Accounting
Overcome obstacles on your path to partnership
Only
However, our research and skills assessment tests show there are five personality traits that significantly make or break your chances of becoming a partner. Some are inherent, some can be learned, some can be corrected. The list may surprise you.
1. Conscientiousness done differently
Overly conscientious persona: Taylor got promoted into a management role at a midsized accounting firm six months ago. Her diligent commitment to getting clients’ accounts done on time and exceeding the firm’s expectations of quality and attention to detail played a big part in Taylor getting that promotion. But, she has very little experience managing teams and it’s beginning to show.
Most people think conscientiousness is a positive attribute since conscientious people tend to be reliable, prudent, dependable folks who value planning, organization and structure. They typically adhere to well-established policies and processes. They not only meet deadlines but do so with quality output to meet their high personal standards.
It’s no surprise that conscientious employees are prized by accounting firms when the role requires meeting immovable external deadlines and producing quality output. But when highly conscientious accountants start moving up the ranks and begin managing people, they often struggle. Their rigid mindset can make it difficult for them to think outside the box and adapt when complex challenges arise — challenges that can’t be solved by sticking with the firm’s longstanding policies and procedures.
Since they’re hesitant to take shortcuts or look for “workarounds,” they generally don’t mind working late and coming in on weekends. But expecting team members to make the same sacrifices often creates resentment, erodes firm culture and can spike a rash of resignations and mental and physical health issues.
When I speak to firms and organizations about “Conscientiousness Done Differently,” I tell them it’s not about setting immovable deadlines and work quality expectations; it’s about questioning the way things are done at one’s organization to see if their rigid mindset is adversely affecting their team in a profession that’s perpetually short of talent.
Solution: With a preference for valuing and adhering to established methods, highly conscientious people who aspire to become partners must be trained to ask themselves if their adherence to old methods still adds value — or where the process could be streamlined and still deliver results. The Taylors of your firm must also be trained to ask themselves if they’re contributing to an unhealthy “long hours culture” at the firm. Help the Taylors keep the focus on results, not on maxing out billable hours.
2. Let it go! Trusting and delegation
Trusting/delegation persona: Chris is a team leader who prides himself on the quality and accuracy of the accounts produced by his team. He spends considerable time performing quality assurance checks on all work produced by his reports.
During his last performance review, Chris was asked to reduce the time spent reviewing his team’s work so he could focus on developing his staff to be self-sufficient and grow their careers. Chris is clearly struggling with this request.
Most accounting tasks require careful attention to detail and forensic levels of fact-checking and verification. Employers tend to hire accountants who have a healthy degree of skepticism to ensure they’re not accepting everything a client shares with them at face value or letting fraudulent or misleading data find its way into financial statements. But what happens when these wary accountants start moving up the ranks and managing teams of their own? They often struggle to delegate and evolve into micromanagers who scrutinize every single task their team members do. This naturally breeds resentment and erodes firm culture.
Solution: If you think people like Chris have partnership potential at your firm, help them see the benefits of delegation and allow their reports to make their own mistakes — if mistakes occur — as long as those mistakes don’t irreparably harm the firm.
3. Emotional Intelligence
We designed our firm’s Accountants Personality Profile Questionnaire to prioritize traits linked to EI. This allows accounting firms and corporate finance departments to assess the degree to which their emerging leaders build deeper, more meaningful relationships with their teams and clients. Our research shows most accountants would rather join a people-first culture than a me-first culture.
Emotionally unintelligent persona: Wayne is a technical genius when it comes to accounting. Soon after joining the firm two years ago, he became the “go-to” person for solving complex accounting matters. Because of his technical acumen, the firm’s partners want to keep promoting Wayne, but the firm’s administrator and HR manager have reservations. Wayne would rather be right than make friends at work, and his personality has led to several tearful interventions by management and even a resignation or two.
Without improving his people skills, Wayne’s personality will likely do more harm to firm culture and retention than his technical expertise will add value.
Solution: From a coaching perspective, EI can be developed for professionals like Wayne, but it’s not a quick fix. He can start by showing more empathy toward his colleagues and take a genuine interest in their lives outside the office — remembering team members’ birthdays, kids’ names or favorite hobbies, and chatting with them about things other than work. When people feel their manager is genuinely interested in them, they are much more likely to stay at their firm and report satisfaction with their job. Widely used personality tests such as 16PF, Personality Assessment Inventory and Big 5/OCEAN call this the “warmth scale.”
4. Self-confidence and resilience
Insecure persona: Ella has been with a large accounting firm for six years but has never hinted at wanting to progress her career. As a new hire, she recorded some of the highest critical reasoning test scores ever recorded at the firm and consistently produces high-quality work. But her manager and the HR team have seen her stymied at times by extreme anxiety when asked to take on new tasks.
I’m guessing you have people at your firm who are trustworthy, reliable and highly competent at their jobs, but don’t have the confidence to seek out promotions or advocate on their own behalf. This reticence could have been caused by toxic bosses undermining them at previous jobs, or it could go back earlier in life to parents reminding them they weren’t as smart as their siblings, vindictive teachers not recognizing their talents or “friends” who betrayed them in childhood.
As much as you feel for the Ellas of the world, they won’t make good partners or help you move your succession plan forward if they’re still haunted by ghosts of their past failures and embarrassments (real or imagined). Also, widely used personality tests such as MBTI and DISC don’t measure a respondent’s coping style or stress tolerance. However, our personality questionnaire (APPQ) extensively measures a team member’s stress tolerance, self-confidence and emotional stability, which combine into their coping style.
Solution: Resilience-based coaching can help the Ellas of your firm address their fear of failure and lack of confidence. Addressing emotional instability and apprehension may also require the help of an outside mental health professional. We’ve found that most employees are receptive to coaching if it shows them how much the firm or company values them and wants them to succeed. And when the highly competent Ellas of the firm have more confidence to be leaders, this tends to improve the motivation and morale of all those around them.
5. Assertion and social boldness
Non-assertive persona: Sam is being considered for promotion at a Midwest accounting firm with many clients in the agricultural sector. Clients are experiencing challenging conditions. They’re straight talkers who often question the accounting advice and don’t mince words. If Sam gets promoted, he will move out of back-office support into an advisory role in which he will need to communicate persuasively with clients and sometimes challenge the accounts they submit.
As accountants move up the ranks, they must spend more time interfacing with clients, massaging egos, defending the firm’s work and challenging clients’ business practices. Without being assertive and confident, accountants like Sam could be coerced into doing something unethical or not addressing questionable behavior or risk losing the client unless their unreasonable demands or expectations are met.
Solution: Provide Sam with the coaching he needs to get comfortable with these situations when much of his early career has been back-office support should be an early coaching priority.
Becoming an accounting firm partner requires more than long hours, personal sacrifice and technical expertise. By recognizing and addressing the five personality traits above, accountants can overcome hidden obstacles and significantly improve their partnership prospects.
The Financial Accounting Standards Board met this week to discuss its projects on accounting for transfers of cryptocurrency assets and enhancing the disclosures around certain digital assets, such as stablecoins.
Processing Content
During Wednesday’s meeting, FASB’s board made certain tentative decisions, according to a
At a future meeting, the board plans to consider clarifying the derecognition guidance for crypto transfer arrangements to assess whether the control of a crypto asset has been transferred.
FASB also began deliberations on the
The board decided to provide illustrative examples in Topic 230, Statement of Cash Flows, to clarify whether certain digital assets such as stablecoins can meet the definition of cash equivalents. It also decided to include the following concepts in the illustrative examples:
- Interpretive explanations that link to the current cash equivalents definition;
- The amount and composition of reserve assets; and,
- The nature of qualifying on-demand, contractual cash redemption rights directly with the issuer.
FASB plans to clarify that an entity should consider compliance with relevant laws and regulations when it’s creating a policy concerning which assets that satisfy the Master Glossary definition of the term “cash equivalents“ will be treated as cash equivalents.
“I agree with the staff suggestion to look at examples,” said FASB vice chair Hillary Salo. “From my perspective, I think that is going to help level the playing field. People have been making reasonable judgments. I agree with that. And I think that this is really going to help show those goalposts or guardrails of what types of stablecoins would be in the scope of cash equivalents, and which ones would not be in the scope of cash equivalents. I certainly appreciate that approach, and I think it has the least potential impact of unintended consequences, because I do agree with my fellow board members that we shouldn’t be changing the definition of cash equivalents, and it’s a high bar to get into the cash equivalent definition.”
“I’m definitely supportive of not changing the definition of cash equivalents,” said FASB chair Richard Jones. “I believe that’s settled GAAP in a way, and we’re not really seeing a call to change it for broader issues. I am supportive of the example-based approach. The challenge with examples, though, is everybody’s going to want their exact pattern, but that’s not what we’re doing.”
The examples will explain the rationale for how digital assets such as stablecoins do or do not qualify as cash equivalents and give a roadmap for other types of digital assets with varying fact patterns to be able to apply.
“We really don’t want to be as a board facing a situation where something was a cash equivalent and then no longer is at a later date,” said Jones. “That’s not good for anyone, so keeping it as a high bar with certain rigid criteria, I think, is fine.”
Stablecoins are supposed to be pegged to fiat currencies such as U.S. dollars and thus provide more stability to investors. “In my view, while a stablecoin may meet the accounting definition established for cash equivalents, not every one of those stablecoins in the cash equivalent classification represents the same level of risk,” said FASB member Joyce Joseph.
She noted that the capital markets recognize the distinctions and have established a Stablecoin Stability Assessment Framework to evaluate a stablecoin’s ability to maintain its peg to a fiat currency. Such assessments look at the legal and regulatory framework associated with the stablecoin, and provide investors with information that could enable them to do forward-looking assessments about the stability of the stablecoin.
“However, for an investor to consider and utilize such information for a company analysis the financial statement disclosures would need to include information about the stablecoin itself,” Joseph added. “In outreach, the staff learned that investors supported classifying certain stablecoins as cash equivalents when transparent information is available about the entities at which the reserve assets are held. Therefore, in my view, taking all of this into consideration a relevant and informative company disclosure would include providing investors with the name of the stablecoin and the amount of the stablecoin that is classified as a cash equivalent, so investors can independently assess the liquidity risks more meaningfully and more comprehensively by utilizing broader information that is available in the capital markets and its emerging information.”
Such information could include the issuer, reserves, governance and management, she noted, so investors would get a more holistic look at the risks that holding the stablecoin would entail for a given company.
The board decided to require all entities to disclose the significant classes and related amounts of cash equivalents on an annual basis for each period that a statement of financial position is presented.
Entities should apply the amendments related to the classification of certain digital assets as cash equivalents on a modified prospective basis as of the beginning of the annual reporting period in the year of adoption.
FASB decided that entities should apply the amendments related to the disclosure of the significant classes and amounts of cash equivalents on a prospective basis as of the date of the most recent statement of financial position presented in the period of adoption.
The board will allow early adoption in both interim and annual reporting periods in which financial statements have not been issued or made available for issuance.
FASB also decided to permit entities to adopt the amendments to be illustrated in the examples related to the classification of certain digital assets as cash equivalents without the need to perform a preferability assessment as described in Topic 250, Accounting Changes and Error Corrections.
The board directed the staff to draft a proposed accounting standards update to be voted on by written ballot. The proposed update will have a 90-day comment period.
Senators introduced several pieces of tax-related legislation this week, including measures aimed at improving customer service at the Internal Revenue Service, cracking down on tax evasion and curbing the carried interest tax break, in addition to efforts in the House to repeal the Corporate Transparency Act.
Processing Content
Senators Bill Cassidy, R-Louisiana, and Mark Warner, D-Virginia, teamed up on introducing a bipartisan bill, the
The bill would establish a dashboard to inform taxpayers of backlogs and wait times; expand electronic access to information and refunds; expand callback technology and online accounts; and inform individuals facing economic hardship about collection alternatives.
“Taxpayers deserve a simple, stress-free experience when dealing with the IRS,” Cassidy said in a statement Wednesday. “This bill makes the process quicker and easier for taxpayers to get the information they need.”
He also mentioned the bill during a
“I’m happy to meet with the team … and do all I can to make it as good as you want it to be,” said Bisignano.
“My bill would equip the IRS with the legislative mandate to create an online dashboard so that taxpayers can monitor average call wait time and budget time accordingly,” said Cassidy. He noted that the bill would allow a callback for taxpayers that might need to wait longer than five minutes to speak to a representative, and establish a program to identify and support taxpayers struggling to make ends meet by providing information about alternative payment methods, such as installments, partial payments and offers in compromise.
“I know people are kind of desperate and don’t know where to turn for cash, so I think this could really ease anxiety,” he added. “This legislation is bipartisan and is likely to pass this Congress.”
Cassidy and Warner
“Taxpayers shouldn’t have to jump through hoops to get basic answers from the IRS — and in the last year, those challenges have only gotten worse,” Warner said in a statement. “I am glad to reintroduce this bipartisan legislation on Tax Day to ease some of this frustration by increasing clear communication and making IRS resources more readily available.”
Stop CHEATERS Act
Also on Tax Day, a group of Senate Democrats and an independent who usually caucuses with Democrats teamed up to introduce the Stop Corporations and High Earners from Avoiding Taxes and Enforce the Rules Strictly (Stop CHEATERS) Act.
Senate Finance Committee ranking member Ron Wyden, D-Oregon, joined with Senators Angus King, I-Maine, Elizabeth Warren, D-Massachusetts, Tim Kaine, D-Virginia, and Sheldon Whitehouse, D-Rhode Island. The bill would provide additional funding for the IRS to strengthen and expand tax collection services and systems and crack down on tax cheating by the wealthy.
“Wealthy tax cheats and scofflaw corporations are stealing billions and billions from the American people by refusing to pay what they legally owe, and far too many of them are getting a free pass because Republicans gutted the enforcement capacity of the IRS,” Wyden said in a statement. “A rich tax cheat who shelters mountains of cash among a web of shell companies and passthroughs is likelier to be struck by lightning than face an IRS audit, and Republicans want to keep it that way. This bill is about making sure the IRS has the resources it needs to go after wealthy tax cheats while improving customer service for the vast majority of American taxpayers who follow the law every year.”
Earlier this week. Wyden also
The Stop CHEATERS Act would provide the IRS with additional funding for tax enforcement focused upon high-income tax evasion, technology operations support, systems modernization, and taxpayer services like free tax-payer assistance.
“As Congress seeks ways to fund much-needed policy priorities and address our growing national debt, there is one common sense solution that should have unanimous bipartisan support: let’s enforce the tax laws already on the books,” said King in a statement. “Our legislation will make sure the IRS has the resources it needs to confront the gap between taxes owed and taxes paid – while ensuring that our tax enforcement professionals are focused on the high-income earners who account for the most tax evasion. This is a serious problem with an easy solution; let’s pass this legislation and make sure every American pays what they owe in taxes.”
Carried interest
Wyden, King and Whitehouse also teamed up on another bill Thursday to close the carried interest tax break for hedge fund managers that
Carried interest is a form of compensation received by a fund manager in exchange for investment management services, according to a
Under the bill, the
“Our tax code is rigged to favor ultra-wealthy investors who know how to game the system to dodge paying a fair share, and there is no better example of how it works in practice than the carried interest loophole,” Wyden said in a statement. “For several decades now we’ve had a tax system that rewards the accumulation of wealth by the rich while punishing middle-class wage earners, and the effect of that system has been the strangulation of prosperity and opportunity for everybody but the ultra-wealthy. There are a lot of problems to fix to restore fairness and common sense to our tax code, and closing the carried interest loophole is a great place to start.”
Repealing Corporate Transparency Act
The House Financial Services Committee is also planning to markup a bill next Tuesday that would fully repeal the Corporate Transparency Act, which has already been significantly
If enacted, the repeal would eliminate beneficial ownership reporting requirements, removing a transparency measure designed to help law enforcement and national security officials identify who is behind U.S. companies.
“This repeal would turn the United States back into one of the easiest places in the world to set up anonymous shell companies, something Congress worked for years to fix,” said Erica Hanichak, deputy director of the FACT Coalition, in a statement. “These entities are routinely used to facilitate corruption, financial crime, and abuse. Rolling back the CTA doesn’t just weaken transparency, it signals to bad actors around the world that the U.S. is once again open for illicit business.”
The Internal Revenue Service rarely penalizes taxpayers who have high balances in foreign bank accounts and fail to file the proper forms, according to a new report.
Processing Content
The
Taxpayers with specified foreign financial assets that meet a certain dollar threshold are also required to report the information to the IRS by filing Form 8938. Failure to file the form can result in penalties of up to $60,000. However, TIGTA’s previous reports have demonstrated that the IRS rarely enforces these penalties.
The IRS created an Offshore Private Banking Campaign initiative to address tax noncompliance related to taxpayers’ failure to file Form 8938 and information reporting associated with offshore banking accounts, but it’s had limited success.
Even though the initiative identified hundreds of individual taxpayers with significant foreign bank account deposits who failed to file Forms 8938, the campaign only resulted in relatively few taxpayer examinations and a small number of nonfiling penalties. The campaign identified 405 taxpayers with significant foreign account balances who appeared to be noncompliant with their FATCA reporting requirements.
The IRS used two ways to address the 405 noncompliant taxpayers: referral for examinations and the issuance of letters to them.
- 164 taxpayers (who had an average unreported foreign account balance of $1.3 billion) were referred for possible examination, but only 12 of the 164 were examined, with five having $39.7 million in additional tax and $80,000 in penalties assessed.
- 241 noncompliant taxpayers (who had an average unreported account balance of $377 million) received a combination of 225 educational letters (requiring no response from the taxpayers) and 16 soft letters (requiring taxpayers to respond). None of the 241 taxpayers were assessed the initial $10,000 FATCA nonfiling penalty.
“While taxpayers can hold offshore banking accounts for a number of legitimate reasons, some taxpayers have also used them to hide income and evade taxes,” said the report.
Significant assets and income are factors considered by the IRS when assessing whether taxpayers intentionally evaded their tax responsibilities, the report noted. Given the large size of the average unreported foreign account balances, these taxpayers probably have higher levels of sophistication and an awareness of their obligation to comply with the law.
TIGTA believes the IRS needs to establish specific performance measures to determine the effectiveness of the FATCA program. “If the IRS does not plan to enforce the FATCA provisions even where obvious noncompliance is identified, it should at least quantify the enforcement impact of its efforts,” said the report. “This will ensure that IRS decision makers have the information they need to determine if the FATCA program is worth the investment and improves taxpayer compliance.
TIGTA made three recommendations in the report, including revising Campaign 896 processes to include assessing FATCA failure to file penalties; assessing the viability of using Form 1099 data to identify Form 8938 nonfilers; and implementing additional performance measures to give decision makers comprehensive information about the effectiveness of the FATCA program. The IRS disagreed with two of TIGTA’s recommendations and partially agreed with the remaining recommendation. IRS officials didn’t agree to assess penalties in Campaign 896 or with implementing performance measures to assess the effectiveness of the FATCA program.
“From our perspective, TIGTA’s conclusions regarding IRS Campaign 896 are based, in part, on a misguided premise and overgeneralizations, including the treatment of ‘potential noncompliance’ as tantamount to ‘egregious noncompliance’ that warrants a monetary penalty without contemplating the variety of justifications that may exempt a taxpayer from having to file Form 8938,” wrote Mabeline Baldwin, acting commissioner of the IRS’s Large Business and International Division, in response to the report.
What that means for consumer loans
Checks and Balance newsletter: Of God and MAGA
Why software stocks, 2026’s market dogs, have joined the rally
Armanino adds Strategic Accounting Outsourced Solutions
New 2023 K-1 instructions stir the CAMT pot for partnerships and corporations
