A Millennial’s View

Guest blog by: Isaac Bumgarden, audit intern, Eide Bailly LLP

Accountant: the career that seems like it’s filled with numbers nerds, gloomy days reading over spreadsheets and days spent typing away on a calculator. If we’re talking about a public accountant, everyone thinks you’re an evil number cruncher who’s up to no good (and maybe even works for the IRS).

So how does someone, let alone a millennial, decide accounting is the right career path?

As you know, everyone is different (yes, even us millennials have different tastes and interests). While I don’t speak for everyone, it seems a majority of millennials have a similar experience when it comes to choosing a career, especially if they landed on accounting. When looking at the accounting profession (at least before having much exposure to it), we tend to think of someone sitting behind a desk, quickly punching numbers into a calculator all day, or even someone working for the IRS – and often times, these views don’t seem to sit well with us millennials. After all, we are said to be a social generation which thrives off of each other.

However, college and schooling comes around, and a whole new world presents itself. Rather than hearing about the IRS auditors, you start learning about different options in the accounting world.

“A CFO? What’s that?”

            “There are other auditors besides the IRS? Well what’s the difference?”

           “I can open up my own tax accounting firm in my small home town if I                           understand this stuff?”

You begin to realize that maybe accounting isn’t a one-size-fits-all career path, and there might even be something about it that catches your eye. In fact, I see accounting as a door that leads to a lot of potential in the business world, which is something I never would have even thought of on my own.

Many of the potential scenarios in accounting appeal to us millennials if we are exposed to these options. If you enjoy being alone, maybe the traditional accounting job is for you. If you like interacting with people, take a look at the business side of accounting, such as being a CFO, where you get to go in and work alongside different companies. If travel is your idea of an ideal career, maybe an auditor is the right choice for you. There are many different opportunities and possibilities for each personality and skill set.

For myself (and other millennials, too) and even the general public, accounting is often seen as a boring profession, as explained before. However, accounting is so much more than just the numbers. Public accounting is not only a way to help individuals, but businesses as well.

Being an auditor allows you to help businesses be sure they are on the right track both legally and financially. If you’re the tax man (or woman), you can make sure individuals, families and businesses are being taxed properly, which can lead to saved money and greater revenue and income. Many people don’t realize accounting truly allows you to help people do what they love.

It seems the reason millennials aren’t choosing accounting as readily as other generations simply stems from the lack of information about what accounting really entails. When it comes to accounting, you’re never really stuck in one area. We millennials enjoy variety and a change in scenery, and accounting allows us to have just that.

Prepping for Audit & Tax Work

It’s that time of year again – and no, we aren’t talking about the Super Bowl or Valentine’s Day. It’s time to starting thinking about your taxes and audits! Your awesome, talented and completely humble (or maybe not) CPAs know their stuff when it comes to taxes and audits.

However, there are some things you can do in your business to help prepare for your audit and tax work and (hopefully) take some of the headache away regarding these fun projects.

  1. Have your management or ownership team review all financial information before you submit it to your CPA. You might catch a mistake that needs to be fixed.
  1. Understand your balance sheet! If you’re recording your financials on the accrual basis (here’s your reminder), your balances should fluctuate. Some common balance sheet blunders we see include:
  • Prepaid asset issues. For example, did you prepay your insurance and still have some coverage in to the next year? You would then need to set that amount up as an asset, and reduce your expenses for the year.
  • Accrued liability issues. These are really anything you owe at year-end. You would still have to pay these, even if you stopped doing business on the last day of the year. For these, think of accrued PTO to your employees, sales tax collected, etc.
  1. Take a look at the tax organizer list or list prepared by client that your accountant or auditor has sent you, and make sure all items are good to go. It doesn’t hurt to have this reviewed by someone else, too. In fact, once this information is ready to go, your CPA will likely accept it early.
  1. Designate an employee in your company who will be the main contact with your CPA. This is usually someone who is responsible for most of the financials, or someone who has strong project management skills. If you’re the business owner and feel like this doesn’t quite describe you, have no fear – it doesn’t need to be you. Your time might be needed somewhere else in the business. Your accountant or bookkeeper would be a great contact, as they work with your finances daily. As a side note, if you choose to outsource your accounting services, that person could serve as your CPA’s main contact. This will help you have more time to work on your business, not in it.
  1. When it comes to your audit, know when your auditors plan to either work at your site or work on your information. If they will be on-site, make sure you have a space (and maybe a treat or two – rumor has it CPAs like treats) with enough room for them. Make sure your main contact and others who may have answers are around. The assistance of these people can ultimately improve the turnaround time on your audit and tax return. Let’s be real, it feels good to get that over with.

