Speaker 1:
From Carr, Riggs & Ingram, this is It Figures, the CRI podcast, an accounting, advisory and industry-focused podcast for business and organization leaders, entrepreneurs and anyone who is looking to go beyond the status quo.
April Shuping:
Welcome to the latest edition of It Figures. I am April Shuping. I’m a partner in our Gainesville office that I deal with a lot of local government audits. We’ve got with us today two other amazing partners, Matthew and Sandi. Matthew is also a partner who actually deals with different kind of audit work, and Sandi is our top HR expert. She works in our corporate office and we have got her on. Matthew and I are going to have a conversation with her today about something that I think is really relevant to anyone who might listen to this podcast, which is a potential shortage of CPAs.
I will admit, I’ll try not to age myself, but for many decades now, I’ve been hearing about this potential pipeline problem, Sandi, and it’s something that I think is really critical to learn a little bit more about. Is it really a problem? What are we doing about it? What are our solutions? So I was hoping to pick your brain a little bit today. So let’s start with, from your perspective, is there a pipeline problem? Is this just all made up or is there really something serious that we need to address?
Sandi Guy:
I mean, you see my gray hairs, right?
April Shuping:
Yes.
Sandi Guy:
It is a problem, and I kind of giggled a little bit when you said potential. I’m like, “Potential?” It is here. It is not just the elephant in the room. It is the entire bird in the room. I remember back in 2000, I think it was 2004, I was at an AICPA presentation and it happened to be Barry Melancon presenting, and he was talking about the war on talent and he had this graphic that showed this nexus point in 2014 where the demand for public accountants was going to outweigh the supply. And I remember sitting there 2004 having a full-blown panic attack of what am I going to do by 2014, like, “Oh, my gosh, at least I got time. Let’s bust to move.” And let me tell you that nexus, it just kept growing and growing and growing.
So I personally have been in the public accounting space and the talent space for 25 years and it has never gotten better. It has continued to track where that demand is outpacing the supply. So I wish you were right, April, and we were still at the “potential” phase, but I think we can tell by my gray roots, no, it’s here and it’s been here. It’s for sure a thing.
April Shuping:
I mean, it’s definitely been my experience to see that as well, and thanks for your thoughts. Of all the people in the firm, Sandi, I think you would know the best because you’re the ones we come crying to when we need more staff and we need managers, I mean, entry-level managers, partners. It’s really hard to find qualified CPAs or even potential CPAs, accounting graduates who are interested in making this their profession. So it’s good to get a little validation in here that it’s not just my office, it’s not just my experience.
Sandi Guy:
It’s not. It’s not just our firm. Myself and my peers at the other firms when we talk about it, every two years, AICPA puts out what they call the trends report and it’s looking at enrollment into accounting programs and then passage of the CPA exam and things of that nature and they explore where it’s coming from. Again, my hairdresser is going to have a lot of job security with me for quite a while because every year, you see that enrollment in accounting programs continues to decrease for a variety of reasons. I mean, there’s so many options for kids not just going into college, but when you’re going into a business school, there’s so many different specialties and things you can do other than accounting programs that can be more appealing. And as you’re entering that, you’re looking at, well, what are the job prospects, but then what’s the certifications.
And I think part of what’s prohibitive to people is certainly some of the requirements. You could go get your MBA and work in corporate accounting or go work as a consultant or things like that and not have to … You’re getting that master’s degree, but you don’t have to go sit for your CPA and do all that other stuff, and there’s a financial component to it. So there’s a lot of reasons, but it goes as far back as just even enrollment in accounting programs at universities.
The good news is if you have kids, there’s a lot of great options of career paths in business schools. The downside for public accounting is there’s a lot of great options when people go in. So for me, it’s really to start at the root of that and what are we doing to promote public accounting, well, accounting as a degree, but then public accounting as a career and make that value proposition one that resonates with, I hate to say it, y’all might roll your eyes, but with high school juniors and seniors as they’re looking at schools to go to and programs to get into.
April Shuping:
That’s a really good insight that when we start thinking about let’s look for interns in college, we might’ve already missed the boat.
