Category: News

News

Four Critical Budgeting Steps Your Not-for-Profit May be Forgetting

Post author By FFC
Post date June 13, 2016

Four Critical Budgeting Steps Your Not-for-Profit May be Forgetting

For any organization, budgeting can be more than just an annual exercise of putting numbers in columns. The budget is the financial interpretation of your work plan. It’s the tool you use to ensure that your finances are on track to meet your goals and that you are making the most of your financial resources— two achievements that are mission critical for not-for-profits. Based on work with not-for-profits over the years, I’ve identified 10 steps that should be a part of every budget process. Unfortunately, though, many organizations omit the last four steps, despite their importance to your process and, ultimately, reaching your strategic goals. Is your organization skipping some key aspects of the budgeting process?

Getting Started

Most organizations follow the first six steps of the budgeting process, so chances are you’ve got these covered:

Put the budget in writing.

Establish a team to oversee and champion the budget.

Create a calendar and timeline for the process.

Set guidelines to help ensure the budget mirrors organizational goals and priorities.

Start drafting the budget.

Have the budget reviewed and approved.

Getting Stuck

This is the crucial point where many financial managers stop. Getting to this point can feel like a huge relief. I completely understand: to get this far, you burned some midnight oil, exhausted your political capital and put your patience to the test. Many organizations go through several iterations and drafts before the leadership team, finance committee and board signs off on the final budget.

Pause and celebrate your success, but don’t be tempted to put your budget on a shelf of completed projects. To get the greatest juice from the squeeze, add these next four steps:

Create and share the final budget. There may have been several versions of the budget as it made its way toward approval, so it’s time to issue an official final budget, enter it into the accounting system and circulate it to the staff. Whether you delete all previous drafts or store them for possible later reference, having a final budget ensures that the entire organization is working with the same assumptions and allows you to make reliable comparisons with actual numbers going forward. Sharing with staff is important for practical reasons, but transparency also helps give your team a greater sense of purpose and belonging, giving them more motivation to help the organization reach its goals.

Use the budget to monitor your results. This can be carried out at various levels within the organization, including the board and finance committee, CEO and CFO or budget managers. No matter who is involved, keeping track of where you stand, what variances have occurred and why, is too valuable an exercise to skip.

Develop forecasts and trending reports. Not all not-for-profits perform forecasting, but it’s worth considering because it can give you a valuable perspective on your current plans and the trends and developments that might shape your future. Your forecasts can be adjusted throughout the year as new information becomes available.

Maintain budgetary controls and oversight. The board of directors is ultimately responsible for the allocation of resources and oversight, which includes the budgeting process. In many organizations, staff and/or the finance committee may do a detailed review of the budget to actual results and involve the board when concerns arise. Regardless of which approach is best for your organization, active and responsive oversight of the budget, including preparing forecasts based on new information or events or compared to the actual numbers—is critical to sustaining your efforts and meeting short- and long-term goals.

Reaping the Benefits

There are many benefits for organizations that carry out these last four steps. A resilient budgeting process can help improve an organization’s ability to achieve its mission by putting it on sound financial footing. Plus, staff are more invested in the mission and recognize how and why resources are allocated and decisions made. It’s important to take the time and effort to invest in the budgeting process to foster a greater sense of direction. You can leverage your budget process as a planning tool that reflects an organization’s programs, mission and strategic plan.

Want to learn more about budgeting? Join my co-presenter, Carolyn Mollen, CFO at Independent Sector, and I for a CPE and CAE eligible webcast on optimizing the not-for-profit budgeting process, taking place June 15 from 1-3pm ET. The webcast is open to all; however, members of the AICPA Not-for-Profit Section can participate for free as one their four pre-determined annual free webinars.

Cheryl R. Olson, CPA, CGMA, Director of Not-for-Profit Consulting, Clark Nuber, PS. Prior to joining Clark Nuber, she was Director, Council Financial Consulting at the Girl Scouts of the United States of America. She volunteers on the AICPA Not-for-Profit Advisory Council and is an instructor for AICPA’s Not-for-Profit Certificate II, a video-based e-learning program for not-for-profit professionals and their business advisors.

The Powerful Impact of Women in Accounting and Tax

Post author By FFC
Post date June 10, 2016

The Powerful Impact of Women in Accounting and Tax

Jane Doe, CPA, also known as Super Woman, woke up this morning at 5 a.m., jumped on her computer to address some urgent work emails, proceeded to pack her children’s lunch, get them out of bed (easier said than done), dressed, and off to school – and then worked all day, leading her team and conquering the business world. She runs from one business meeting to the next, finally stopping only to make dinner for her family, help her oldest child with his homework, bathe her two-year-old, and put both kids to bed. Oh, and she also helped her husband with his PowerPoint presentation, fed the pets and paid the household bills. It’s now 9 p.m., time to jump back on the computer and wrap up more business.

