Resolutions, Reforming and Running From Your History

New Year’s is nearly upon us and many people start thinking of resolutions to make. Resolutions can be about anything, but often resolutions are focused on some form of personal improvement – be it physical, spiritual or mental. People want to change for the better and while we often joke about the failure to carry through on resolutions, people do successfully change for the better. I saw a quote recently from Anne Bronte that stated, “It is never too late to reform, as long as you have the sense to desire it and the strength to execute your purpose.”

I wonder, though, if that is possible in today’s world. People bring up something someone said when the person was young or over a decade ago and imply that those words are what the person really believes even today. Social media enables the research, but the core issue is do people really believe other people can change. If people believe that the past is who someone is today, then people must also believe no one can ever change. No one can go from being a persecutor of a cause to the most prolific advocate of that cause. No one can rise from failure as a young adult to being a leader to stop tyranny in the world. No one can go from joining a profession because it is about numbers and turn into a prolific writer who produced over 400 blogs.

I do believe people can change and I also believe that the only way to change is to have a discussion. That means people need to be willing to share thoughts, words and beliefs, but doing so makes one vulnerable. If people are attacked for asking insensitive questions because they do not know any better, then no one will ever be able to change. In order to really make society better, we have to change the way people pile on in social media. Instead of sitting back and being relieved that the trolls are not attacking you, we all need to take action and tell the trolls to go back into their holes and allow people to have open, honest, learning conversations, because that is the only way people will change and make the world a better place.

Maybe that is the resolution we all need to make for 2019.


A CPAs Wish List

“It’s the most wonderful time of the year,” and the time when children (and adults) write letters to Santa Claus in hopes of getting a couple of really cool items Christmas morning. In that spirit, I thought we might have a little fun putting together a CPA wish list for 2019.

10) A regular session reapproval of the Texas State Board of Public Accountancy.

9) An increase in the number of accounting graduates taking the CPA exam.

8) Legislation eliminating the need to file state tax returns when someone works in a state for one day.

7) A Congress that funds the IRS so the help line can provide help instead of courtesy disconnects.

6) A Financial Accounting Standards Board that finally eliminates a disclosure without adding any in the process.

5) An IRS delivering regs that make sense and explain what Congress meant in the new tax law.

4) States and territories passing individual and firm CPA mobility.

3) Computer systems that don’t crash on April 14.

2) Clients delivering all needed documentation accurately and on time.

1) A beautiful spring day – on April 16!

I hope everyone has a great holiday season!

A Day in the Life of an Internal Auditor by Guest Blogger Marylyn Byrd, CPA

When I got the chance to enter the internal auditing world with our local university (my alma mater) and colleges, I jumped on it. In my mind, I remember thinking it would be just like external auditing, but with less hours and a more family friendly schedule. As a working mom, having good work-life balance is crucial. I wouldn’t say any day since I started internal auditing is a typical day. Every day is different. To be successful in this profession, you must be comfortable with priorities constantly changing.

In our office, we have a team of five internal and IT auditors who are responsible for four campuses. We perform legislatively required audits, risk-based audits (both financial and compliance), investigations, ongoing risk assessments, special projects for management and we assist external auditors coming in. Below is an example of what one of my days may look like, but remember every day is different.

 8 a.m.

I just arrived at work and breathe a sigh of relief as I’ve successfully gotten my two young sons off to two different schools and made it to the office on time. Most people would put on the coffee to brew, but I’m not a coffee drinker. I say good morning to my coworkers, sit down at my computer, and start going through any emails and voicemails I’ve received.

 8:30 a.m.

I’m done responding to emails and voicemails and start on an audit. The work for this audit could include any number of things, including completing or reviewing workpapers, reading laws, policies and/or procedures, writing or reviewing audit reports, completing fieldwork, doing data analytics, making phone calls, sending emails requesting documentation, etc.

 9:15 a.m.

I receive a call from management indicating a concern that fraud may be occurring in a certain area. After obtaining the relevant details, I put my audit work to the side and lock it up, then head out to campus to meet with the person voicing the concern. If needed, I schedule additional interviews with any relevant party who has information on the concern. Our team then launches an investigation if we determine there is a need. These investigations are highly confidential and on a need-to-know basis. Investigations move very quickly at first, but then slow down as we get into the detail. Typically, when we have an investigation, depending on the nature of it, we will notify the president of the university or college, as well as the campus police chief. If we need to get data from an employee’s computer or email account, we get authority from the ISO to do so.

 11 a.m.

Our team has gotten approval to take images of an employee’s laptop. We head over to their office (while they are away at lunch) and use our tools to take an image of it. We head back to the office and use our forensic tool to target specific codewords or topics to help search through all of the files and/or emails on their computer. The forensic tool is time consuming, so once we start that running, we head back to our office to prepare workpapers of the interview that has taken place. Our IT auditors now create a new project file on our server and I set up the project in our audit workpaper system.

