Most financial advisors will tell you they know their clients inside and out. But study after study finds significant gaps between an advisor’s assumptions and what clients say they are getting from their advisors.

Amy Mullen, president of Money Quotient, Inc. and vice president at MQ Research & Education, recently did a study in conjunction with the Financial Planning Association about developing and maintaining client trust and commitment in a rapidly changing environment.

Here are some key findings:

• Seven out of eight financial planners (87%) believe they are open to discussing what clients value most in life, but only half of the clients (50%) believe their advisors are open to discussing what they value most in life.
• Ninety percent of financial planners believe their recommendations are based on a client’s personal goals, needs, and priorities, but less than half of the clients (49%) feel that way.
• Eight out of 10 financial planners believe they communicate to clients the importance of incorporating all areas of life when creating a plan, but less than half of the clients (47%) feel their advisors are taking that approach.
• Seven out of eight (85%) financial planners say they contact clients regularly to see what life changes may be affecting their plan, but less than four in ten (39%) clients say their advisor contacts them regularly.

What this data tells us is that as professional service providers, we’re so focused on the numbers — and mathematical solutions — that we forget to ask clients about their most important values and life goals. As a result, we’re missing at least half of the puzzle pieces, sometimes more.

This same message can be applied to accountants and CPAs. I know it can feel like a full-time job just getting your clients’ books in order so you can get tax returns done on time and correctly. But do you have any idea what they want most out of life? Do you know how to put together a life plan? A life plan is a living document that can help you and your client regularly assess their satisfaction in all aspects of their lives, not just investments and taxes.

Why Life Planning Should Come First

Traditionally, people don’t start working with a planner until after they’ve had some sort of financial windfall, life-altering event (death, divorce, disability) or runup to retirement. But how many people’s lives could be transformed if you could help them get their ducks in a row before these life-changing events upend their lives? You may be thinking this is a job for wealth managers and estate planning attorneys. Don’t sell yourself short.

Accountants have long been the financial “first responders” in their clients’ lives. How many owners of small and midsize businesses could improve their businesses and sense of well-being by undergoing a comprehensive life plan early in their relationship with their CPA?

Values-based Planning 

Values-based financial planning is an approach to financial planning that takes into consideration an individual’s unique values, beliefs and goals — in addition to their financial situation — to create a customized, sustainable plan. Unlike traditional or goals-based financial planning, which may not fully consider the role of personal values when making financial decisions, values-based financial planning aligns a person’s financial plans with their life purpose and goals. 

“A large portion of our society doesn’t like goal setting,” Mullen told me recently. “The word ‘goal’ can have negative connotations either because society failed in the past to reach certain personal goals or they’re in a work setting in which rigid performance goals are pressed upon them.”

Advisors of all types, including CPAs, should try to give clients a fresh perspective on goal setting that gets them excited about engaging. The key is to help them set goals that are “aligned with their values.”

According to Mullen, clients shouldn’t just say: “Retirement is a goal” or “Funding college is a goal.” We want them to picture a “wonderful retirement with the people they love, doing the things they like to do.” Ask them: “Where will you be? Who are you with? What are you doing?” This, she said, is a really fun way to help people shift their perspective around goal setting. “You could say, ‘Let’s set up some benchmarks that we can celebrate along the way to make reaching this goal fun and rewarding,’” she added.

You also want to talk about the timeliness of the goal. One thing we don’t do enough of as advisors is to take the time to recognize when clients are overwhelmed because they already have too much on their plate already. By helping them prioritize small, manageable steps, they are more likely to stick to, and reach, their goals.

Next Best Action (NBA)

I’ve found the Next Best Action (NBA) approach can be very helpful for goal setting. Start with the “why” to establish a significant and meaningful vision, then shift to the “how” by becoming focused on the process.

Once your client has a goal in mind, the NBA becomes the actionable step that keeps them moving forward. For example, if your client’s ultimate goal is to run a marathon, the “why” might be to lead a healthier lifestyle. The “how” could be something as simple as running a mile or simply putting running shoes on and walking around the block to get them on the right path. NBA creates positive momentum and helps clients stay engaged with the process, even when the big picture feels daunting.

You’re great with the numbers and clients trust you immensely. Consider small, manageable steps to becoming a more comprehensive advisor and confidante in their life. Start building your ROR (Return on Relationship) or the human side of advice beyond the numbers today!

Arrowroot Family Office Disclaimer

This material contains opinions of the participants but not necessarily those of Arrowroot Family Office, its affiliated companies, directors, and employees. The opinions contained herein are subject to change without notice. Forward-looking statements, estimates, and certain information contained herein are based upon proprietary and non-proprietary research and other sources. Information contained herein has been obtained from sources believed to be reliable but are not assured as to accuracy. There is neither representation nor warranty as to the current accuracy of, nor liability for, decisions based on such information. Past performance is not indicative of future results. Content should not be construed as investment, legal or tax advice. The information in this communication is for informational purposes only and is neither an offer to purchase, nor a solicitation of an offer to sell, subscribe for or buy any securities or the solicitation of any vote in any jurisdiction pursuant to the proposed transactions or otherwise, nor shall there be any sale, issuance, or transfer of securities in any jurisdiction in contravention of applicable law. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.

Accounting is no longer just about numbers. It’s about navigating possibilities — and career paths should reflect that. For decades, the accounting profession has sold the dream of a singular path to success: graduate with your degree, land a job at a firm and work your way up the ladder to partner. Or exit the firm and become a controller and work your way up to CFO. For many, that ladder was clear, structured and (for some) satisfying.

But for too many others — especially younger generations, mid-career changers and those from historically underrepresented backgrounds — the ladder can feel limiting, outdated or even out of reach. Or even worse, not reaching the top can feel like failure.

It’s time for the profession to replace the traditional ladder with a jungle gym (thank you, Sheryl Sandberg, technology executive and former COO of Facebook (now Meta)) — a more flexible, dynamic and inclusive vision of career growth that reflects the complexity of modern accounting and the aspirations of today’s workforce.

From Climbing Up to Moving Around

Unlike a ladder, a jungle gym offers multiple ways to reach new heights. You can climb up, sideways, even backwards — and sometimes take a step down to ultimately leap forward. That’s the kind of career agility that today’s accountants need.

Consider the rise of nontraditional accounting roles:

• Data analysts and automation specialists inside firms
• ESG consultants leading sustainability initiatives
• Internal firm coaches and strategists
• Client advisory professionals specializing in tech stack design or process reengineering Accountants turned into startup founders, authors or educators

These are not deviations from the profession. They are evolutions of it. And yet, many firms and organizations still talk about success as if there’s only one direction: up the ladder.

Why the Ladder is Losing Its Appeal

Three major trends are accelerating the shift away from the ladder model:

1. Changing talent expectations: Today’s professionals are seeking purpose, autonomy and balance. They want roles that align with their values, leverage their strengths and allow for personalization. A rigid path to the executive level doesn’t appeal to everyone — nor should it have to. We should honor diverse definitions of success, not just the titles on a business card.
2. Evolving business models: The rise of advisory roles in firms and finance, niche consulting in non-accounting areas and AI-enabled workflows are redefining what it means to be valuable in a firm. Expertise is no longer solely vertical — it’s lateral, interdisciplinary and collaborative.
3. Urgency around retention: While some research suggests the tide of quiet quitting has eased, the cost of losing talent is still an issue for many accounting firms and finance teams. But many of those professionals aren’t burned out — they’re boxed in.

What the Jungle Gym Looks Like in Practice

Transitioning to a jungle gym model doesn’t mean abandoning structure; it means expanding it. Instead of a single upward track, it’s best to offer multiple pathways with interchangeable roles across departments, service lines or specialties. A tax associate might shift into a tech implementation team. An auditor could explore sustainability consulting or training roles. A controller could try being a business analyst with a focus on data analytics and operations.

