Accountants to stay in high demand, says local leaderJanuary 19, 2014
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Jim Reeves, Thomson Reuter Tax and Accounting
Accountants and auditors are among the top five most in-demand jobs right now, according to a recent Time magazine article.
Certified public accountants find themselves in an enviable position relative to many other professions and vocations, says Fort Worth CPA Jim Reeves. Reeves is vice president, professional tax market and federal tax product line, for Thomson Reuters Tax and Accounting. His responsibilities include segment and product line growth strategies, product management and new product development. He is also the site leader for the Fort Worth office.
“Demand for talent is at an all-time high and should continue for the foreseeable future,” Reeves said. “However, despite the fact that we’re seeing a record number of new entrants into the profession, it probably won’t be enough to replace retiring baby boomers over the next 20 years, due to the growing demand for tax and accounting services and the disproportionate share of CPAs currently over 50.”
Reeves joined Thomson in 1988 to help start the PPC Audit and Accounting guidance product line. He currently serves on the American Institute of Certified Public Accounts (AICPA) Council and on the boards of the Texas Society of CPAs and the Fort Worth Chapter, TSCPA. Reeves has been recognized for meritorious service to the accounting profession by the local chapter and has been named a Lone Star Pathfinder by the TSCPA.
He has chaired conferences dealing with e-business issues, multidisciplinary practices, consolidation in the accounting profession and alternative tax systems. He writes a top-rated column in Today’s CPA magazine titled Emerging Issues.
Describe the current state of supply and demand for accountants.
The Bureau of Labor Statistics expects the profession to experience “much faster than average” employment growth in the coming years, estimating a 22 percent increase in the number of accounting and auditing jobs by 2018. Hiring of accounting graduates by public accounting firms is at a record level, and nearly 90 percent of firms are expecting to at least maintain, if not increase, current hiring levels, according to the AICPA’s 2013 Trends in the Supply of Accounting Graduates and the Demand for Public Accounting Recruits.
Texas CPAs in particular are well positioned. Not only is the Texas economy doing well relative to other states, but Dallas and Houston lead the nation in job prospects for accountants, according to a recent Accounting Today survey.
U.S. colleges and universities are enjoying record enrollment and number of degrees awarded in both undergraduate and graduate accounting programs, and in a growing number of cases are actually turning students away, due to both limited physical space and a shortage of doctoral faculty. And while schools do not expect an increase in enrollments at the bachelor’s level over the next two years, they are forecasting strong growth in both MBA in accounting and masters in taxation programs, according to the AICPA study.
What can be done to encourage more students to major in accounting?
Why not a TV show about CPAs? Doctors have E.R. and Grey’s Anatomy, and lawyers have Perry Mason and Boston Legal, but we’ve never had a TV show about accountants. Seriously though, the accounting profession, particularly our professional organizations like the AICPA and TSCPA, are doing a good job of building a robust pipeline of accounting students as we discussed above. They have been increasingly involved with activities like career days at high schools and colleges, reaching out to guidance counselors and leveraging the Internet. Check out the website www.startheregoplaces.com. Ultimately, the market forces of supply and demand will determine where the students and prospective students migrate … They’ll go where the jobs are.
Retaining talent is also a big concern for accounting firms and other organizations that employ CPAs. Retention needs to be top of mind. Fortunately, firms in Tarrant County seem to get it. I saw recently where three Tarrant County firms were recognized as among the top 100 firms in the U.S. to work for in 2013 by Accounting Today.
What are the top challenges and issues for the industry in 2014?
For the smaller firms, it’s keeping up with tax law changes and all the complexity. For slightly larger firms, it’s succession planning, as firm owners try to figure out the most profitable exit strategy as they near retirement age. For middle-market firms, it’s all about growth issues and staying competitive – bringing in new business, retaining existing business, staffing appropriately, and geographic and service line expansion. For the largest firms, those with 20 or more professionals, it’s people issues, including partner accountability and unity.
One issue common to accounting firms of all sizes is the increasing volume of mergers and acquisitions of firms. Whether it’s to acquire talent, clients, expertise, or succession planning, firms of all sizes are acquiring or merging with other firms at a rapid rate. I saw a study that showed 44 percent of multi-owner firms are having M&A discussions with other firms. That’s pretty astounding. The counter-trend is that we are seeing a record number of start-up firms, whether the result of merger fallout, corporate downsizing, technology that enables small firms to scale up, or the good-old American entrepreneurial spirit. The result is kind of a barbell effect, where you have double-digit growth at both ends of the spectrum, with mid-sized firms feeling squeezed.
Other issues the profession is dealing with include globalization, as practically all firms now have clients with international aspects to their businesses. That wasn’t the case five years ago. There is also a big push toward specialization, or what some would call hyper-specialization, whether by industry or line of service. The volume and velocity of regulatory change and the related complexity show no signs of abating anytime soon, driving practitioners to specialize, as we see in other professions. There is no single model for specialists – they might reside within a firm, within a firm’s association of firms, or within informal networks of specialists that can be called upon as needed.
How is technology transforming accounting?
Accountants have been heavy consumers of technology for years. CPAs now have access to information on demand, from a variety of devices that eliminate geography as a barrier and create expectations for real-time solutions. Of course the trend toward wireless and mobile is being felt by the accounting profession just like it is everywhere else. The emergence of e-learning platforms is changing the way CPAs meet their continuing education requirements. E-books, with key word searching, hyper-linking, and cloud-based features such as automatic updating and saving notes and annotations to the cloud and transferring them from edition to edition, could be a game-changer. Also, we are beginning to see the convergence of information and software in the form of decision tree applications, document assembly tools and mind-mapping software.
Despite all the productivity advances, the No. 1 issue in the AICPA’s Top Ten Technology Initiatives is data management, including security and privacy, and managing information technology risk. Practitioner concerns extend beyond issues arising from the loss of data itself, to the malpractice risk that is now top of mind. Developments like cloud computing and BYOD (bring your own device to work) exacerbate the risk.
What technology skills will CPAs need to be successful in the next decade?
The first one that comes to mind is advanced data analytics. At some point it will no longer be sufficient to prepare an historical-based document, such as a financial statement or a tax return for a client, send out a bill and call it a day. With all the hype about “big data,” client expectations will be a lot higher, expecting their tax and accounting professionals to interpret and benchmark the historical data and provide value-added insights. Firms that do the best job of that will be very successful.
Mastering an array of collaboration tools will be essential as geographic barriers disappear and firm members and clients increasingly work from disparate locations. From holding virtual meetings to video-conferencing to instant messaging, collaboration using technology tools will soon become essential. Mastering information assets and tools that help the practitioner research, understand and apply rapidly changing and complex tax laws and accounting standards will be essential. I see too many younger professionals today beginning and ending their research with Google, and that’s risky business, to say the least.