How CFOs Can Better Utilize Independent CPAs

Peter Renzulli, CPA – March 14, 2019
  How CFOs Can Better Utilize Independent CPAs

Many CFOs and their independent CPAs do not have a plan for their relationship beyond the traditional one where the CPA does compliance work for the business and may or may not be called upon for other services. Fortunately, the relationship can be much more than compliance work. The CFO and the independent CPA should work together to develop a well-thought-out plan for the relationship so the use of the CPA firm’s team is efficient and the CFO’s goals for the organization are met. Having a developed plan will align the goals of both organizations, help both teams develop professionally and increase satisfaction knowing that both the CFO and the CPA are fostering positive growth for both organizations. Here are four key steps in the planning process.

1. Build the Team

The first step in integrating the relationship is a meeting between key stakeholders, including everyone from high-level executives to clerical-level team members from both the organization and the CPA firm. The goal is to create a clear communication channel at the most appropriate levels. Accounting staff should have a contact person to discuss questions with the CPA firm staff in order to better understand reporting issues, journal entries and documentation. The controller should have a contact person at the CPA firm with whom to discuss internal controls, reporting and general quarterly/year-end planning.  Finally, the CFO should have contacts at both the senior/manager level as well as at the partner level to discuss all issues, especially taxation, financial reporting and long-term planning. It is common for CPA firms to have a relationship between the CFO and the partner on the account, but most ignore other relationships that are equally important. What is key is that staff from both the CPA firm and the organization will receive another level of training and development, which will assist in each employee’s job satisfaction, feeling of belonging and skill development.

2. Review Prior Work

The second step is for the CFO and the CPA to completely and thoroughly review the prior year’s work papers, with particular focus on several items. These include:

Reviewing of immaterial items. While they may be immaterial to the financials, they can be very material in designing training and staff development. 

Discussing any difficulties during the audit or review so that systems and procedures can be modified to simplify the process. Do not rely on the management letter, which is a summary of items. Get into the details. Use the audit or review process to help develop and train the CFO’s staff. 

Having the CPA firm’s staff work direct­ly with the organization’s staff so that both teams get training in working as an integrated team. 

This meeting should occur at least annually, with sufficient time dedicated to the subject matter. If done properly, the CFO will be better able to manage the CPA firm’s costs and improve reporting and internal controls. The CPA firm will have a stronger client relationship and a method to further develop staff.

3. Include the CPA in Annual Planning

The third step is for the CFO to include the CPA firm in the annual planning process. By keeping the CPA firm and its tax staff up to date about the organization’s annual budgets and plan for the year, they can have input as to the tax effects of the plan. This input is crucial to creating a model for maximizing net income and managing capex while minimizing income tax. It will also enable a proactive tax plan to be in place. The CFO will have benchmarks to proactively contact the CPA if any significant changes occur throughout the year. This approach replaces the reactive methods used in many relationships with the CPA and creates a communication flow that includes taxation minimization in the planning process.

4. Be Proactive

Finally, start work mid-year on a year-end audit or review. Have the CPA firm’s staff do a partial review during the year so that any compliance or record-keeping issues are addressed early in the year and before they become issues in many transactions. The review or audit should not be reactive at year end but a proactive process to assist in managing the accounting department processes.

By including the CPA as a proactive and integral part of an organization’s ac­counting function, the CFO will be able to reduce taxes, maximize revenue, train staff and assist in meeting the strategic goals of the organization they are helping to run.


Peter J. Renzulli

This article is posthumously published by Peter Renzulli, CPA, president/CFO at PerformAccount and an adjunct professor at Rutgers University. He passed away in December 2018. Peter had been a member of the NJCPA Content Advisory Board since 2016 and served on various NJCPA committees.

This article appeared in the March/April 2019 issue of New Jersey CPA magazine. Read the full issue.