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Art of Accounting: How to make clients your sales team

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Many CPA firms rely on client referrals for growth. I consider referrals a validation of a satisfied client. 

Occasionally the lack of referrals is because a client likes you and wants to continue using you but does not feel confident that you would do a good job for someone they might refer you to. There could be many reasons for this. If you feel their reticence is valid, then I suggest you examine the relationship and what might be done to right it so they will become a raving fan. Many of these clients feel that what you do for them is good and is part of the overall package of the relationship that they are happy about being with you. However, they feel something is lacking and that is what’s holding them back from referring you.

That is an important issue, but today I want to suggest ways to get more referrals from existing clients who are truly happy about their relationship with you, and I will start with a short story.

In the early 1990s we hired a full-time salesperson who was not an accountant, but a “professional” salesperson. We gave him a list of our clients and told him not to contact any of them, and otherwise, anyone else was fair game for him. About a month into the relationship, I overheard the receptionist buzz him and tell him that Mr. Soandso was on the phone. Later in the day I asked him why Mr. Soandso called him and he said he returned a call he made to him. He missed seeing his name on our client list and I called the client to apologize for the intrusion, explaining the call was from a salesman we hired. The client said he was not aware we wanted new business and the following month he recommended three clients to us!

That experience taught us that you have to let clients know you want to grow and would appreciate any referrals. We thought about this and realized that barring dissatisfaction with your services, the two major reasons clients do not recommend you are: 1) they do not think about it; and 2) they do not know how to go about it.

This led to us making a greater effort asking our clients for referrals and to develop “materials” for clients to use when referring us. We then considered our clients to be our sales force.

We changed the way we spoke and learned to never say we are busy or too busy and now we say, “We are doing quite well but are looking to grow,” followed by “and we would always appreciate referrals. They are important to us.” 

As “sales managers” we need to manage our referral base, which are our clients, professionals we interact with, bankers and pretty much everyone else we know, including our alumni and other CPAs. The way we go about this is to develop fact sheets, blogs, memos and speech handouts on the many specializations and industries we have expertise in and send them to targeted clients. Email has become a ubiquitous way to distribute much of this material. However, we also want to create a personal connection, and we do this by postal mailing printed copies to people we think are interested in those topics or who know people they could refer. We include a handwritten note saying, “The enclosed is something we wrote (or presented) and I think you would enjoy seeing it. Also, I would appreciate any comments or questions you have. Further if you think you want to proceed.”

I believe postal mailed information that is not immediately thrown away will linger for a while in sight of the recipient, giving it a much greater shelf life than an email. Note that it helps if you have a mailing address where they will receive that piece of mail. Many people now work virtually and only sporadically go into their office. If you can, mail it to their house. I am a stamp collector and when I mail this material, I try to select attractive stamps that also get attention. I have a few stories about clients I’ve gotten or friendships that developed because of my choice of stamps. In many cases the mail is sent by an express service or with a postage meter — that’s OK too.

Whenever we speak with business and larger tax clients, we try to make them aware of a new service that they might be particularly interested in. You can prepare some notes on some added services you could provide to each of your clients that you have meetings with. I prepare notes about two or three added services and usually get one added engagement every other time I meet with a client.

Another thing you can do is adopt my 1/20th Tax Client marketing method. This involves calling tax clients with a goal of getting added engagements from 5% of your tax clients each year. This might require contacting many more clients, perhaps as many as 15%, in order to achieve your goal. However, none of the extra calls are wasted because they are a way to let these clients know about the additional services you offer and to also suggest that they let anyone they know that they think would need such services about you. This works wonders! The 1/20th rule is explained and included in my checklist file which you can download for free here.

A final suggestion, for now, is to inform your staff about the importance of added engagements from clients, make them aware of what you offer, and how to approach it and look for openings. This takes some effort and training but is a very small investment with a very large payback with added business, better and more thorough services to clients, and more involved and aware staff.

The above might seem daunting, but it isn’t. It is many small things pieced together to create a very large whole. The goal is to make your clients more effective in referring you and more aware about how to do it. I did and do everything and this all works. 

And be the sales manager your clients, i.e., your sales staff needs.

Do not hesitate to contact me at [email protected] with your practice management questions or about engagements you might not be able to perform.

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Accounting

IRS sets new initiative with banks to uncover fraud

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The Internal Revenue Service’s Criminal Investigation unit has embarked on a new initiative for engaging with financial institutions as it makes greater use of banking data to uncover tax and financial fraud. 