 12 p.m.

I head to lunch. Yes, I’m back to getting an entire hour lunch (most days) and it is amazing!

 1 p.m.

I’m back in my office. I’ve done all I can do on the investigation. The forensic tool is still working, so now I’m back to the audit I was working on this morning.

 3 p.m.

I get a phone call from management asking me to sit in on a last-minute meeting with an external auditor. I head to campus for the meeting.

 4:30 p.m.

I’m back at my office and my boss calls the team together for a team meeting. We go over all our projects that we are currently working on and then brainstorm on the new investigation and what we think our approach will be, as well as begin to assess the risks the university or college is facing.

 5 p.m.

I’m done for the day. I head out to pick my boys up from school and move on to my favorite activity – 1st grade homework! I’m completely exaggerating on my excitement level.

Every day is different and can be more or less eventful than the day described above, especially during risk assessment time in the summer when we are working on our audit plan for the next year. During that time, we have three or four meetings per day across the campuses and I’m still working on my other audits and projects.

Key Takeaways from My Time as an Internal Auditor

  • Internal auditors need good people and communication skills. You will be working with individuals who serve in different departments and come from various backgrounds. You are in and out of meetings, on phone calls, sending emails, and constantly interacting with a wide variety of individuals.
  • Internal auditors must always be ready to ask questions and more questions and more questions. You also have to anticipate what your Board (or whoever you report to) is going to ask you.
  • Internal auditors must be knowledgeable of every aspect of an organization, not just the financial or compliance side.
  • Some people still tend to view us as the enemy or the “gotcha police” even though we are internal. It’s the stigma that comes with the auditor title. Once employees realize the value of your department, you become a trusted advisor and resource.
  • In my case, internal auditing has allowed me to continue doing what I love (auditing of any sort) without working tons of extra hours. It’s a great choice for your career and your work-life balance.

Marylyn Byrd, CPA, is an internal auditor with the Texas State University System responsible for the four Lamar components – Lamar University, Lamar Institute of Technology, Lamar State College – Port Arthur and Lamar State College – Orange. Byrd is a member of TSCPA’s Board of Directors and former president of the Southeast Texas Chapter.

TSCPA Executive Board Meeting

At our November meeting, the Texas Society of CPAs (TSCPA) Executive Board continued to focus on how TSCPA needs to evolve to better help members achieve success. The Board heard about, and provided input on, a number of initiatives, including:

  1. Membership investment;
  2. Branding;
  3. CPE;
  4. Partnership between the state and chapter organizations;
  5. Sunset and legislative activities.

Progress continues to be made on maintaining the Texas State Board and licensing of CPAs in Texas. That would seem to be a non-event to many, but there is a growing push to reduce the number of licensing boards across the country and too often, those pushing that agenda sweep up learned professions such as doctors, lawyers and CPAs in their efforts to eliminate state licensing requirements across a large swath of jobs. Usually, those pushing for reduced licensing state they never intended to include CPAs in their efforts, but TSCPA has to keep an eye out on the specific language proposed in bills to ensure the change in law is not overly broad and includes CPAs.

All TSCPA members are members of both the state and a local chapter organization. State and chapter leadership realize that providing value to members is a joint responsibility. The task force working on that partnership is exploring ways for both organizations to better coordinate their activities and resources to produce better results for our members. Similar efforts are being made on the CPE front to better coordinate course offerings by the state and chapter organizations and to fill different needs for large, medium and small chapters.

Finally, I’m excited about the proposed changes on how your professional organization will brand itself to you as members and to the public at large. We are all proud to be Texas CPAs and the new brand will focus on both of those concepts. Please stay tuned, as there will be more to come on that front in the next few months.

What Scares Accountants

While ghosts and goblins may scare most people, professional accountants aren’t easily frightened by such things. Instead, our list of things that wake us up in the middle of the night in a cold sweat is more like this:

10) Having to tell the salesperson that the contract they got signed at 11:59 p.m. on December 31 won’t get booked as revenue because we had not actually delivered any products or services yet.

9) Congress announcing yet another effort to “simplify” the tax code.

8) A client walking in with a shoebox … because we know it is full of receipts and probably only half the information we need anyway.

7) The CFO walking into our office saying they just heard a great presentation from a software vendor that is going to solve all our problems.

6) Realizing all those rounded numbers are off by one when we add them up and compare them to the total at the bottom of the column.

5) Turning on our computer and seeing that blue screen of death … on April 14.

4) Hearing FASB and the SEC say they are starting a project to reduce disclosures because we all know they will eliminate three paragraphs no one was disclosing anyway, but realize that five new pages of information would be very useful to investors.