Does this sound familiar? We all know women like this in our accounting profession – and these women should be celebrated.

Men and women have inherent differences, thank goodness! Bringing those perspectives together in the workforce (along with talents like Jane’s Super Woman multitasking skills) allows synergy and a blend of ideas to come to the best solution. Cultivating this blend in the CPA profession is critical. Our biggest success indicator is our talent pool – our people. We need to foster diversity and inclusion to keep talented staff engaged and advance our profession.

Startling Statistics for Women in Accounting

According to a recent Women’s Initiatives Executive Committee study, women have made up roughly half of all university accounting programs for a few decades. They’re also well-represented at entry levels in accounting firms, but their numbers tend to significantly decline as they move up the career ladder. Perhaps some women choose to stop climbing the corporate ladder, pursue other endeavors, or maybe they aren’t given the same opportunities or don’t have a valuable mentor to guide them in their career/life journey.

Fixing the Advancement Problem

I want to bring focus to women in the profession and encourage CPAs to implement a strategy to develop and retain female talent.

Our profession has countless examples of women CPAs leading the pack:

Cathy Engelbert, first female CEO of Deloitte

Lynne Doughtie, first female CEO of KPMG

Kimberly Ellison-Taylor, Global Accounting Strategy Director at Oracle and the Vice Chair of the AICPA Board of Directors

Tommye Barie, Partner at Mauldin & Jenkins LLC and fourth female Chair of the AICPA Board of Directors

Annette Nellen, Professor at San Jose State University and Vice Chair of the AICPA Tax Executive Committee (TEC)

Patricia Thompson, Partner at Piccerelli Gilstein & Company LLP and former Chair of the TEC

And, all of the women who received the AICPA Women to Watch Award should also be recognized – to name a few amazing accounting women.

Importance of Mentorship

One of the best ways for women to lead other women is through example and mentorship. I was fortunate to have a significant female mentor early in my career. Ronda was a partner in the CPA firm that I worked for years ago (she has since moved on to be a CFO of a large company). She took me under her wing and helped me with my challenges. She always listened more than she talked, allowing her to gain valuable information from others, as well as their trust.

To this day, when I find myself in a high-stress situation that requires me to step up and lead a mission, I ask myself “what would Ronda do?” Her poise, composure and professionalism has always resonated with me. Ronda also once told me, “Life is a marathon, not a race.” I live by this advice. Our career isn’t about racing to the finish line, it’s about pacing yourself to continuously grow.

More to Come at the AICPA for Women

The AICPA Tax Division has scheduled a Women in Tax Panel discussion to address the unique opportunities and challenges faced by women in tax. This video will be posted in the spring along with other new resources. Additionally, the AICPA offers the following valuable resources:

Women in the Profession Resources page – your one-stop shop for practice guides, research studies, networking opportunities and articles to help firms develop a women’s initiatives program.

Women in the Profession Toolkit – Assortment of tools and templates to help businesses and accounting firms develop and implement strategies to foster and advance female talent.

Mentoring Program Guide – a 15-page how-to guide to help you set up and launch a mentoring program in your organization.

Mentoring opportunities – the AICPA is looking for volunteer mentors to help members seek and obtain guidance and support (use “aicpa2016” in the assigned program passcode field).

Let’s continue our progress. I think we can all agree that Jane Doe, CPA, is truly Super Woman, and we need more women like her leading our businesses.

Susan C. Allen, CPA, CITP, CGMA, Lead Technical Manager-Tax Practice and Ethics, American Institute of CPAs.

Superwoman CPA courtesy of Shutterstock.

Client Advocacy: Susan Tillery, CPA/PFS, Takes a Unique Approach

Post author By FFC
Post date June 9, 2016

Client Advocacy: Susan Tillery, CPA/PFS, Takes a Unique Approach

What does an ancient biblical word meaning “holy spirit” have to do with financial planning in the 21^st Century? Plenty, according to Susan Tillery, CPA/PFS.

Susan is president and co-founder of Paraklete® Financial, Inc., a fully-integrated personal financial planning (PFP) firm with offices in Georgia, North Carolina and South Carolina. With more than 30 years’ experience in financial services, Susan sticks to one, basic tenet: placing her clients and their financial well-being first. We recently sat down with Susan to learn about her unique service model, business mentality and outlook on the profession.

AICPA: Paraklete operates on a fee-for-service model and your catchphrase is “An Advocate in Financial Services.” What is this model all about, and how does the advocacy tagline ladder up to your firm’s operations?