Normalize lateral transitions and rotations as growth opportunities. These can deepen perspective, prevent burnout and build team resilience. Empower employees to shape their own trajectories. Let them combine technical, leadership and personal growth goals in ways that make sense for their aspirations and your business needs.

Mentors as Guides, Not Gatekeepers

Encourage mentorship models that support exploration and risk-taking, not just grooming for the executive path.

It’s time to redefine what success looks like in accounting. The jungle gym model honors the complexity of modern accounting and the humanity of the people who choose this profession. Whether you’re a managing partner, CFO, HR director or young professional trying to find your place, ask yourself:

• Are we offering real career agility or just lip service?
• Are we rewarding curiosity and lateral growth?
• Are we building teams that people want to stay in — or escape from?

Let’s Design the Profession We All Want

The future of accounting should continue to be inclusive, dynamic and fulfilling. But we can’t get there if we cling to outdated models of what a “successful accountant” looks like.

Let’s give people the freedom to swing, climb, pivot and grow. Let’s build teams where the view from the top isn’t the only one that matters. Let’s ditch the ladder and build a jungle gym together.

My career isn’t glamorous. You won’t find it on TV crime shows. No one grew up saying, “I want to be an internal auditor.” Internal audit doesn’t get the spotlight — but maybe it should. 

Ask anyone in the field, and they’ll tell you that internal audit is one of the most unexpectedly rewarding careers out there. Many, if not most, auditors stumble into the field but then often end up staying for their entire career. That’s definitely my story. I followed the classic advice: major in accounting, land a role at a Big 4 firm and start climbing. After a few years, it was clear that public accounting wasn’t for me, but I still had no idea where my journey would take me. I decided to give internal audit a try because I had heard there was amazing work-life balance — and I have never looked back.

Over the years, I’ve had experiences that “college-me” could never have imagined. I’ve shown up at a casino at 2 a.m. and watched a “drop and count” (the nightly process of physically collecting and reconciling all money in the machines and game tables), visited the oil and gas fields of West Texas and wen to a cash distribution facility under armed guard. I’ve learned how coal ash is turned into usable products and how building trusses are measured and cut. I’ve found fraud and investigated employees. It’s all in a day’s work for internal auditors. 

Few careers offer the chance to investigate, influence, protect and grow all in a single day but internal audit does. Here are just a few of the many hats that internal auditors wear every day: 

• Corporate detective: Asking thoughtful (and often unexpected!) questions is an auditor’s superpower. They spot patterns that others might overlook, investigate anomalies, dig into data and follow leads to uncover root causes. For those of us who are naturally curious (I prefer this word over nosy!) and always ask “why,” internal audit is a great fit. See something that just looks a little off? Dig into the data and figure out what happened.
• Trusted advisor: The best auditors don’t just fill out checklists. They are strategic partners to management and the board of directors. I admittedly didn’t realize for many years that we’re ultimately in the “relationship game,” but auditors must form strong relationships across all departments. We earn trust through the objectivity and insight we provide and by not only focusing on what went wrong, but also on what’s working. When people first meet auditors, they are often nervous. True audit pros know how to garner trust and still deliver tough messages.
• Risk wrangler: Most people don’t think much about risk (or don’t want to!) but auditors do. Auditors of the past often had a “historical looking” lens and spent the majority of their time analyzing data and looking back at what happened. Today’s auditors stay up to date on emerging risks, trends and technologies to keep organizations safe.  Auditors are explorers — scanning the risk horizon to assess what could go wrong and how bad it could be before it happens.
• Lifelong student: If you loved school — learning and asking questions — internal audit is your dream job. Every audit is a crash course in a new topic, process or system. Auditors are constantly expanding their knowledge across industries, technologies and regulations. And best of all, you get paid to keep learning, questioning and growing!

Internal audit is one of those rare paths where you can make a real impact, grow endlessly and never be bored (and trust me, I get bored easily!). This career has challenged me in ways I didn’t expect and opened doors I didn’t even know existed. I’ve gained a front-row seat to how organizations really work and a direct line to the executives and leaders making things happen. I’ve helped shape how both organizations and individuals succeed. If you're curious, adaptable and driven to make things better, then this might just be the career you didn’t know you were looking for.

As governments respond to emerging risks, new disclosure requirements and calls for greater transparency, policies are reshaping the audit landscape in significant ways. For auditors and finance professionals working with public entities, these shifts aren’t just technical, they influence audit scope, timing, risk assessment and, ultimately, public trust.

Here are three ways today’s policy updates are influencing government audits and how finance teams can stay agile in the face of regulatory change:

1. Standard-Driven Policy Changes Are Expanding Audit Risks

Government financial reporting standards continue to evolve. Governmental Accounting Standards Board (GASB) pronouncements such as GASB Statement No. 96 (Subscription-Based IT Arrangements), GASB Statement No. 101 (Compensated Absences) and GASB Statement No. 102 (Certain Risk Disclosures) reflect a broader push toward modernized and consistent disclosures. While these standards are not legislative mandates, governments at all levels are establishing internal policies and procedures to align with and implement them.

These developments have auditors reassessing risk, particularly around the new estimates and judgments that governmental entities are making. In addition, auditors are evaluating the design and effectiveness of internal controls over financial reporting in light of the new standards, as well as assessing the adequacy of supporting documentation.

Remaining up to date on how these standards are implemented at each government entity is essential to understanding their impact on audit planning, risk assessment and testing.

2. Data and Technology Policies Are Reshaping Audit Evidence

Government policies on data governance and digital records are actively changing how audit evidence is obtained, documented and evaluated. As more entities transition to cloud-based systems, electronic records and workflow automation tools, new requirements around data retention, cybersecurity and access control are directly impacting audit processes.

While some government entities continue to lag in technology adoption, particularly with artificial intelligence, many are steadily increasing their use of digital tools for daily operations. This shift introduces new considerations and risks for auditors to navigate.

These changes are especially relevant as audit teams leverage technology-assisted audit software. The broader movement toward digitalization will further influence how auditors approach evidence collection, analytical procedures and consistency checks across large datasets.

To remain effective, audit teams must understand and assess the risks associated with emerging data policies while investing in training that equips auditors to evaluate controls in increasingly digitized environments.

3. Policy-Driven Transparency Initiatives Are Elevating Expectations

Public sector accountability is top of mind for policymakers and citizens alike. Transparency initiatives, such as open data laws, performance dashboards and public reporting portals, have become more common and raise the public’s expectations for accuracy, comparability and clarity in financial reporting.

The audit and the Annual Comprehensive Financial Report (ACFR) are increasingly viewed as mechanisms to validate that governmental entities are collecting, managing and allocating resources appropriately (the NJCPA’s and New Jersey Business & Industry Association’s recent legislation to provide a “plain-language” summary of the report likely helps). When audit findings identify deficiencies, the impact extends beyond the finance function, affecting legislative decision-making, media narratives and public trust.

Finance professionals and auditors must therefore view each policy-driven disclosure as an opportunity to strengthen communication, provide context and support decision-makers with clear and reliable data.

New policies are not just regulatory hurdles — they are key factors that directly influence how we plan and perform audits of governmental entities. Whether it’s adopting a new GASB standard, evaluating IT systems under new security policies or ensuring transparency through improved disclosures, every change requires auditors and government finance professionals to stay informed, flexible and collaborative.

By viewing policy shifts through a lens of opportunity, not just obligation, we can elevate the value of audits and contribute to stronger governance, greater accountability and more transparent, trusted public entities.

