1 00:00:00,000 --> 00:00:05,667 < Intro > 2 00:00:05,667 --> 00:00:07,400 – Greetings, accounting professionals. 3 00:00:07,400 --> 00:00:10,750 Adam Larson here, host of Count Me In, and today we embark 4 00:00:10,750 --> 00:00:13,060 on a transformative journey with Adam Lean, 5 00:00:13,060 --> 00:00:16,699 the visionary CEO of TheCFOProject.com. 6 00:00:16,699 --> 00:00:19,340 Prepare to break free from the shackles of the accountants' trap. 7 00:00:19,340 --> 00:00:23,500 A pervasive challenge that confines so many to a transactional purgatory. 8 00:00:23,619 --> 00:00:27,667 In this conversation, Adam unveils a potent cocktail of liberation, 9 00:00:27,667 --> 00:00:30,720 strategic transformation, technology-driven empowerment, 10 00:00:30,720 --> 00:00:33,200 and high value service mastery. 11 00:00:33,200 --> 00:00:36,300 So join us on this first podcast of 2024, 12 00:00:36,300 --> 00:00:38,770 and together, let's rewrite the future of accounting, 13 00:00:38,770 --> 00:00:41,000 one empowered professional at a time. 14 00:00:41,000 --> 00:00:47,833 < Music > 15 00:00:47,833 --> 00:00:51,000 Well, Adam, we're really excited to have you on the Count Me In podcast. 16 00:00:51,000 --> 00:00:54,510 And you are the leader at The CFO Project, 17 00:00:54,510 --> 00:00:57,950 and you have a podcast called the Accountants Trap, 18 00:00:57,950 --> 00:00:59,430 and you mention that a lot. 19 00:00:59,430 --> 00:01:02,170 Maybe you can start by defining what is the accountants' trap, 20 00:01:02,170 --> 00:01:05,159 and why is it a challenge for many firm owners today? 21 00:01:05,333 --> 00:01:07,030 – Yes, that's a great question. 22 00:01:07,030 --> 00:01:10,090 We have this saying here at The CFO Project, 23 00:01:10,090 --> 00:01:13,990 we want accountants to escape what we call the accountants' trap. 24 00:01:13,990 --> 00:01:18,167 The idea is that accountants, and when I say accountants I mean accountants, 25 00:01:18,270 --> 00:01:21,170 CPAs, bookkeepers, enrolled agents. 26 00:01:21,170 --> 00:01:25,360 Traditionally, accountants are trading time for money. 27 00:01:25,360 --> 00:01:29,240 In order to make more money they either have to work more hours, 28 00:01:29,240 --> 00:01:32,166 which there's, obviously, not many more hours you can work, 29 00:01:32,166 --> 00:01:34,166 or you have to take on more clients. 30 00:01:34,166 --> 00:01:37,666 Well, the thought of taking more clients on, in order to make more money 31 00:01:37,666 --> 00:01:40,170 is depressing to a lot of accountants. 32 00:01:40,170 --> 00:01:44,666 Because most clients are high-demanding, low-paying clients, 33 00:01:44,666 --> 00:01:47,666 and they give you all their paperwork at the very last minute, 34 00:01:47,666 --> 00:01:53,666 and the idea of taking on more clients is not appealing to most people. 35 00:01:53,666 --> 00:01:59,790 And it's a trap because you can't raise your prices. 36 00:01:59,790 --> 00:02:04,060 You can't raise your prices because there's always another accountant 37 00:02:04,060 --> 00:02:07,666 that's willing to do it cheaper than you. 38 00:02:07,666 --> 00:02:11,990 And if you think about it from the viewpoint of your client, 39 00:02:11,990 --> 00:02:16,360 and we have to always think about it from the viewpoint of our clients. 40 00:02:16,360 --> 00:02:20,333 On the laundry list of things that a business owner has to think about, 41 00:02:20,333 --> 00:02:24,333 during the day, accounting falls towards the bottom. 42 00:02:24,333 --> 00:02:28,333 They think of accounting as a commodity, in a sense. 43 00:02:28,333 --> 00:02:30,833 It's like a gas station; you're driving down the road 44 00:02:30,833 --> 00:02:34,666 and there are two gas stations next to each other, one is $0.50 higher. 45 00:02:34,666 --> 00:02:37,333 Most people are probably not going to go to that gas station 46 00:02:37,333 --> 00:02:41,333 because they view fuel as a commodity, it's interchangeable. 47 00:02:41,333 --> 00:02:45,760 And the same thing with accounting and bookkeeping services. 48 00:02:45,760 --> 00:02:49,333 What you do, A, they really don't understand, 49 00:02:49,333 --> 00:02:51,999 and, B, they feel that any accountant can do it. 50 00:02:51,999 --> 00:02:53,930 Any accountant could put the tax return together. 51 00:02:53,930 --> 00:02:55,800 Any accountant can do the books. 52 00:02:55,800 --> 00:02:59,200 So why would they pay you more, significantly more, 53 00:02:59,200 --> 00:03:00,849 than the average accountant? 54 00:03:00,849 --> 00:03:04,166 They wouldn't, and, so, this is the trap; 55 00:03:04,166 --> 00:03:06,666 to make more money you're forced to work more hours 56 00:03:06,666 --> 00:03:08,832 for little pay, with high-demanding clients. 57 00:03:08,832 --> 00:03:12,666 And, so, we suggest that there's a better way. 58 00:03:12,999 --> 00:03:15,999 – I would hope so because, that would be really frustrating 59 00:03:15,999 --> 00:03:18,999 as time goes on, and to have to get more clients. 60 00:03:18,999 --> 00:03:22,319 And if you're an internal accountant, within a corporation, 61 00:03:22,319 --> 00:03:24,999 you have to help all the different operations of the business 62 00:03:24,999 --> 00:03:26,909 to get everything together, do the budget, 63 00:03:26,909 --> 00:03:30,832 and that can bring a different type of accountants' trap challenge. 