Sandi Guy:
Oh, 100%.
Matthew Montemayor:
They got to start a bit earlier, right?
Sandi Guy:
Right.
April Shuping:
So I think that leads into a question I had for you, Matthew, your experience, and just think back to high school, junior high, college. At some point, you decided to be an accounting major, I’m assuming, to get to where you are today. There’s a lot of talk amongst the profession about why we are not getting that original push into the pipeline of people deciding to take the accounting major and then eventually actually graduating with an accounting degree, that first step. Can you think back to when you were in college or high school and what are some of the reasons that maybe you had heard maybe from your friends who were art majors or your friends who went into finance, what do you think some of the reasons are that we aren’t getting as many students that are actually declaring accounting as their major and then going forward all the way to graduation with that as their degree?
Matthew Montemayor:
That’s a good question, and I think it’s one that we could continue to talk about this entire podcast, but I was one of the few that took Accounting 1 and 2 in high school. So I had my decision made up back when I joined high school and was taking these accounting courses, but I think there’s many factors that impact individuals that are pursuing their college degrees and that may go off a different road rather than accounting, but Sandi touched on a lot of them. One of the top three that I would think would be just the passion and the interest in the accounting field.
The accounting profession might not be seen as an attractive career or exciting career path for some of the younger generation. It’s not one that stands out and they might not see it create an impact in the society or they might not see themselves standing out in society. So that might be one of the reasons why they don’t have that drive to pursue an accounting degree.
Another factor, I think, is an important one, one that we’ve always seen is the salary comparisons into other degrees out there. The starting salary for accounting degree is a bit lower than other degrees out there, and that is one of the mantras out there that they see.
The last one being, the additional educational requirements and as well as the additional hours that you need to get the 150 to take the CPA exam and the mantra of that in the accounting world, you’re working X amount of hours above the original 40-hour workweek. So that creates a stigma on the profession. I think growing up and going through my career path and my educational career path was accounting is going to require a lot of work. You’re not going to start off with a great salary, but in the long-term, always not so short-sighted, if we could get these younger generation to kind of see in the long-term, it has its benefits and you have the opportunity to grow.
Specifically if you’re working in public accounting, this is a profession where you could grow and work to become an owner. You can become a partner and be a part of a firm, and that was the sight that I had. So if you just thought about it, if you had a listing of college degrees and each degree you had side by side, you had the level of effort and the amount of work you had and the salary, odds are a college student is going to go look for the one that pays the most and what has the least amount of work. That’s where the younger generations are looking at.
But I think overall, the ways that we could go forward and improve and keep these college students on a track to pursuing their accounting degree is just making the academic experience engaging, as well as getting out there in front of them so that way they could have that mentorship or they could have that support system to understand that this is a good career path for anybody to take on.
Sandi Guy:
Matthew, it’s so interesting that you referenced compensation because there’s been a few models. I’ve seen a couple of the state associations have pulled together these models where it looks at degrees in business schools and the earning potential over time. So you can see right after graduating, whether it’s with master’s, MBA or whatever, there’s some variation there, but you watch the trajectory of students going into public accounting, and I think that those two lines start to cross around, I think it’s like the seven to 10-year mark, which we all know that’s about when you’re right through the partner track, but the long-term earning potential for people choosing careers in CPA is far greater in those who right out of college maybe got their master’s or their MBA and went that route.
But I get it. When you’re young and you’re starting out, you’re now, God help you if you’re paying a student loan, having to repay that, but you are getting an apartment, you’re in a new city and it’s a … When you get out of college, there’s a lot of financial burdens there. So if somebody’s willing to offer you five, 10 grand more a year, which materially might not seem like a lot, but when you’re just starting out and all that kind of stuff, it makes a difference. So I can understand why somebody coming out of college, they are looking more short-term, but gosh, when you look at some of those models that these associations have done and seeing just how different it is when people hit about that 15-year mark in their career, those who went into public accounting, oh.