Interns can be one of the greatest untapped assets in the accounting profession. They bring fresh energy, new perspectives and a willingness to take on tasks that more experienced team members may no longer wish to perform. But turning a good internship into a great one — both for the intern and the firm — takes thoughtful planning and consistent engagement.

Over the years, I’ve seen both the good and the not-so-great when it comes to welcoming interns into the field. Whether you’re preparing for fall interns or already looking ahead to tax season, here are 10 field-tested strategies for successfully onboarding and engaging your interns.

1. Create a solid pre-boarding process. We’ve all had (or been!) that intern who shows up on day one, unsure where to park, what to wear or even what they’ll be doing. A simple welcome email with logistical basics and a quick overview of what they can expect during the first day or so can go a long way to reduce those first-day jitters. Consider sending out an informal welcome packet that can include things like an organizational chart, some team bios and even a light-hearted FAQ to give the new interns a sense of who the firm and team members are beyond the spreadsheets. This helps them walk through the door with confidence and sets the tone for the experience to come.
2. Make orientation meaningful. Orientation shouldn’t just be about filling out forms and finding the nearest coffee machine (though I would argue this is very important!). This is your chance to introduce interns to the firm’s culture, values and how they can fit into all of it. It’s your opportunity to introduce interns to the why behind the work and help them build pride, engagement and a stronger sense of connection from the start.
3. Assign them a mentor. One of the most impactful moves you can make is assigning each intern a mentor. This should be someone who isn’t their supervisor, but who can help them navigate everything from client etiquette to where to find the office supplies. These mentor relationships can often turn out to be the most meaningful part of the internship — a simple investment that can pay long-term dividends!
4. Set expectations early. Like any client engagement, a successful internship begins with clear expectations from their supervisor. Sit down with your intern during week one to go over what success in their position would look like. Give them more details on what projects or clients they will be working on, discuss how their performance will be evaluated and how they will receive feedback. Having these conversations early helps reduce confusion and builds trust, while giving a clear sense of purpose.
5. Give them real work. It can be tempting to save all the “grunt” work for your interns, but how rewarding would it be to give them a real, substantial project or task? I’ve noticed how interns are so much more engaged when they are given an important piece of the project. I’ve always been a big proponent of allowing interns to assist with client requests and shadow meetings or discussions with them as well. It is important to note that balance is key here; you want to challenge them but not overwhelm them.
6. Check in frequently. Make sure to keep interns on track and keep the door open for honest conversations. Open communication is recommended.
7. Help them feel like part of the team. Culture matters, and interns can only absorb it if they feel like they belong. Help them integrate into firm life by making the effort to connect — and include them in team lunches or birthday celebrations, encourage informal conversations and acknowledge milestones and achievements. Little moments of appreciation add up, and interns are more likely to stay engaged and return in the future.
8. Prioritize ongoing feedback. Giving consistent, constructive feedback is essential to an intern’s growth. Interns need feedback throughout their program to help them improve and to show that you care about their development.
9. Ask for their input. It’s important to ask them what are you are doing well as a firm and what you could be doing better. Interns often notice things others overlook, and listening to their perspectives can spark innovation and process improvements across the firm.
10. Celebrate their contributions. At the end of the internship, take time to acknowledge what your interns have accomplished by recognizing their contributions. Consider personalized notes and open discussions about future opportunities. Even if they don’t return to your firm immediately, they leave as ambassadors of the accounting profession and of your firm.

Onboarding and engaging interns is key to building the future of our profession. By investing the time and energy into mentoring young talent, we all benefit. By building thoughtful, structured and human-centered internship experiences, we help shape tomorrow’s accounting leaders and strengthen our firms in the process.

Our People and Our Community 

As we pass the midpoint of 2025 and the beginning of our new fiscal year, I would like to extend our sincere thanks to our members, partners and stakeholders for your continued engagement and support. Your contributions are vital to everything we’ve accomplished. On behalf of our Board of Trustees, leaders and NJCPA staff, we’re pleased to share several key updates that reflect our collective progress and ongoing momentum. For a look at our collective accomplishments last year, please watch our Year in Review video. 

NJCPA-proposed legislation that will create an additional pathway to CPA licensure in New Jersey is entering the home stretch. The NJCPA is calling to modify New Jersey’s Accountancy Act to enable CPA candidates to qualify for licensure by earning a bachelor’s degree, completing two years of experience and passing the CPA Exam. 

Prospective CPAs can still follow the existing pathway (150 hours of education plus one year of experience and passing the Exam), but the new path allows accountants to opt for more real-world experience rather than take an additional 30 hours of education. In addition to the new CPA pathway, the legislation will ensure practice mobility for out-of-state CPAs. 

The bill (A5598) passed the full Assembly on May 22, and a companion bill was unanimously passed by the Senate Commerce Committee on June 12. Final passage of the bill has been delayed by the legislature’s summer recess, but we fully expect the bill to pass in the full Senate and be signed by the Governor when lawmakers return from their break by the fall. 

A special thank you to everyone who attended our NJCPA Convention & Expo last month in Atlantic City — the Society’s signature gathering of current and up and coming accounting leaders committed to advancing the profession. This four-day experience offered powerful conversations, new connections and practical strategies for personal and professional development, including an expanded student track with 40 students in attendance. If you missed it, check out the convention recap. 

I’d like to close this CEO Compass with an excerpt from my opening remarks on the first day of the Convention: “Let me emphasize what makes NJCPA truly special: it’s our people AND our community. Our accomplishments were not achieved by any single person, but by all of us working together. Each donation to the food drive, to our PAC, each presentation at a school, each time we speak up for the profession, sends a signal of strength and purpose. As we saw last year, the strength of NJCPA is in the relationships we nurture and the networks we build. When we act collectively, our impact multiplies.” 

I have no doubt that by joining forces, we will continue to be a force for good in our communities and for our profession. 

I’d like to thank all of you who volunteer in any capacity for your time and expertise in helping to steer us in the right direction. We invite others to get involved at Volunteer Interest Profile. And, as always, we’d like to hear from you at feedback@njcpa.org.

Marketing for CPA firms isn’t just about running ads or posting on social media. It’s about building trust. After spending tens of thousands of dollars on marketing tactics — some that worked, but most that didn’t — I’ve seen firsthand the common pitfalls CPA firm owners fall into when trying to attract high-value clients. 

The reality is, many marketers claim they can help accountants grow, but very few truly understand what it takes. That’s because marketing for a CPA firm isn’t the same as marketing for a restaurant or an e-commerce store. The clients you want — business owners with significant revenue — are cautious, skeptical and not easily swayed by flashy promotions. 

So why is it so hard to bring in new clients? And more importantly, what can you do differently to make your marketing efforts actually work? Let’s dive into some of the most common misunderstandings and mistakes I’ve seen in the industry. 

1.  Underestimating the Trust Barrier 

Why it’s a mistake: Accounting firms aren’t selling a commodity. You’re not just offering a service — you’re asking potential clients to trust you with their business’s most sensitive information. That’s a massive ask. Many accountants assume that if they just present themselves as the “better option,” clients will switch. But switching accountants is a big deal for most businesses. 

Business owners already have an accountant, and even if they’re unhappy with their current provider, they’d rather stick with someone they know than take a risk on someone new. The saying, “Better the devil you know than the devil you don’t,” rings true here. 

The fix: Your marketing strategy needs to focus on building trust over time rather than expecting immediate conversions. Instead of pushing aggressive sales tactics, focus on education-based marketing — sharing insights, addressing common pain points and positioning yourself as the expert they can rely on when they’re ready to make a change. 

2. Treating Marketing as a Short-Term Experiment 

Why it’s a mistake: One of the biggest marketing failures I see among CPA firm owners is running a campaign for two or three months, seeing little to no results and then shutting it down. Trust and credibility take time to establish — especially in professional services. 