64 00:03:30,832 --> 00:03:36,665 – Yes, absolutely, your candle is burning at both ends, 65 00:03:36,665 --> 00:03:39,165 and there's no give. 66 00:03:39,665 --> 00:03:43,110 – Yes, there's no give at all. 67 00:03:43,110 --> 00:03:45,332 So how important is it? 68 00:03:45,332 --> 00:03:48,490 Because, like you said, a lot of times for owners, 69 00:03:48,490 --> 00:03:51,269 they don't understand the importance of the accountant. 70 00:03:51,269 --> 00:03:53,332 How do you change that role for the business owner, 71 00:03:53,332 --> 00:03:56,010 if you are the CFO, if you're the controller, 72 00:03:56,010 --> 00:03:58,165 you're within the organization, and you're trying to say, 73 00:03:58,165 --> 00:03:59,665 "Hey, this is an important part." 74 00:03:59,665 --> 00:04:02,832 How do you help change that view, at the top of the organization? 75 00:04:02,832 --> 00:04:05,165 – Yes, this is the frustrating part 76 00:04:05,165 --> 00:04:08,665 because accountants are very valuable, they're needed. 77 00:04:08,769 --> 00:04:11,999 But the people that use accountants; 78 00:04:11,999 --> 00:04:16,165 so the company you work for or your client, if you have a business, 79 00:04:16,165 --> 00:04:19,498 and if you work for clients, they don't view it that way. 80 00:04:19,498 --> 00:04:22,665 Which, again, goes to what I was talking about 81 00:04:22,665 --> 00:04:23,832 with the accountants' trap. 82 00:04:23,970 --> 00:04:28,998 They don't view what you do as important as they should. 83 00:04:28,998 --> 00:04:32,560 Having great books is important, it's needed. 84 00:04:32,560 --> 00:04:36,665 And what you do to ensure that the books are kept accurately 85 00:04:36,665 --> 00:04:41,310 and timely, and the taxes are filed, is very important. 86 00:04:41,310 --> 00:04:49,665 But until your client, whether it's your boss or whether it's your actual clients, 87 00:04:49,665 --> 00:04:53,060 business owner clients, until they view you 88 00:04:53,060 --> 00:04:58,770 and your work as highly valuable, they're not going to pay for that. 89 00:04:58,770 --> 00:05:03,831 So the idea is to shift in your client's mind, 90 00:05:03,831 --> 00:05:07,165 in your constituent's mind, your value. 91 00:05:07,165 --> 00:05:09,665 So instead of being thought of as the person 92 00:05:09,665 --> 00:05:13,498 that just keeps the books or that just does the taxes. 93 00:05:13,498 --> 00:05:14,831 Because you have to remember 94 00:05:14,831 --> 00:05:19,160 that your client doesn't really understand what you do. 95 00:05:19,160 --> 00:05:21,490 You know what you do, and so you know all the effort, 96 00:05:21,490 --> 00:05:23,831 and time, and energy you pour into it, but they don't. 97 00:05:23,831 --> 00:05:27,150 So they're not going to place the value on it as much. 98 00:05:27,150 --> 00:05:30,998 But if they can wrap their mind around your value, 99 00:05:30,998 --> 00:05:33,620 then, they will find you more valuable. 100 00:05:33,620 --> 00:05:36,400 Which means they'll pay you more and you can escape the trap. 101 00:05:36,400 --> 00:05:42,998 So the idea is to be the financial professional in your client's life, 102 00:05:42,998 --> 00:05:46,040 that they actually want. 103 00:05:46,040 --> 00:05:49,331 And what is it that most business owners want? 104 00:05:49,331 --> 00:05:52,620 They want someone that they can trust, 105 00:05:52,620 --> 00:05:57,789 to tell them what to do to have a growing and successful business. 106 00:05:57,789 --> 00:06:00,030 So if you, as the accountant, 107 00:06:00,030 --> 00:06:04,880 can be that person that a client trusts to tell them what to do. 108 00:06:04,880 --> 00:06:09,880 To give advice on something that they really care about, 109 00:06:09,880 --> 00:06:16,710 which is their business, then, your stock with them will go dramatically up. 110 00:06:16,710 --> 00:06:21,540 They'll pay you as much as you command, as much as you want, 111 00:06:21,540 --> 00:06:25,300 and they will not think of you as just the person that records the books, 112 00:06:25,300 --> 00:06:30,060 or just this commoditized, necessary evil that I've got to pay. 113 00:06:30,060 --> 00:06:34,000 And they'll start to view you as somebody that's a trusted confidant, 114 00:06:34,000 --> 00:06:37,831 an advisor, somebody they want to talk to every month. 115 00:06:38,164 --> 00:06:42,240 – Yes, that advisor, the term that we use a lot is that business partner. 116 00:06:42,240 --> 00:06:45,831 You want to be that business partner, not just the number cruncher. 117 00:06:45,831 --> 00:06:50,800 – That's right, you'll still provide the same value, 118 00:06:50,800 --> 00:06:55,260 that in your mind they need, which is accurate books, taxes. 119 00:06:55,260 --> 00:06:58,660 But you're going to shift the value in your client's mind. 120 00:06:58,660 --> 00:07:00,164 Which, I mean, let's be honest, 121 00:07:00,164 --> 00:07:04,830 it's really the only thing that matters is your client perception of you. 122 00:07:04,830 --> 00:07:06,331 That's what's going to pay the bills. 123 00:07:06,331 --> 00:07:08,664 If you get more clients who have a higher perception of you, 124 00:07:08,664 --> 00:07:13,164 that means you can earn more money, and that's how you escape the trap. 125 00:07:13,664 --> 00:07:16,830 – All right, so you work with a lot of different organizations 126 00:07:16,830 --> 00:07:20,410 and folks within the accounting space, and the accounting world. 