IRS-CI released FY24 Bank Secrecy Act metrics Friday, demonstrating how it uses BSA data to investigate financial crimes. During fiscal years 2022 through 2024, 87.3% of IRS-CI’s criminal investigations recommended for prosecution had a primary subject with a related BSA filing, and adjudicated cases led to a 97.3% conviction rate, with defendants receiving average prison sentences of 37 months. IRS-CI also leveraged BSA data to identify $21.1 billion in fraud linked to tax and financial crimes, seize $8.2 billion in assets tied to criminal activity, and obtain $1.4 billion in restitution for crime victims.

Under the BSA, which Congress passed in 1970, financial institutions use suspicious activity reports to notify the federal government when they see instances of potential money laundering or tax evasion. The SARs data is used by agencies like IRS-CI to probe money laundering and related financial crimes.

A new IRS-CI initiative known as CI-FIRST (Feedback in Response to Strategic Threats) aims to establish ongoing engagement with financial institutions. They will receive quantifiable results from IRS-CI on how the agency uses suspicious activity reports to investigate federal crimes. 

“Public-private partnerships thrive when everyone mutually benefits, and to enhance our partnership with the financial industry, we plan to launch CI-FIRST which will promote information-sharing, streamline processes and demonstrate how valuable BSA data is to criminal investigations,” said IRS-CI Chief Guy Ficco in a statement.

As part of the CI-FIRST program, IRS-CI plans to streamline subpoena requests and share pointers with financial institutions on what to include in suspicious activity reports to maximize their impact. The program will address what’s working and what can be improved, offering continuous lines of communication between partners. IRS-CI headquarters will work with larger financial institutions that have a national and international presence, while its field office personnel will work with regional and community banks and credit unions.

IRS-CI special agents ran an average of 966,900 searches each year against currency transaction reports during the last three fiscal years. Close to 1,600 cases were opened in FY24 with at least one currency transaction report on the primary subject. The data also shows that 67.4% of cases opened by IRS-CI had a subject with one or more currency transaction reports below $40,000, with 50% of currency transaction reports involving amounts less than $22,230.

BSA data has also proven to be effective in helping IRS-CI combat narcotics trafficking and pandemic-era tax fraud. Since FY20, IRS-CI used BSA data to initiate nearly 1,300 investigations with ties to fentanyl and investigate alleged employee retention credit fraud totaling $5.5 billion.

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Accounting

How tax departments can avoid 2017’s mistakes ahead of the 2025 TCJA sunset

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As the expiration of key Tax Cuts and Jobs Act provisions looms, tax professionals are preparing for what could be another period of upheaval.

In 2017, when the TCJA was first enacted, tax departments struggled to keep pace with new regulations and guidance. According to our recent Bloomberg Tax survey of 434 tax professionals, 92% of tax professionals working in tax at the time reported that the TCJA’s implementation was moderately to highly disruptive, and 60% said it took a year or more to fully implement the changes. 

The coming year could bring more of the same. Eight in 10 respondents are moderately or very concerned about the potential impact of these changes. Yet many rely on outdated, manual processes that make adjusting quickly to major legislative changes difficult.

With the benefit of hindsight, tax professionals have a unique opportunity to apply the lessons of 2017 and invest in automation now to avoid repeating the same costly mistakes.

Manual processes still dominate tax departments

One of the most striking findings from our survey is that many tax professionals continue to rely on manual workflows despite the increasing complexity of tax compliance. Seventy-six percent of respondents said they still use Excel for tax calculations, and 63% manually gather data from enterprise risk management and general ledger systems to perform tax calculations.

These outdated processes create inefficiencies and make it harder for tax teams to respond quickly to legislative changes.

In its time, the TCJA was the most sweeping tax code overhaul in decades. It required tax departments to significantly modify or even replace their workpapers to reflect the changes. 

While 62% of survey respondents believe they can update their existing workpapers without major difficulty, one in four anticipate significant challenges, and 10% will need to create entirely new workpapers.

This manual burden could put firms at a disadvantage when deadlines are tight and compliance requirements shift rapidly.

Scenario modeling is challenging yet critical

When big changes are on the horizon, running multiple tax planning scenarios helps organizations make decisions and manage risk. Automated tax solutions streamline this process by allowing tax teams to evaluate different legislative outcomes and come up with strategies to address them.

Firms that lack automation in their tax workflows may have a tough time keeping up with the pace of change — especially if Congress waits until the eleventh hour to pass legislation, as was the case in 2017.

Eighty-eight percent of respondents reported it is moderately or very difficult to conduct scenario modeling for TCJA changes, and only half have started the process. One respondent noted, “We need as much lead time as possible to make changes to our models, and significant changes take even more time to incorporate. Running multiple scenarios is a very manual and difficult process.”

Quantifying the cost of inaction

Failing to invest in automation before a substantial tax law change can be a costly mistake.

Among respondents, 71% who experienced the enactment of TCJA in 2017 reported wishing they had invested earlier in tax technology to better manage the complexity of compliance updates. Manual processes not only slow response times but also drive costs, as nearly 40% of respondents anticipate a $100,000 or higher increase in consulting budgets if significant TCJA-related changes occur. 