Some other pointers to consider…

  • Consider all the changes to your business that happened throughout the year: growth, new customers, etc. Are all the effects of those changes reflected in your financials?
  • Did you have any ownership changes? Even if you’re not quite sure how to put this on paper, bringing them to your CPA’s attention is always a good choice.
  • Did you add any long term assets (think building additions, vehicles, equipment, etc.)? If so, there are some details your CPA will want to know to make sure you’ve capitalized it correctly and are capturing the correct depreciation (hopefully some accelerated depreciation, too).

Ultimately, keep in mind that all of us CPAs are hired by you, to help you. Your success is our main goal. If we’re hard to understand, or using too much confusing number nerd talk, let us know. We want you to understand what’s happening in your business. Your CPA can be a valuable ally on your pursuit of growth and success for your business.

Tax Accountants, CFOs & Bookeepers … Oh My!

When people hear I’m an accountant and used to be an auditor, I can put money on the next two statements that come out of their mouth. “Oh, so you do taxes?” and “I didn’t know you worked for the IRS!”

I mean, yes, I have done taxes, but that’s a very small portion of my work. In fact, many of my colleagues don’t do any taxes and probably never will. And we’ve said it before, but we will remind you again: just because someone is an auditor does not mean they work for the IRS.

This leads me to my point. Although some accountants do taxes and some go on to work for the IRS, there are many more areas that accountants find themselves working in. In fact, there are so many unique areas that we thought we would break them down for you. Here are some of the different types of accountants:

  • Tax Auditor – These accountants work for the government and help make sure tax returns are filed correctly.
  • Public Accounting Auditor – These accountants are employed by public accounting firms (like us!) and are hired by companies to make sure all accounting records and financial statements are accurate. They work closely with these companies to correct any issues, and make sure the company has good safeguards and controls around their accounting department.
  • Internal Auditor – I promise, this is the last auditor! This type of auditor is generally employed by a specific company and focuses on uncovering and correcting inefficiencies and preventing fraud within the organization. They also check the work of the accounting department to ensure everything looks correct. They do all of this to help your business run better.
  • Tax Accountant – This type of accountant helps companies or individuals with all things related to, you guessed it, tax. This could be personal or business returns, tax planning, estate planning and even succession planning for their business. Tax accountants often focus on a specialized area of tax, such as international tax or state and local tax, to name a few.
  • Forensic Accountant – This type of accountant practices in a very specialized area of accounting focused around detecting and uncovering issues. This could be fraud, embezzlement or even bankruptcies. These accountants may also act as expert witnesses in court.
  • Bookkeeper – Working as a bookkeeper focuses on originating and organizing business transactions and entering this information into the accounting system. Common duties of a bookkeeper include sending customer invoices, processing cash receipts and paying bills, to name a few.
  • Controller – The Controller acts as a manager of the accounting department, and is responsible for all transactions and controls within the department. Often times, this includes the preparation of financial statements and checking to ensure there is accuracy throughout the department.
  • Chief Financial Officer –– This is a high-level accounting position in a business, which can sometimes be overseen by the president or vice president of finance in the organization. Being at such a high level, this position holds a substantial amount of responsibility. Some of the duties of a CFO include overseeing the accounting function, managing taxation of the business and assisting with strategic planning. It is safe to say that a CFO is not just a one trick pony. (To learn more about the cast of financial characters, check out this blog).
  • Consultant – This type of accountant brings a high subject matter expertise to their clients. They often times have many years of experience in many different areas of accounting, and can help a business with many of their needs, rather than focusing on one specific area. This could include strategic planning, implementing accounting systems, making sure the company is running efficiently or even helping a business grow.

Accountants are able to specialize in a certain area within their practice and are therefore able to meet clients’ specific needs. Specialization can also be fun for accountants (yes, we said fun!) because they are able to focus on what they enjoy.

So there you have it. We’re not all tax accountants and most of us have never, and will never, work for the IRS. However, we do come from different backgrounds that have given us vastly different experiences that have helped us decide where we belong in the world of accounting.

(Shameless plug: if any of these people sound like someone your business could use, contact us!)