127 00:07:20,410 --> 00:07:22,997 Maybe there's some short story or two you can share, of people 128 00:07:22,997 --> 00:07:25,370 who have effectively navigated this traditional role 129 00:07:25,370 --> 00:07:28,100 to the more advisory position that you've seen that was successful, 130 00:07:28,100 --> 00:07:30,330 and some lessons that you've seen and learned. 131 00:07:30,330 --> 00:07:31,729 – Yes, it's a good question. 132 00:07:31,729 --> 00:07:35,164 So we have a membership program where we train accountants, 133 00:07:35,164 --> 00:07:39,540 and bookkeepers, enrolled agents, and CPAs on how to be an outsourced CFO. 134 00:07:39,540 --> 00:07:44,470 Right now we have, I think, 325 people in the program. 135 00:07:44,470 --> 00:07:46,164 One of my favorite stories, 136 00:07:46,164 --> 00:07:50,997 is this guy who's been a tax practitioner for about 20 years. 137 00:07:51,129 --> 00:07:55,663 We have what we call a Wins' Board in our online portal, 138 00:07:55,663 --> 00:07:57,330 and he posted in the Wins' Board a few months ago, 139 00:07:57,330 --> 00:08:01,497 and he says, "I've owned a tax practice for about 20 years." 140 00:08:01,497 --> 00:08:05,900 And he goes, "Every single tax season, I've dreaded it. 141 00:08:05,900 --> 00:08:08,497 But I joined The CFO Project two years ago. 142 00:08:08,497 --> 00:08:12,699 Last year I sold my tax practice, and instead of having..." 143 00:08:12,699 --> 00:08:15,163 I think he had about 400 tax clients, 144 00:08:15,163 --> 00:08:19,497 he now has less than a dozen CFO clients. 145 00:08:19,497 --> 00:08:24,163 And he said that he's made more money, this year, so far this year, 146 00:08:24,163 --> 00:08:27,997 than he's ever made as a tax professional 147 00:08:27,997 --> 00:08:30,663 and he didn't have to go through a tax season. 148 00:08:30,789 --> 00:08:31,949 And I'm not saying there's anything wrong 149 00:08:31,949 --> 00:08:34,909 with going through tax season, but it's just not for everybody. 150 00:08:34,909 --> 00:08:39,663 And we have plenty of members that still do taxes for their clients. 151 00:08:39,663 --> 00:08:43,089 But they've enhanced their tax service, 152 00:08:43,089 --> 00:08:46,649 to be this all encompassing CFO advisor for their clients. 153 00:08:46,649 --> 00:08:48,760 So they'll do CFO work and tax work, 154 00:08:48,760 --> 00:08:52,269 or CFO work and bookkeeping work, and they'll bundle it all together. 155 00:08:52,269 --> 00:08:53,663 And that's how they differentiate themselves 156 00:08:53,663 --> 00:08:55,163 from all the other accountants, 157 00:08:55,290 --> 00:09:01,360 and all the other software that's trying to compete with accountants out there. 158 00:09:01,360 --> 00:09:05,709 The beauty of this is that by giving your client what they want, 159 00:09:05,709 --> 00:09:10,089 which is advice on how to have a successful business. 160 00:09:10,089 --> 00:09:14,496 And not to digress, but success to us, financial people, means a business 161 00:09:14,496 --> 00:09:18,496 that is generating consistent, positive cash flow every single month, 162 00:09:18,496 --> 00:09:21,140 that is a successful business. 163 00:09:21,140 --> 00:09:21,829 Because if you think about it, 164 00:09:21,829 --> 00:09:24,496 every business that failed would have not failed 165 00:09:24,540 --> 00:09:27,163 if they were able to generate consistent, positive cash flow. 166 00:09:27,163 --> 00:09:28,496 So that's our job as CFOs. 167 00:09:28,496 --> 00:09:29,996 So if you could do that to your client, 168 00:09:29,996 --> 00:09:33,829 they're going to value you way much more, 169 00:09:33,829 --> 00:09:36,760 and you'll be able to separate yourself from all the other accountants, 170 00:09:36,760 --> 00:09:43,720 who are just, and I use the word just in jest, recorders of the past. 171 00:09:43,720 --> 00:09:44,996 In the minds of your clients, 172 00:09:44,996 --> 00:09:47,329 they think of you as somebody that just records the past, 173 00:09:47,420 --> 00:09:50,680 puts the right numbers in the right boxes, makes sure the IRS is happy, 174 00:09:50,680 --> 00:09:55,163 and makes sure that the books are closed, whatever that means. 175 00:09:56,040 --> 00:09:59,870 – It's interesting because as you work with so many different CFOs, 176 00:09:59,870 --> 00:10:04,996 in that interim capacity, whether it's a client or that fractional type of role. 177 00:10:04,996 --> 00:10:07,996 How do you see this CFO role changing, 178 00:10:07,996 --> 00:10:09,662 and are there specific critical skills 179 00:10:09,662 --> 00:10:12,496 for somebody who wants to get into this line of work? 180 00:10:12,496 --> 00:10:14,220 – Yes, it's a good question. 181 00:10:14,220 --> 00:10:16,240 In terms of the CFO role changing, 182 00:10:16,240 --> 00:10:24,662 there are CFO terms being floated out there, in the accounting space. 183 00:10:24,662 --> 00:10:30,399 Fractional CFO, advisor, outsourced CFO, part-time CFO, 184 00:10:30,399 --> 00:10:32,996 and there's really not a good definition of what it is. 185 00:10:32,996 --> 00:10:38,560 In our view, we like to call it a productized CFO service. 