And let’s be honest, when you graduate with a degree in accounting, it’s not like you’re below the poverty level. You are making a good salary, but compared to, say, an MBA starting salary if you’re going to one of these large consulting firms or something, but I always encourage students, when you’re looking at what you want to do in your career, whether it’s, “Hey, do I want to go into tax, audit, advisory?” or whatever and you’re also looking at your offers, try to look at that long-term earning potential because it shocked me the first time I saw it. I knew it was greater, but it is significantly greater for CPAs who go into public accounting.
April Shuping:
I think that’s really good point, and I find it fascinating, Matthew, that you actually had Accounting 1 and 2 in high school.
Matthew Montemayor:
I was going to bring my certificate and show it off, but I’m in the office at home.
April Shuping:
We definitely need more of that. And I also think it’s interesting thing for non-traditional students or students who are first time college. I know when I was trying to decide what to be, it was an engineer and an accountant, and I picked accountant because I didn’t actually know what engineers did because I grew up with a blue collar family and no one gone to college before and I actually babysat for CPAs. So I was like, “Oh, I guess I’ll do that because I kind of know what that is.” So getting that message out of what those different career paths are, some of the flexibility that you have working anywhere in the world and the country, the long-term earning potential, those are, I guess, the messages that we want to start seeing trickled down to help people make those decisions.
So another place that we see that this pipeline gets clogged up, the proverbial pipeline or real pipeline gets clogged up is we get some people, they decide to be accounting majors, some of them stick it out, they get their degrees, they graduate, yay, they’re going to start working, but we can’t quite get as many of them as we need over the hump of sitting for passing the exam, actually getting that certification to be certified public accountants, which is really, I mean, that’s a ticket to long-term job stability and that trajectory of making money. There’s really not a lot like it that gives you that. So do what you think is happening that we’re getting so many people, and I think I really feel like it’s getting worse, to get stuck at that spot?
Sandi Guy:
It is, and it’s unfortunate because I think the profession is doing things to, I don’t want to say make it easier, but maybe not quite as burdensome, but it seems to be creating a different set of problems. And I agree with you around the urgency because pretty much every public accounting firm, you have to have your CPA certification to advance to manager. So if you go into public accounting, it can be a career, not just staller but a stopper. So right there, again, like that, typically, people make it to manager after about five years or so, assuming that technically they’re strong and performing well. So again, right there where those earnings are about to really start kicking in, and if you hit that wall, you hit that wall. A lot of firms, you can’t be promoted to senior without it. So it is really key.
The obstacles, there’s some consistency there with folks. I think a lot of it does depend on the individual. I’ll be very honest with me. I like to think I’m intelligent, but I’m more like street smart intelligent. I am not a test taker, so I always struggled whether SAT or things like that. It’s kind of challenging in how you study for that. But some of the biggest barriers that are common with everybody, first and foremost, a lot of people cite financial barriers that, again, as I mentioned a few minutes ago, you’re just starting out, you’re putting deposits on apartments. If your car breaks down, you’re responsible. Life continues to life and, boy, lifing can be expensive, so when you add to that sitting fees, prep.
Now, most firms, CRI is no exception, does things to try to help manage that additional cost to sit for the CPA exam. But for me personally, by and large, what I see the biggest barrier, people graduate, they start with their firm as an associate of first year and they’re all excited and they’re high performers, so not picking on new audit partners, but I think you both understand how it works. When you have a high performer, y’all fight to get them on your clients because they do great work and you love having them on there, and they’re not going to tell you no, but that means that their schedule is slam full and there’s not time to properly study and sit.
So what happens over time, it’s like, “Okay. After this first year, settled into my apartment and I’m working hard, establish myself, I’ll start studying the next year.” Again, life keeps lifing. So by now you probably have a social circle where you’re living, you might be in a relationship, starting to maybe settle down, get married, whatever it is, but work keeps happening and you keep getting … Everybody loves how you’re performing, so you keep getting put on the schedule.
So some people, they may sit and not pass one of the parts, whatever first part they sit for, can be very discouraging, and then your schedule. It is this vicious cycle. So I always tell our partners and I’ve probably told you all this before, look, I get it, she’s a rock star, your clients love her, you love her, she does all the good work and meets all the deadline, but when we’re doing her annual planning, let’s carve out time for her to sit and study.