Susan Tillery: “Your Advocate in Financial Services” comes directly from the meaning of the name of our firm; Paraklete is the Greek word for advocate, counselor and one who walks alongside you, which best describes what our business model is all about and what we offer our clients.

We don’t manage assets and we don’t sell products; rather, we create a personal financial plan for our clients and then act as their advocate in educating them and implementing their plan. Because we don’t sell anything, manage assets, or receive or pay referral fees, we are able to be completely independent and objective when creating and implementing the client’s plan.

We also arrange and attend the client’s meetings with their investment adviser, estate attorney, CPA, insurance adviser, retirement plan designer, private banker and business attorney, among others, to implement their plan. If the client does not have an adviser in a needed discipline, we will make introductions to at least two advisers and attend these meetings. If the client is already working with certain professionals, we also work with them and integrate everyone into the client’s team.

AICPA: That’s different from the traditional model other CPA financial planners offer. How is this a competitive advantage?

ST: I think consumers are looking for something different from the traditional financial planning model; they want independent, professional advisers to assist them in their financial journey because the process is too complicated and time-consuming to manage on their own. As a result, they need a fiduciary/advocate they can trust. Who better to fill this role than a CPA/PFS who offers only advice and advocacy? Rather than thinking of this model as giving us a competitive advantage, we look at it as the only way to offer PFP. When we began offering this service model, we did so without the intent of giving us a competitive advantage, but rather, with the assurance that it is the right way to provide these services.

AICPA: So, you refer clients to professionals who can work with them on asset management and products; how do you develop your referral network?

ST: Tom, my husband and business partner, and I have been in Atlanta and in the financial services arena for more than 30 years each. We have met many professionals offering many different financial services, and meet new people every day.

Before we refer our client to professionals, we run a background check within their specific discipline. Then, we meet with them and share our vision for servicing our clients, as well as our approach. If they are in agreement with our service model, we introduce them to one client. We observe and make sure their actual service and fees are what they promised. If they display integrity and the client has a good experience with them, we begin to introduce them to other clients who need their services. This professional has also had a chance to observe our integrity, service model, and to meet and network with the other professionals on the team. In turn, they begin to refer clients to us.

AICPA: What do your clients say to you about your role as a PFP?

ST: They are thankful they were introduced to us. Many of them are excited to finally understand the complexities of their financial life and the many financial decisions they have to make. Some even say it’s as though they received an MBA in personal finance. This is very rewarding to us.

AICPA: How do you think having taken care of your clients’ financial planning needs has altered your relationship with them, if at all?

ST: Most of our clients are high net worth and busy people with many responsibilities. They enjoy the fact that we are CPAs and treat the engagement with professionalism, from an educational perspective. Great respect is generated on both sides.

AICPA: What advice would you give another CPA or firm who may be wrestling today with the decision of offering financial planning services?

ST: My advice is to begin offering financial planning services to your clients; if you don’t, someone else will. Your clients are looking for a trusted adviser to assist them in their financial journey. You, as the CPA are the trusted adviser. We have had several CPA firms establish PFP services through Paraklete; they are profitable and their clients are thankful their CPA provided this service.

Dan Snyder, CPA, Senior Technical Manager-Personal Financial Planning, American Institute of CPAs.

Are You Helping Protect Your Older Clients From Financial Scams?

Post author By FFC
Post date June 7, 2016

Are You Helping Protect Your Older Clients From Financial Scams?

Most everyone, at least once, has received an email from a “Wealthy Prince” who claims to know of a massive inheritance in their name. If only you would wire $10,000 U.S. to unlock $10 million … Sounds too good to be true, right? It is. In order to get the inheritance, this “Wealthy Prince” typically requires you send your bank account information, social security number, birthdate and other personal information. This leads to a financial disaster.

Unfortunately, this is just one of an increasing number of financial scams that people have fallen victim to, especially older Americans. Recently, an American World War II veteran was scammed out of $43,000 due to a fake sweepstakes that told him he won $4.7 million and a new Mercedes-Benz, as long as he provided personal information and opened a bank account where the money could be deposited. The elaborate scam involved multiple bank transactions over an extended period of time, each with the purpose of gaining the victim’s trust. Unfortunately, once the money is wired, it is very difficult to recover.

The AICPA has been a leading advocate for helping protect older Americans from financial scams. The AICPA is a partner organization for the National Adult Protective Services Association Global Summit for World Elder Abuse Awareness Day, held each June in Washington, DC. Additionally, the AICPA sits on the North American Securities Administrators Association (NASAA) Seniors and Diminished Capacity Advisory Council. Earlier this year, NASAA adopted a model act that provides new tools for investment advisers and broker-dealers to help detect and prevent financial exploitation of vulnerable adults.

According to the Investor Protection Trust, almost one in five Americans over the age of 65, or nearly seven million seniors, have been taken advantage of financially, either by an inappropriate investment, unreasonably high fees for financial services or fraud. Elder financial abuse is a major issue in the United States, but there are preventive steps you can take to ensure your older clients protect themselves.

If it’s too good to be true, it usually is. The “Wealthy Prince” emails and telemarketing scams typically start with a well-meaning and trusting victim that gets deceived. You can speak with clients to help make them skeptical of these “too good to be true” offers.

Keep personal information private. Remind clients they should never give out credit card, banking, social security or other personal information over the phone unless your client initiated the call. All personal information should be kept private unless giving it to a trusted source.

Shred unwanted personal information. Ask your clients if they own a shredder. Be sure they know bank statements, credit card statements, receipts and other personal financial information should be shredded immediately after use. People who come into an older person’s home can steal personal information or dig through the older person’s garbage to get this information.

Don’t buy from an unfamiliar company. If the product or service you are buying is unfamiliar, ask your older clients to research the company first before providing payment. If the person tries to rush your client into a decision, that could be a red flag.

Ask for written verification. If someone calls your older client on the phone about an offer or charity, instruct them to always ask for and wait until they receive written material. Have the client ask for specific information about the salesperson, including name, business identity, telephone number, address and business license number before conducting business.

For more information on protecting clients from financial scams, visit 360finlit.org.

Dan Bond, Senior Manager – Communications and Consumer Education, American Institute of CPAs.

Samantha Delgado, Manager – Communications and Consumer Education, American Institute of CPAs.

Senior citizen giving financial information to scammers courtesy of Shutterstock.

In Case You Missed It: Golf, Beyoncé, and the Next Version of the CPA Exam

Post author By FFC
Post date June 2, 2016

In Case You Missed It: Golf, Beyoncé, and the Next Version of the CPA Exam

Another busy tax season has passed and I can see the heads of CPAs have now risen from the grindstone. While your focus was on tax business and financial statements over the last several months, you may have missed some important news.

Golfer Jordan Spieth’s dream of winning back-to-back Masters sunk on the 12^th hole, Beyoncé (or Queen Bey) released her deeply personal Lemonade album and set off a social media storm, the Villanova Wildcats upset UNC at the NCAA tournament, and the highly anticipated “Batman vs. Superman” movie could barely muster 27% on Rotten Tomatoes.

Oh, and along the lines of something important to the AICPA and the CPA profession, we announced details about the next version of the Uniform CPA Examination, which launches on April 1, 2017.

The coming Exam changes are the most significant in a more than a decade. They serve to maintain alignment with the work of newly licensed CPAs and preserve the strength and mission of the profession. The most prominent changes include:

Greater assessment of a candidate’s higher-order cognitive skills,

The introduction of in-depth section blueprints to illustrate the content and skills to be assessed, and

The expanded use of simulations, including within the Business Environment and Concepts (BEC) section for the very first time.

All of this information, as well as what went into the development of the next Exam, is covered in the Practice Analysis Final Report released on April 4.

To educate current and future candidates about the next Exam, the AICPA maintains a dedicated web page featuring valuable information, such as FAQs, a highlight video and links to sample tests. To provide additional clarity to candidates, the AICPA also released a white paper detailing the testlet and break structure of the next Exam, which is a helpful resource when preparing for the test.

The launch of the next Exam is a major announcement and I’m confident that those of you in public accounting will take note because of the impact on your employees. With thousands of newly hired associates joining the ranks of public accounting firms each year, a wave of new candidates will join those already sitting for the Exam. It’s critical that all of them understand the differences between today’s Exam and the next version coming in 2017 – an absolute must if they want to succeed. This is why we began communicating the changes a year prior to launch.

The AICPA, along with its partners at the National Association of State Boards of Accountancy (NASBA) and Prometric test centers, are at the ready with the most up-to-date and accurate information about the next Exam. Our outreach to candidates and other key stakeholders will continue beyond April 2017. We welcome opportunities to share information and help firms and companies educate their newest associates preparing for the Exam. The AICPA’s Examinations team is always available throughout the year and looks forward to helping candidates navigate these changes.

Mike Decker, Vice President-Examinations, American Institute of CPAs.

Beyonce courtesy of Asterio Tecson via Wikimedia Commons.

Summer Reading Recommendations

Post author By FFC
Post date June 1, 2016

Summer Reading Recommendations

Part I

Nothing says summer vacation like a few good beach (or mountain, lake, backpacking… you get the picture…) reads. The AICPA Communications staff joined forces to present you with a diverse collection of books we think will make your summer vacation, wherever that may be, even more enjoyable.

Christopher Almonte, Manager, Communications recommends:

The Innovator: How a Group of Hackers, Geniuses and Geeks Created the Digital Revolution by Walter Isaacson (2014)

From the author who wrote the biography of Steve Jobs comes the story of how computers and the internet were created.

David and Goliath: Underdogs, Misfits and the Art of Battling Giants by Malcolm Gladwell (2013)

Challenge how you think about obstacles, disadvantages and setbacks to reshape the way you think of the world around you.

Tammy Atkins, Manager, Brand and Communications recommends:

The Nightingale by Kristin Hannah (2015)

Set during WWII, two French sisters, different as night and day, find that the horrors of war pull them together, and apart at times, in ways they never imagined. The war tests their endurance,strength and family bond.

Dawn Booker, Senior Manager, Communications Quality Initiatives says:

I Put a Spell on You by Nina Simone with Stephen Cleary (1992)

Every summer I read Nina Simone’s autobiography. She was a globally loved music icon. I am inspired by the many lives she led. I read the book while listening to her music on my MP3 player.

Samantha Delgado, Communications Manager—Consumer Education recommends:

The Girl on the Train by Paula Hawkins (2015)

A thriller that keeps you on your toes the entire time, wondering who is the “good guy” and “bad guy,” constantly changing your mind each chapter. It’s coming out as a movie in the fall.

Dark Places by Gillian Flynn (2009)

In another thriller by the author of the popular novel, “Gone Girl,” the main character confronts memories of the murder of her mother and two sisters while trying to prove her brother’s innocence.

Adam Junkroski, Lead Manager, Tax Communications recommends:

Lost Horizon by James Hilton (1933)

Shangri-La seems an achievable Eden; a place where occasional human failings are accepted as inevitable in an otherwise idyllic culture. Also, I imagine it has an awesome Chinese restaurant.

Ann Marie Maloney, Communications Manager-Tax recommends:

The Art Forger by B.A. Shapiro (2012)

A fictional account of intrigue involving the real-life theft of masterpieces from the Isabella Gardner Museum in Boston. I liked this partly because it raises some interesting moral issues and has some good twists.

Heather O’Connor, Senior Manager, Communications recommends:

The Great Gatsby by Scott Fitzgerald (1925)

Yes, you read it in the ninth grade, but this book is even more enthralling when you pick it up as an adult.

Tales of the City by Armistead Maupin (1978)

Follow Midwesterner Mary Ann Singleton as she journeys from tourist to fulltime resident of mysterious, charming and cosmopolitan San Francisco.

Donna Salter, Senior Manager, Young Member Initiatives recommends:

The Life We Bury by Allen Eskens (2014)

Mystery, literary thriller. Great development of characters. An easy read that gets very exciting until the climactic finish.

Lost Lake by Sarah Addison Allen (2014)

A beautiful, haunting story of old loves and new, and the power of the connections that bind us forever.

Stacie Saunders, Sr. Communications Manager, Social Business & Member Engagement recommends:

The Corrections by Jonathan Franzen (2001)

This is not a new book, but it is the story of a dysfunctional, but relatable American family that stuck with me. Not a light read, it was a finalist for the 2002 Pulitzer Prize and well worth a spot in your summer reading line up.

To balance it out, pick up copy of Tina Fey’s Bossypants (2011), a funny autobiographical comedy by the SNL super-star. It can be read a chapter at a time, which is perfect between dips in the pool.

James Schiavone, Senior Manager, Public Relations recommends:

A Prayer for Owen Meany by John Irving (1989)

Captivating from start to finish, with shocking twists and turns. Irving is an excellent storyteller and his dialogue and details keep the pages turning. Like a lot of authors, he touches upon similar themes in all of his novels. I believe this is his best work.

Lauren Sternberg, Communications Manager recommends:

The Spoils of Time Trilogy by Penny Vincenzi

(No Angel (2003), Something Dangerous (2004), and Into Temptation (2005))

The unputdownable tale of several generations of the Lytton family led by their indomitable, passionate, creative matriarch, Celia. The saga begins with blueblood Celia’s marriage to the son of a publisher, Oliver Lytton, in England in 1898, and continues through the turmoil and tumult of the early 20^th century to New York in the 1960s. If you want an extra dose of fun, listen to Florence + the Machine’s Ceremonials while you read. It is the perfect soundtrack.

AICPA Communications

Woman reading in a hammock courtesy of Shutterstock.

5 Steps to Transform Leadership Theory into Practice

Post author By FFC
Post date May 31, 2016

5 Steps to Transform Leadership Theory into Practice

Most of us have read numerous books on leadership development theory, because they are excellent resources that offer valuable insights. However, you need to do more than just read and understand these books for them to have any real value. You need to be personally inspired and motivated to get the most out of such personal success literature. Basically, you have to walk the walk. Embody the teachings found in these books and demonstrate positive leadership behavior every single day. The question is: how?

