The Future Of The Accounting Industry

As we begin 2015, the accounting profession industry is changing rapidly. One of the leading authorities in the accounting industry, Joseph Tarasco, president of Accountants Advisory Group, shares his predictions and identifies critical trends:

– Fee pressures, rising staff labor costs, and lack of quality staff will force firms to carefully examine their mix of services, industry concentrations, and their positioning in their marketplace relative to their technical/consulting resources and competition. Industry, service, and niche segment profit centers will come under more pressure for better results as the competition stiffens.

– Companies will continue to acquire consulting and advisory companies that compliment their traditional services to provide integrated solutions services to their clients.

– Career development and leadership training will continue to grow as the need for quality professional staff at the managerial and partner levels turns into a crisis mode. Firms will have no choice but to invest heavily in their best and brightest in all stages of their careers in order to remain competitive and develop succession plans.

– The firms who have grown through the consolidation of aging practices will begin to deal with intensified succession issues. This will fuel more mergers of mega-firms into larger firms.

– Consolidation of firms in the country will continue at a faster pace with the second tier firms, such as BDO and McGladrey, continuing their buying spree.

– Managing Partners and Executive Committee members will come under more scrutiny by their partners in their ability to lead and manage successfully. Firm management will have to make tough business decisions concerning under-performing partners.

– There will be an increase in the number of firms below the Top 100 hiring professional lead generators to supplement the practice development efforts of the partners. In addition, firms below the Top 200 will outsource their marketing and practice development programs to professional consulting companies as the need for diversified multi-faceted marketing professionals is necessary to remain competitive.

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– The partnership structure will continue to fade away and be replaced by a corporate type structure. More firms will hire professional COO’s from outside of the CPA profession to assist them in managing their organizations.

– Partner compensation will be more geared toward higher levels of profitability and contributions to the future success of the firm. Aligning the firm’s goals and vision with partner performance criteria and accountability will be a key objective for progressive firms.

– More small firms will split up due to a lack of partner consensus on succession planning and investing in the future direction of the firm.

While all of Tarasco’s predications might not all play out in 2015, what is very clear is that the accounting firms are going to need to make significant strategic decisions and implement effectively if they are going to succeed in a more competitive environment.

Job of a tax consultant

Tax consultants, also know as tax advisors, are experts in tax law, compliance and planning. They serve individuals and businesses alike by staying current on new tax law and positioning taxpayers for long and short term tax optimization. A tax consultant typically expands on the role of tax preparer. While tax consultants prepare tax returns, they also often work closely with clients throughout the year to ensure client tax liability is minimized. Tax consultants are strong written and verbal communicators able to explain tax law and strategies in a way that is easy and accessible for clients to understand.

Tax consultants work for public accounting firms, law offices, financial consulting firms and many even have their own independent tax preparation and consultation businesses. In all settings, tax consultants can be expected to perform duties that include:

– Conducting research on tax laws

– Strategizing with clients to minimize tax liability

– Communicating with clients to explain tax issues

– Preparing tax returns

– Estate planning

– Keeping clients compliant with their tax obligations

Producing written content is a significant part of the job, as tax consultants must communicate their research findings including changes in tax laws that create opportunities for new tax strategy. Because a tax consultant may have many clients affected by the same issue, the ability to draft a well-written and concise letter is often the most effective means of disseminating information to a number of different clients.

Education Required

Tax consultants generally hold bachelor’s degrees in accounting, finance or a related field; however, because no formal certification is required, individuals often take on advisory roles after years of experience in another tax related profession. Ultimately, professionals with both formal education and tax experience are best positioned for these careers. Obtaining licensure as a CPA demonstrates the formal education and professional experience needed to support a future as a successful tax consultant. Internal Revenue Service employees may have years of experience, yet no formal education and be very well suited for advisory roles allowing them to obtain positions as tax consultants because of their relevant experience alone.

 

Postgraduate education can also be beneficial to the tax consultant career path, and many pursue a Master of Science in Taxation. An option for more advanced postgraduate study is through a Juris Doctor degree in taxation program. This advanced degree provides an in-depth knowledge of tax law and allows graduates to practice as tax attorneys.

Associations and certifications

There are several professional designations that compliment the tax consultancy profession well. Each of these is offered by different governing bodies and involves unique certification requirements.

Accredited Tax Consultant

The most relevant certification to the tax consultant profession is the Accredited Tax Consultant (ATA) credential. This designation demonstrates that a professional has advanced knowledge in complex tax planning subjects, including estate and retirement planning. To achieve the designation, a candidate should have at least five years of experience in a tax-related profession, with at least 40 % of the work dedicated to tax planning and consulting. There are no minimum education requirements to be considered for an ATA credential. The candidate will be required to pass a thorough exam consisting of 100 multiple choice questions. The exam questions cover ethics, tax preparation, client consulting, bankruptcy, compliance, regulation and more.

