Why A Generation Z’er Chose Accounting by TXCPA2B Blogger Liz Wood

I still have family friends ask me about my career path with a response similar to this: “Accounting, huh?  That seems…interesting.”  It is hard for people to try and act excited about my college path, especially when they still think of my generation as the technological savvy, entrepreneurial, adventurous type.  However, I think a lot of individuals confuse Millennials with Generation Z; furthermore, there are actually a lot of Gen Z’ers that are interested in fields like accounting.  Here is a list of reasons why I, as a fellow Gen Z’er, chose accounting:

Diverse Opportunities

“Accountants are boring.”  Some of my friends continue to joke with me about this idea, but I laugh it off!  I think a lot of non-accounting majors do not understand the vast routes you can take.  For instance, by the time I graduate, I will have engaged in three internships—all of them will be based on accounting but are completely different at the same time.  My first internship was in corporate accounting for a private company in an office-like environment.  My second internship will be in internal audit with a lead producing company.  I will be able to visit multiple facilities in France, California and New York and assist with conducting audits.  Finally, my third internship will be in external audit with a Big Four firm.  This will allow me to engage with different clients and review their financial records and documents.

And it doesn’t just end there.  There are SO many other different pathways to take in an accounting career, and each one will help you develop a new skill set.  Accounting is great for the indecisive but also for those who want to work the same job until retirement.

Stability and Growth

I am personally not a huge risk-taker. In fact, I have already started a Roth IRA to save up for my retirement because I like having a cushion to fall back on.  With an accounting career (especially public accounting) I can feel safe knowing that I probably won’t be laid off any time soon.  Also, a public accounting career provides almost guaranteed promotions after a certain timeframe.  “Hmm, I wonder if I will ever get promoted to senior associate?” is not a question new auditors typically have to worry about.  It certainly takes a heavy weight off my shoulders!

Accounting is not Always Forever

But what if you end up hating accounting?  This is a question I receive a LOT, and here’s my take on it:

As I mentioned earlier, there are different routes to take, so I could always try a different accounting sector.  Even then, if I still did not enjoy my career, I am not forced to stay in accounting just because that is what my degree is in.  I know many individuals who have switched from accounting to marketing or human resources and are currently executives at a company.  Accounting provides such a strong foundation that is integral in all parts of a business and can allow you to branch out to new departments.  That’s why I personally think accounting is a strong degree to pick for undecisive business majors.

I’ll be honest, accounting is typically not the first major that comes to a student’s mind in terms of studies (it may be a last choice for some, in fact).  However, the benefits, learning experience and ability to grow, and even travel, are just a few of the factors that attract Generation Z’ers to this field.  I think accounting is a hidden gem that not many young students think about, so I consider myself lucky to have discovered it so early!

Blogger: Liz Wood

 

 

 

 

 

 

 

TXCPA2B is a blog written by Texas students in pursuit of the CPA certificate. The views expressed here are those of the authors and not necessarily held by TSCPA or our members.

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Deferred Tax Assets and Liabilities By Guest Blogger William R. Stromsem, JD, CPA

The Tax Cuts and Jobs Act of 2017 lowered the corporate income tax rate to a flat 21 percent and provided a one-time deemed repatriation tax on controlled foreign corporations’ current earnings and prior untaxed earnings back to 1986. The repatriation rate is 15.5 percent on liquid assets and 8 percent on illiquid assets instead of the prior 35 percent rate. Many large corporations are reporting radical changes to their bottom line from adjustments to their deferred tax assets and liabilities.

It is difficult to estimate the book income effect of the repatriation tax because we do not know how management may have initially accounted the deferred tax, with many companies assuming that earnings would be perpetually reinvested overseas and not booking deferred tax liabilities. Also, there is uncertainty as to when repatriation will be recognized with the new tax law allowing the tax to be paid over up to eight years. Some companies will pick up the tax expense immediately, with Apple announcing that it will pay $38 billion to repatriate its foreign earnings of $252.3 billion that have not been previously taxed in the U.S. It is estimated that more than $2.6 trillion in corporate profits are sitting in foreign bank accounts.

