Accounting firms are not marketing with blogs

Law firms continue to outpace accounting firms when it comes to harnessing the power of blogs to market their services to current and potential clients. A recent post by Michelle Golden asks the question “Isn’t Your Firm Blogging Yet?” and the answer apparently is no.

The post quotes this one from LexBlog founder Kevin O’Keefe, which brings to my attention that 53 of 200 AmLaw firms have a blog (or sometimes more than one). There is no comparable data for accounting firms, but Michelle maintains a pretty comprehensive list of accounting related blogs on her site, which includes my own.

(My views do not represent those of my accounting firm, but you can find my latest post on the BDO.ca home page as of this past weekend. In a sense, you can say BDO in Canada blogs.)

Seems like a good time to reprise an article I wrote about a year ago for Canadian accounting and finance industry publication The Bottom Line. It was titled
“Blogs can be important marketing tools“, but I don’t think the title was insistent enough because the message hasn’t been heeded within the profession it seems.

Blogs are all about having more personal and meaningful conversations with an audience about a topic. When you’re an accountant or accounting firm, blogs are a way to reach people interested in your expertise, whether they’re fellow accountants interested in discussing the profession or potential clients looking for an accountant with an aptitude for technology and an ability to stay on top of the trends.

This stuff still rings true, so take mine and Michelle’s and Kevin’s advice: Get started with your blog today.

Simplified accounting rules for small business

The CICA announced late last year a draft version of a new accounting framework for small, owner-managed businesses. The framework is being developed because these types of companies don’t have complex reporting needs like public companies, non-profit organizations, or private companies with significant third party investors or creditors.

I haven’t begun working on public company clients yet, although I have a couple equivalent-to-public companies currently. I have made it known in the office that I want to work on public companies in the future, so hopefully I will be scheduled on one or two soon.

Canada is moving towards international accounting standards (IFRS) for publicly accountable enterprises. The decision has been made and the process of reconciling Canadian GAAP to IFRS is in motion. Word around the office is that IFRS is very similar to Canadian GAAP in terms of the financial statements, but much more developed (read: verbose) when it comes to note disclosure.

But back to small business, or Owner Managed Enterprises (OMEs) as the framework calls them. The framework’s Foreword offers a glimpse into the thinking behind the endeavor:

Such a system could share some of the basic requirements of GAAP financial reporting … but expressed in a basic fashion.

You aren’t going to hear me complain if we can make accounting standards more understandable and accessible. In fact, I would consider it a prime concern if we want to create a more robust, entrepreneurial economy, here and around the world in the future. Such a milieu would help developing countries pull themselves up and improve their lot the only surefire way: through the expansion of trade.

A non-GAAP solution opens up a wide range of possibilities. A tax basis of accounting, a modified cash basis of accounting, a less complex version of GAAP – all are possible.

This is really interesting. I can’t say as I think these bases would provide better information, but they would be easier in many ways. The tax basis would obviously make filing a snap, and minimizing taxes is a key concern for small business owners. As for modified cash basis, there’s not enough information here to comment. Modified how?

Concerns were about the loss of a well-known frame of reference for financial statements [due to the transition to IFRS].

IFRS is great for the global economy. You want to tap into the global markets, you gotta play by the global rules (regardless of how dubious the model for the setting of those rules happens to be at this point in time). The conclusion of the CICA stems from the above quote – keep the accounting standards we know, just cut out the complicated stuff that small businesses don’t need. In their words (again):

The existing financial reporting framework in the Handbook represents … the collective intellectual capital of the accounting profession in Canada.

That is the best reason I can think of for reusing the standards for Owner-Managed Enterprises.

The CICA sought comment from interested parties on the framework by January 31, 2008. They recently posted an update on those consultations.

Explaining the virtues of testing

One of the most challenging aspects of my job as a public accountant and auditor is explaining to clients why I’d like to do what I need to do.

Frequently you’ll find in your position as the auditor that client employees will enjoy seeing you twist in the wind and will find the most effective way to cause this is to ask you to justify the test you’re performing.

To juniors, this is kryptonite. They won’t be able to. They simply don’t have a clue. The keeners will try, and they might get far, but to the seasoned client employee, they will always be able to stump the junior auditor.

The key to counteracting this situation is to fall back on the assertions. Existence, completeness, accuracy, valuation. (There are others, but those four are key.) Explain how the test relates to the assertions for the given balance or transaction stream being tested.

This has two possible effects (both good): The client will understand why you’re doing the test, or they will have a better way to test the assertions you’ve mentioned.

And if you can explain the test to the client with reference to the assertions being tested, then you’ll better understand the test itself and be able to perform it more efficiently and identify errors if encountered. It’s a win-win.

Financial statements using Flash

Are there any companies out there presenting their financial statements, or information derived from financial statement data, using Flash?

I haven’t seen any, but if they’re out there, I’d like to. If you know of any, please let me know! I think it’d be a pretty engaging medium to use to communicate financial data to stakeholders. Might as well make it entertaining!

Today I am a CA

Got the email from the ICAO this afternoon at about 4:30. I was accepted as a member (i.e. a Chartered Accountant) on the March 24 committee meeting!

So, with that, my blog has no purpose. It all began shortly after I passed the CKE in early 2006, and you’ve been following my journey down the path to this point in my career.

It feels pretty great though. Now if you’ll excuse me, it’s time to celebrate.