Future Success of Your Firm?: Interview with Jennifer Warawa

Meet one of today’s leaders in the accounting software world, Jennifer Warawa. As the Vice President, Partner Programs and Channel Sales at Sage North America, Jennifer has a wealth of experience working with accounting professionals. Enjoy this insightful, educational and entertaining Q&A…

Q: The world of accounting marketing has obviously changed dramatically in recent years. What has surprised you in terms of what public accounting firms have done (or not done)–both positively and negatively?
A: Every year we do a membership study for the Sage Accountants Network and when we ask accountants what keeps them up at night, the #1 response for many years now is how they can get new clients. What I find very interesting is that although this continues to be a top challenge, we still haven’t seen the profession really change their approach to how they get new clients. In fact, I spend a great deal of time visiting accountants all over North America and quite often when I ask about their marketing strategy, I find they often don’t have one at all. In our recent research of U.S. accounting firms, 65% say they actually don’t even have a website. In order to grow their firms and attract new clients, there will need to be a shift in the profession’s approach to marketing which needs to include embracing new marketing methodologies such as digital marketing and social media. On a positive note, we are starting to see more and more of the “next gen” mindset emerging in public accounting. I believe next gen is unrelated to age but is more in how someone embraces change and new ideas. We’re seeing professionals of all different ages step up with a great deal of passion, ready to transform their firms, and we love working with those individuals as they create their new future.

Q: If you had to jump on a time machine and go forward 20 years, what would you tell CPAs?
A: Innovation isn’t about technology alone. Change is happening at an unprecedented rate and we don’t see any signs of it slowing down in the near future. Few people have taken time to really think about what “being innovative” means to their firm or business. Many view innovation as technology alone but I challenge that thinking because I believe innovation in how you run your business or firm is equally as important. From the services you offer, to your customer and employee strategies, to how you brand yourself; this all should be thought of as innovation. If a firm sees picking up the latest and greatest technology as their key to being innovative, they are missing a large component in their future success.

Q: How has your role at Sage evolved over the last couple of years?
A: When I started with Sage almost five and a half years ago, I was solely focused on the Canadian market and about three years ago added the U.S. accountant business to my responsibilities which has made for a very exciting time in my career. I love the North American outlook and there are so many learnings each market can take away from the other.

Overall, I think my role has evolved and changed as Sage itself has evolved and changed. Over the last few years Sage has become increasingly focused on its core solutions, has made some tough but necessary decisions, and has restructured its product names and focus to a unified Sage brand. All of these changes require everyone at Sage to reinvent ourselves in many ways and it keeps us learning, growing, and challenging the status quo. I love it!

Q: What have been some of the key things you’ve learned throughout your career? What might you do differently if you had it do to all over again?
A: Wow – that’s a big question!

First, I would say that sometimes your biggest roadblock is your own opinion. You think you know something but quite often, it’s really just your perspective, and the ability to be able to set your opinion aside and be open to new ideas and alternate solutions is critical to success.

Second, the outcome is always proportionate to the effort you put in and nothing good just falls in your lap. There is no replacement for hard work, commitment, and dedication.

Third, it’s all about the people. It goes back to that saying that no one will remember what you said, but they will remember how you made them feel. Treating people with respect and maintaining your integrity are so important through all circumstances and situations.

As far as what I’d do differently, I can honestly say nothing immediately comes to mind. I grew up with entrepreneurial parents who owned their own businesses and learned many lessons about business before I even learned how to drive. I then spent a wonderful (and adventurous) 12 years starting, growing, and then selling a small business. Entrepreneurship taught me an incredible amount – lessons I still use every day. Now I am working for a global company with endless opportunities. I have been very fortunate!

Q: You travel a lot. How about sharing an interesting travel story?
A: There is certainly no shortage of interesting travel stories – I think I have one from almost every week I’ve spent on the road! One of the most memorable was when I was traveling to Vancouver from Atlanta with a connection in Seattle. Our flight out of Atlanta was delayed and as a result, I missed my connection which happened to be the last flight of the day. The airline put us up in a hotel in Seattle and after a very long day of travel, I arrived at the hotel just after 1:00 am. There was a lady on my flight that was on the same shuttle bus as I was and when we arrived at the hotel she was informed she had mistakenly gone to the wrong hotel and was told to go back to the airport and catch a different shuttle bus to the correct hotel. She almost started crying realizing she would get minimal sleep as it was literally the middle of the night and her new flight was before 7:00 am. I felt her pain and after confirming my room had two beds, I offered her my second bed which she gratefully accepted. The funny part is as we were lying there dozing off to sleep, she quietly asks “Um… what is your name?” I was happy to wake up after my brief 3.5 hour “nap” and see that my purse had not disappeared!

