Public Accounting is a Great Environment for Generation Y

The cover of the Fall 2010 Pennsylvania CPA Journal offers a Generation Y Anatomy Lesson for CPA firms hiring the most recent generation of college graduates born in the years 1980 to 2000.

Siting findings from a 2010 Pew Research Center survey, the article notes that Gen Y tends to have a high level of self esteem compared to other generations. The impact of this attitude on their work is that they have high expectations for their careers, desiring to feel a sense of contribution to their employers' success. As a member of Gen Y myself, this was one of the main reasons I thrived in the public accounting environment. I welcomed the significant amount of responsibility thrown at me from day one, and the opportunity to contribute during meetings with clients, partners, and senior managers, despite my low ranking "staff" status. I also had to remind myself, however, that I may have been assigned more basic responsibilities because I still had a lot to learn about the profession.

The Pew survey also found that Gen Y places high importance on work-life balance and autonomy. Face time and career advancement based on hours contributed seem senseless, because Gen Y feels they should be rewarded based on job performance and the quality of their work. Firms are increasingly tuning into this fact, as job flexibility, telecommuting, and work-life balance programs in the workplace have grown over the past decade. A Gen Y colleague of mine recently recounted a discussion with his boss, who called him into the office and noted that my colleague seemed to be "eager" to leave work each day because he would head out promptly at 5pm each evening. The boss suggested that he be more of a "team player" and hang around a bit longer, even if he wasn't busy. This seemed a ridiculous suggestion to my colleague, who felt that working late would only be reasonable if he had additional work or a tight deadline. This sentiment is often echoed across CPA firms by other members of Gen Y. With the frequent performance evaluation process in place at many firms, employees are provided with more opportunities to communicate their accomplishments and detail the quality of their work as evidence of their work ethic. We no longer need to punch the clock as a means of proving our worth.

One finding of concern that was uncovered in the Pew survey noted that Gen Y tend to take risks with the disclosure of personal information online. They are more likely than previous generations to neglect online security habits for the sake of convenience, and share personal or confidential information via social media. Gen Y, as well as their employers, should take note of such behaviors when it comes to client and other confidential information. Firms need to dedicate training time to highlighting and monitoring the protection of confidential information. Perhaps online professionalism and managing your online identity is a topic that needs to be taught at universities before graduates enter the workforce.

While Gen Y differs from previous generations, many CPA firms have been updating their operations and cultures to accommodate this hard working, ambitious generation of young minds. Our profession will be the better for it.

Amazing New Technology to Simplify Your Life

I just read a review by the CPA Technology Advisor that blew me away. Imagine having one charger for your smart phone, e-reader, cell phone, portable printer, and camera. You no longer have to keep a tangle of power chords and batteries under your desk, in your lap top bag, and in your car. Even better, your universal charger is wireless! PowerMat and WiPower are just two of the companies developing a mat that allows you to recharge any device just by laying them on the mat. These devices use inductive technology to eliminate the tangle and clutter of miscellaneous chargers to ensure you can recharge any portable device on the go, whether in an airport or on the dashboard of your car. For any accountant who travels between the office and clients, such a device would be a lifesaver. Keep your eyes opened for these handy devices to hit the market in the near future.

Being True to Yourself; Since When is that Networking?

Networking. It's a word that makes many people's skin crawl. That's because it often invokes an image of sleazy sales people trying to force fake conversation in order to accomplish an ulterior motive. While in school, your career counselors and professors use phrases like "expand your network" and "network your way into a good job" when giving you tips on getting hired. But does that mean you have to be something you're not?

It's time we realized that networking is not a four letter word. It's a tool that you cannot live without if you want to advance your career. That doesn't mean you have to study up about college football even though you hate it, just to impress your boss who is a football fanatic, or that you have to go fishing with your clients just to prove you can relate to them despite your disgust of baiting a hook. In a recent article by Virginia Business Magazine entitled Career vs. Culture: Do you Have to Choose?, two CPAs explore the social hurdles they had to overcome in order to succeed in their profession. One author notes that as the daughter of immigrants, she was taught to respect her elders and speak only when she was spoken to. This posed a problem for her when she entered the workforce, because she felt it was disrespectful to raise her opinion during a meeting or provide professional input directly to her boss. Being an active part of your team and showing initiative is a key component of networking, and one that can boost your career when done appropriately. Working with colleagues to find a compromise that melds the best of everyone's ideas is a skill that you will find is appreciated by those around you. It is possible to provide a contradicting idea without offending someone if it enables you to reach the best solution.

The second author notes that he was uncomfortable bringing his accomplishments and contributions to the attention of his peers and supervisors, fearful of seeming arrogant. He soon realized that he was the only one with the power to give himself credit where credit was due. Many of us are understandably uncomfortable praising ourselves, but we need to learn to highlight our contributions to our employer when the opportunity arises. Many firms have a performance review process which asks employees to periodically rate their performance and discuss personal accomplishments and areas for improvement. While we all have room for improvement, do not be too bashful and fail to showcase your successful contributions and fulfillment of responsibilities on your performance reviews. It's alright to nominate yourself for positions of leadership or awards if you feel you have rightfully earned them. You are the one responsible for building your resume, not your boss, so take advantage of every opportunity to get ahead.

The aspect of networking that most people struggle with is the social component. In an informal environment such as a gathering of fellow professionals or a recruiting event, how do you relate to strangers while making important business connections? A major rule is to avoid being something you're not. Don't try to talk about topics you know nothing about as if you were an expert, just to get people to like you. Thankfully, the workplace isn't high school. Try and steer the conversation toward something you and your colleague are both comfortable with. Find some common ground, perhaps the same Alma mater, familiarity with a particular city, or similar tastes in reading materials. Even if you speak with someone for two minutes before exchanging business cards and parting ways, you want to strike a chord with them that will make you memorable and leave an impression of approachability in the other person's mind. That way, they'll be much more likely to contact you later on for business or professional connections, which is, after all, the purpose of networking.

No one was born to network, so don't be afraid to work on aspects of it with which you are less comfortable. We all need improvement and the leverage of relationships to advance our careers.

Uncertainty Surrounds the Future of GAAP

Financial Accounting Standards Board (FASB) chairman Robert Herz has recently announced his sudden retirement two years before the expected end of his term. This news comes in the midst of a crucial time of transition for US GAAP, as the FASB works with the International Accounting Standards Board (IASB) to converge US accounting standards with International Financial Reporting Standards (IFRS). The FASB will also add two new members in addition to the current five. These changes in the leadership mandated with overhauling US GAAP has placed many companies and accounting professionals on edge about the uncertainty of current convergence efforts.

The FASB currently has nine exposure drafts awaiting public comment, and votes on these may be delayed as the additional board members are appointed and the chairmanship is in transition. Many worry that such an important initiative as US GAAP/IFRS convergence which impacts the global business environment, will be derailed by such a sudden and significant change in leadership. At the same time, the new chairperson and board members may be the catalysts needed to continue the momentum already gained by the FASB in this effort. Time will tell.

New Study Sheds Light on Investor Use of Audited Financial Information

There were many times when, as an auditor of public companies, I questioned if all of my hard work was in vain . Was I being idealistic telling myself that my independent auditing would amount to greater transparency and understanding of by clients' performance by countless investors? A recent study conducted by the Journal of Accountancy found that professional and retail investors have a tendency to rely on financial information included in the MD&A portion of a company's annual report, which is reviewed but not audited by the company's independent auditors. The investors in the study, particularly retail investors, were less likely to reference the audited financial statements or footnotes when making investment decisions.

These results support something we auditors have often suspected: that the copious, detailed, and often technical financial information included in the financial statements and more specifically in the footnotes seems to be resulting in information overload. Retail investors, who generally have less financial knowledge than professional investors, can often get overwhelmed by all of this data that we CPAs have worked so hard to tick and tie down to audited information. Professional investors reference the footnotes occasionally, still preferring other sources of information on which to base their investing decisions. The SEC should consider revising their disclosure requirements to either include greater objectivity and disclosure of information in the MD&A portion of annual reports, or even require an expansion of the independent auditors' report to include such information that is the preferred source of financial information used by investors. The SEC should also review requisite footnote disclosures, perhaps eliminating redundant or less important data, and expanding more frequently referenced data such as the allowance for doubtful accounts footnote.