So years ago, and April, you and I were talking about this the other day when I was like, “You have to sit for all four parts at one time years old or are you younger than that?” Years ago when they changed up the exam to make it less burdensome and you could take it in parts, I personally think that was not a great idea just because what happens is people will then take it in chunks, time keeps going, and April, I’d love to hear your thought on this. So back in the day where you had to sit for all four parts at one time and there were only two windows in a year where you would hardcore sit down and study to knock it all out in once, and I think what I see happening now that it’s in parts time and time again, listen, I would be the same, I’m not judging, people will work, they’ll fail one part or maybe they pass a part, but by the time they go to take the second one, the one they passed may have expired.
I think it was a great thought to break it up that way, but if you look at pass rates since they’ve done it, pass rates are a little lower or how long it takes somebody to pass because of that? I don’t know. Since you were take it all in one part years old, how do you feel about that? If it was in parts, do you think it would’ve impacted you differently than taking it all at once?
April Shuping:
So I actually do, and I mean, I had to walk uphill to school and the snow both ways. I live in Florida, but probably not the snow. So you know me, I like to regale people with stories of having to sit for all four parts at the same time two solid days, only twice a year. I mean, you got to have your battle scars, right? But in retrospect, I think you’re right, and I think, yeah, some of it depends on your personality and your lifestyle, but I knew I couldn’t try to work studying in to an active lifestyle. So I intentionally delayed having children. I was like, “I’m not having kids till [inaudible 00:20:10] exam.” It was a conscious decision.
I think if I had thought that, “Okay. Well, I can do one part at a time and I’ve got flexible time,” I had a solid deadline and if I missed that deadline, it was another six months before I could [inaudible 00:20:26] So I do think that as hard and as challenging and just your life just stalls for four months while you study, having that push did put some structure. I think it was structure around it, that really did help keep me focused, put my eye on the prize and get it passed within a reasonable amount of time.
I do think people of my age bracket who also like the hairstylists very much to protect us, pick our identities, I think if they’d really step back and thought about it, there was a lot of benefit to as much as it was very disruptive to any other social life and family life, and I think it was beneficial. Matthew, what was your experience sitting for the exam? You look like you’re one of the multi-part people generation. How was that? And imagine if you could only take it twice a year and had to take all four parts at once, how would that have changed what you did?
Matthew Montemayor:
So my experience was a little bit different from both the years. When I took the CPA exam, it was offered in two-month windows throughout the year. I hear the stories from the partners when I was coming up in the firm of having to take the CPA exam all four sections in one sitting, and I couldn’t imagine the amount of effort and level of studying that had to go in to prepare for that one exam.
But for me, when they broke it out in the two-month windows, it really allowed for me to study and focus in on that one section so that way I could just prepare and increase my chances of passing. I was lucky enough to pass each section on the first time around, but I did take the entire 18-month … When I took it, it was 18 months you had to pass all four sections and that was just a little procrastination on my part, but also the workload that I was working in public accounting and I was one of the few that had a slam schedule during busy season and I had to work around that and find my time to study throughout the year to pull them up to where it was a slower time of year rather than … I wasn’t studying around March or April because we had tax deadlines then. And when you’re a young staff, you’re working both sides of the aisle, right? You’re doing audit and you’re doing tax.
So I had to navigate that and schedule it out for the different windows that I could and then prepare to study for it. But overall, the content of the exam, it’s a challenging exam if we’re to be real, right? It’s a difficult exam. I think the educational requirements, all those should still be in place. How do you make the exam more inviting for college graduates to take? Do you make the application process simpler? Do you make the educational requirements less stringent? What are the ways that the AICPA or even the individual state boards that they can incorporate some of those things to make it a bit more accepting to college graduates to take the exam?
