Deneen Dias
There are a ton of big-name accounting conferences out there, and I attend as many as I can. Many are concentrated, as you probably know, in the late spring and summer months, so it can be a challenge to navigate. But every year I reflect on just how worth it it is.
I have the opportunity to meet with accounting professionals and firm principals all over the United States. Sure, there are some natural geographic differences that make every individual’s concerns just a little different from the next person’s, but themes absolutely emerge.
When I wrote this, I'd just completed my 9th flight for work in a month (July). It’s been a real whirlwind! But in all the discussions I’ve had, some key themes kept reappearing:
1. CAS is King!
I spoke about CAS at four different conferences this month:
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BDO’s Alliance annual conference: at their first-ever in person CAS track
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LEA’s conference: at their first-ever CAS track
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Rainmaker’s Super conference: at their first-ever in person CAS track
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BDO Alliance Carolina’s regional meeting
At each of these CAS groups there was lively discussion around the fact that CAS is the fastest-growing revenue source for firms… yet somehow firms still have struggles.
Main pain points included:
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Many firms still don’t have a dedicated CAS partner (how can that be if it’s the fastest growing revenue source?).
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Pricing needs to change from billable hours, yet firms struggle with value billing for CAS clients (which means they are leaving so much money on the table).
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Shockingly — CAS teams are still forced to do write-up work for tax teams (which is a drain on profitability for the group, as well as exhausting for your CAS talent).
2. Capacity & talent shortage issues abound.
I heard consistently that 70% of firms’ partners are set to retire in the next 7 years. We’ve known this is coming for some time, but it’s really starting to become reality. On top of this, there’s a shortage of tax talent & bookkeepers… and this is not going to change anytime soon!
I had the pleasure of seeing Joey Havens from Horne present twice, and both times he mentioned that firms had their best and most profitable revenue year yet, but: what got us here won’t get us there. Especially impactful was when he said firms need to “put their legacy firm out of business in the next three years” (in a good way).
Taking care of talent needs to be front-of-mind (not the client), because currently firms are not winning the battle for talent (everyone wants an accountant).
3. Retiring partners are blocking firms from changing.
At the Allinial Conference, Mark Koziel announced that he’s never met a partner who can be managed. Firms need to run their practice like a corporation, and not allow retiring partners to make decisions for the future of the firm. Instead, he suggests firms should have CEOs — and I can’t tell you how thrilled I was to meet so many CEOs at that conference.
4. AI is a hot topic and everyone seems really jazzed about it.
Everyone acknowledges that they need help automating in order to continue to grow and excel. With a spectrum of security concerns, questions about how automation can fit into their tech stacks, and a generalized lack of solid understanding of what constitutes AI, it’s clear more education needs to happen on the topic. And a concern I’ll raise is this: what ROI can you expect from any AI you employ? Adopting AI to be trendy or appear cutting-edge without having a solid grasp of how it’s benefitting you is ultimately not helpful to your firm — and could cost you plenty.
5. ADVISORY is on everyone’s lips.
At LEA Global, Chris Mason of Mindshop says many firms have a new mindset that they are going to be an advisory firm offering accounting (instead of an accounting firm offering advisory). This really underscores the value firms are finding in advisory. My thought here is that this means CAS will only get more complicated to do WELL, so firms should be working on either getting their CAS departments up and running to smooth out the competition and learning curves, or maturing their departments into well-oiled machines. Anything less will put a legacy firm out of business (this time in a bad way).
6. Finally, Private Equity (PE) and Mergers and Acquisitions (M&A) were hot topics!
I saw Josh Beck, Managing Partner of MarksNelson speak on a PE panel at Rainmaker Conference about why they decided to accept PE. His response? Their goal is to go from 30 million in revenue to 500 million in 3 years!
Alan Kolton spoke at Allinial Conference at the beginning of the month about a wealth advisory firm doing tax returns for their clients for free that approached him about buying a top accounting firm — 2 weeks later it was announced that Creative Planning acquired BerganKDV (the first of its kind in the profession). And of course, with so many partners approaching retirement, succession planning, including M&A activity, is a real center of conversation.
Sooooo much change is happening, so fast. The leaders in the profession agree on that, and on the points above.
My question to you is: Do you agree with all these thought leaders in the profession? If so, what is your firm doing about it?
For more great info on CAS, visit Botkeeper’s dedicated CAS page, linking to tons of resources:
