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What partnership means to the next generation of accountants

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As a 27-year-old professional, my conversations with CPA firms range from the managing partner to younger leadership, such as managers or newly admitted partners — and it is evident that there is a shift in how emerging leaders perceive firm ownership. 

Historically, becoming a CPA and achieving partner status was seen as the ultimate career milestone. However, in recent years, many younger CPAs have questioned whether the traditional path to partnership aligns with their career goals, values, and lifestyle preferences.

Several factors contribute to why younger CPAs are avoiding the pursuit of the partnership track.

  • Financial barriers: The buy-in cost is often seen as a barrier for those already burdened by student loans, buying houses, or seeking financial flexibility. For many young professionals, the idea of taking on additional debt or committing a large portion of their savings to buy into a firm feels risky, especially in an uncertain economic environment. 
  • Work-life balance: The accounting profession is known for its demanding hours, particularly during tax season and other peak periods. However, many younger professionals today have a different value perspective on work-life balance and personal well-being. Some are unwilling to sacrifice their health, family time, or personal interests for career advancement. They are seeking roles that offer flexibility, remote work options, and better integration of work and life. To some, these elements are often perceived as lacking in the typical partnership model.
  • Alternative career paths: Accounting is rapidly evolving. With that comes new technologies, regulations, and market demands that constantly reshape the landscape. As a result, there are now more career opportunities outside the traditional firm structure than ever before. Roles in private equity, financial consulting, and technology are increasingly attractive to young CPAs. They are being given a chance to leverage their skills in innovative and dynamic environments. These alternative paths often offer competitive salaries, career advancement opportunities, and the chance to work on cutting-edge projects — without the need to buy into a partnership.
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We’re increasingly hearing from firms about the challenges they face in attracting young talent to the partnership track. The concerns are not just about financial and time commitments, but also about the desire and readiness of young professionals to take on leadership roles.

  • Shifting career expectations: For many, success is no longer defined by making the partner level in just any firm. Instead, they value career progression that allows for continuous learning, skill development, and opportunities to work on meaningful projects. They are also looking for employers who prioritize a healthy work-life balance.
  • The need for flexibility: Flexibility is a key demand among younger CPAs. Whether it’s the ability to work remotely, set flexible hours, or pursue side projects, flexibility is seen as a non-negotiable aspect of a modern career. Firms that fail to offer flexible working arrangements may find themselves at a disadvantage in recruiting and retaining top talent. Are there issues with remote or partially remote work environments? Yes, but is that due to the work environment situation or the differences that exist in each person’s ability or desire to stay focused?
  • Technology and innovation: The rise of automation, artificial intelligence, and data analytics are transforming the accounting profession. Younger professionals are eager to embrace these technologies and apply them in their work. They are looking for firms that are not only adopting these innovations but also integrating technology into their services.

Adapting to the generational shift

The shift in mindset among younger professionals is both a challenge and an opportunity. To remain competitive in attracting and retaining top talent, firms need to rethink their approach to career development, leadership, and the overall partnership model.

  • Offer alternative compensation models: Firms can explore offering equity stakes or profit-sharing arrangements that don’t require the traditional buy-in. By separating ownership from financial investment, firms can make leadership roles more accessible to talented professionals who may not have the resources for a large buy-in.
  • Consider merging up or being acquired: Merging or being acquired by a larger firm can provide young professionals with enhanced career opportunities and reduce the financial burden of traditional buy-ins. This strategy allows firms to offer a more dynamic environment with better resources and client diversity, making them more appealing to young CPAs.
  • Enhance work-life balance: To attract and retain young professionals, firms must prioritize work-life balance. This can be achieved by offering flexible work arrangements, promoting a healthy work culture, and supporting mental health and well-being initiatives. Firms that demonstrate a commitment to employee well-being will stand out in a competitive talent market.
  • Leverage private equity to attract young talent: Private equity is another option for firms, as it can provide the capital needed for investments in technology and expansion of services to offer competitive compensation packages. PE-backed firms tend to present young professionals with innovative career growth and partnership opportunities, making them attractive to those seeking a modern and rewarding work environment.

Is your firm future-ready?

The traditional partnership model is at a critical transitionary period. As the accounting profession continues to evolve, firms that recognize the shifting priorities of the next generation and adapt accordingly will be better positioned to thrive in a competitive and changing marketplace.

Whether it’s rethinking the partnership track, or looking to evolve as a firm, there are numerous ways to align the offerings with the expectations of today’s young professionals.

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Accounting

IAASB tweaks standards on working with outside experts

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The International Auditing and Assurance Standards Board is proposing to tailor some of its standards to align with recent additions to the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants when it comes to using the work of an external expert.

The proposed narrow-scope amendments involve minor changes to several IAASB standards:

  • ISA 620, Using the Work of an Auditor’s Expert;
  • ISRE 2400 (Revised), Engagements to Review Historical Financial Statements;
  • ISAE 3000 (Revised), Assurance Engagements Other than Audits or Reviews of Historical Financial Information;
  • ISRS 4400 (Revised), Agreed-upon Procedures Engagements.

The IAASB is asking for comments via a digital response template that can be found on the IAASB website by July 24, 2025.

In December 2023, the IESBA approved an exposure draft for proposed revisions to the IESBA’s Code of Ethics related to using the work of an external expert. The proposals included three new sections to the Code of Ethics, including provisions for professional accountants in public practice; professional accountants in business and sustainability assurance practitioners. The IESBA approved the provisions on using the work of an external expert at its December 2024 meeting, establishing an ethical framework to guide accountants and sustainability assurance practitioners in evaluating whether an external expert has the necessary competence, capabilities and objectivity to use their work, as well as provisions on applying the Ethics Code’s conceptual framework when using the work of an outside expert.  