Unlike e-commerce or retail, where a Facebook ad can generate quick sales, your ideal clients require a much longer decision-making process. If you turn off your marketing efforts after a short period, you’re cutting off your chances of gaining traction. 

The fix: Shift your mindset to long-term consistency. Marketing for an accounting firm is more like public relations than direct response advertising. Your efforts should focus on consistently showing up in front of your target audience, proving your expertise and nurturing relationships. 

Commit to a marketing plan for at least 12 to 18 months before evaluating its full effectiveness. Trust-building doesn’t happen overnight. 

3. Falling for Overpromising Marketers 

Why it’s a mistake: There’s no shortage of marketers promising to flood CPA firms with leads. But many of these companies excel at selling to accountants but fail at actually bringing in clients for accountants. 

The problem? Many marketing firms don’t understand how to sell professional services. The approach needed to sell accounting and advisory work is completely different from selling a product or a low-commitment service. 

The fix: Before investing in any marketing firm, demand proof. Ask for specific case studies of how they’ve helped other service-based businesses like CPA firms. Look for clear ROI metrics — not just vanity metrics like website visits or ad impressions. 

Better yet, learn to run some of your own marketing. There are incredibly cost-effective ways to generate leads without spending thousands per month on a marketing firm. For example, leveraging LinkedIn direct outreach can be far more effective than hiring an expensive agency that doesn’t truly understand your business. 

4. Relying on a Generic Outreach Strategy 

Why it’s a mistake: Many CPA firms waste money on broad, one-size-fits-all advertising. The problem? Your potential clients don’t respond to generic marketing. A business owner looking for a CPA isn’t just going to Google “accountant” and pick one at random. They’re going to ask for referrals, research your background and take their time making a decision. 

The fix: Instead of blasting out broad messages, think of your marketing as a targeted outreach campaign. Identify exactly who your ideal client is — what industry they’re in, what revenue they generate, what pain points they have — and create a specific marketing message just for them. 

A few effective tactics include the following: 

• Conduct direct LinkedIn outreach. Using LinkedIn Sales Navigator, you can create highly targeted lists of your ideal clients and start meaningful conversations.
• Attend industry-specific events. Instead of posting on Facebook, attend industry events in fields where you want clients. If you want medical clients, show up to a healthcare conference. If you want construction firms, be at their networking events.
• Use email sequences that provide value. Send well-crafted emails with genuinely useful content, not just sales pitches. This keeps you on their radar without being pushy.

5. Expecting a Quick and Easy Sales Process 

Why it’s a mistake: Many accountants want a quick and low-effort way to land clients. Unfortunately, bigger businesses — the ones that are worth working with — aren’t going to switch accountants just because of an ad. 

Signing a new client requires two steps:

1. They need to trust you.
2. They need to be willing to break up with their current accountant.

That second step is a huge obstacle. Many business owners have already switched accountants before and have been burned. They’re wary of change, even if they know their current accountant isn’t great. 

The fix: Your marketing should acknowledge and address this hesitation. Show that you understand their fears and that you’re not just another accountant making empty promises. Offer a low-risk way for them to engage with you, like a free financial assessment, so they can see what working with you would be like before making a full commitment. 

Final Thoughts 

Marketing a CPA firm is about playing the long game. If you want to attract high-value clients, you must focus on building trust, staying consistent, and using a targeted, strategic approach. 

Your marketing shouldn’t feel like throwing money into a black hole. It should feel like a system that reliably brings in the right clients, month after month.  

Referrals are the lifeblood of many accounting firms. But far too often, referrals happen by chance. A client might casually mention your name to someone — but there’s no system in place to make it easy, trackable or repeatable.

Let’s be honest: hoping for referrals isn’t a marketing strategy.

To generate reliable, high-quality leads, you need a referral program that’s structured, intentional and easy to use. The good news? You don’t have to build it alone. With AI tools and simple automations, creating a referral program is easier than you think.

Why Referral Programs Work

Referrals come with built-in trust. Also, organized referral programs outperform traditional marketing channels. Consider the following:

• Referral leads convert 30% higher than others. (Saassquatch)
• Referred customers have a 16% higher lifetime value. (Growsurf)
• 84% of B2B decision-makers begin their journey with a referral. (ReferralRock)

How to Create a Robust Referral Program

This free guide, “AI Prompts for Building a Client Referral Program,” outlines what you need, including AI prompts, CRM tips and a step-by-step checklist. Here’s a preview:

• Step 1: Define your ideal referral. When you’re specific, your clients will know exactly whom to refer. Provide guidance about the following:
• Your niche (e.g., dental practices, construction firms, solopreneurs)
• The ideal client’s size or revenue range
• Services those clients will most likely need (e.g., tax planning, bookkeeping, advisory services)
• Step 2: Choose incentives that work. Incentives don’t need to break the bank, but they should be meaningful and professional. Explain the terms clearly — for example, the reward is issued after the referral’s engagement letter is signed. Popular incentives might include the following:
• $50 to $100 discount off their next invoice
• A donation to a charity of their choice
• Gift card to a favorite local spot
• Free service upgrade (like a financial review)
• Step 3: Promote the program. If clients don’t know the program exists, how can they refer others? Your messages should incorporate friendly language, such as “Know someone who needs reliable accounting support? Send them our way — and get rewarded.” Then, promote it in various ways, including the following:
• In client newsletters
• On your website’s home and services pages
• As a message in email signatures and invoice footers
• During onboarding and meetings
• In post-tax season wrap-up emails
• Step 4: Make referring as easy as possible. Clients are busy. Make the process effortless with tools like the following:
• A referral link or form
• A forwardable email
• A business card with a referral or QR code
• A simple “Who referred you?” text field in contact forms
• Step 5: Track and thank every referral. One of the biggest mistakes you can make is to ignore or forget a referral. To avoid that, consider the following:
• Tag and track referrals in your CRM.
• Set up notifications for follow-up.
• Send thank-you notes — even if the lead doesn’t convert.
• Keep a list of top referrers to celebrate annually.

Tip: Add AI and Automation to the Mix

Here’s where it gets smarter! Pair these tips with AI tools and your CRM automation to create a system the runs in the background — saving you time. Use these tools to auto-generate outreach and thank-you messages, draft social media posts or scripts, and personalize follow-ups at scale.

Ready to Launch?

If you’re serious about growing your firm through word of mouth, it’s time to stop guessing and start building a referral program that works. The “AI Prompts for Building a Client Referral Program” guide includes sample prompts to use with AI tools, CRM suggestions for tracking success and a ready-to-use checklist for launching your program.

What are you waiting for? Don’t let those referrals slip by.