April Shuping:
I mean, it sounds like some of those universal challenges, I think there’s been a lot of approaches and ideas to meet those, but we’re still having to keep in mind that we’re really balancing making it more attainable and accessible with keeping that high quality. CPE is one of the most trusted certifications out there, and so you don’t want to water it down, but you do want to be providing support to rise up to some of those levels, I think. And I think that’s a key thought of what do we … We’ve got so much writing as a profession, as a firm on keeping that prudential so valuable and it needs to mean something, but we also need people who can get it.
So Sandi, what are you seeing that maybe firms are doing, the employers who are non-public accounting firms that maybe you still are in contact with or just the kind of professional associations themselves, what do you see as approaches that are either in progress or maybe on the short-term horizon to try to balance that tightrope?
Sandi Guy:
Well, I’ll speak to that, but first, I do want to say just in case anybody from NASBA or the AICPA or whatever is listening to this, I’m not suggesting the problem is that it’s in part, I just can’t help but see some of the different trends, and I really think I’ll call it the ownership is on the firms who are employing the individuals who are taking it because, again, by far, it’s the, again, on high demand, on the schedule, what are the employers doing because the employer benefits from that individual having their … It’s their license, but the employer benefits from that. So I do think the accountability is on the individual firm or employer to make sure that they’re cognizant of the time and the training needs.
So I like that it’s in parts. I could not imagine having done it the way you did it, April, so I’m not suggesting going back. I think it’s just key that employers and firms acknowledge that. So when you look at what some firms are doing, I mean, I’ll definitely speak to what we’re doing. We take a very, I’ll say, active approach in if you have 400 people who aren’t certified and need to be certified, there’s 400 different sets of circumstances of where the challenge is. You may have somebody who it’s not really a challenge. Maybe when they finished their internship, they started Becker prep and studying and started preparing, and they have a plan to take it right out of the gate. As we all know, statistics even show this, the earlier you start sitting once you’re eligible, the higher probability you’ll pass, the longer you wait, the more difficult, the further away from schooling, the more difficult it becomes.
So we, CRI, takes the approach up. Let’s understand everybody individually where they are on the journey, where they’re struggling. Somebody may be struggling in finding the time and they haven’t sat yet at all, and they have anxiety, and if I could have a coach or what I like to call a peer tutor to work with them to get them over the hump. Some may just say, “You know what? I just haven’t gotten to it. If I could sign up for the Becker prep through the firm and do that.”
So I do think it’s a very personalized approach. It’s beneficial. It’s what CRI does, making sure … So April, if somebody on your team is on there and they’re like, “Oh, I just can’t get the time,” well, partner April’s getting a call from Sandi going, “Girl, she is struggling. Let’s talk about this. If you really want to keep her and not have her stress out and leave the profession altogether, let’s find time to carve it in.”
I will say it’s interesting to me that, don’t get me wrong, I love when people throw money at me, it doesn’t happen a lot, but throwing money at a problem doesn’t solve it. So again, statistics show that if you just have a large CPA pass bonus, the pass rates aren’t higher for the people who are getting a large bonus to pass. Again, it’s what are you doing to understand their challenges to get there. Firms do a variety of things. Some of them are doing, again, larger and larger bonuses or tiered incentives to sit and pass sooner. There are firms who like CRI believe in, understand the individual coach and mentor them through the process based on what their unique needs are.
But you mentioned something that I think is worth talking about, and one of the things that the AICPA and several state associations have started focusing on. One of the things hindering people in pursuing this career, specifically going in public accounting are the additional hours requirements. So a bachelor’s in accounting is not going to qualify you to sit for the CPA pretty much. I know some states are looking at this and we could have a whole separate podcast on the topic of what states are doing and we’re not going to do that. But on the whole, it requires 150 credit hours and typically a bachelor’s 120.
So if you’re entering school to get a bachelor’s degree, you can get your bachelor’s in accounting or finance or economics, but if you want to go in public accounting, you have to that additional 30 hours, whether you’re just getting the hours, you’re getting the masters. There’s additional cost in that. So it’s been interesting to see the AICPA rolled out ELE, which is earn, learn … I always get the two Es mixed up. I just know ELE, but it’s a way for you to continue to work sponsored by your employer and go to school to meet those credit hours.
Several firms have started partnering with a couple of individual universities to create that within their own firms so that their employees can get those additional credit hours through those universities. So wait, I know the state of Florida, I’ll pick on Florida, April, since you’re on here, I shouldn’t say pick on, I’ll applaud the state of Florida. What the board chair Ms. Weir is working on is fantastic. The state of Florida, their association has been incredibly proactive and on this of what are we doing to get people ready, what are we doing to monitor what other states are doing.
So one of the things I always encourage partners is, well, let’s talk about what state is the person planning on getting certified in, let’s look at that state might have some benefits. I was actually reading an article, funny enough, I have it right in front of me, where the Massachusetts CPA, we don’t have an office in Massachusetts, but the Massachusetts CPA partnered with another firm to promote to high school students and look at ways to, again, get them over that educational hump if they do pursue the 150 hours.
So firms are doing things to partner with universities, to partner with people individually. There’s still plenty of firms who are just like … It’s carrot or stick. There are plenty of firms that are like, “You have to do it. You have to do it by here.” I won’t name any of them. There are some firms that if you don’t sit and pass within just a couple years, you’re terminated. And I get it, but what are you doing to help them pass? It is a wonderful milestone when you pass and something that should be celebrated. You don’t do it alone.
I joke sometimes and go, “It takes a village to pass the CPA.” It does take a village, whether that village is your home life. I have so much respect for young women that I speak to. Two of them in our firm stand out, for sure, and I’m not going to name them because then I’ll forget anybody else who’s done it, but who were young, had just gotten married, the ones who maybe are pregnant with their second child. So you already have a young child at home, you’re working full time, and you sat and pass it. Girl, I’m telling you right now, there’s no way I could have done that. So it takes a village. It takes a village at home, it takes a village at your employer. It’s so much more than just you have to meet this requirement, go get this requirement. It’s really that partnership.
And I think the firms who are going to be successful and having large classes of their talent who are CPAs have worked with them individually and not just said, “We’ll give you a big bonus when and if you pass.” I have personal opinion. Sorry, I could rant about this the longest time. I apologize.
April Shuping:
No, I think it’s great insight, and yeah, I do think there can be a focus in some places of, “We’re going to give you this big bonus when you pass, but not support you as you’re getting to that passing stage.” So what my takeaways here are if you’re going to give some financial support, do it on the front end, buy the training courses, help the tuition reimbursement maybe or you’re partnering with another program to get that 150 hours, those extra hours. That may be more effective and a better investment than just some big bonus at the end.
Sandi Guy:
Listen, you and I have talked about this, April, or spend the money in that you don’t have to have billable hours for these four hours that day come into the office and study. So I’m going to forego that four hours of billable time from you so you can come in, lock yourself up in a conference room and study on work time, yet still get paid. I mean, I think, again, firms benefit from that license too, and I think it’s that partnership with the individual to obtain it.
April Shuping:
And our best performers, you’re right, are going to be the ones that the best performers, the ones that we’d like to invest in most heavily to keep for the future, our future partners, the people who want to replace us one day, those are the people that are going to have the least amount of time because they’re so in demand. So it is an extra, it’s a harder investment up front to say, “Let’s carve that time out.” They’re also the people who are going to be less likely to ask for it because they’re the high performers. They’ve got ownership of the jobs, they want to make their clients happy. So really helping them to understand that it’s not a shortfall to say, “Hey, maybe your billable hours for the next year while you study, the budget needs to come down and here’s a specific time each week that you are expected to go sit and study. We don’t want you to …”
Sandi Guy:
“It’s on the schedule. Everybody knows this is blocked out.”
April Shuping:
We think that is a hard investment to make, but I think you’re right. I think it’s probably the number one most effective investment for the long-term.
Sandi Guy:
Agree.
April Shuping:
What’s your thoughts, Matthew, when you’re looking at your team’s experience? Would that kind of structured early investment with time and support make a difference?