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Accounting

Tariffs will hit low-income Americans harder than richest, report says

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President Donald Trump’s tariffs would effectively cause a tax increase for low-income families that is more than three times higher than what wealthier Americans would pay, according to an analysis from the Institute on Taxation and Economic Policy.

The report from the progressive think tank outlined the outcomes for Americans of all backgrounds if the tariffs currently in effect remain in place next year. Those making $28,600 or less would have to spend 6.2% more of their income due to higher prices, while the richest Americans with income of at least $914,900 are expected to spend 1.7% more. Middle-income families making between $55,100 and $94,100 would pay 5% more of their earnings. 

Trump has imposed the steepest U.S. duties in more than a century, including a 145% tariff on many products from China, a 25% rate on most imports from Canada and Mexico, duties on some sectors such as steel and aluminum and a baseline 10% tariff on the rest of the country’s trading partners. He suspended higher, customized tariffs on most countries for 90 days.

Economists have warned that costs from tariff increases would ultimately be passed on to U.S. consumers. And while prices will rise for everyone, lower-income families are expected to lose a larger portion of their budgets because they tend to spend more of their earnings on goods, including food and other necessities, compared to wealthier individuals.

Food prices could rise by 2.6% in the short run due to tariffs, according to an estimate from the Yale Budget Lab. Among all goods impacted, consumers are expected to face the steepest price hikes for clothing at 64%, the report showed. 

The Yale Budget Lab projected that the tariffs would result in a loss of $4,700 a year on average for American households.

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Accounting

At Schellman, AI reshapes a firm’s staffing needs

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Artificial intelligence is just getting started in the accounting world, but it is already helping firms like technology specialist Schellman do more things with fewer people, allowing the firm to scale back hiring and reduce headcount in certain areas through natural attrition. 

Schellman CEO Avani Desai said there have definitely been some shifts in headcount at the Top 100 Firm, though she stressed it was nothing dramatic, as it mostly reflects natural attrition combined with being more selective with hiring. She said the firm has already made an internal decision to not reduce headcount in force, as that just indicates they didn’t hire properly the first time. 

“It hasn’t been about reducing roles but evolving how we do work, so there wasn’t one specific date where we ‘started’ the reduction. It’s been more case by case. We’ve held back on refilling certain roles when we saw opportunities to streamline, especially with the use of new technologies like AI,” she said. 

One area where the firm has found such opportunities has been in the testing of certain cybersecurity controls, particularly within the SOC framework. The firm examined all the controls it tests on the service side and asked which ones require human judgment or deep expertise. The answer was a lot of them. But for the ones that don’t, AI algorithms have been able to significantly lighten the load. 

“[If] we don’t refill a role, it’s because the need actually has changed, or the process has improved so significantly [that] the workload is lighter or shared across the smarter system. So that’s what’s happening,” said Desai. 

Outside of client services like SOC control testing and reporting, the firm has found efficiencies in administrative functions as well as certain internal operational processes. On the latter point, Desai noted that Schellman’s engineers, including the chief information officer, have been using AI to help develop code, which means they’re not relying as much on outside expertise on the internal service delivery side of things. There are still people in the development process, but their roles are changing: They’re writing less code, and doing more reviewing of code before it gets pushed into production, saving time and creating efficiencies. 

“The best way for me to say this is, to us, this has been intentional. We paused hiring in a few areas where we saw overlaps, where technology was really working,” said Desai.

However, even in an age awash with AI, Schellman acknowledges there are certain jobs that need a human, at least for now. For example, the firm does assessments for the FedRAMP program, which is needed for cloud service providers to contract with certain government agencies. These assessments, even in the most stable of times, can be long and complex engagements, to say nothing of the less predictable nature of the current government. As such, it does not make as much sense to reduce human staff in this area. 

“The way it is right now for us to do FedRAMP engagements, it’s a very manual process. There’s a lot of back and forth between us and a third party, the government, and we don’t see a lot of overall application or technology help… We’re in the federal space and you can imagine, [with] what’s going on right now, there’s a big changing market condition for clients and their pricing pressure,” said Desai. 

As Schellman reduces staff levels in some places, it is increasing them in others. Desai said the firm is actively hiring in certain areas. In particular, it’s adding staff in technical cybersecurity (e.g., penetration testers), the aforementioned FedRAMP engagements, AI assessment (in line with recently becoming an ISO 42001 certification body) and in some client-facing roles like marketing and sales. 

“So, to me, this isn’t about doing more with less … It’s about doing more of the right things with the right people,” said Desai. 

While these moves have resulted in savings, she said that was never really the point, so whatever the firm has saved from staffing efficiencies it has reinvested in its tech stack to build its service line further. When asked for an example, she said the firm would like to focus more on penetration testing by building a SaaS tool for it. While Schellman has a proof of concept developed, she noted it would take a lot of money and time to deploy a full solution — both of which the firm now has more of because of its efficiency moves. 

“What is the ‘why’ behind these decisions? The ‘why’ for us isn’t what I think you traditionally see, which is ‘We need to get profitability high. We need to have less people do more things.’ That’s not what it is like,” said Desai. “I want to be able to focus on quality. And the only way I think I can focus on quality is if my people are not focusing on things that don’t matter … I feel like I’m in a much better place because the smart people that I’ve hired are working on the riskiest and most complicated things.”

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