For tax rate changes, recent reports in the press show major companies taking hits: Amgen, $6-6.5 billion; Bank of America, $3 billion; and Credit Suisse, $2.32 billion. Fannie Mae and Freddie Mac had net operating losses from the financial meltdown and will have to adjust the value of their deferred assets downward by a combined total of $10-$20 billion. However, about two-thirds of the companies in the Dow Jones Industrial Average will have a boost in income as a result of reducing deferred tax liabilities. These include Verizon, $18.4 billion; Exxon, $12 billion; Pfizer, $17.5 billion; and Apple, $11 billion.

These valuation changes flow through the income statement, but most savvy analysts view this as not important and a distraction from real operating results. On the first page of his annual letter to shareholders, Warren Buffet commented on the $24 billion increase in Berkshire Hathaway income from adjusting its deferred taxes, saying that it distracted from operating results and, “For analytical purposes, Berkshire’s ‘bottom-line’ will be useless.”

Smaller corporations have less dramatic dollar amounts, but they still must make required valuation adjustments to their deferred taxes and be prepared to explain unexpected results to owners and lenders.

Accounting for taxes is a generally shared responsibility for financial accounting and tax experts, but often they each look at the other as having the primary responsibility. Financial accountants sometimes see tax accounting as tax, and tax experts see tax accounting as having FINs (financial interpretations). The important thing is for everyone to know what is required at this point. Accounting Standards Codification (ASC) 740, Income Taxes, requires adjustments to the beginning of the year balance of a valuation allowance if there is a change in circumstances that causes a change in management’s judgment about the realizability of the recognized deferred tax assets. A valuation allowance is required if it is more likely than not that some or all of the deferred tax asset will not be realized in the future. ASC 740 also requires analysis and disclosure of changes to deferred tax assets, which will help in seeing how corporations are managing their deferred tax assets and liabilities.

William R. Stromsem, JD, CPA, is a technical writer for TSCPA’s Federal Tax Policy Committee and an assistant professor at George Washington University School of Business.


The Importance of Committing to a Thorough Interviewing / Hiring Process by Guest Blogger Bryan Edwards, MSA, CPA

Sometimes you reap what you sow…………………..

Have you had too many employee challenges and too much turnover?  It’s easy to bemoan not finding “the right” candidates/employees in a tight labor market.  One path to better results is to analyze your hiring process.

Being both a CPA and recruiter, I have the opportunity to see many organizations’ hiring processes.  If you are looking to improve your hiring and retention results, consider these questions:

  • Am I realistic in assessing the current labor market?  A strong economy, many baby boomers retiring and the 150 hour CPA requirement all contribute to fewer candidates in the market.  Be careful waiting to interview too many candidates only to lose your top candidate due to delays.  When you see somebody you like, you have to move quickly in a competitive market; otherwise somebody else will.  Also, researching the appropriate salary range for a particular skill set and experience level are key.
  • Is it appropriate to delegate the screening process? You, as the hiring manager, know what you need better than anybody else. Therefore, it makes sense to be as involved as possible in the early stages of the process.  This is an investment of time, but it is an investment that pays off.
  • What personality and working style makes sense? Beyond your company culture, specific roles require specific working styles.  Somebody who is a great Analyst, for example, usually wouldn’t be the right person for a high volume data entry role.  Consider what specific working style makes sense given the nature of the work.
  • Are we doing all we should to ensure an employee’s long-term success? Once hired, do they feel they are a part of the team?  Have they been introduced to possible mentors?  Are they being invited to participate in events?  Employees in today’s market decide quickly whether or not they consider their new positions to be a long-term fit.  Make sure you invest as much in them post hire as you did to hire them in the first place.

Assessing your hiring and onboarding process prior to a search is an investment in the beginning, but pays good returns in the end.  You are more likely to locate and secure the right fit and they are more likely to stay with your organization for a longer tenure.

Best wishes in all your hiring processes,

Bryan Edwards, MSA, CPA

Bryan R Edwards, CPA, MSA

 


The Upside-Down View of Leadership and Why You Should Care by TXCPA2B blogger Jacob Walker

When you think of a leader, what comes to mind? What about a boss? If these two terms are not synonymous in your vocabulary, then the remainder of this post is for you.

Imagine two scenarios:

  1. You show up to work only to be yelled at by a superior demanding that certain tasks get done in an unreasonable amount of time. There is no appreciation when you meet their extreme expectations, and you feel like you have been stuck in the same position for too long.
  2. Your boss asks how projects are going and asks if there is any way they can lend a hand. Not only do they go out of their way to provide assistance, but they make sure you have all the tools necessary to reach your full potential.

These might sound like two extremes, but scenario 1 exists far too often. There is one simple way to revolutionize how you lead which creates an environment where everyone thrives. This is done through something called servant leadership. Most people view leaders as someone who is at the top and commands people below. Servant leadership flips that idea around and puts the leader on the same level as his subordinates getting the work done with them. The boss from scenario 2 embraces this idea and lets it show in how he directs his employees.

In my six years of employment working various jobs, I have experienced both forms of leadership. A scenario 1 boss creates an environment of hostility and fear in the workplace. Not only do employees dread coming to work, but they are motivated to only put in enough effort to get the boss off their back. A scenario 2 boss creates a warm and trusting environment that employees love. Not only do they look forward to work, but they want to go above and beyond because their boss leads by example.

The beauty of servant leadership is that it does not stop there. One of my favorite quotes is from Todd Wagner. He says, “Great men use power to serve others.” Part of being a servant leader is not just leading by example, but it is using your available resources to ensure that your employees are maximizing their potential and advancing in their careers. If you master this skill as you move up the corporate ladder, there will be no limits.

This idea of leadership is easy to grasp but much harder to put into practice. As a student myself, it is something I constantly strive for because acting as an effective servant leader is not something that happens overnight. I know that if I begin trying now, it will come much easier when I do start off in my career.

Now think of the best boss you have ever worked for; do you see any similarities between how they lead and how a servant leader acts? Perhaps you can think of a terrible boss who does the opposite of what servant leader does. Regardless of which category your superiors fall under, understand that servant leadership is the golden standard. When you put it into practice, you will soon realize that it is a challenging and humbling experience. However, the quicker you adopt the upside-down view of leadership, the better off you will be.

 

 

 


Replace Yourself by Guest Blogger Susan B. Anders, Ph.D., CPA, CGMA

First the good news: Texas is the best state for accounting positions, with a 16% growth in the number of accounting jobs between 2009 and 2016, and the highest cost-of-living adjusted entry-level and mid-level salaries, and a tie with Delaware for the high-level salaries. (Accounting Principals Blog, August 25, 2016)  Accounting salaries are expected to continue to rise, especially for accountants in industry. (Journal of Accountancy News, August 30, 2016) Here’s the 2017 Robert Half Salary Guide for detail by position.

Now the bad news: although demand is strong, studies indicate there are not enough accountants, new hires or experienced, to meet the demand, especially as baby boomers retire. (Going Concern, “The State of Accounting Recruitment and Talent Shortages in 2017”) Here is the AICPA’s full report: Trends in the Supply of Accounting Graduates and Demand for Public Accounting Recruits (2015).

Calling all CPAs: think back—who influenced your decision to become an accountant and a CPA?  In my case, it was four practicing CPAs—all with different career paths, all enthusiastic about their jobs, and all encouraging me to study accounting and become a CPA.  Although my accounting professors were great, it has usually been practicing accountants who influenced my career—including my decision to pursue becoming a professor.

Has the profession been good to you?  Don’t you think it could be a great career for others?

Replace yourself: Help us to recruit more potential accountants and let them know that being a CPA, in all of its great variety, is the best profession ever.

  1. Encourage your employer to offer accounting internships

Employers can help ensure more future accountants by offering internships.  Even more importantly, we need internships in industry so that students can learn about a wide range of career opportunities.  Most of the internships on the TSCPA website are in public accounting.

If your company cannot offer internships, what about letting prospective accounting students “shadow” you on the job?

  1. Adopt a high school or college

Opportunities abound, from representing your company at formal career fairs, to speaking to accounting student groups, to just attending meetings and getting to know the students.  The TSCPA has helpful resources for talking to students, including ideas for career fairs, formal PowerPoint documents, and videos.  Don’t forget the AICPA’s Start Here Go Places.

  1. Talk to everyone you meet

Get your “elevator speech” ready.  Mine is that accounting is the most beautiful of all subjects.  It’s all about balance and relationships.  Oh, it probably doesn’t sell, but what can you expect from a professor?  Just another reason for practicing accountants to promote the profession.

