The CPA Shortage

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The CPA Shortage

 

The CPA Shortage is real and tangible! I feel it and hear about it as I work with CPA firms around the country regardless of their size, services or geography.  Offshoring in the public accounting industry is on the rise with volumes not seen before.  As a seminar and workshop leader who trains CPAs from entry level to the executive levels, this problem is palpable. I am increasingly training CPAs working for US firms in India and The Philippines!  

The CPA Shortage is a first-time shift that the public accounting is experiencing very similar to how The Great Recession of the late 2000’s resulted in layoffs and massive turnover in a relatively recession proof thought of industry.  

Among the many reasons discussed by the AICPA and the public accounting industry, the major issues that stand out are compensation in a competitive market, work-life balance, the 150-hour requirement, the CPA Exam and the repetitive and mundane nature of the work 

From my discussions with a large swath of CPAs from staff to senior manager level across the country, I hear a few other reasons.  The most striking among them are newer accountants not feeling like they are making a difference and not knowing how what they do on daily basis counting for anything meaningful. Some of this directly relates to the Millennials and Gen Z being perhaps more idealistic, holistic and in my opinion utopian in their worldview.  Inflation, high rents, high interest rates and the pandemic all have played a role in graduates and newcomers into public accounting being impacted by a confluence of factors. 

So the question arises on what CPA firms can do to tackle this challenge.  I would propose a three-prong strategy that I call CPA (I know, it’s the same acronym but maybe it will stick!) 

C: Create  

P: Pitch  

A: Act  

 

C: Create 

CPA firms need to create a vision for new recruits with conscious cognition.  This requires firm leaders to embrace the reality that most all engagements are solved by the synergy developed on 3 fronts: process, people and technology. Today’s CPA is evolving into an analytical and smarter version who will leverage generative AI for most tasks and will be super focused on client solutions via analytics and CPA/Client collaboration full mindful of independence requirements and professional skepticism on assurance engagements. The conscious cognition is a refined understanding of the mindset of the new recruits and the ability to match those skills to the needs of the clients. 

P: Pitch 

CPA firms need to pitch the roles and their fit with the firms with proactive reaction.  This requires firm recruiters to pitch the staff roles (tax, audit, advisory, technology) in creative ways that tap into the holistic views of new recruits and them wanting to make a difference.  The basic values of public industry come down to being a client’s trusted advisor and being someone that the average investor or lender depends on to tell the truth about their clients.  This altruistic approach has been lost over the years.  Firms need to be more transcendent vs. transactional in their appeal to new recruits. 

A: Act 

CPA firms need to act with an awakened energy to deliver on their creating a vision and pitching the altruistic role to new recruits. Procrastination and apathy in today’s marketplace are a sure way to failure and obsolescence for firms of all sizes. A common misconception is that firms are not big enough or ready enough for action.  Cynicism and the mode of “It’s always been this way” are obsolete ways of thinking.  The industry must evolve within its established framework of objectivity and ethics. Firms need to be more action oriented vs. boardroom discussion stuck. 

 

Alvin Toffler, the famous author of the best-selling book “Future Shock” said: 

“The illiterate of the future are not those who can't read or write but those who cannot learn, unlearn, and relearn.” 

It’s time to use the CPA strategy: Create, Pitch and Act. Now.

 

The CPA Shortage 

Sunish Mehta, CPA. CGMA.  

Founder, Mindful-CPA Mindful-PRO 

www.mindful-cpa.com 

 

 

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