Matthew Montemayor:
I think both of those factors are important, support and time, because as I think back at my time studying for the exam and getting prepared, and that’s what I needed the most, I needed the time to study and I needed the support. Some firms might create these buddy systems or these peer-to-peer systems where they work alongside and grow up in the firm and study at the same time. I can recall my experience when I first started studying for the exam, there was another colleague who started at the same time I did and we were both studying at the same time, and that was great because we held each other accountable. We visited with each other on our lunch hours and, “Hey, how’s your study going along? How are you progressing with your study?” We both saw that getting the CPA certification would benefit us and help us grow within the firm. So we held each other accountable in that regard and that helped me progress in my study efforts and take the exam.
And then the other concept of the factor of time, the partners giving you that additional time or the partners being aware that you need that additional time to study. I recall my environment to study was the office and after 5:00, of course, and I would stay past 5:00 and I would shut my door, have everything quiet. I have to have everything quiet when I study to fully concentrate. I would be studying and a partner would come in my office about 6:00 or 7:00 at night and he would start telling me, “Hey, what about this audit binder or this audit report that we got to get?” and he would see what I was doing. He’d say, “Oh, what are you working on?” and I would say, “Oh, I’m studying for the CPA exam,” and he would say, “Okay. Forget everything I told you. I’ll take care of that. Go ahead and get back to studying.”
I saw that as a good support platform for me personally because I know he was giving me that and in turn, I needed to further progress and sit for the CPA exam and pass it right and make my partner happy because I saw there’s value there and I saw there was opportunity. So just that little bit of, “Hey, go ahead and continue studying, I’ll give you that,” that support really went a long way. I think the more that firms and the more partners, the more we could see that and the more we could give that to our staff, whether it’s a first year staff or a 10-year staff, the first year staff that’s not married and has no kids or the 10-year staff that’s married and has a family going on, the moment we can start implementing that and start working with our professional staff, I think that could help turn the corner on this thing.
April Shuping:
That’s great. I mean, kudos to your partner in the past who had that foresight. I love hearing that. So I guess we’ve got some concept of what’s causing this shortage that is impacting us today, and it’s probably looking still continue in the future, just probably to get a little bit worse before it gets better. We can think about what’s in our control as partners in a CPA firm, what is in our control, and it sounds like some of that is there and there’s some things that are outside of our control. We may not be able to decide what Hollywood decides to make their next big TV show about. Maybe not so much public accounting, but you never know. But Sandi, can you give us your perspective on what the future looks like? Is there hope for the future? Are we near turning this problem? Is it just we are all going to work till we’re 90 because there’s nobody going to replace us?
Sandi Guy:
Girl, no. Look, I’m of an age where you sit in all parts. I’m getting ready to let me go chill on the beach and the golf course for a little bit, so hopefully not. I do think there’s hope, and I think a couple of things that give me hope for sure is, it’s going to sound strange, but it’s not a problem that’s unique to our firm. And for the first time over the past couple of years, our profession started talking about it as a collective problem and started coming together to solve the problem. So there’s even a national pipeline advisory group that’s made up of some wonderful people from across the profession and state associations that they’ve finished that first data digging and there’s a wonderful exec, excuse me, there’s a wonderful report of all the research they’ve done, and they’re starting to come up with some solutions. A lot of the things that they’ve seen in their own research align with what we’ve talked about today.
So I definitely think there’s hope because, to your point, the people who can create the change have all come together. So it’s not like firms going, “Well, it’s the AICPA’s problem to solve,” or firms going, “It’s just our firm.” Everybody is coming together. I’ll speak to two auditors in the room. I remember when the Center for Audit Quality came about, and I was like, “That’s cool because they’re all coming together.” So I do think it’s great because we’re all coming together to come up with a solution.
So I have hope that the things that are causing the issue will be able to mitigate. I’m sure there’ll be a little trial and error there, but I have hope for that. I also have hope because one of the trends in our profession right now is private equity money coming into the mix and into firms, and some of the things that they’re doing around innovation and things like that, it’s good press because they’re talking about how they’re coming into these firms, turning them around, the money that’s being generated, what some firms have done to change their structure.
