Sun Still Shines on Main Street For America’s CPAs
When Forbes magazine runs a review of the best places to do prison time in the United States, you might think that the accounting industry’s public image is at an all-time low, that accountants are suddenly perceived as the bad boys (and girls) of the business world. After all, many Americans today are afraid to open their 401k account statements, thanks to the trillion plus dollars of investor equity that has evaporated in the wake of high-profile accounting scandals at the likes of Enron, Worldcom and Tyco.
But, believe it or not, while the accounting industry news from Wall Street has run the gamut from bad to horrible this year, the news from Main Street, USA is actually very encouraging. Recent studies show that America’s small business owners and operators, the men and woman who collectively produce and manage more than 50 percent of the U.S. gross domestic product and employ more than half of all private-sector workers, are overwhelmingly optimistic about their future prospects. Not only do the owners and operators of America’s 22.4 million small businesses see sunny financial skies ahead, they trust their accountants to help them get there.
For example, a study commissioned by Intuit Professional Accounting Solutions (PAS) found that more than 90 percent of small business owners are optimistic about the prospects for their industries and their individual enterprises. Other studies, by D&B and the National Federation of Independent Business, recorded similarly sunny outlooks among small business owners. Even the lingering economic downturn does not dim the picture. The D&B survey found that 75 percent of small business owners were making plans based on the assumption that the economy would improve substantially by yearend.
These stalwarts of the free enterprise system are upbeat about the future, and they have strong and abiding faith in the accounting professionals who advise them in the management of their business. Year after year, surveys show that CPAs are the professional advisors that small business owners turn to most frequently for counsel. Bankers and lawyers have their place in the team lineup, but CPAs are the pros business people rely on most frequently for financial advice.
This is also evident in the feedback we’re getting from our own member accountants and their clients. Our accountants are turning to us for a range of services to help market their practices, connect with colleagues in the industry and get up to speed on the latest technologies, because their own clients are requesting this. Nearly six out of ten small business owners are telling us they’d like their CPA to provide additional services beyond tax preparation, to help them plan and build their businesses – like help with business strategies, technology issues, estate planning and more.
This feedback and the fact that 68 percent of small business owners say they are very satisfied with the service they receive from their CPAs (another 25 percent say they are satisfied) makes it evident that CPAs have worked hard to earn the trust of their small business clients, and translates into increased opportunity for CPAs.
Main Street accountants are obviously perceived much differently than the handful of financial professionals at the center of the maelstrom on Wall Street. Despite the Enron scandal, 88 percent of small-business owners say they have not lost confidence in their own accountants and will continue to trust them for counsel. But while CPAs have worked hard to earn the trust of their clients, small business owners must also do their part to maintain this trust and continue growth. This is why it’s also important for them to do their homework when looking for the right accountant for their business:
- Find out what experience an accountant has in your industry
- Know who will be your principal contact
- Call other clients for references
- Find out how the accountant stays abreast of current trends in your industry
- Ask if they are actively pursuing CPE credits to maintain accreditation
- Are they informed about the latest financial technology?
- How will they work with you on an individual level to share information?
The optimism and confidence of small business owners is best seen in the fact that by yearend Americans will have launched approximately 575,000 new businesses that employ workers other than the owners. (Even more will hang their shingles as one-person shops.) Two-thirds of these fledgling firms will still be open for business two years down the road. Wall Street may be under a dark cloud of suspicion these days, but the American dream is alive and well on Main Street, and America’s accounting professionals are helping more people realize that dream than ever before.
As Director of the Professional Accounting Solutions Group at Intuit, Rich Walker, CPA, is responsible for the development and coordination of strategies and programs to help professional accountants and software consultants, better serve their clients in the use of Intuit’s products and services. In addition, Rich is involved in the strategic planning and development of products and services for professional accountants.