Similar to a CPA, ATAs are required to meet annual education requirements to ensure the continuity of their certification. Although CPAs often need to obtain as many 120 credit hours during a three-year period, ATAs are only required to complete 90 hours of continuing education.

Tax consultants, also know as tax advisors, are experts in tax planning, law and compliance. While tax consultants prepare tax returns, they also often work closely with clients throughout the year to ensure client tax liability is minimized. Tax consultants are strong written and verbal communicators able to explain tax law and strategies in a way that is accessible and easy for clients to understand.

Tax consultants generally hold bachelor’s degrees in accounting, finance or a related field; however, because no formal certification is required, individuals often take on advisory roles after years of experience in another tax related profession. The most relevant certification to the tax consultant profession is the Accredited Tax Consultant (ATA) credential.

Accounting is a good profession in the future

Regardless if it’s the money-laundering stoner in “Weeds” or the dorky auditor in “Parks and Recreation,” pop culture tends to portray an unsavory picture of accountants, but this profession doesn’t deserve such a bad reputation. Accountants make a pretty good living, and they have a lot of job security. As long as people make money, they’ll need other people to handle it for them.

Put simply, an accountant is a person who keeps or inspects financial records. They’re “numbers” people who excel at organization and detail-oriented work. Since they deal with money– sometimes significant amounts of it– accountants must also possess a high degree of integrity.And because they’re constantly interacting with clients, accountants should be effective communicators. Patty Pogemiller, the national director for talent and acquisition and mobility for Deloitte, one of the world’s “Big Four” accounting firms, writes in an email: “Problem solving skills are essential in a client business like professional services. Employers are looking for people who demonstrate an ability to think analytically and approach a problem in a structured and methodical way. Can they objectively solve an issue and analyze? And once they have a solution, they must have the ability to communicate it to others– their clients, managers and fellow team members.”.

In addition to preparing taxes for individuals, public accountants can also perform audits, prepare taxes and provide consulting for corporations, nonprofit organizations and governments. Internal accountants create processes to find and eliminate financial waste and fraud. Management accountants record and analyze financial information. Government accountants– at the federal, state or local level– maintain records of government agencies and audit private businesses or individuals whose activities fall under government regulation or taxation.

The Bureau of Labor Statistics projects that 166,700 new accounting and auditing jobs will open up by 2022. This equates to a 13.1 percent job growth rate, which is about as fast as the average for all professions.

Salary.

According to the BLS, the median annual salary for an accountant was $65,080 in 2013, or $31.29 per hour. The best-paid 10 percent earned roughly $113,740, while the lowest-paid made approximately $40,370. The best-compensated accountants work in the fields of securities and commodity contracts intermediation and brokerage and for securities and commodity exchanges. The highest-paid accountants work in the metropolitan areas of New York City; Newark, New Jersey; and San Jose, California.

Training.

Although there are some associate degrees for accounting, a bachelor’s degree generally looks better to prospective employers. Some employers may even prefer that their accountants have a master’s degree in accounting or business administration with a concentration in accounting. And some colleges and universities offer a five-year combined bachelor’s and master’s degree program, which is a smart choice for students hoping to take the Certified Public Accountant exam. Most states require graduates to have a total of 150 hours of coursework, which equates to five years of school, before sitting for the exam. After passing, accountants will be able to file reports to the Securities and Exchange Commission, which makes them much more attractive to employers. Christopher Ekimoff, the director of FTI Consulting, a global business advisory firm, says, “Those three letters [CPA] really make your accounting career. They will identify you in the marketplace, in the business world and in your career path as a professional willing to hold yourself to a higher standard and operate under a set of guidelines and principles that really set you apart.”.

In addition to the CPA certification, accountants may also want to get the Certified Management Accountant certification, which requires a bachelor’s degree, two years of work in management accounting and passing an exam. There are also a handful of other certifications that accountants may want to procure down the line, including the Certified Internal Auditor certification and the Certified Information Systems Auditor certification.

 

Accountants make a pretty good living, and they have a lot of job security. Since they deal with money– sometimes significant amounts of it– accountants must also possess a high degree of integrity.And because they’re constantly interacting with clients, accountants should be effective communicators. Government accountants– at the federal, state or local level– maintain records of government agencies and audit private businesses or individuals whose activities fall under government regulation or taxation.

Some employers may even prefer that their accountants have a master’s degree in accounting or business administration with a concentration in accounting. And some universities and colleges offer a five-year combined bachelor’s and master’s degree program, which is a smart choice for students hoping to take the Certified Public Accountant exam.