As auditors, we should not be discouraged, thinking that our independent audit work over our clients' financial statements and footnotes is in vain. Most of this information is the support behind the financial data included in the MD&A portion of an annual report. It would be difficult for a company to fabricate MD&A information given this close relationship. Also, with the introduction of searchable financial filings through the use of XBRL, hopefully audited data will be dissected to a greater extent by financial analysts and investment professionals to make more objective and informed investment decisions on behalf of their clients.

To read an overview of the Journal of Accountancy's study, visit http://www.journalofaccountancy.com/Web/20102682.htm#

Inequality in the Workplace Still Exists

A recent study by Indiana University South Bend found that there is still considerable inequality in the workplace when it comes to use of informal networks for professional advancement. The study evaluated informal networks at one of the nation's largest financial services organizations using a nine-page survey completed by 1,100 employees. Despite women's years of experience or length of time with the organization, the study still found that men are much more likely to assist other men in getting promoted. Senior leadership positions at the company surveyed, as is the case at many other organizations, were predominately held by men, even though women outnumbered men in total throughout the company.

This situation is not uncommon at public accounting firms as well. Men hold many of the partner and leadership positions at firms, while women dominate the entry-level positions. So what should an ambitious woman in public accounting do to change this trend? For one, women looking for mentorship and networking opportunities can join organizations or like-minded professionals such as the American Society of Women Accountants. Many of the national accounting firms also have committees or formal networks specifically for women, such as KPMG's Network of Women. Through such outlets, you can learn from the few women who have successfully challenged the trend of male leadership in business, and leverage their guidance and opportunities to advance your own career. You also need not shy away from taking on leadership positions in co-ed professional organizations or on your audit teams at work. Just because this study proves that we still have a long way to go in achieving workplace equality between men and women doesn't mean that you as a woman shouldn't work toward changing the tide.

For further information about the Indiana University South Bend Study, visit http://www.torontosun.com/life/2010/08/17/15048606.html.

Are you a control freak?

Do the following statements describe someone you know?:

• You're proud of never taking vacation time
• You feel angry when others let you down
• If anyone asks how you're doing, you're always "swamped"
• People ask you a lot of questions because they're afraid of doing something wrong
• You actually believe that no one else can do what you do

These are just some of the characteristics described by leadership consultant Cheryl Cran in a recent interview with Entrepreneur magazine about letting go of your inner control freak. If you find any of the above descriptions eerily familiar, then you may need to address your attitude in managing those around you.

When I was working in the Big Four audit environment, you were the exception to the rule if you took all 5 weeks of your firm-issued vacation each year. Being perpetually swamped was a badge of honor, and many people refused to delegate minor tasks to staff or administrative professionals because they wanted to take credit for anything and everything possible in the hopes of getting a higher bonus.

According to Cran, author of The Control Freak Revolution, you ironically can't get out of being a control freak alone. Before you risk burning yourself out, you have to teach yourself to trust other people. Cran suggests you start by delegating basic tasks like scheduling, expense reports, and time sheets. If you're a senior associate and don't have access to a dedicated administrative professional, you need to focus your attention on training your staff well and giving them clear instructions, so that they are well equipped to execute the audit work you assign to them. You'll know you've done a good job at prepping them if they only come back to you with bigger issues they need help on. If they're constantly nagging you about small stuff and the basics of audit execution, they likely need better guidance before being sent back out in the field.

Many people at all levels of an organization think their work is just too important to entrust to others. But even the most powerful people in the world, from political leaders to corporate executives, could not be successful without the legions of trustworthy, well-trained people working behind the scenes to support them in their daily tasks. What makes you think you're more important than the president? Trusting others is the key, and when you invest the time to prepare your staff to understand your expectations and equip them with the skills and resources they need to execute your assignments, you'll find you have a lot more time to be the best at what you need to do.