186 00:10:38,560 --> 00:10:42,329 You're offering an outsourced CFO service, but it's a productized 187 00:10:42,329 --> 00:10:51,995 CFO service, that's in direct opposition of a fractional CFO service. 188 00:10:51,995 --> 00:10:55,130 A fractional CFO service, you're going to a client 189 00:10:55,130 --> 00:10:56,920 and saying, "What do you need? 190 00:10:56,920 --> 00:10:59,070 What problem do you need me to solve?" 191 00:10:59,070 --> 00:11:02,470 And you're relying on them to say, "Well, I need X, Y, and Z." 192 00:11:02,470 --> 00:11:03,162 And then you're creating 193 00:11:03,162 --> 00:11:06,995 this very customized engagement for your client. 194 00:11:06,995 --> 00:11:08,162 Well, the problem with that 195 00:11:08,162 --> 00:11:10,995 is that because it's customized, you can't scale it. 196 00:11:11,029 --> 00:11:13,829 You can't take on many of these clients because each client, 197 00:11:13,829 --> 00:11:17,010 each take-on, will feel like a part-time job. 198 00:11:17,010 --> 00:11:19,162 And if you have multiple part-time jobs 199 00:11:19,162 --> 00:11:21,829 where you're doing very different things, 200 00:11:21,829 --> 00:11:25,995 that's just a recipe for burnout, and it's not scalable. 201 00:11:25,995 --> 00:11:30,540 Well, what is the definition of scalable? 202 00:11:30,540 --> 00:11:34,380 If you think about a manufacturer who manufactures, 203 00:11:34,380 --> 00:11:37,410 I have a coffee mug on my desk, coffee mugs, 204 00:11:37,410 --> 00:11:40,440 they've created the product once, 205 00:11:40,440 --> 00:11:45,995 and then manufacture it over and over again, that is scalable. 206 00:11:45,995 --> 00:11:47,162 Well, that's what we need to do. 207 00:11:47,162 --> 00:11:49,660 So we say offer a productized CFO service. 208 00:11:49,660 --> 00:11:54,420 Have one standard CFO service where you're telling the client, 209 00:11:54,420 --> 00:11:57,662 "This is what you're going to get and why you should hire me. 210 00:11:57,662 --> 00:11:59,662 But because you created it once, 211 00:11:59,662 --> 00:12:03,490 you can do that same system over and over again, with your client. 212 00:12:03,490 --> 00:12:06,910 But because it's still a service and your client highly values it, 213 00:12:06,910 --> 00:12:09,190 they're going to pay you like it's a service, 214 00:12:09,190 --> 00:12:12,495 but your cost is going to be like that of a product. 215 00:12:12,495 --> 00:12:14,661 And, so, that's a productized CFO service. 216 00:12:14,661 --> 00:12:18,328 And, so, that's the difference between all the other outsourced 217 00:12:18,328 --> 00:12:22,161 CFO services out there, fractional CFO services. 218 00:12:22,161 --> 00:12:30,830 So you've got to have a system that's scalable, that will, A, get results, 219 00:12:30,830 --> 00:12:34,995 and B, that you can do the same steps 220 00:12:34,995 --> 00:12:37,828 with every single month, with every single client. 221 00:12:37,880 --> 00:12:43,661 The second part of your question in terms of how an accountant 222 00:12:43,661 --> 00:12:47,699 needs to think of themselves as an advisor, the mindset shift, 223 00:12:47,699 --> 00:12:54,660 is that when you're advising somebody, you have two critical jobs. 224 00:12:54,660 --> 00:13:01,020 The first is you've got to give them advice that actually is helpful, 225 00:13:01,020 --> 00:13:03,661 which a lot of accountants struggle with. 226 00:13:03,661 --> 00:13:05,828 I mean that's why they give their advice away for free because they're not sure 227 00:13:05,828 --> 00:13:09,161 if the advice they're giving is the best advice, but I digress. 228 00:13:09,161 --> 00:13:11,209 So you got to give advice that is actually helpful. 229 00:13:11,209 --> 00:13:13,650 That's really going to help your client grow their business, 230 00:13:13,650 --> 00:13:18,959 have a successful business, meaning generate positive cash flow. 231 00:13:18,959 --> 00:13:20,994 But the second component 232 00:13:20,994 --> 00:13:25,661 is you have to get your client to actually take that advice. 233 00:13:25,661 --> 00:13:28,440 That is a hard skill. 234 00:13:28,440 --> 00:13:31,430 You could be the most credentialed CFO on the planet. 235 00:13:31,430 --> 00:13:37,494 You could be the CFO for the biggest company in the world, 236 00:13:37,494 --> 00:13:39,930 and I think right now it's Apple. 237 00:13:39,930 --> 00:13:44,171 You could be their CFO and still fail at being the CFO 238 00:13:44,171 --> 00:13:46,380 for a small or a medium-sized business. 239 00:13:46,380 --> 00:13:52,399 If you can't get that client whom you don't control to take action. 240 00:13:52,399 --> 00:13:54,827 You don't control them, they're your client. 241 00:13:54,827 --> 00:13:57,161 But you've got to get them to take action and if you don't, 242 00:13:57,161 --> 00:13:59,161 you will fail at your job of CFO. 243 00:13:59,161 --> 00:14:03,994 And, so, that is an art as much as it is a science. 244 00:14:04,994 --> 00:14:10,994 – Well, and I think that goes back to as a CFO coming to the table, 245 00:14:10,994 --> 00:14:13,827 and having a voice at the table, and being that true business partner 246 00:14:13,827 --> 00:14:16,660 so that you can help make the strategic decisions 247 00:14:16,660 --> 00:14:18,519 because otherwise you'll never be able to do that. 248 00:14:18,519 --> 00:14:20,994 Like you said, you can be the CFO of the biggest thing 249 00:14:20,994 --> 00:14:24,660 and still fail because you're not helping with the direction. 