As everyone knows, old habits die hard. Changing behavior is frustratingly challenging, even if the habits you are trying to adopt are positive. That’s why it’s extremely useful to have a roadmap. Aristotle said, “We are what we repeatedly do. Excellence, then, is not an act but a habit.”

Here are five steps that can guide you in successfully adopting positive leadership behaviors to transform yourself into an authentic leader.

Make a list of people you admire – and those you don’t. What qualities, values, or traits do these people embody or lack? What are their strengths and developmental opportunities? Challenge yourself to take a closer look at how your strengths and weaknesses align (or don’t) with theirs. The more positive qualities you have in common, the higher your chances of success.

Read a biography about someone who inspires you. Biographies often touch our emotions and can be even more transformative than business books. They offer an opportunity to see principles from the leadership theories you have studied put “into action” by individuals you look up to.

Create leadership goals and share them with others. Simply making a list of goals without follow-through will fail every time. Share your goals with someone who can help keep you accountable. As you articulate your goals, think about the “big picture.” Where do you want to go? What do you want to achieve? What are your unique leadership strengths?

Incorporate new behaviors. Every day is a new chance to adopt more integrity, to be more collaborative and to become more strategic. Start by creating a list of behaviors, review it daily and make them consistent practice by keeping track of positive changes. It may even be helpful to include them in your overall leadership goals list.

Embrace criticism. Ask those you work with for an informal critique of your technical competencies and personal behavior. By waiting for the obligatory annual review, you may miss a perfect opportunity to shine brighter or change directions in your approach. Self-awareness is key.

Congratulations, you’ve now established a path. Here are actions you can continue to take to help strengthen your leadership skills:

Find your “discomfort” zone. No successful leader got to where they are without accepting and learning from personal challenges. For some, this might mean facing the fear of public speaking by doing a presentation. For others, it might mean volunteering for an assignment or project in an area in which they are not content experts. Only you know what actions would be most beneficial for your personal growth but, through practice, you will gain confidence.

Keep a positive attitude. People are naturally attracted to individuals with positive outlooks on life. Turns out, having a positive attitude can also attract exciting opportunities and possibilities. If you want to become a better leader, work on modeling positivity.

Become a lifelong learner. Great leaders never settle for where they are and are always pushing themselves to learn more. But it’s not out of duty—it’s because they are passionate about learning. Keep learning. Embody new behaviors. Repeat.

Focus on interpersonal skills. Leaders don’t fail because of a lack of technical knowledge or experience—they derail because they lack interpersonal competence.True leadership is in the doing, not the knowing. Repetitive practice is necessary to hone authentic leadership skills. It will take patience, but mapping your path and consistently exhibiting positive behaviors will get you where you want to go.

Leadership books are a great first step to understanding leadership theories. are far too many great leadership books to list in this blog post. However, a few deserve mentioning. The Situational Leader by Dr. Paul Hershey outlines how to adjust your style to meet the needs of those you lead; how to develop people; how to determine readiness; and what to do when performance wanes. Another book I often refer to is Transformational Leadership by Bernard Bass. It outlines a concept based on the leader collaborating with employees in order to identify what needs to be changed, developing a vision to guide the change through inspiration, and implementing said vision.

Donna W. Salter, Senior Manager – Young Member Initiatives, American Institute of CPAs.

Leadership word cloud courtesy of Shutterstock.

Here’s How This Millennial Learned How to Budget

Post author By FFC
Post date May 27, 2016

Here’s How This Millennial Learned How to Budget

If you have some semblance of common sense, then managing your money should be a piece of cake, right? Unfortunately, as I have seen in myself and in those around me, that is not always the case. Financial knowledge is a topic that many people think should be inherent, but in reality, this is oftentimes not the case.

As a millennial, frequent life changes become commonplace, and it can feel overwhelming. Whether transitioning to a new job, moving to a new city or deciding to get married – it’s easy to get distracted by the excitement and let personal finance fall by the wayside. According to a recent survey, over a third of millennials (34%) said that saving money was their top priority this year – more than leading a healthy lifestyle (20%) or losing weight (14%). Yet, millennials’ spending habits may be one reason they struggle to reach their financial goals: 65% of the young adults surveyed said impulse shopping got in the way of saving.

Luckily, when I started at the AICPA last August, I was introduced to all the free resources from Feed the Pig, a national public service campaign in partnership with the Ad Council that encourages and helps Americans aged 25 to 34 take control of their personal finances.

