiveri, Kimball & Co., L.L.P.  is “all in” when it comes to electronic communication. 

“We are moving toward being 100 percent paperless,” he added. “We file as many returns electronically as we can.  All of our internal copies of financial statements, work papers and tax returns are stored digitally with multiple back-ups.” 
Technological advances represent one facet of a changing landscape, but there are others. A trend that began at least a decade ago – the consolidation of accounting firms – continues to re-shape the industry as a whole. 

“Medium-sized firms like ours will have to find ways to compete with larger accounting firms that will try to make in-roads into Rhode Island,” said DeCataldo. “This movement can be directly attributed to the aging of our profession. Many accounting firms lack a succession plan that communicates their strategy on how they intend to transfer ownership and control of the firm to the next generation.”

Gregory Cabral, CPA, MST, is a Managing Partner in the Providence office of one of those larger firms – BlumShapiro.  Like DeCataldo, Cabral also sees a countless technological advances at the forefront of a changing landscape.  He believes the most successful firms, regardless of their size, will be the ones who continue to use technology to create greater efficiencies for their clients. 

“The attest function software needs to integrate with the tax software and vice versa to make our annuity work more efficient,” said Cabral. “This is already taking place but needs to become more seamless and inclusive. Additionally, the use of benchmarking software has allowed the profession to perform analytics for our clients using the information received during our annuity work. This provides clients with valuable information to help them run their businesses. Clients want accountants who understand their businesses.”

At Otrando, Porcaro & Associates, Ltd., in Warwick, Gregory A. Porcaro, CPA/APV, MST, CFF, points out that technology has been “a force effecting our profession since the 1980s.”

“For the most part, it has been my observation that CPA firms have adapted to changes, but at different paces,” said Porcaro. “There are early adapters and late adapters.”

Much to gain by embracing change

If there is one constant, it is the idea that change is something CPA firms – from sole proprietor shops to national giants – should embrace.  

“As a smaller firm, we are able to adapt very quickly to changes in the economy and the professional environment,” said Porcaro.  “As a result, we have significantly increased the services we can offer to a client. I have an excellent staff and I try to seek out their areas of interest.  In doing so, I encourage them to enhance their knowledge and skills by providing in-firm training and experience to create a dynamic work environment.”

At BlumShapiro, Cabral reiterates the idea that firms willing to embrace change have much to gain. He also sees targeted training as an area for positive change. Cabral believes the profession needs to move in the direction of industry specific training as a way to “educate professionals in industry related issues to go along with traditional attest and tax training.” It is an approach that could impact a firm’s structure in terms of personnel.  

“This will likely lead to hiring some additional skill levels in order to provide clients with the services they desire,” said Cabral. “Most accounting firms hire accountants, but to really provide clients with the services they require, I believe firms are going to need to hire finance professionals, economists and engineers, just to name a few additional disciplines.” 

The expansive services that Cabral describes are driven by the advances made possible through technology.

“We are a believer in technology and the efficiencies gained through the use of technology,” he said. “We have hired several computer and software professionals.”

BlumShapiro has developed a growing consulting group consisting of engineers, strategist, manufacturing experts and IT professionals.

“This allows us to provide our clients with services far beyond the accounting and tax services of a traditional accounting firm and has allowed us to become a total business advisor to our clients to help them become more efficient and profitable,” said Cabral.  

A people business

Even with the ability and willingness to tap into technology, the accounting profession remains a people business. Attracting and retaining talent may yet be the single most telling barometer of a firm’s success. At Sansiveri, Kimball & Co., L.L.P.  DeCataldo points out several approaches that have produced results over the years. Among them are financial assistance to employees in meeting their credit hour requirements and in preparing for the CPA exam; 40 hours per year of continuing professional education; and half-day Fridays during the summer. Flexible work schedules are also important to employees and their families. 

“Our overall hiring process has not changed significantly over the years, but each year we fine tune the process,” he said. “One of our biggest advantages in attracting and retaining talent has been our ongoing internship program that was established in 1986. It began with two students and has grown to 12. We use this program to introduce the best and brightest students to our firm and to show them an excellent alternative to the Big Four.”       

At a smaller firm like Otrando, Porcaro & Associates, Ltd, the hiring process can be a challenge. Here at least, Porcaro describes an old fashioned approach that seems to rival one driven by any technological advances. In fact, said Porcaro, web-based job postings have produced limited returns.

“When necessary I get the word out that I’m looking for staff member via my network of friends and business contacts,” he said. “To be honest I have been able to maintain our service level without having to increase staff because of the way we utilize technology and the efficient manner in which we handle engagements.”