250 00:14:24,827 --> 00:14:27,994 – Yes, I love the word partner because if you think about the partner 251 00:14:27,994 --> 00:14:33,494 in a marriage or dating, sense, they're somebody that you view as an equal. 252 00:14:33,494 --> 00:14:36,160 Somebody that you trust, that you want their advice, 253 00:14:36,160 --> 00:14:40,230 that you're confident on, they're somebody that you lean on for support. 254 00:14:40,230 --> 00:14:43,660 That's exactly what you should be to your clients. 255 00:14:43,660 --> 00:14:45,160 And, so, an outsourced CFO 256 00:14:45,160 --> 00:14:48,660 should be somebody that the client intimately trusts. 257 00:14:48,750 --> 00:14:51,709 Because there's not that many people in a client's life 258 00:14:51,709 --> 00:14:53,494 that they could trust, if you think about it. 259 00:14:53,494 --> 00:14:56,660 They can't really trust their employees because their employees don't get it, 260 00:14:56,660 --> 00:14:58,730 and at the end of the day, they're employees. 261 00:14:58,730 --> 00:15:01,310 You could trust your friends and family, 262 00:15:01,310 --> 00:15:06,130 but they don't understand numbers, or business, or financial strategy. 263 00:15:06,130 --> 00:15:10,170 They're going to be supportive, but they're nary not going to help you. 264 00:15:10,170 --> 00:15:11,800 Your banker, the other numbers person, 265 00:15:11,800 --> 00:15:15,149 in most business owner's life, they've never ran a business themselves. 266 00:15:15,149 --> 00:15:17,827 They don't get it. 267 00:15:17,827 --> 00:15:19,160 Business coaches, oh, my goodness, 268 00:15:19,160 --> 00:15:20,993 business coaches, there are many of them out there, 269 00:15:20,993 --> 00:15:22,660 and most of them are terrible. 270 00:15:22,660 --> 00:15:25,160 Because the advice they are giving, 271 00:15:25,160 --> 00:15:28,993 they have no idea how that impacts cash flow. 272 00:15:29,029 --> 00:15:31,993 How their advice has impacted cash flow because most business coaches 273 00:15:31,993 --> 00:15:34,493 are leadership coaches, or management coaches, 274 00:15:34,493 --> 00:15:36,310 or sales coaches, or whatnot. 275 00:15:36,310 --> 00:15:38,993 And I'm not saying they're all bad, there are some that are good, 276 00:15:38,993 --> 00:15:41,389 but the good ones are really expensive. 277 00:15:41,389 --> 00:15:46,830 And, so, who does a business owner turn to for help? 278 00:15:46,830 --> 00:15:50,493 If you could be that person, oh, my goodness, they'll pay you 279 00:15:50,493 --> 00:15:55,493 a lot of money, and you will be thought of as their trusted partner. 280 00:15:55,493 --> 00:15:59,493 – Mh-hmm, so we can't talk about transforming the role 281 00:15:59,493 --> 00:16:00,826 and becoming that good business partner, 282 00:16:00,826 --> 00:16:02,326 without talking about technology. 283 00:16:02,326 --> 00:16:03,826 Technology has played a huge role, 284 00:16:03,826 --> 00:16:07,410 and it's continuing to play a huge role with the advancement of generative AI, 285 00:16:07,410 --> 00:16:10,530 and different accounting technologies. 286 00:16:10,530 --> 00:16:13,660 How are these new technologies reshaping the role of the CFO 287 00:16:13,660 --> 00:16:15,399 and the accounting industry? 288 00:16:15,399 --> 00:16:18,149 And then how can you, like you've been saying this, outsourced CFO, 289 00:16:18,149 --> 00:16:22,159 how can you utilize those technologies to do better at your job? 290 00:16:22,493 --> 00:16:25,493 – So a lot of people have different opinions on technology, 291 00:16:25,493 --> 00:16:31,493 especially things like AI, and it's easy to feel scared about the future, 292 00:16:31,493 --> 00:16:33,659 when it comes to things like that. 293 00:16:33,659 --> 00:16:36,993 I've read statistics that 95% of what accountants do, today, 294 00:16:36,993 --> 00:16:40,826 will be replaced, within a decade, with AI. 295 00:16:40,826 --> 00:16:43,993 And one of our members sent me an article last week, 296 00:16:43,993 --> 00:16:46,930 that said that AI has been able to close, 297 00:16:46,930 --> 00:16:52,826 reconcile a set of books, in less than four minutes, which is nuts. 298 00:16:52,826 --> 00:16:57,826 But, here's the thing, I think this is a wonderful time 299 00:16:57,826 --> 00:16:59,493 for the accounting profession. 300 00:16:59,493 --> 00:17:03,992 Because embracing technology and things like AI, and software, 301 00:17:03,992 --> 00:17:08,780 and whatnot will allow us to do less, spend less time, 302 00:17:08,780 --> 00:17:15,709 on tasks that are, menial, and spend more time on higher value tasks. 303 00:17:15,709 --> 00:17:20,319 Things where you're able to charge more money to your client. 304 00:17:20,319 --> 00:17:24,159 So you could be your client's tax person or your client's bookkeeper 305 00:17:24,159 --> 00:17:29,049 and be their advisor, but now you're able to spend much less time, 306 00:17:29,049 --> 00:17:31,159 or you will, in the future, spend much less time 307 00:17:31,159 --> 00:17:34,492 on those transactional or compliance things. 308 00:17:34,492 --> 00:17:37,326 Instead of having to spend a lot of time looking up tax code 309 00:17:37,326 --> 00:17:39,690 or figuring out the best scenario for a client. 310 00:17:39,690 --> 00:17:44,326 Let the software do it, and then you spend more time advising your client. 311 00:17:44,326 --> 00:17:50,159 I mean, it's going to happen, whether we like it or not, 312 00:17:50,159 --> 00:17:53,992 technology is going to happen, we can either embrace it or not embrace it. 313 00:17:53,992 --> 00:17:57,659 I mean, if you think about it, in 1902 nobody had a vehicle. 314 00:17:57,659 --> 00:17:59,659 Everybody rode around on horses and buggies, 315 00:17:59,659 --> 00:18:01,992 and all of a sudden, this vehicle came. 316 00:18:01,992 --> 00:18:04,825 You could be scared by it, or you can embrace the possibilities 317 00:18:04,825 --> 00:18:09,492 of what this thing is going to help you accomplish. 318 00:18:10,049 --> 00:18:10,825 – I like that. 319 00:18:10,825 --> 00:18:13,825 I like how changing your mindset of saying, 320 00:18:13,825 --> 00:18:16,659 "Hey, this is a tool that's going to help me get rid of the tasks 321 00:18:16,659 --> 00:18:20,659 that I don't like doing and that can be cumbersome, 322 00:18:20,659 --> 00:18:23,159 and then it allows me to be more strategic." 323 00:18:23,159 --> 00:18:26,325 So in some ways, we have to learn the new technologies 324 00:18:26,325 --> 00:18:28,159 in order to become more strategic. 325 00:18:28,570 --> 00:18:33,820 – Right, I agree, and I think there's plenty of places to learn it. 326 00:18:33,820 --> 00:18:35,690 But I don't think anybody should feel 327 00:18:35,690 --> 00:18:39,070 this overwhelming sense of, "Oh my goodness, I'm behind the eight ball." 328 00:18:39,070 --> 00:18:44,630 Because things like AI and software change all the time. 329 00:18:44,630 --> 00:18:50,100 Just slowly read a couple of articles, and then try it out yourself, 330 00:18:50,100 --> 00:18:53,590 and then just see where it takes you, and then go from there. 331 00:18:53,590 --> 00:18:57,158 I mean, at the end of the day, 332 00:18:57,158 --> 00:18:59,325 regardless of how you accomplish your job, 333 00:18:59,370 --> 00:19:04,200 your client just wants this trusted partner, like we've talked about. 334 00:19:04,200 --> 00:19:06,325 They don't really care how it gets there. 335 00:19:06,325 --> 00:19:08,300 – That's very true. 336 00:19:08,300 --> 00:19:13,590 – It's like somebody going to the store to buy a drill. 337 00:19:13,590 --> 00:19:16,429 Most people that go to the home improvement store to buy a drill, 338 00:19:16,429 --> 00:19:18,950 they're not really concerned about the drill itself. 339 00:19:18,950 --> 00:19:22,909 They really just want what the drill provides, which is the hole. 340 00:19:22,909 --> 00:19:24,100 That's why people buy the drill. 341 00:19:24,100 --> 00:19:26,880 And, so, you have to remember, your clients are buying you 342 00:19:26,880 --> 00:19:31,991 for what you provide, they don't really care how you provide it. 343 00:19:32,325 --> 00:19:36,325 –That's true, well, and you can also, like you said, be aware, 344 00:19:36,325 --> 00:19:39,491 read articles, and a lot of technologies 345 00:19:39,491 --> 00:19:42,158 that you're probably already using are going to start integrating 346 00:19:42,158 --> 00:19:44,840 different generative AI into their software, 347 00:19:44,840 --> 00:19:46,658 so that you don't even have to learn it. 348 00:19:46,658 --> 00:19:49,658 It'll probably just be a click of a button or type a question in, 349 00:19:49,658 --> 00:19:52,158 and it'll answer things for you. 350 00:19:52,158 --> 00:19:54,824 – Absolutely, I mean, anybody that's used QuickBooks Online 351 00:19:54,824 --> 00:19:59,158 has seen this morph over the past several years. 352 00:19:59,158 --> 00:20:00,824 QuickBooks used to be desktop, 353 00:20:00,824 --> 00:20:02,991 obviously, and then they moved to online. 354 00:20:03,100 --> 00:20:06,324 And then a lot of accountants don't like it because it's automating, 355 00:20:06,324 --> 00:20:07,890 it's trying to automate a lot of tasks. 356 00:20:07,890 --> 00:20:11,530 But that's essentially what AI is going to do. 357 00:20:11,530 --> 00:20:15,380 They're going to say, "All right, well, this transaction, 358 00:20:15,380 --> 00:20:19,158 we think should go in this account, is this correct?" 359 00:20:19,158 --> 00:20:22,658 I mean, QuickBooks has been doing that for years now, 360 00:20:22,658 --> 00:20:24,158 and you set up rules around that. 361 00:20:24,158 --> 00:20:27,158 Well, that's essentially, by setting up rules, 362 00:20:27,158 --> 00:20:29,824 you're training the software to think like you. 363 00:20:29,824 --> 00:20:31,324 That's essentially what AI is, 364 00:20:31,324 --> 00:20:34,491 you're training something to think how you would think, 365 00:20:34,580 --> 00:20:40,289 and then next month you just run all the rules and boom, it's done. 366 00:20:40,289 --> 00:20:42,991 That's really what AI is. 367 00:20:42,991 --> 00:20:45,690 So you don't have to think of it as this big, scary thing. 368 00:20:45,690 --> 00:20:50,500 I mean, you've been doing it more than I think most people realize. 