I call it kismet that I started working on the consumer education team at AICPA. Since then, I’ve discovered a multitude of resources on Feed the Pig that have helped elevate my financial knowledge. Moving to Washington, DC from Orlando and making a new budget that I could stick to was difficult, but Feed the Pig’s tips made it easier. For example, I started writing down everything I spent money on each month – after realizing that I spent a lot on Uber rides, I made a conscious effort to walk more or take the metro when possible. This 401(k) calculator and Student Loan Consolidation and Debt Payoff calculator are other examples of useful tools that I regularly consult. Working alongside the National CPA Financial Literacy Commission has also given me the opportunity to hear best practices for managing finances, and I never hesitate to pass those pro tips along to my friends and family members.

Life has so much to offer, and, in the moment, it can be difficult to prioritize. Should you take that trip to the Caribbean or put aside more money for retirement instead? Spend $140 at the bar with friends or pay off a little more of that student loan debt? These are all very real decisions that when added up, could potentially affect financial futures. Feed the Pig touches on all of this, and, if your millennial clients struggle with seeing the bigger picture, it’s a great resource to supplement your advice.

Finances can seem daunting, but even the smallest of changes makes a huge difference. If I can do it with the right help and guidance, everyone can! If you haven’t already, make sure to follow Feed the Pig on Snapchat (BenjaminBankes) and Instagram (Benjamin.Bankes) for fun financial tips. Happy Saving!

Samantha Delgado, Manager – Consumer Education & Communications, American Institute of CPAs.

Millennial budgeting courtesy of Shutterstock.

CPA Success Story: Angela Ho

Post author By FFC
Post date May 26, 2016

CPA Success Story: Angela Ho

In celebration of Asian American and Pacific Islander Heritage Month

For Angela Ho, CPA, CGMA, dichotomy has been a constant presence in her life: East and west. Public accounting and business/industry. Young and seasoned.

Born in Virginia as a first-generation Chinese-American, Angela experienced a childhood with one foot in the United States and the other in Hong Kong, where she lived for five years, followed by two years in Tokyo.

Her father’s international work assignments were “my earliest exposure to the business world,” Angela says. “I was surrounded by businesspeople starting at a young age.”

Sage Advice for a Career Path

When it was time to return to the United States for college, many of her father’s colleagues suggested accounting as a major. It didn’t take much convincing for Angela to investigate.

“I didn’t know much about accounting specifically, or the importance of financial statements,” she says. “But I took a fairly assertive approach to learning about becoming a CPA — going to career fairs, talking to Big 4 firms, and seeking out career services. As early as my freshman year at the University of Massachusetts Amherst, I was mapping out credits and requirements to become a CPA.”

Angela never looked back. Well, almost.

“There was a brief period where I considered majoring in psychology instead. Understanding what people are about, the science behind people’s behaviors, I enjoyed all of that in a freshman-level class.

“But then my dad sneakily sent me a U.S. News article about the relationship between your college major and your lifetime earnings,” she says with laughter.

Goals and Actions Come Together

The rest is history. With her fondness for math and her drive for success, Angela reached 150 credits within four years at UMass, ready to continue her journey toward CPA licensure.

As a freshly minted accounting graduate, Angela jumped right into interviews and networking with accounting firms of all sizes.

“One of my first career memories is the sense of accomplishment I felt after I received several internship offers,” she says. “There’s a lot of stress and pressure during daylong interviews with multiple firms. But I could proudly say, ‘I landed this internship because I put in the work. Now I get to pick what firm I want.’”

Fast forward 10 years: Angela has been vice president and controller of a 39-branch community bank in New York and New Jersey since 2012. She made the jump to business and industry from public accounting after three years as an auditor.

“You’re in public accounting for however many years, and of course, the path to partner is the right fit for many CPAs. What I love about the profession is that there are so many other roles. Controllers, CFOs, you name the leadership title; CPAs are part of the collaborative leadership function in any organization.”

And her brief foray into psychology has had lasting benefits.

“Getting to know what motivates people is crucial to being an effective leader, because CPAs are constantly working in team environments” says Angela.

“People may think accountants have their heads down, pencil to paper, but it’s so far from the truth. You’re always interacting with different departments, auditors, senior management and regulators.”

Standing Out in a Crowd

Angela is the first to admit that she has been on the receiving end of other assumptions, but not because of her Asian heritage.

“I work in a mature and seasoned work environment. As a younger person in community banking, I want to gain a seat at the table and to be taken seriously. Part of that is being as prepared as possible and making sure my facts are straight for meetings and calls.

“The confidence of knowing your stuff helps you be a better communicator and presenter. That translates to a commanding presence at the table. And colleagues have to take you seriously, as they would someone who has 10 or 20 more years of experience.”

When it comes to representing a minority group in the workplace, Angela says, “Be proud of who you are. Be authentic. And don’t be afraid to show that. Generally speaking, people are interested in knowing your background.