3) Hearing procurement proudly announce they have solved the current year budget problem by getting our vendor to defer the payment until the next year even though we will get the products and services right now.

2) Realizing it is December 30 and we haven’t completed that pesky ethics training requirement yet to maintain our CPA license.

1) October 15 … because tax deadline day is way scarier than Halloween.

I hope you had a great time on Halloween and maybe a little laugh enjoying this blog.

Innocence, Guilt and Civilized Society

I want to spend some time talking about the principle “innocent until proven guilty.” There are those who say the principle only applies to criminal proceedings. While I agree that “innocent until proven guilty beyond a reasonable doubt” is a foundation of our criminal justice system, just because the principle is a foundation in criminal courts does not mean that “innocent until proven guilty” is not also a foundational principle in other aspects of our society.

Business and society are based on trust; it is trust that people will do what they say, abide by rules and do what is right. Trust, when described in this way, is really the same thing as “innocent.” We are saying that our leaders, peers and staff are doing the right things for the right reasons. ”Guilty” on the other hand, is the same as saying you don’t trust someone. You believe they have ulterior motives, will lie unless forced to tell the truth and believe in the ends justify the means no matter how bad the means.

When it comes to business, Stephen Covey wrote a great book titled The Speed of Trust, which showed that when people within a company trust each other, the ability to complete projects and provide great service to customers is multiplied exponentially. Trust is founded on the principle of innocent until proven guilty and was something I mentioned time and again to my staff without even realizing it, whether I was leading an accounting policy group or internal audit team. I would tell my team to trust that the person seeking an accounting answer or being audited had the best interest of the company at heart, knew the process and operations of their part of the business better than we did, and was telling the truth until that person proved that they could not be trusted. I realize now I was telling them to believe the person was innocent until proven guilty.

The thing that makes me wonder when people say “innocent until proven guilty” is not a foundational principle of society is that the principle applies equally to both sides. If we say that in society innocent until proven guilty does not apply outside criminal proceedings, then we are saying anyone making a statement about anything (including the “accuser”) is guilty until proven innocent. That means we are saying we don’t believe anything anyone says. In reality, people who say that innocent until proven guilty doesn’t apply outside of criminal proceedings really mean to say that they want to pick and choose who they will apply the principle to and who they won’t. There are many words that are applied to such people – biased, discriminatory, racist – and none of them are positive traits you would like applied to you.

So how do individuals apply the principle of innocent until proven guilty to all sides fairly and equally? They have to look at corroborating facts and evidence and make a decision. This is where the idea that “innocent until proven guilty beyond a reasonable doubt” is limited to criminal proceedings. In society and business, the measurement is “innocent until more likely than not proven guilty.” That means we are making a lot of 51 percent – 49 percent decisions out there and with decisions being made on such a close measure, it is easy for two rational and reasonable people to come to a different decision on which side, innocent or guilty, gets the 51 percent and which gets the 49 percent. The one thing I believe with all my heart is that we can’t say “innocent until proven guilty” applies only in the court of law.


As CPAs, we live, maybe even thrive, in a world of rules. Rules provide important boundaries on how to do things and get the “right” answer, but rules can also be negative. Rules can slow down your business; they can prevent better customer experiences and they can drive away great employees who don’t want to deal with needless directives. Because CPAs are so rules oriented, we can have difficulty seeing rules that are causing problems, especially when those rules are unwritten. But if you’re willing to take a chance, you may find a few rules that are worth getting rid of, if you ask the people who work in your organization. Here are three steps you can take to come up with a rule or two to get rid of:

  1. Identify regulations vs. rules
  2. Focus on what you can control
  3. Avoid the complaint session

You need to start out by making it clear that we can only get rid of rules we have put in place as a business. There may be accounting standards or IRS regulations that we all hate, but those are outside of our ability to change. Get the team focused on rules created within the company, not from the government or other regulatory bodies.

Even if you get the team focused on company-made rules, there still may be many rules you can’t control. If you are the CFO, your span of control is pretty large, but if you are a department head, the span of control decreases. If you are looking to make changes, help define the scope of rules that could be subject to change.

Finally, in order to avoid turning the elimination of rules into the same old gripe session, focus your team on an important question: “What do you want?” Instead of griping about a rule, get them focused on the solution. What should change? How should the rule be eliminated? What would processes be like if the rule was eliminated? How would that be better?

As CPAs, it might seem a little scary to go about eliminating rules, but think of eliminating rules this way. In a financial report, we focus on material items rather than spend time equally on all items because the material items are what matter. We should take the same approach to rules. Which ones are “material,” that is really matter, and which ones are “immaterial,” and don’t really make a difference. If a rule doesn’t make a difference, why have it in the first place?