369 00:20:50,500 --> 00:20:52,789 – Mh-hmm, that's very true. 370 00:20:52,789 --> 00:20:56,049 So somebody listening to this and they're like, "You know what? 371 00:20:56,049 --> 00:20:58,740 I've been an accountant for a long time." 372 00:20:58,740 --> 00:21:00,324 How do you shift your mindset 373 00:21:00,324 --> 00:21:02,640 from the way you've always been doing things, 374 00:21:02,640 --> 00:21:06,657 to be more aligned with this, be the advisor, be the partner. 375 00:21:06,657 --> 00:21:09,491 Because I imagine it's very difficult to make that transition, 376 00:21:09,491 --> 00:21:11,450 especially, if you've been doing it a long time. 377 00:21:11,657 --> 00:21:14,157 – Yes, I think anybody that's been doing something for a long time 378 00:21:14,157 --> 00:21:18,029 is set in their ways, and they're comfortable in their ways. 379 00:21:18,029 --> 00:21:20,824 But if there's any part of you that thinks, 380 00:21:20,824 --> 00:21:24,190 "I either don't want to be doing this much longer." 381 00:21:24,190 --> 00:21:26,400 Or I'm getting paid way too less to be doing this." 382 00:21:26,400 --> 00:21:30,929 The average accountant's salary in the United States is $74,000. 383 00:21:30,929 --> 00:21:34,324 We think that's very low for the experience 384 00:21:34,324 --> 00:21:36,657 and knowledge that accountants have. 385 00:21:36,657 --> 00:21:38,657 And, so, therefore, a lot of accountants are underpaid. 386 00:21:38,657 --> 00:21:41,440 So if you think you're underpaid or you just don't want to do this, 387 00:21:41,440 --> 00:21:45,419 or your clients are asking for advice. 388 00:21:45,419 --> 00:21:47,657 They're saying things; they may not come out and say, 389 00:21:47,657 --> 00:21:49,290 "Well, I have an advice-related question." 390 00:21:49,290 --> 00:21:55,657 But they're saying things like, "You're telling me I owe $24,000 on taxes 391 00:21:55,657 --> 00:21:58,490 because I made 150,000 last year in profit, 392 00:21:58,490 --> 00:22:03,370 but I only have $7,000 on the bank account, why? 393 00:22:03,370 --> 00:22:05,157 Why am I paying so much in taxes?" 394 00:22:05,157 --> 00:22:07,823 And the accountant is thinking, "Well, I don't really understand." 395 00:22:07,823 --> 00:22:10,020 Or "No, I can't help you or advise you 396 00:22:10,020 --> 00:22:13,789 because I have a stack of 300 other tax returns on my desk 397 00:22:13,789 --> 00:22:17,020 that I got to complete before Friday." 398 00:22:17,020 --> 00:22:19,323 This is a stressful situation for everybody 399 00:22:19,323 --> 00:22:21,800 because the accountant wants to be able to help their client, 400 00:22:21,800 --> 00:22:25,157 and the client wants the help because the client's clueless. 401 00:22:25,157 --> 00:22:28,323 And, so, if there's any part of you 402 00:22:28,323 --> 00:22:31,657 that wants to be able to be intentional 403 00:22:31,657 --> 00:22:36,490 about the advice that you give to your clients, then I would look at advisory. 404 00:22:36,490 --> 00:22:38,823 Either adding on an advisory service 405 00:22:38,823 --> 00:22:43,120 or completely getting out of what you're doing and becoming an advisor. 406 00:22:43,120 --> 00:22:45,823 Or hiring somebody on your team to take the compliance 407 00:22:45,823 --> 00:22:47,490 and transactional work off your plate 408 00:22:47,490 --> 00:22:49,823 or hiring one of these third-party companies 409 00:22:49,823 --> 00:22:53,823 that outsource the accounting work. 410 00:22:53,909 --> 00:22:57,799 If there's any part of you that wants to be able to make more money. 411 00:22:57,799 --> 00:23:03,840 While working less, while having such a huge impact on the thousands, 412 00:23:03,840 --> 00:23:07,323 literally, thousands, of business owners in your town that are struggling, 413 00:23:07,323 --> 00:23:09,990 I mean, this is hands down the way to go. 414 00:23:09,990 --> 00:23:14,323 – Yes, that really sounds like it and it's looking at what you're doing 415 00:23:14,323 --> 00:23:16,656 and saying, "Is this what I continue want to do, 416 00:23:16,656 --> 00:23:19,490 or do I want to advance or scale up?" 417 00:23:19,490 --> 00:23:20,656 – Yes, totally, it's not for everybody, 418 00:23:20,656 --> 00:23:22,823 but for the people that would like to explore it. 419 00:23:22,823 --> 00:23:26,656 I mean, I think you should explore it because your clients 420 00:23:26,656 --> 00:23:30,656 would love you to be their confidant, their partner. 421 00:23:30,656 --> 00:23:34,489 –Mh-hmm, I love these types of conversations 422 00:23:34,489 --> 00:23:38,323 because it's looking at the accounting space from a different perspective. 423 00:23:38,323 --> 00:23:40,323 And you have a unique perspective, 424 00:23:40,323 --> 00:23:43,489 where you work with many different clients. 425 00:23:43,650 --> 00:23:48,210 And I like to ask, what are your predictions, as you look to the future? 426 00:23:48,210 --> 00:23:50,156 Where do you think the accounting space is going to go 427 00:23:50,156 --> 00:23:55,823 and what should people be looking for, as they want to go with the tide? 428 00:23:55,823 --> 00:23:57,823 – Yes, that's a good question, 429 00:23:57,823 --> 00:24:00,156 and we touched on this, but I think the accounting profession 430 00:24:00,156 --> 00:24:02,489 is going to be less transactional and compliance nature, 431 00:24:02,489 --> 00:24:05,323 in the future and more advisory nature. 