Accounting firms can no longer rely on familiar marketing tactics to stand out. In a world oversaturated with marketing messages, relevance is everything. Audiences — whether clients, prospects or key contacts — quickly tune out anything that doesn’t speak to them. To attract attention and move people through the buyer’s journey, marketers must be more creative, intentional and focused than ever before, delivering personalized experiences that build trust, spark dialogue and foster community. The following are seven marketing strategies modern accounting firms should consider:

1. Lead with authority, not just visibility. Trust is built by solving real problems before you’re hired. Move beyond basic content — create interactive tools like a project cost calculator, industry-specific risk map or capital planning scorecard. Offer confidential office hours or a regulatory watchlist by sector. These resources show you understand your audience’s world and can guide them through complex decisions, earning trust before the first call.
2. Create personalized, data-driven experiences. Audiences expect relevant, tailored interactions, not generic messaging. Start by aligning your outreach with key business activities, such as expansion, hiring or equipment upgrades, to trigger timely messages about tax credits, regulatory changes or planning opportunities. Use data, AI and behavioral insights to personalize content, outreach and digital experiences based on industry, location or engagement patterns. Reinforce your value with targeted checklists, short videos or sample reviews that address specific goals and risks. These touchpoints demonstrate that you understand their priorities and position your firm as a proactive partner from the start.
3. Build community through peer groups and events. Today’s clients want more than reports or advice; they want meaningful relationships. Create spaces for peer collaboration through invite-only mastermind groups, roundtables or executive retreats. Let clients lead the value exchange, and bring in outside experts to add depth. These gatherings foster trust, spark fresh ideas and give clients something they won’t get elsewhere: a professional community that makes your firm an indispensable part of their success ecosystem.
4. Turn testimonials into client-centered stories. Testimonials are good, but client stories are better. Showcase your clients’ success, not just your role behind it. Use mini case studies or short videos to build an emotional connection and reinforce your expertise without overt self-promotion. Let clients be the heroes, and include an industry thought leader or subject matter expert to add credibility and speak to the value you provided.
5. Deliver exclusive, members-only insights. Create a private client content hub that offers more than articles — think priority access to proprietary research, early looks at tax strategy shifts, curated industry trend reports and invitations to closed-door briefings. This isn’t about publishing more; it’s about offering high-value, exclusive insight that your clients can’t get anywhere else. When clients feel like insiders, they stay engaged and loyal.
6. Use social media to extend value — not just visibility. Don’t chase likes — use social media to spark meaningful engagement. Share highlights from exclusive events, previews of proprietary insights or invitations to small-group strategy sessions to show what people are missing by not working with your firm. Use polls to gather input or test ideas for future content. Social media should serve as a gateway to meaningful engagement, not just a platform for promotion.
7. Establish and share a client service guide. Create a client service guide that defines your core values and exactly what actions bring them to life. Share it internally and with clients to promote consistency and accountability. Publish the guide on your website and include it in client and staff onboarding materials. A clear, visible guide ensures everyone understands exactly what “exceptional service” looks like and helps your team deliver on your brand promise every time.

Success in modern marketing isn’t about being everywhere but consistently delivering value with focus and purpose. In an industry full of sameness, doing more isn’t the answer — doing it differently is. The most effective accounting firm marketers in 2025 will prioritize trust, experience and community over impressions and clicks.

Real growth comes from relationships, not algorithms. The metrics that matter most are client acquisition and retention, both driven by trust built over time. The firms that thrive make a meaningful impact on their clients’ businesses — the ones clients call before making a significant move, whether it’s expanding, hiring a CFO or investing in new capabilities. That level of trust isn’t given; it’s earned through consistent relevance, responsiveness, reliability and results.

Achieving efficiency in any job demands a specific mindset — one that is shaped by experience and the necessity of the task at hand. My experience comes from installing tile in large department stores, and I urge you to pay attention next time you’re in one; visualize the complexities of that job.

The role of a CPA is fundamentally similar. Instead of laying tile, you manage data, clients and employees through a process that must be executed on schedule. Every unnecessary interaction with data or clients wastes your time and duplicates your efforts. In my observation, a staggering 90% of inefficiencies arise from a mere 10% of the entire process.

In flooring, any instance of handling tiles more than once clearly indicates a problem. So, how do you pinpoint these issues? You need to implement IBM flowcharting templates. This dynamic tool will require multiple iterations to map and define the workflow accurately. Once you establish the current path, you can effectively begin your analysis and drive improvement.

What Do Inefficiencies Look Like?

One of the most significant complaints I hear from my CPA colleagues during tax time is interruptions. Whether the interruption comes from a client or associate, the damage remains: time lost, the process stopped and inefficiency created. How do you eliminate the inefficiency? It can vary depending on the individual doing the analysis, but here are some simple guidelines to follow:

• Eliminate: Client interaction is non-negotiable and must remain a cornerstone of your operation. However, it is imperative to reevaluate processes that may have once been effective but are now outdated. My office has entirely phased out hard copies of client information, eliminating unnecessary paper waste and freeing up valuable space in our filing cabinets. While complete elimination can drive efficiency, not every function, such as paper use, can vanish.
• Change: Embracing change is essential. We have moved away from columnar paper to computer spreadsheets, and technological advancements are revolutionizing every facet of the accounting business. Staying stuck in the past is not an option. Adopting new tools that enhance efficiency and keep you at the forefront of our evolution is essential. Those who fail to adapt will face dire consequences.
• Mitigate: Elimination and change are critical for increasing firm efficiency, but it’s the ability to mitigate challenges that offers the most significant opportunities for improvement. Take interruptions, for example. While you can’t eliminate them or stop being a resource for your team, you can effectively mitigate their impact. Mitigation requires a strategic approach; placing barriers too high can stifle the flow of essential information and disrupt office productivity.

When I tackle projects like this article, I implement two crucial barriers to combat interruptions:

• Connection: Connection is the most straightforward, yet most difficult, barrier to maintain. I turn off my phone’s ringer, shut down my email and lock my door to ensure an environment focused on productivity. It’s time to take control and maximize our efficiency. The concept of threshold enters the process. What would be the threshold where interruption would be warranted? Setting thresholds like interruption may unduly restrict the flow of your firm. The choice of threshold corresponds to your individual preference. I caution you against being too strict with the level you choose.
• Time: For me, the connection has worked well, but time has worked since I began my professional career. As an early riser, I have found that performing essential tasks while others are sleeping offers me the best opportunity for efficiency.

The accounting profession is undergoing a seismic shift, with private equity (PE) now firmly entrenched in our landscape. As someone who’s advised on 30-plus PE-backed CPA firm transactions in recent years, I can attest this isn’t a trend — it’s the new normal. Here’s what partners at firms need to know about how PE works, who qualifies and why education is critical.

How PE Works

• The players: More than just PE firms
• Family offices often seek longer holds (10-plus years) with less aggressive growth mandates.
• Pension funds/wealth managers typically target stable cash flows.
• Short-term versus Long-term holders: PE firms may flip a firm in three to five years; others hold indefinitely.
• Deal structures: Majority ownership versus minority ownership
  • 60/40 splits are common: PE buys 60%; partners retain 40% as “rollover equity” (reinvested into the deal).
  • Local versus TopCo rollover: Where your 40% sits impacts whether you control your own destiny or are impacted by the performance of the entire group.
• Valuation: It’s about EBITDA, not revenue. PE firms evaluate CPA firms based on adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), not top-line revenue. Adjustments to EBITDA might include owner compensation adjustments and non-recurring expenses.
• Multiples: Adjusted EBITDA X Multiple = TEV
  Example: A firm with $8 million in revenue and $2 million in EBITDA might command a 5x multiple, yielding a $10 million total enterprise value (TEV).
  Real-world benchmarks: Firms once fetching 3.5x to 5x EBITDA now command 4.5x to 8x, depending on niche and geography.
• Payment Terms: Highest multiple ≠ best deal
  • Upfront cash (typically 50%) with balance paid over five years
  • Working capital requirements (e.g., three months’ cash left in the firm versus more)
  • Huge variations in calculation of EBITDA (higher EBITDA times slightly lower multiple may yield greater TEV)

Who Should Consider Private Equity?

PE isn’t for everyone, but every firm should evaluate it. Ideal candidates have the following:

• EBITDA ≥ 15% of revenue after partner scrape (reduction in partner compensation). Firms below this threshold may struggle to attract interest.)
• Growth-ready: PE seeks scalable platforms (firms that have track record of organic growth as well as successful M&A growth).
• Leadership teams with poor internal succession. PE brings professionalized talent acquisition and has better odds of engaging younger partners for succession.

Why Education Is Non-Negotiable

PE-backed firms are your new competitors. They can:

• Outspend on talent: Offering salaries 20% to 30% above market
• Leverage capital stacks: Funding acquisitions
• Move faster: Streamlined decision-making versus traditional partner models

Even if PE isn’t right for your firm, understanding these dynamics is critical to competing.