I’ll talk about my previous firm, BEO, what they did with going to an ESOP. So they’re doing all these things that aren’t that same old, same old way of running public accounting firms. So with that change happening in our profession, a lot of the, I’ll call it stigma or reputation that we had as being old school, a bunch of people with advisors and old men sitting in these old offices, books everywhere, a lot of that’s kind of going to the wayside and we’re getting a lot of press for the innovative things that are happening in our profession.
So for lack of a better way to put it, I do think our image is starting to improve because it looks like a sexier career path. Look, we talk about this all the time as a partner group, how the jobs that we compete with outside of public accounting can seem so sexy, and it’s because we’re the worst promoters of what we do. I know, April, when you and I talk about what you do, I’m like, “That’s really cool.” If somebody wanted to really do something and impact change in the world but they had a strength in public accounting, you could do that and your clients be not-for-profits and things like that. So there’s ways for those worlds to come together. We have just the worst promoters of what we do. It’s just like, “Oh, you got to come in and get your CPA. Go to work.”
So I think that with private equity coming into the mix and a lot of firms changing how they’re structured, how they operate, that’s getting the news. I think we’re all becoming a little bit more aware of how we package truly what it’s like and what the jobs are like. Look, every time somebody goes, “Oh, accountants are introverts and they’re boring,” I’m like, “Some of the most fascinating, interesting people I have ever met who do crazy insane things, and I mean in a good way, live these very adventurous lives are accountants. The secret lives of accountants, I’m telling you, some of the most fascinating people.” We just don’t promote that. So I think the more we promote that and what it’s like and how you can blend those passions with the client work or the areas you pursue and you start telling people in high school about that and in college about that, it becomes a very attractive career.
Lastly, of course, the more we promote, here’s the long-term earnings potential and the more that we’re transparent about that, constantly monitor our profession salaries against competing professions, we definitely want to do that and have a competitive value proposition. As long as we’re doing that, I think it will continue. Now, when do I think it’ll … We didn’t get here overnight, we’re not getting out of here overnight, but when do I think it’ll start to turn? I’m actually really hopeful in the upcoming years. I’m excited to see what some of these advisory groups are coming out with.
I think this new generation of students, it’s interesting how things happen in 20-year terms and what this latest generation is looking for out of a career. I think it’ll start to turn. I think the more that we promote the entrepreneurial spirit within public accounting, I think that is definitely going to resonate with this generation who’s used to having not one job, but they might be a social media influencer, they might have a shop on EPS, they might have a ton of things. And I think the more that we demonstrate that entrepreneurial spirit has a home in public accounting, which all three of us know it does, I think they’ll start to see that, and it’s a snowball. Once you start to see a change, it gets better.
So I’m hoping it’ll slow down and start to turn here in the next couple of years, and maybe we say let’s do this podcast,” or whatever podcasting is called 10 years from now, let’s come back together and see how it’s changed and hopefully those tides have changed.
April Shuping:
Yeah, definitely. You and I can meet from the beach when that [inaudible 00:45:32]
Sandi Guy:
I will come see you down on the coast of Florida and look at the numbers.
April Shuping:
Well, if anybody from Hollywood’s listening to our super popular and viral podcast, the secret lives of accountants [inaudible 00:45:46]
Sandi Guy:
Listen, no-
April Shuping:
I’m just saying this could be the next big, guys.
Matthew Montemayor:
Reality [inaudible 00:45:52]
Sandi Guy:
I’m writing a book when I retire. I’m just changing names because, Lord, there are some interesting life.
April Shuping:
I like it. Well, thank you both. Honestly, I do think we could talk about this for all day long because it’s a big thing and there’s a lot of great ideas, and I think our firm is probably leading the way in some of these, and I’m excited to see the changes in the future. Thanks again for joining us. I hope that anyone listening got some good takeaways. Really, if you want to support our profession and people becoming CPAs, it’s really just giving those potential candidates that customized support as they move forward in their careers. Give them the time and any kind of financial support to get the studying and the extra credits, and maybe that’s going to be our magic mix. So thanks everyone. Please stay tuned and keep listening to It Figures. We’ll be bringing you more exciting news like this in the future.
Speaker 1:
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