Revenge of the Bookkeepers
If it feels like your CPA practice is under attack, it is. First, it was online tax software.Then offshore accountants working for pennies on the dollar. Next, came Watson, artificial intelligence, and the robots. And now this —revenge of the bookkeepers.
CPA David Bergstein wrote an excellent article in the April issue of Accounting Today about “a whole new set of advisors coming into play in accounting.” These new professional services companies are like CPA firms, except without the CPA.
As Bergstein points out, many of these hybrid firms have their roots as bookkeeping companies providing back office accounting services – now bolting on value-added services, such as consulting and strategic advisory. In the process they’re servicing small and mid-sized business owners at a higher level than many compliance-centric CPA firms do.
Entrepreneurs and business owners today are looking for more from their advisors than 20th Century thinking and historical record keeping. If CPAs won’t provide it, these executives are willing to look outside traditional channels to find it.
Last week on our podcast we heard about several bookkeeping firms who are doing six figures a month. As you can imagine, to generate steady revenue like that, they’re doing much more than balancing a company’s checkbook.
Separately, I had a conversation with a millennial CPA who walked away from a lucrative career at a top “name” regional firm to join a bookkeeping service because he:
1) was fed up with 80-hour workweeks
2) was tired of practicing “drive-by accounting”
3) now has more freedom to add value wherever he sees need
4) feels like he’s using more of his brain
5) can engage clients on a much deeper level that they appreciate
6) can still make a very good income
Some CPAs look down on bookkeepers because they don’t have a CPA license. Meanwhile, many bookkeepers are rejoicing because they DON’T have one.
Not having a CPA license means they never have the responsibility and aggravation and liability of doing tax returns. They’re free to build a firm unchained to the tax return — which means proactive, value-added, forward-looking services that speak to the modern business owner.
And when it comes time to do the tax return? They can hire that low-level commodity service out.
Paul Partridge is a partner at HaydenRock Solutions. He is an entrepreneur and marketing executive who has worked with dozens of Fortune 500 clients from Madison Avenue to Silicon Valley.