The Bottom Line

Private equity has reset the rules. The question isn’t “Should I explore this?” but “How do I position my firm to thrive in this reality?” Whether you pursue PE or not, ignorance is the only unsustainable strategy. The time to get educated is now.

We had the incredible opportunity to share our knowledge and experience in the accounting profession last month with students at Cumberland Regional High School, which was coordinated by the Center for Audit Quality’s (CAQ) Accounting+ program/EVERFI. We were eager to introduce the power that accounting holds in modern society — particularly as a field that was mainly known for just its financial functions, to one that offers careers that open a world of limitless possibilities.

We started by sharing our own experiences in accounting. Then we described the basic functions of an accountant, how we serve as advisors to business owners, and the purpose and importance of auditing. Additionally, we explained the education and other requirements for becoming a CPA.

Why Become CPAs

We discussed practical applications of accounting, such as the following:  

• One student said that before becoming a business owner at a car dealership, he may be able to first start as an accountant to learn more about the business.
• Other students talked about their part-time jobs, and discussion ensued on budgeting and spending or saving decisions.

Grace Wilson, business teacher at Cumberland, emphasized that our presentation helped her students gain a real-world understanding of the accounting profession and the importance of financial responsibility.  She explained that our insights as CPAs provided a unique perspective that truly enhanced their curriculum.

Our ability to create a lasting impression on students brings us immense joy and excitement. This experience has not only inspired the students, but it has also inspired us. The future of accounting is invigorating and vibrant and we were honored to be able to share it.

What Others Can Do

Sharing one’s story and discussing the reasons to go into accounting helps to engage the next generation of accountants. Here are some ways others can follow suit:

• Get involved with the NJCPA to visit schools. More than 65 NJCPA members visited 70 high schools in 2024 to inform students about becoming a CPA.
• Become a mentor. Make a difference and assist the next generation of accountants)
• Participate in community service events. Encourage students to help support/participate in project-based or day-long service events held by NJCPA to help the community.
• Spread awareness. Organize networking events that give students the chance to connect and learn more about CPAs.
  

As an accounting educator, my core mission has always been to prepare accounting students for the evolving demands of the profession. Reflecting on my own experience graduating with an accounting degree in 1985, I recall that personal computers and spreadsheet software were missing from the classroom. We learned traditional accounting methods but had little exposure to the tools that would soon transform the profession.

Fast forward to today, Nicholas, my co-author, agrees that the landscape of accounting education has changed dramatically. Technology, particularly cloud-based platforms and the internet, has revolutionized the way we teach and how students learn. Microsoft Office tools, like Excel and Word, are now essential components of the curriculum. Data analytics, artificial intelligence and specialized platforms, like Power BI and Tableau, have become powerful additions to our teaching arsenal. Textbook publishers have enhanced learning with interactive tools and assignments, and major software companies, such as SAP and CaseWare, have developed academic partnerships that give students hands-on experience with industry-standard tools.

Despite these advancements, there is a growing expectation for students to enter the workforce with a strong command of tools like QuickBooks, Excel and Google Workspace. These are no longer optional skills; they are essential for day-one readiness.

A recent article by CPA Credits outlined the top 10 skills aspiring CPAs need:

1. Analytical skills
2. Attention to detail
3. Communication skills
4. Ethical judgment and integrity
5. Organizational skills
6. Technology proficiency
7. Problem-solving skills
8. Interpersonal skills
9. Project management
10. Knowledge of accounting standards and regulations

These skills align closely with both academic programs and employer expectations. Jake Galan, CPA, senior manager at CBIZ (and a Stockton University alumnus), notes that the qualities he values most in new CPAs are attention to detail, ethics and integrity, communication skills and time management. He emphasizes that these must be cultivated during college and refined through internships. Today’s CPAs are no longer just providers of financial data; they must analyze and interpret the numbers and communicate their insights clearly and persuasively.

This shift is echoed by staffing firm Robert Half in a 2023 article, which states that “CPAs must know how to present information in a clear, concise and compelling manner — especially to nontechnical audiences.”

Edward G. O’Connell, CPA, CGMA, CFF, CFE, partner at Withum, offers another critical perspective: CPAs operate in a world of constant learning. One recent example, he says, is the need to understand and apply artificial intelligence (AI) in real-world scenarios. His message underscores the importance of technology agility — the ability to adapt quickly to new tools and innovations without fear.

Jeffrey A. Wilson, CPA, managing director at Capaldi Reynolds & Pelosi, emphasizes the value of a strong foundation in traditional accounting practices, while also keeping up with emerging standards, client expectations and technologies. He maintains it is no longer enough just to be technically skilled; students must also be flexible and forward-thinking.

Yet, alongside these technical expectations, one area remains a challenge: communication and people skills. Research by Edeigba (2022) highlights how many students, particularly during and after the COVID-19 pandemic, have struggled with soft skills due to reduced classroom interaction. With online and hybrid learning here to stay, educators must find new ways to help students engage, collaborate and grow socially and professionally.

Promoting group projects, leadership opportunities and student organization involvement can help fill this gap. These activities teach collaboration, leadership and real-world communication — skills that are just as vital as any technical tool. At Stockton University, for example, our active Accounting and Finance Society offers students leadership roles and hosts events that prepare them for the profession, including sessions with practicing CPAs on topics like interview etiquette and workplace expectations.

While universities may not always have the resources to keep up with the fast pace of industry innovation, we can and must focus on teaching students how to manage change. By fostering technological agility, we help students develop the confidence to embrace recent technologies, not shy away from them.

Accounting education must continue to evolve. It is no longer just about recording transactions; it’s about developing a balanced set of technical and interpersonal skills and the flexibility to thrive in an ever-changing profession. Educators and practicing CPAs have the opportunity and responsibility to guide students on that journey.

Today’s accountants are no longer just number crunchers tucked away in quiet corners; they're full-blown circus performers juggling a dizzying mix of skills to stay on top of their game. Between mastering emerging technologies, building client relationships, being adaptive to a changing environment, and still making time for themselves, the modern accountant is walking a tightrope that’s only getting thinner. Success in this profession now and in the future requires balance, agility and the nerve to keep juggling when the spotlight is on.

Act I: Taming the Tech Lions

Step right up and meet one of the wildest acts in today’s accounting arena: emerging technology. From AI-powered tools to blockchain-backed ledgers, tech is transforming how accountants work, and the show is just getting started. But instead of fearing the lions, today’s professionals need to learn how to train them. Success means being comfortable with automation, curious about data analytics, and willing to experiment with new platforms. It’s not about replacing the accountant; it’s about empowering the accountant with sharper tools. Those who can juggle technical know-how with critical thinking will be the trainers who can command the tech lions to perform routine tasks for them at lower or no cost.

Act II: Winning the Crowd – Building Trusting Client Relationships

Behind every dazzling performance is having a strong connection with the audience, and in the accounting world that audience is your client. Being technically brilliant is only half the act; the real magic happens when clients feel heard, understood and genuinely supported. In a landscape where financial uncertainty, regulatory shifts and business challenges are always center stage, accountants who act like trusted advisors, not just service providers, earn standing ovations. That means showing up consistently, anticipating needs before they're voiced and delivering insights that go beyond the numbers. Whether it’s a small business owner navigating their first audit or a CFO rethinking strategy after a merger, clients want a ringmaster they can rely on.