Q: Outside of your work duties, what else do you like to do? How do you spend your down time?
A: I am married and with all the travel I do, when I finally get some down time it’s great to just hang out with my husband and our “fur babies” and stay relatively close to home. I love reading, writing (I have various blogs I contribute to), and just getting outside. I have been told I am “solar powered” and it’s true – I love being outside on sunny days!

Q: What’s in the future for Jennifer Warawa?
A: The future is truly an endless list of opportunities. Five years ago if you would have told me I’d move from my small, hometown of Kelowna, BC, Canada to Atlanta, GA I would have laughed and wondered how on earth that would happen, but here I am. It proved to me that if you’re open, there are all kinds of opportunities out there and the future is limitless (and excitingly unknown!).

Jennifer Warawa

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The Best Accounting Joke In The History of The World? Well, Maybe Not…

We’re almost to April 15. In that spirit, enjoy this fine accounting joke! Pass the link around to your co-workers, clients and referral sources.

A local bar was so sure that its bartender was the strongest man around that they offered a standing $1,000 bet. The bartender would squeeze a lemon until all the juice ran into a glass, and then give the lemon to a patron.

Anyone who could squeeze another drop of juice out would win the money. Many people tried, but no one could do it.

One day a scrawny little man came in, wearing thick glasses and a polyester suit. He said in a squeaky voice, “I’d like to try the bet.” After the laughter died down, the bartender grabbed a lemon and squeezed it. Then he handed the wrinkled remains of the rind to the little man who clenched it in his small fist.

Soon the crowd’s laughter turned to total silence as six drops of juice fell into the glass. As the crowd cheered, the bartender paid the $1,000 and asked the little man, “What do you do for a living?”  The little man replied with a winning smile, “I work for The IRS.”

Lemon Drink

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On This Sunny Afternoon, The Tax Man’s Wanting to Tax the Dough

Is the double-edged sword striking down on that lunchtime chicken salad sandwich? I’ve often wondered when Silicon Valley’s culture of providing meals to employees at all hours–and I’m speaking of Google, Facebook and other companies in this free food mix–would be more of a hot Tax vs. Don’t Tax topic. Well, my friends, that day is officially here.

While this debate has certainly come up in the past, the lunch wagon has it on the front burner again, most likely because the IRS is on a mission to scrape up dimes in the gutter with a putty knife.

Looking at both sides of the controversy, on the pro-tax view of those company-provided lasagnas, smoothies and various cookies, crème puffs and gelatins, I venture to say that the average employee at these companies is enjoying at least a couple of thousand dollars a year in free eats and drinks. That’s clearly compensation and should be taxed.

Now, for the anti-tax view, it can all be taken in the same “de minimis” vein as the free donut and coffee of yesteryear. Why? Today’s work culture has changed. These companies that go to great lengths and costs to establish a high level of perks feel that they must do so in order to remain competitive with recruitment and retention in their respective industries. Few would argue that fact, I think. With that being the case, it doesn’t seem right to tax the free salad bar and barbecue hut, does it? If a Yahoo employee has to declare these edible fringe benefits as compensation, does that really seem fair?

What do you think about this issue? This matter isn’t in the same realm as a public accounting firm bringing in evening meals during busy season…this is a whole other kettle of fish. Drop it like a hot potato, IRS.

Cucumbers

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The Foggy Crystal Ball of Early April

Every once in a blue moon a public accounting firm’s post-April 15 celebration party gets a little out of hand or it results in someone making a very bad error in judgment. Fortunately, that scenario doesn’t happen very often. When I worked at an accounting firm I think the most out-of-character thing that ever happened was someone having an extra beer or two (or far too much sausage and sauerkraut the one year we had the festivities at a German restaurant). What will the crystal ball see this year for the evening of April 15?