By leveraging tax automation tools and centralized tax-focused software, firms can optimize how they engage with external consultants. Automation allows tax departments to take ownership of routine processes, such as calculations and compliance adjustments, reducing reliance on consultants for these tasks. Instead, consultants can be utilized more effectively on high-impact projects that drive strategic value, such as tax planning, risk management or navigating complex regulatory changes. This shift enables firms to streamline compliance while ensuring external expertise is directed toward creating lasting organizational benefits.

Preparation now means greater confidence going into 2026

The data is clear: firms investing in automation today will be better positioned to handle the upcoming tax changes confidently. Here’s how to get ahead:

  • Integrate tax technology. Replace manual calculations in Excel with automated tax workpapers that integrate with source data and automate data gathering and calculation processes.
  • Adopt scenario modeling tools. Invest in software that allows for real-time legislative modeling so you can analyze multiple potential outcomes before changes take effect.
  • Reduce reliance on external consultants. Implement in-house tax software to keep control over your data, reduce consulting budgets and respond quickly to regulatory shifts.

With less than a year until TCJA provisions are set to expire, the time to act is now. Taking proactive steps to automate and modernize your workflows will put you in a far stronger position than companies that wait until the last minute. 

Major tax law changes can be disruptive, but with the right technology, you don’t have to relive the turmoil of 2017. Embrace tax-focused automation to remain agile, efficient and ready to navigate whatever changes come next.

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Accounting

SEC stops defense of climate disclosure rule

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The Securities and Exchange Commission voted to end its legal defense of the climate-related disclosure rule it approved last year under the Biden administration.

The climate disclosure rule was facing numerous lawsuits from business groups and a temporary stay imposed by a court, the SEC had already paused it last April after narrowly approving a watered-down rule last March. The former SEC chairman, Gary Gensler, who had pushed for the rule, stepped down in January and acting chairman, Mark Uyeda, who had voted against the rule, announced in February that he was directing the SEC staff to ask a federal appeals court not to schedule the case for argument. He cited a recent presidential memorandum from the Trump administration imposing a regulatory freeze, and he effectively paused the litigation. The vote on Thursday effectively suspends the rule.

“The goal of today’s Commission action and notification to the court is to cease the Commission’s involvement in the defense of the costly and unnecessarily intrusive climate change disclosure rules,” Uyeda said in a statement Thursday.

The SEC noted that states and private parties have challenged the rules, and the litigation was consolidated in the Eighth Circuit Court of Appals. SEC staff sent a letter to the court stating that the Commission was withdrawing its defense of the rules and that Commission counsel are no longer authorized to advance the arguments in the brief the Commission had filed. The letter stated that the SEC yields any oral argument time back to the court.

One of the SEC commissioners blasted the move and pointed to the arduous, years-long process of crafting the climate rule. “By way of politics, the current Commission would like to dismantle that rule. And they would like to do so unlawfully,” said SEC commissioner Caroline Crenshaw in a statement Thursday. “The Administrative Procedure Act governs the process by which we make rules. The APA prescribes a careful, considered framework that applies both to the promulgation of new rules and the rescission of existing ones. There are no backdoors or shortcuts. But that is exactly what the Commission attempts today. By its letter, we are apparently letting the Climate-Related Disclosures Rule stand but are withdrawing from its defense in court. This leaves other parties, including the court, in a strange and perhaps untenable situation. In effect, the majority of the Commission is crossing their fingers and rooting for the demise of this rule, while they eat popcorn on the sidelines.”

Environmental groups were critical of the SEC’s vote. “Climate change is a growing financial risk, and ending the SEC’s defense of its own climate disclosure rule is a dangerous retreat from investor protection,” said Ben Cushing, sustainable finance campaign director at the Sierra Club, in a statement. “Letting companies hide climate risks doesn’t make those risks any less real — it just makes it harder for investors to manage them and protect their long-term savings. The SEC is leaving investors in the dark at exactly the moment transparency and action is most needed.”

“The SEC was established to protect investors, and for more than 20 years, investors have clearly and overwhelmingly stated that they need more clear, consistent, and decision-useful information on companies’ exposure to climate-related financial risks,” said Steven M. Rothstein, Ceres’s managing director for the Ceres Accelerator for Sustainable Capital Markets, in a statement. “The ongoing acceleration of physical climate impacts, including the tragic fires in Los Angeles, has underscored the importance of transparency on these risks. Investors have clearly indicated they require better disclosure, with $50 trillion in assets under management broadly supportive of the rule adopted in March 2024. This is clearly a step backward in helping investors and other market participants have the information they need to manage climate-related financial risks.”  

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