Act III: Being the Quick-Change Artist – Adapting in Real Time

The spotlight never stays still, and neither do the rules. With tax laws evolving at the speed of politics and new regulations seemingly launched by cannon every quarter, today’s accountants must be expert problem-solvers with Olympic-level reflexes. Whether it’s deciphering the latest legislative surprise or recalibrating strategies in response to shifting guidance, adaptability isn’t just a nice-to-have; it’s your fireproof vest. Continuous learning is the safety net that keeps you sharp, while curiosity and creativity are the tools that turn chaos into clarity. The accountants who thrive aren’t the ones who know all the answers; they’re the ones who know how to find the answers — fast — and explain them in plain English before the next curtain rises.

Act IV: Staying Upright on the Unicycle – Work-Life Balance

Even the greatest performers need a break from the spotlight. In a profession that never truly clocks out, maintaining work-life balance is more than self-care, it’s survival. Burnout doesn’t impress clients or boost accuracy. The best accountants know when to juggle and when to step off the stage, refuel and return stronger. Remember: The show must go on, but so should your life outside the tent.

Act V: Flying the Trapeze – Thriving Through Global Collaboration

Today’s accounting teams are no longer working solo acts; they’re part of an international trapeze routine where timing, trust and coordination are everything. Whether partnering with offshore teams to increase efficiency or helping clients navigate cross-border challenges, global collaboration is now a core skill. Success means more than just tolerating time zones; it’s about embracing cultural differences, sharing knowledge freely and executing seamless handoffs mid-air. Those who master the art of working globally can deliver more agile, scalable service and stay in sync no matter where the spotlight shines.

Final Act: The Encore Is Yours

The modern accounting career is no longer a one-act play; it’s a full production, complete with high-wire decisions, roaring lions, and a front row full of demanding clients. But with the right mix of skills, adaptability and balance, today’s accountants aren’t just surviving the circus; they’re stealing the show.

They say, “true love is your soul’s recognition of its counterpoint in another,” but even the most heartfelt vows don’t come with instructions on managing joint bank accounts, determining risk tolerance or handling student loans.

Marriage is a beautiful union — but it also brings together two unique sets of values, habits and resources. To build a life that thrives together, understanding each partner’s contributions is where the magic begins.

Planning Separately, Together

Before combining finances, clients should start by understanding their own financial and personal contributions — income, assets, liabilities, goals and values. Recognizing these helps individuals understand how they align (or don’t) and sets the stage for a shared plan.

Everyone has a “money script” — whether it’s focused on security, freedom or living comfortably without flaunting wealth — that shapes how he or she approaches finances. Some may spend to present a certain image, while others prioritize long-term stability. Understanding these differences helps avoid friction, plan more intentionally and align financial and personal goals. That’s the power of planning separately, together.

Combining Resources: Not Just Financial, But Personal

Once both parties understand their individual contributions, it’s time to create a shared financial plan. This plan isn’t just about numbers — it’s about their vision for the future: the life they want to create together, the experiences they’ll share, and how they’ll support each other through life’s inevitable changes. The goal isn’t compromise; it’s alignment — finding the best way to merge each person’s unique resources in a way that strengthens both people.

Protecting What Each Person Contributes: Securing the Plan

Life is unpredictable. Protecting what each partner contributes to the relationship is crucial — not just for individual security, but to ensure the success of the plan they’re building together. This means thoughtful risk management, including life insurance, disability coverage and emergency savings, to safeguard their collective future.

Prenuptial Agreement: A Tool for Clarity, Not Distrust

While often misunderstood, a prenuptial agreement can be an invaluable tool for clarity and respect. It’s not about planning for failure, but about having an open conversation about each person’s individual contributions and how those assets would be handled if the marriage ends.

The best time to have this discussion is when both partners are focused on fairness and each other’s best interests — not during times of conflict.

Flourishing Together

Ultimately, financial planning in marriage shouldn’t be about control — it’s about alignment. It’s about using combined resources in a way that reflects the couple’s shared values, supports them through life’s transitions and strengthens their bond. It’s about creating a future that’s greater than the sum of its parts — one where both partners thrive and flourish together. 

Divorce is one of the most emotionally and financially challenging events a client can face, and CPAs often find themselves as trusted advisors during this turbulent time. While CPAs play a critical role in untangling financial complexities, partnering with a financial advisory firm can often provide the additional support needed to craft thoughtful, unbiased solutions. The following are some client-focused strategies that align with your work as a CPA: 

When a client is going through divorce, their accountant is often the most consistent advisor in the room. With so many Americans stuffing their employer-sponsored retirement plans to the gilt, one of the most critical issues in divorce is the proper handling of retirement assets — particularly those subject to qualified domestic relations orders (QDROs).

In New Jersey, where equitable distribution rules meet complex federal tax law, accountants are uniquely positioned to protect clients from costly missteps. It’s important to understand the key tax considerations, pitfalls and state-specific issues surrounding QDROs so that you can bring clarity where others bring confusion.

Understanding the QDRO Framework

A QDRO is a domestic relations order that creates or recognizes an alternate payee’s right to receive all or part of a participant’s retirement benefits under a qualified plan. These are plans governed by the Employee Retirement Income Security Act of 1974 (ERISA), importantly this does not include IRAs.

Under IRC §414(p), a QDRO must (1) relate to child support, alimony or marital property rights; (2) be made pursuant to a state domestic relations law; and (3) be accepted by the plan administrator. A divorce decree alone is not enough. Failure to secure plan administrator approval can nullify tax protection.

Tax Treatment: Timing Is Everything

When structured correctly, a QDRO allows for early distributions from a retirement plan to an alternate payee without triggering the 10% penalty under IRC §72(t)(2)(C). However, those funds are still taxable as ordinary income to the recipient unless rolled over to another qualified plan or IRA.

In one example, the court in Darby v. Commissioner, 97 T.C. 51, held that a taxpayer who withdrew retirement funds for his ex-wife before a QDRO was in place remained liable for the tax and early withdrawal penalty, even though the funds were ultimately meant for his former spouse. Thus, clients navigating a divorce should never move funds before the QDRO is approved by the plan; and when funds are moved, make sure the receiving spouse rolls it over into an IRA or other qualified plan.

New Jersey-Specific Issues

New Jersey follows equitable — not equal — distribution. Retirement accounts accrued during the marriage are generally marital property under N.J.S.A. 2A:34-23.1, but how they are divided can vary. CPAs should pay close attention to:

• Valuation dates: The date of the complaint versus date of distribution can create significant tax timing issues — particularly in volatile markets.
• Immediate offsets: Trading a retirement account for another asset (e.g., home equity) ignores the deferred tax burden of the retirement asset, leading to unequal post-tax outcomes.
• Survivor benefits: In defined benefit plans, the QDRO must address survivor annuity rights under IRC §417. Failure to do so can eliminate the alternate payee’s benefit if the participant dies.

Common Mistakes to Avoid

• Assuming IRAs require QDROs: They don’t. Transfers incident to divorce from an IRA are governed by IRC §408(d)(6) and must be executed via trustee-to-trustee transfer. Mistakes here result in taxable events.
• Ignoring plan-specific procedures: Every ERISA plan has its own QDRO approval process. Accountants should ask for the plan’s QDRO guidelines early, particularly in defined benefit plans where distribution options are limited.
• Improper rollovers and withholding: If the alternate payee takes a lump sum distribution, a mandatory 20% withholding may apply. A direct rollover avoids this. Educate clients on the difference between a rollover and a taxable distribution.

Practical Tips When a Client is Going Through a Divorce

• Engage early: Don’t wait until after the decree. Your insight can shape negotiations, especially regarding pre-tax versus after-tax asset values.
• Coordinate with counsel: You don’t need to draft the QDRO, but your review can catch financial errors that attorneys may miss.
• Model after-tax outcomes: Use post-tax value comparisons when helping clients consider trades like, “you keep the house, I’ll keep the 401(k).”
• Document everything: If you advise on the tax consequences of a proposed division or draft QDRO language, retain your notes and written recommendations.