One of the latest trends in food marketing is to slap the word “protein” on the packaging, which apparently is driving such products to sell faster than vitamin-stoked hotcakes. I wonder what the crystal ball sees next in the food world? For instance, did anyone see this Greek yogurt wave coming? Fantastic yogurt, but it’s out of control, brother.

Of course, what we really care about is the next big trend in the accounting profession. What does the crystal ball see for the rest of this year and next year? So many people were banking on this being a huge M&A year in public accounting. Will that be how it plays out?

What do you think is behind the fog in that mystical future-telling window to the accounting world?

??????????

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IRS Concludes Open-Air Parking Garages are Buildings

The Curator offers this insightful article by Kreig Mitchell. It’s interesting. Enjoy.

IRS Concludes Open-Air Parking Garages are Buildings
By Kreig Mitchell

In recent Chief Counsel Memo #20125201F, the IRS concludes that open-air parking garages are considered buildings rather than land improvements for tax purposes and that a taxpayer’s conclusion to the contrary warrants the assessment of a negligence penalty.

Classification as a building or land improvement presents a timing issue. A building generally has a 39-year recovery period for depreciation purposes, whereas a land improvement generally has a 15-year recovery period. The shorter recovery period for property classified as a land improvement generally produces a larger depreciation deduction in the current tax year.

According to field advice handed down by the IRS, a taxpayer made several arguments as to why his open-air parking garages were land improvements and not buildings.  The taxpayer argued that:

  • The applicable regulations are invalid as they depart from the legislative history;
  • The garages are not buildings because they do not have floor-to-ceiling walls, a conventional roof, and they do not share supporting structural elements; they offer only minimal shelter from the elements or protection from vandalism and theft and their primary purpose is storage of vehicles; and
  • The garages are land improvements because they are merely parking lots stacked one on top of another and not “garages” as that term is commonly understood.

The IRS field advice rejects each of these arguments based largely on a literal reading of the applicable regulations and certain concessions in the taxpayer’s submissions. This is consistent with Coordinated Issue Paper LMSB4-0709-029, which the IRS made public in 2009.

Despite assertions from the IRS, it is not altogether clear that the taxpayer’s position is incorrect or whether the taxpayer’s facts warrant the imposition of a negligence penalty. It is also not clear whether the IRS would reach the same conclusion if the facts were slightly different, such as if the parking garage was designed in a way that no one floor functioned as a roof for a lower floor, if the parking garage was situated entirely underground, or if the parking garage had an additional primary function–such as storage for supplies, tools, or other equipment.

If anything, this field advice serves as another warning to taxpayers that a contrary position will be challenged by IRS examiners and may have to be resolved by the IRS Appeals Office or the courts.

About the Author
Kreig Mitchell serves on the advisory board of Engineered Tax Services and is tax attorney focused on federal and state research tax credits and incentives and tax controversies. During his career, Kreig has worked as a tax attorney in private practice, a tax consultant for a research tax credit firm, and an attorney and appeals officer for the IRS. He is also the author of Research Tax Credits, a book published by the American Law Institute-American Bar Association and his research tax credit articles are in a number of well-respected tax publications.

ETS Disclaimer
The article is designed to provide authoritative information on the subject matter covered. However, it is distributed with the understanding that the publisher, editors, and authors are not engaged in rendering legal, accounting, or other related professional services for your client base. Consequently, it is your responsibility to exercise all of the necessary measures to ensure proper tax preparation and tax advisory services for your client base.

Circular 230 Disclaimer
Circular 230 Notice: In compliance with U.S. Treasury Regulations, the information included herein (or in any attachment) is not intended or written to be used, and it cannot be used, by any taxpayer for the purpose of i) avoiding penalties the IRS and others may impose on the taxpayer or ii) promoting, marketing, or recommending to another party any tax related matters.

Parking Garage

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What’s On Your Highlight Reel?