I am happy for anyone who would like more information or ideas about how to replace yourself to email me at susan.anders@mwsu.edu.

Susan B. Anders, Ph.D., CPA, CGMA is the Louis J. and Ramona Rodriguez Distinguished Professor of Accounting at Midwestern State University in Wichita Falls TX.  She has been an academic accountant for over 20 years, and was a practicing CPA for the first 15 years of her career.  She is an officer and board member of the Wichita Falls Chapter of the TSCPA.


Excel – A Love/Hate Relationship by Guest Blogger Anita Cadena, CPA

In my accounting experience, Excel is the most used tool in the Microsoft Office suite. It can do so many things to make our lives easier with its various functions. In addition, its data analysis capabilities can be extremely valuable. But how do you really know what it’s calculating and displaying is accurate? That could depend on how many people utilize the file and who created it.

If you think about software you use to help with calculations (for example – depreciation), there is some comfort that the program will calculate accurately because we generally cannot edit the “source code.”  However, when we use Excel for something similar, we can easily and accidentally edit the “source code” (i.e. formulas). I know – we use it whenever possible because it is familiar and convenient. However, if it is calculating something significant, you might want to add some control over who can access and edit the file (even provide some protection against yourself!).

Here are some ideas – the right solution and application will vary based on circumstances:

  1. Include check figures or some sort of “reasonableness test.”
  1. Protect the worksheet (you can lock certain cells – i.e. formulas and/or all “non input” fields).
  1. Protect the entire file.
  1. Protect the network folder (you may need help from your IT team).

Also, if someone other than the user(s) created the worksheet, you may want to keep documentation, including a log of changes. An additional tab could be created with the following information:

  • Purpose of the spreadsheet
  • User(s) of the spreadsheet
  • Who created the worksheet and when
  • Detailed list of any changes and date they were made, including who made them and why

Certain changes can also be tracked via Excel (in a shared workbook). Some details on this can be found here.

Finally, some things to look out for include hidden rows/columns, broken or incorrect links to data, “plug formulas,” and numeric vs. text values. These items could affect formulas.

To learn more, simply search online for “spreadsheet controls.” You’ll find a ton of information at your fingertips.

Anita Cadena is the Internal Auditor for Navy Army Community Credit Union in Corpus Christi, Texas.  She has been an internal auditor for public and private companies for the last eight years. In addition, she has over 10 years of experience in public accounting where she provided tax and audit services to a variety of industries.


Cyber Attack now What! by Guest Blogger P.J. “Trish” Fritsche, CPA, CFF, CGMA, CITP

Businesses and other entities will suffer at some point from a computer hack or other event that affects business reputation or client relations. The idea is….Not if, but when and the question follows; does your business have a response plan in place?

Computer hacking refers to the practice of modifying or altering computer software and hardware to accomplish a goal that is considered to be outside of the creator’s original objective by cyber.laws.com/hacking.  An example could be a keylogger.  While a keylogger in itself is not necessarily malicious, some people hear keylogger and think of a malicious event. A keylogger used with the intent to gain information like passwords, banking information or other sensitive data is a business issue that should have policies and procedures attached so when your turn comes, the response plan is effective and efficient. The response plan could include a specific team, mitigation and investigation, and internal and external communications.

Whether the cyber event is by an employee or sophisticated digital criminal, losing cash that is vital to a business’s ongoing operations is a disruptive event including changing bank accounts, forensic investigations, reporting to enforcement and required disclosure to clients about compromised information.

While revenue generation is a key business concern, taking the time to address limited security budgets, outdated security, appropriate insurance coverage and employee training can reduce your risk. The threat is just a click away.

In closing, when was the last time you talked to your insurance representative to understand coverages related to cyber threats.

Who to report to can be found here.

For response plan assistance go here.

Disclosure information at Cyber Privacy Fortification Act of 2017 is here.

Just remember your turn is coming….

Ms. Fritsche has more than 25 years of experience providing services related to forensic accounting, litigation support, audit assurance and tax services to public sector, profit entities and individuals. Her areas of expertise include leading special investigations, financial data analysis and conducting forensic interviews.