Top business leaders, MPs of major accounting firms, state societies and financial regulators gathered to discuss the most pressing issues facing the profession at the AICPA’s Spring Council meeting in Washington, D.C. in May.
“The potential changes to audit reports for public companies and mandatory firm rotation proposals may change the auditing process.” – AICPA President and CEO, Barry Melancon.
Melancon foresees a host of opportunities in assurance, including greenhouse gas emissions, sustainability of supply chains and more.
Melancon called creating more diversity in the profession “an economic imperative.”
“Big data will likely change our thoughts about how we audit and what we audit to increase relevance and reliability.” – Barry Melancon.
“We’re the most trusted professional in the business space. Other professions would love to have the type of reputation that people in this room have.” – Barry Melancon.
“Cloud computing has transformed the relationship between the practitioners and their clients. Technology is a driver of change today and into the future of our profession. We have to embrace it.” – Barry Melancon.
John Veihmeyer, CEO of KPMG, says he has a simple litmus test when it comes to regulatory changes: “Will it help? Or make it more difficult to retain and attract the best people into this profession?”
“We have a crisis at the audit partner level, they put their career on the table every single day.” – Lou Grabowsky, COO of Grant Thornton.
Audit practices are stressed, says Bill Freda, Vice Chair of Deloitte.
“I look at proposals using the lens of whether it improves audit quality and enhances governance. I don’t think mandatory firm rotation meets that test.” – Steve Howe, MP of Ernst & Young.
“Let’s change the dialogue from defensive to offensive or aggressive.” – Lou Grabowsky on the need for good dialogue with executives and CEOs of the companies. “We’ve moved so far to a compliance discussion that we forget about the business discussion.”
“The level of accountability for the profession is higher than it’s ever been and it’s moving in the right direction.” – Bill Freda, Vice Chair, Deloitte, on the strides the profession has made.
“Assurance is seeing a lot of growth and the potential is enormous. If we continue to hire the best and the brightest, we’ll continue to be the profession that brings our clients the solutions.” – Jean Hobby, Assurance Technology, Entertainment and Health Industry Leader, PwC.
“Diversity in the profession is a necessity and 10 years from now it will be an absolute requirement.” – Jean Hobby.
“Our profession is becoming much more of a team activity.” – Jean Hobby.
Dan Griffiths, co-founder, Proficio Services Group, says empathy is a “gaping hole” in the strengths of the profession. It’s important to work with people with diverse backgrounds and understand where they’re coming from. “We’ve got to get more comfortable working with diversity.”
Gen Y says, “Hey, the technology I’ve got in my pocket is better than what I have at work.” – George Colony, CEO of Forrester Research.
“I think it’s important that we emphasize creativity and intuition just as much as rational, logical, fact-based thinking.” – Gerardo Godinez, Business Assurance Senior Manager, Moss Adams, commenting on soft skills.
“What’s not motivating to our generation is ‘pay your dues, put in your time and there’s this pot of gold at the end of the rainbow.’ ” – Dan Griffiths on meaning and purpose being more important than a paycheck.
“LinkedIn is “incredibly powerful” and is being “underutilized.” Dan Griffiths advises firms to stop blocking staff from using it.
On social media bans: “You’re not going to get the best and the brightest to work at your “company. This is the air they breathe and the water they swim in.” – George Colony.
“I think technology is going to enable us to get to the point where there’s no busy season.” – Gerardo Godinez.
“Collaboration is key. The days of financial people sitting at their computer, sitting at their desks all day, are long, long gone.” – Brad Dickerson, CFO, Under Armour Inc.
“Are you a problem solver? Or are you an accountant? Don’t tell me accounting stuff. Tell me a business solution.” – Kenneth Kelly, Senior VP and Controller, McCormick Corporation.
“How do we as financial professionals move up the value chain – not just counting the beans but how to grow the beans?” – Kenneth Kelly.
“I think maybe 15% of your [CPA’s] work is black and white and 85% is gray.” – Brad Dickerson.
“I always thought I had to be the expert on whatever issue was out there. Be an expert in your swim lane. Be comfortable where you’re an expert and be comfortable where you’re not.” – Brad Dickerson.
“Make sure the information is clear and concise and it’s not information overload. I think it’s our [professions’] job to be storytellers.” – Brad Dickerson on leadership.
“I believe many of the assurance engagements we’re doing outside of opinion audits are where clients are seeing the most value. That’s where the market is taking us. If we don’t take advantage of that, we’re going to lose that opportunity.” – Charles Allen, CEO of Crowe Horwath, regarding investors seeing audits as important and having confidence in the audit process.
U.S. Sen. Bob Graham, who served two terms as Florida governor and 18 years in the Senate, called for regulatory reform and said three issues should be considered: acting in a timely manner, creating simple, clear regulations and ensuring they are sustainable.
Neal Spencer, CEO of BKD LLP, said he would take a “hard look” at eliminating some regulations. “It’s causing a lot of pain with our clients today.” Some regulations make sense, “but we’re piling on, quite frankly.”
“We need to be balanced between independence and accountability.” – IRS Commissioner, Douglas Shulman.
“I’m a big believer that there’s a link between transparency and integrity.” – Douglas Shulman.
“Over 60 action items are in this report that can move us to another level, but it takes support from leaders in this room and in the accounting profession.” – William Ezzell, Commissioner of the Pathways Commission, on the future of accounting education.