432 00:24:05,323 --> 00:24:10,822 I mean, it's just a simple fact that a lot of software, and AI, 433 00:24:10,822 --> 00:24:12,610 and things like that, it's going to take 434 00:24:12,610 --> 00:24:15,822 this complicated tax code, and accounting rules, 435 00:24:15,822 --> 00:24:19,390 and all that and simplify it, and just make it easy. 436 00:24:19,390 --> 00:24:23,822 And, so, the traditional need 437 00:24:23,822 --> 00:24:28,322 for an accountant is going to go away, it just is. 438 00:24:28,429 --> 00:24:31,520 But the accountant is still needed, that's the beauty of this, 439 00:24:31,520 --> 00:24:33,322 you're needed to do the one thing 440 00:24:33,322 --> 00:24:37,520 that you've always been needed, by your client, 441 00:24:37,520 --> 00:24:41,822 which is to give advice on how the company can be a growing 442 00:24:41,822 --> 00:24:43,230 and more profitable business. 443 00:24:43,230 --> 00:24:46,822 Think about the CFO for a Fortune 500 Company. 444 00:24:46,822 --> 00:24:49,940 The CFO oversees the accounting department, 445 00:24:49,940 --> 00:24:53,655 but their bigger job is to understand the strategy. 446 00:24:53,655 --> 00:24:55,489 Understand where the client, 447 00:24:55,489 --> 00:24:57,489 in their case, the CEO, and the leadership team, 448 00:24:57,489 --> 00:25:01,050 wants to take the business, and figure out are they on track to do it, 449 00:25:01,050 --> 00:25:03,322 and suggest ways to help them stay on track, 450 00:25:03,322 --> 00:25:06,130 and to ensure the business is financially viable. 451 00:25:06,130 --> 00:25:08,822 Every business on earth needs somebody to do those things. 452 00:25:08,822 --> 00:25:17,570 And if you could be that person, you will embrace the future of accounting, 453 00:25:17,570 --> 00:25:20,419 of what clients need from their accountants, in the future. 454 00:25:20,419 --> 00:25:23,489 So that's really where I think the accounting profession is going, 455 00:25:23,489 --> 00:25:24,655 but I think it's exciting. 456 00:25:25,049 --> 00:25:28,822 – That's really exciting and it allows for you to not be stuck 457 00:25:28,822 --> 00:25:30,220 in the same thing every day. 458 00:25:30,220 --> 00:25:31,919 Because once you get into strategy, 459 00:25:31,919 --> 00:25:34,890 you're thinking outside of the normal box that you've been put in, 460 00:25:34,890 --> 00:25:37,655 especially, if you grew up from starting with a staff accountant, 461 00:25:37,655 --> 00:25:40,155 and moving your way up within an organization. 462 00:25:40,488 --> 00:25:44,155 –Yes, exactly, I mean, honestly, that's what I did, out of college, 463 00:25:44,155 --> 00:25:47,822 I became a staff accountant. 464 00:25:47,822 --> 00:25:50,322 I mean, personally, it was just incredibly boring to just sit there, 465 00:25:50,322 --> 00:25:53,740 behind a desk, and record the past. 466 00:25:53,740 --> 00:25:56,988 So I purposely got myself involved in things 467 00:25:56,988 --> 00:26:01,988 that I could help the business grow, and I enjoyed that way more than. 468 00:26:01,988 --> 00:26:04,655 And by the way, they actually liked it more 469 00:26:04,655 --> 00:26:06,988 that I was being a proactive accountant 470 00:26:07,000 --> 00:26:11,340 because my predecessor, who've been there for two decades, didn't. 471 00:26:11,340 --> 00:26:13,488 All she did was just sit behind a desk and record the past 472 00:26:13,488 --> 00:26:16,488 and nobody heard from her. 473 00:26:16,988 --> 00:26:19,860 – Yes, and that sets you apart. 474 00:26:19,860 --> 00:26:21,988 Certifications and those things can set you apart, 475 00:26:21,988 --> 00:26:23,488 but actually being able to get in there 476 00:26:23,488 --> 00:26:27,655 and do the work really sets you apart from your other colleagues. 477 00:26:27,655 --> 00:26:31,821 – Totally, absolutely, we have to remember 478 00:26:31,821 --> 00:26:34,488 that most people do not speak accounting. 479 00:26:34,488 --> 00:26:36,155 Most people don't want to speak accounting, 480 00:26:36,155 --> 00:26:41,350 and accounting is our language but it's not the outside world's language. 481 00:26:41,350 --> 00:26:43,988 So if we, as accountants, can speak the outside world language. 482 00:26:43,988 --> 00:26:46,321 If we can speak business strategy language, 483 00:26:46,321 --> 00:26:49,655 then the people that you work for or the people that are your clients, 484 00:26:49,655 --> 00:26:52,488 they will love it because they do not want to speak accounting. 485 00:26:52,488 --> 00:26:56,570 They want to speak business strategy, "How can I grow my business?" 486 00:26:57,321 --> 00:26:59,679 – Well, Adam, I've really enjoyed this conversation. 487 00:26:59,679 --> 00:27:01,920 I just want to thank you again for coming on the podcast today. 488 00:27:01,920 --> 00:27:03,821 – Yes, thanks for the invite, this was fun. 489 00:27:03,821 --> 00:27:06,154 < Outro > 490 00:27:06,154 --> 00:27:07,654 – This has been Count Me In, 491 00:27:07,654 --> 00:27:11,821 IMA's podcast, providing you with the latest perspectives of thought leaders, 492 00:27:11,821 --> 00:27:13,821 from the accounting and finance profession. 493 00:27:13,821 --> 00:27:16,321 If you like what you heard, and you'd like to be counted in 494 00:27:16,321 --> 00:27:18,899 for more relevant accounting and finance education, 495 00:27:18,899 --> 00:27:24,654 visit IMA's website at www.imanet.org.