AICPA Spring Council Report

June 17, 2022

       The AICPA 2022 Spring Council Meeting was held on May 16th and 18th, 2022 in Austin, Texas at the Omni Creek Resort.  This was the first meeting held in person since the pandemic started in spring of 2020.  The meeting was well attended in person, with a virtual option available.  A Pre-Council virtual meeting was also held in preparation for the spring meeting on March 23, 2022.  I was joined by Ricky Bullock, outgoing member, Scott Christian, incoming member, and Karen Moody, President/CEO.        Scott attended a session for incoming members prior to the reception on Monday night. 

       Bill Pirolli, AICPA Chair, allowed Tracey Golden to open the meeting, since her entire year of chairmanship was virtual.  The meeting was turned over to Barry Melancon and Sue Coffey.  Their main topic of discussion was “Inspiration in Uncertainty.”  From the AICPA perspective, the world has no trust in most areas, but the CPA profession is trusted.  Of course, we make a living doing this, but we still must remain inspired by the trust held in our profession.  We need to inspire the future, by rethinking and reshaping and reimaging.   There were several areas focused on during this discussion that were their ideas of how CPA’s can be inspiring:

  1. Integrity should be our business plan to deliver value to businesses and people.  CPAs should continue to raise the bar for our profession by providing relevant CPE and information to our members.
  2. There is an evolving tax and planning landscape in which the tax system is a public/private partnership. One example of this would be collaboration between the public sector and CPA’s on changing due dates of returns.  Another would be an alternate extension system for current due dates.
  3. Client accounting services is the fastest growing area in CPA firms today, with 80% planning to expand their services. Firms have a 20% growth in this area.
  4. Assurance and Advisory services are the second largest growth area in CPA firms, especially in the single audit area, with its relevant issues.
  5. Even though ESG is a politically driven area, the market has begun to be the leading driving here and we are seeing more regulations and standards related to the topic. AICPA feels we need more global standards in this area, with controls, measurement, decision making, 3rd party production and reliability.

       The AICPA is still seeing growth in firms, tied to transformation of firm culture by the following ways: digitally, with new service lines, by outsourcing, hiring and retention, mergers and acquisitions, involvement of private equity, and changing business models.

       Sue Lord, a member of the Auding Standards Board Committee (ASB), and Jim Burton with the Assurance Services Executive Committee (ASEG) made a presentation regarding the joint efforts of these two committees to bring quality and innovation to the profession.  From the ASB, they are looking at strategic initiatives to develop a work plan dealing with quality management, risk assessment, audit evidence and attestation standards.  The ASEG is looking to the future and assisting the ASB with needed standards in the areas of ESG, cybersecurity, blockchain and digital assets, and artificial intelligence. We should see some communication of the collaboration of these two committees later in this year.

       Our next presentation was made by the Tax Executive Committee regarding the appearance before the Senate Finance Committee by our very own Jan Lewis.  We are so proud and fortunate to have Mississippi representation by someone so very competent and respected!  Thank you, Jan!  This presentation was made in panel style, with Jan, Blake Vickers and Ed Karl.  There were several questions presented during the presentation time.  As Jan reported, we presented many examples and ideas regarding the IRS issues that the profession has faced in the last several years, not just pandemic issues, but issues that certainly were highlighted due to the pandemic.  As Jan stated, we presented ideas on how to mitigate issues, specifically in the backlog at the IRS, received a lot of attention from Senate, but did not win on much.  There were also some input made on the Schedule K-2 and K-3, trying to advocate for the taxpayers and practitioners due to the confusion on completion of the forms, and lack of ability to efile.  Again, there was no immediate win in this area, but our points were heard and made!  There was also some communication regarding the Build Back Better Plan, specifically in the due date areas.  Stay tuned for future developments. 

       The last part of the first day was filled with breakout sessions in the following areas:

     Future of Finance:  Just briefly, there is a change in the need of professionals with emphasis placed on competencies and digital abilities.  We must continue to create value, and the interpretation of data will be extremely important in this area.  Critical thinking skills are a must for the future of the professional in the finance area.

     Emerging Firms:  Again briefly, there is a high demand for assurance services that is being driven not only by client needs and the market, but the regulatory system and threats from outside sources.  Firms need to be prepared to deal with quickly changing environments.  Technology skills are going to be of utmost importance.  Also, client accounting services will continue to grow and the needs for CAS services will greatly increase.

      Taxation:  Technology is expected to reshape tax practices, and clients are going to demand more from their tax professionals, including wealth management and non-CPA services.  We also must continue to expect IRS service deficits and learn to operation within that reality.

       The next day’s meeting was presided over by Anoop Mehta, the new AICPA Chairman.  He was presented and honored at a luncheon on the previous day, attended by his family members and friends. 

       Sue Coffey began discussion for the day in the area of the pipeline, which was a topic heavily covered at the pre-Council meeting in March.  The AICPA is spending a lot of time in this area as we all are.  Most of us have already experienced the decrease in students in accounting, along with the decrease in accounting students that are choosing to qualify to sit for the exams or choose to sit for the exams.  There is also an increase in exams that are given internationally, which means some of our exam takers are not even in the US.  With the decrease in birthrates, decrease in immigration and number of retiring baby boomers, we have a perfect storm trying to fill vacant employment spots in the US in the CPA arena.  Employers are looking for more depth and breadth with their hires and are having to look past our traditional paths for competent employees and work partners.

       According to Sue, firms need to look to be the employer of choice and try to improve the profession perception around work hours and pay.  There has been a decrease in the emphasis on the CPA certification which needs to be promoted in firms again.  She encouraged members to increase their outreach in the high schools, promote internships, and to use University Advisory Boards to influence at the University level.  The AICPA will continue to promote the STEM measures to add accounting in that area, to execute the CPA Evolution curriculum, to develop and provide resources to high schools and universities, and to develop more internship programs.  Sue charged the state societies to engage with high schools and universities, connect the dots between employers and students, highlight and track scholarships, and to share “good stories” with their members.  (I want to commend Karen and the MSCPA for doing a good job in this area for many years!)  The role of NASBA/State Boards should be to shepherd the CPA exam candidates, provide candidate data to other stakeholders, and drive uniformity to state board rules.  Colleges and universities should look to bring engaging practitioners into the classroom, use CPA ambassadors, change the messaging around the weeding out programs, and support dynamic instructions at the beginner 101 level.

       The next Council meeting will be in October, scheduled for Chicago.  Thank you for allowing me to serve as your state representative.

By Cheryl Sykes  

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