“It’s important to share who you are with people you’re around for 40 to 80 hours a week.”

Angela, the only Asian-American woman at a VP level within her organization, even started an annual cultural event through the great equalizer: food.

“Every Chinese New Year, we have a gathering of 30 to 40 people to celebrate the holiday and eat Chinese food that represents longevity and prosperity. It’s a nice break to learn about another culture, and I’m very happy that people take an interest.

“It’s a small gesture, but I think one that’s appreciated by other minority groups, as well. We can encourage giving a voice to others and invite them to tell their stories.”

Kimberly Drumgo, Director, Diversity & Inclusion, American Institute of CPAs.

What it Means to Be There for Your Clients as They Age

Post author By FFC
Post date May 25, 2016

What it Means to Be There for Your Clients as They Age

Most people don’t think they need to plan for getting older. That is, until they are forced to make unexpected, and potentially no-win, decisions, or, perhaps they fall victim to a scam that targets elderly people. In the best cases, the reality of aging means the person merely finds they can’t do something they used to do with ease. Unfortunately, in many cases, the reality doesn’t hit them until after they’ve experienced a problem.

Getting older can be a challenge to your clients’ personal and financial security if their physical and mental capacity start to wane. As their trusted adviser, you can help your clients safely ease into the later decades of their lives by organizing, simplifying and monitoring their finances, and building important relationships to help them address senior issues. As you gain more experience in this area of practice, you may find yourself identifying a range of later life planning services that can offer significant practice development opportunities.

Get your clients organized. This is the single most important step to safeguard your clients from running out of money and help them keep control of their finances for as long as possible. Most of the time, investment returns are based on asset allocations. Without organized finances, no client can have a comprehensive, monitored investment plan.

You can help your clients create a master list of their assets and where they are located. I’ve found that many seniors don’t know what assets they have, let alone where they are. For example, they often have stock certificates and other important documents in their safe deposit box, which is a dangerous and inefficient means of holding assets because they can easily be overlooked, forgotten or, worse yet, stolen.

As accountants, we need to guide, encourage and push clients proactively to consolidate and simplify where they have their assets. I have one very simple rule: is there a legal or tax reason the client needs a particular account? If not, that account should be consolidated into another account. While this planning might sound simplistic, it is incredibly powerful and, too often, overlooked.

Build monitor relationships. A monitor relationship is similar to an advocate who can “monitor” a situation and recommend solutions. For aging clients, creating this relationship, and in many cases, serving as one of the monitors is a way for you and others to identify your clients’ problems independently. This creates a check and balance on your client, their planning team, and the people giving them care. For example, if the client has duplicate copies of each monthly statement sent to you, and retains you to keep books and records, you will be able to identify a range of issues and alert fiduciaries or family when appropriate. Although there are online tools that can help do this, they all lack a trained professional’s touch.

As clients age, they may begin to have trouble handling some of their finances. Having as much of their finances on autopilot as possible enables them to spend time reviewing, rather than paying their bills., For example, recommending seniors use a personal finance management tool and sign up for auto pay can be very effective. Moreover, don’t forget about life inventory and legal documents. Clients should make a list of the location of all of their important personal items and documents, and identify any preferences they have as to final disposition.

Competency. Observant practitioners can see the signs of cognitive impairment by noting changes in client conduct at meetings, nuances in how they use words or if they make mistakes in communication. Reports from physicians and care managers can be similarly useful. Have the client’s attorney provide confirmation, in writing, that the client has sufficient capacity to sign your engagement letter, investment policy statement and other important papers. If the attorney does not think the client has the capacity, then have the attorney confirm to you that the agent under the client’s power of attorney has the authority to retain you or perform other actions.

Helping your clients plan for their later years, earlier in life, is critical to their financial and emotional well-being. Be proactive and help them plan, now.

Want to learn more about this topic? Martin Shenkman presented a webcast in late 2015, “Aging and Incapacity: CPAs Role in Advising Aging Clients” Click here to access the webcast, and visit the PFP Division’s Retirement Planning Center for more information on a variety of retirement topics. The resources are free to PFP/PFS members, and excerpts for many resources are provided to nonmembers, along with instructions on how to access more information. Throughout 2016, look for additional webcasts, podcasts, and resources related to elder planning and life transitions after retirement.

Martin Shenkman, CPA, MBA, PFS, AEP, JD, Shenkman Law. Martin is the founder of Shenkman Law, where he focuses on estate and tax planning. He is the author of more than 42 books and 1,000 articles, and is a quoted expert on tax matters., His work appears in well-known publications, including The Wall Street Journal and The New York Times. Martin is also known for his active charitable work, which has been profiled in Forbes. See his blog post at www.shenkmanlaw.com.

Elderly couple review finances courtesy of Shutterstock.