This week, I spent the first half walking the same halls of some of the most influential thought leaders our nation has ever known. While attending a conference in Boston on current trends in real estate development, I was lucky enough to walk through the Harvard Club once filled with Supreme Court justices, legislators, business leaders and former presidents (including my personal favorite President, John F. Kennedy). These past leaders all had an impact on where we are today and will be tomorrow.
It was inspirational for me to take a broad view of the public accounting profession to assess where we are and where we could be going.
So buckle up...let's SWOT this thing!
The great position of this profession is I firmly believe our strengths are foundational and have lasting power. The respect and high regard held for CPAs is alive and strong. Walking around some of the brightest minds in real estate development from across the country, I was reminded that CPAs play a vital role in the industry. I was speaking with a partner from another firm, and, in discussion with a developer, it was continually referenced how much they lean on their CPA firms to provide them with expertise, capacity and legitimacy. Additionally, the fact that as a profession we have been able to self-regulate while building a monopoly on our core product (in the form of a financial statement audit) provides us a long runway for the future.
"Who will be the scrappy firm to dream big and create a product solution for the profession that Facebook did for social networks or Amazon has done for commerce?"
For weaknesses and opportunities, I contend they are closely linked. Outside of large firms (mostly Big 4 and other firms serving large institutions), the utilization of technology and software development provide both our weakness and an opportunity to grow beyond just traditional accounting work. There are several firms, even locally, that are beginning to jump all the way in the deep end in this area, and I am curious on their future path.
From my post, I see boundless pivots, uncaptured market share, and feed for innovation to grow new businesses that could grow far beyond the traditional accounting firm. As an avid listener of "Masters of Scale," I am constantly reminded by LinkedIn founder Reid Hoffman that scaling a company fast is what leads to billion dollar "unicorn" companies. I look at the current environment in terms of software utilized by accounting professionals and think far too often, "this would be great if it could only do this…"
The threats looming are how I question our central standards setting boards and regulatory oversight agencies. Revenue recognition under contractual agreements can be put in the same bucket as Tax Reform, where the goal was to create greater simplicity and clarity, but only leaves more complexity. Just this week, the PCAOB has come under scrutiny after a whistleblower made a complaint to the Securities and Exchange Commission on ineffective leadership and lack of results in the Board's primary objective, which is inspecting auditors. This is after a total clean house of the prior leadership following a scandal where inspection reports were unlawfully provided to auditors. Is the AICPA accomplishing the correct goals? Are we, as their constituency helping them best guide our profession through the next 50 years? If you have read any of my work before, you know I always point out these streets we walk go both ways.
There it is…we are very proficient at our strengths and could be avoiding what we are not so good at—maybe too much. What say you? And remember from JFK, "If not us, who? If not now, when?"