Be the Advisor Who Sees Around Corners

The intersection of divorce, retirement assets and tax law is a minefield — but one that CPAs are uniquely equipped to navigate. In New Jersey, where equitable distribution and federal tax law often clash, QDROs are not just legal documents — they’re critical financial tools.

CPAs who understand the real-world impact of Darby, IRC §§72(t), 408(d)(6) and 414(p), and who proactively coordinate with counsel, don’t just save clients from tax headaches — they earn a reputation as indispensable advisors.

Holding the Sails in Place

The accounting and finance landscape is once again experiencing dramatic shifts. A steady stream of executive orders, economic volatility and geopolitical tensions are creating ripple effects across the country — and right here in New Jersey. It’s more important than ever that this uncertainty does not deter from our mission and sway us off course. As always, CPAs are called to lead with clarity, confidence and compassion. 

We’ve been here before. During the COVID-19 pandemic, CPAs didn’t hesitate — you worked around the clock to guide clients, organizations and your communities through uncharted territory. And the NJCPA was right there with you — delivering timely resources, offering real-time updates and providing a sense of community to professionals who have each other’s backs. 

• Creating a new CPA licensure pathway — legislation soon to be introduced in New Jersey, similar to Ohio, Utah, Virginia and others, to make the profession more accessible while maintaining its rigor
• Supporting accounting as STEM — helping reframe and elevate the profession while unlocking new funding and visibility for students 

I graduated from Ramapo College of New Jersey in December 2024. Many of my peers were declining what seemed to be excellent employment offers. When I asked them why they would turn down opportunities like the ones presented, they said they thought they could do better. They were unwilling to settle for anything less than their dream job. Why would a graduating college student who is looking for full-time employment turn down what appeared to be great opportunities? In reality, even though those offers may have seemed great on the surface, after further discussion there were underlying issues with each of them. Many of the offers did not include the benefits that Generation Z (those born between 1997 and 2012) values the most.

Hybrid Schedules and Work-Life Balance

The new generation of graduating students is continuously looking to improve their work-life balance. Communicating to new accountants how hard the last busy season was can be misleading, because the rest of the year is very manageable. A hybrid schedule with the flexibility to work outside of the standard nine to five is becoming ever more popular with recent graduates. The adaptability provided with a hybrid schedule — some days remote, others in the office — allows employees to prioritize personal goals outside of work.

Gen Z continues to demonstrate their ability to incorporate health awareness and empathy into their workplace. Implementing more work flexibility allows the younger generations to feel understood and accepted, allowing for a more manageable work-life balance. The ability to take off a day of work without using their PTO provides opportunities for them to recharge and reset their minds to produce higher-quality work and reduce burnout rate.

Emphasis on Culture

Gen Z has high ideals and standards for what they desire from employers regarding company culture. Having a fun and comfortable work environment, promoting outings with colleagues, taking breaks during the workday, all coupled with productive and cooperative work relationships, signals to younger employees they are appreciated. Using antiquated platforms and software as well as sharing “war stories” about busy season is discouraging for new employees. As an employer, providing the newer generation with a spark of excitement and enthusiasm throughout the day builds lasting trust and excites talented employees.

Guidance and Encouragement

Building and maintaining trust through proper guidance is vital for new employees. I distinctly remember what my manager told me when he offered me my position. “We want to invest in you as much as you want to invest in us.” That sentence spoke volumes to me. I had someone who was investing in me; I was where I belonged. Those few words committed me to Traphagen CPAs & Wealth Advisors, my second home. The subtle reassurance coupled with their culture was what attracted me. Traphagen provided me with the confidence I needed to succeed and embrace the change I was making in my life.

Aspiring to be a young professional and pursuing my CPA, I have often surrounded myself with those who I know would be strong mentors to me. My mentors motivate me to achieve my next set of goals. Many in my generation need the same support system and guidance. I am fortunate enough to be a part of a team where I can grow personally as well as professionally. This position has allowed me to learn, make mistakes and shape who I want to be. I was offered this opportunity as a sophomore in college. Traphagen invested in me, with no experience.

Closing Advice

New grads: Be selective and choose wisely; I work with a firm and individuals who are recognized for their excellence in the accounting profession. As you are mentored, mentor others.

Employers: Take chances on the newer generation that is entering the workforce in an ever-changing landscape. Be an advocate for your younger employees and provide them with trusted support systems. Invest in them as you would expect them to invest in you.

Many company leaders focus too much on operations and not enough on people. True leadership starts with making employees and clients/customers feel genuinely valued.

Successful leaders stay connected to daily challenges. A company cannot thrive if leadership is disengaged. Those who actively support their teams and clients/customers foster a culture of empathy and strengthen trust — the foundation of lasting professional relationships.

Empowering Employees for Success

Overbearing oversight stifles innovation and morale. Employees who feel constantly monitored focus more on avoiding mistakes than on creative problem solving. Leaders must empower their teams with autonomy and decision-making authority to drive peak performance. While mistakes are inevitable, punishing employees discourages risk-taking and growth.

When employees feel trusted, they take ownership and often exceed expectations. Providing space for independent decision making, balanced with accountability, creates an environment where individuals are motivated to contribute meaningfully to the company’s success.

Active Listening Builds Trust

Active listening is a key, yet often overlooked, way to build trust. When people feel heard, they engage more openly, fostering respect and collaboration.

Engage by asking follow-up questions like, “Can you elaborate on that?” and summarizing key points to show understanding. Acknowledging emotions with statements like, “This project seems important to you.” or “It sounds like this has been challenging,” helps individuals feel valued.

Organizations that prioritize active listening strengthen relationships, enhance communication and create a culture of respect.

Strengthening Personal Connections

People appreciate being recognized as individuals. Remembering names, acknowledging challenges and showing personal interest create strong connections. While maintaining this level of engagement can be challenging in larger organizations, it should remain an important goal.

Small gestures, such as inquiring about an employee’s weekend or expressing appreciation for their work, contribute to a culture of respect. When employees feel valued, they are likelier to extend the same courtesy to coworkers and clients/customers, fostering stronger relationships and better service.

Customer Experience: A Critical Metric

In an era where online reviews can shape reputations, a single negative client or customer experience can be costly. Employees who feel respected and supported are naturally more inclined to provide excellent service. The result? Higher customer retention, increased referrals and, ultimately, greater profitability.

Kindness and empathy should not be seen as optional but as essential business strategies. Organizations that deliberately cultivate a respectful culture create a cycle of success that benefits everyone.

Respect and Kindness: The Cornerstones of a Thriving Organization

Respect and kindness are essential for a positive work environment. Respect fosters fairness and trust, while kindness adds warmth and appreciation, making employees feel valued and engaged.

Kindness is not a weakness, and respect is not something to be rigidly earned. Instead, kindness builds trust, and respect strengthens collaboration. Together, they create a workplace where people feel heard, supported and motivated to succeed.

Practical Ways to Encourage Respect and Kindness

• Lead with integrity. Model the behaviors of kindness and respect, setting the tone for the entire firm.
• Ensure fair recognition. Acknowledge and value all colleagues equally, regardless of their role or level of experience.
• Encourage meaningful conversations. Cultivate an environment where employees and clients feel heard through open, thoughtful discussions.
• Encourage team collaboration. Involve employees at all levels in discussions and decision making.
• Honor work-life balance. Encourage employees to set boundaries and respect their time outside work.

Respect and kindness are more than ethical values; they drive business success. Employers that cultivate respect outperform competitors, retain engaged employees and build stronger customer relationships.

Prioritizing these principles is not just the right thing to do but a strategic advantage. A culture of respect and kindness strengthens teams, fosters loyalty and fuels sustainable growth.