As always, Accounting Today’s Top 100 Firms edition is so full of substance it’s like going to a meat ‘n cheese buffet. Strap on the feed bag. The section that grabs my interest first every year is the “Firm Highlights” summary. Each Top 100 firm has but a few lines to put their best foot forward touting their crowning achievements of the previous twelve months. Most of these firms display their broad strokes in this section with mentions of mergers, acquisitions and new service lines. For those firms declaring “had revenue growth of x-percent,” it leaves me thinking that nothing special happened with their firm and that they merely grabbed a few new clients and it was all business-as-usual. I suppose some years are like that, but I do wonder what’s below the surface of that “ten-percent growth” statement.

The following are some of the “firm highlights” that struck me:

*Moving to managing by service line
*Formed two new service areas: a specialty tax services group and a transaction advisory services group
*Expanded strategic planning task force to include “up and comers”
*Deepened industry expertise through hiring experienced staff
*Fastest growing client category – real estate
*Launched an online risk management tool
*Formalized wealth management practice

What is your firm or company doing in 2013 that will be worthy of the highlight reel this time next year? It had better be something more dynamic than:

*Moved to a new office building
*Had a hip deejay at the post-April 15 party
*Got a new coffee machine in the company kitchen

Coffee Pot_Old

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Top Ten Things to Do Immediately After Busy Season

In recent conversations with CPAs and Enrolled Agents, one of them mentioned that he, thus far, is “working five percent less and is one-hundred percent happier” this busy season. Hopefully that will continue for him down the stretch of the final month.

Here’s a collection of what these hard-working CPAs and EAs mentioned they’re going to do after busy season concludes. If you’re in the same boat, consider making your own list!

10. Get back to cooking

9. Fall asleep in the backyard hammock and be in no hurry to get up

8. Disconnect from all devices for a while

7. Go watch some baseball games

6. Tackle the home improvement list and love it

5. Volunteer at church

4. Spend time in some museums and national parks

3. See all Oscar-nominated films

2. Finally start the banjo lessons I’ve wanted to do

…and the #1 Thing to Do Immediately After Busy Season…

1. Enjoy time with the family and friends I’ve ignored since January!

Lan 1283

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Bottom Line, It’s Just Hard

Now that small accounting firms are waist-deep in busy season (aren’t all seasons “busy?”), it was time for another conversation with James C. Metzler, CPA, Vice President of Small Firm Interests at the AICPA to get that mid-February pulse of the profession.

What’s running through the minds of small firm partners as they deal with the host of recent tax changes, resulting in a later start to busy season this year, can perhaps be summed up in two words: Stress & Opportunities. Shedding light on current challenges at small public accounting firms, Jim Metzler got out the floodlight.

With the accounting software changes that we all know about resulting in an even more compressed busy season, the ballgame has been altered a bit. While the ability to have those customary early-in-the-year client seminars, published documents and marketing initiatives became more challenging, plenty of possibilities still abound. “The first out the door wins lots of new clients,” commented Metzler, “and harnessing these opportunities is crucial. The ‘glass is half-full’ people will take advantage; the ‘glass is half-empty’ people will suffer.”

A tough road ahead? Certainly. But what are some of the positive steps that small firms are taking now to increase their chances of a smooth (to the extent that’s possible) busy season? “Setting realistic expectations with clients is key,” remarked Metzler, “and communicating to your clients that there will be more extensions as a result of these recent changes.”

The light at the end of the tunnel, post-April 15, focuses on additional ways to assist clients and produce new engagements, ranging from healthcare reform issues to wealth management services. “These non-financial measures taken now will pay off after busy season,” proclaimed Metzler. “This is a great time to mine the gold in your own backyard, but what has to happen now is initiating contacts with clients—and measuring partners and senior people in these activities. Accountability for getting out there and talking to clients…”

Be sure to read this post from November:
Making Sense of a Changing and Complex World

Meltzer 1

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Paying It Back

Easing the burden on military families during tax season…sounds like a great idea, doesn’t it? The Ohio Society of CPAs has an initiative that offers free tax preparation services to Ohio military families this tax season. Operation CPA is the name of the program; the intent is for Ohio CPAs to prepare tax returns free of charge for deployed troops. Regardless of where you live, whether you’re a CPA, EA or otherwise…is there anything you or your company/firm can do to assist America’s military personnel?

“Operation CPA has helped over 400 military families since it was launched in 2005,” said Amy Johnson, OSCPA’s Vice President, Communications. “This program is a way for CPAs to say thank you to the men and women serving our country.”

“I think that these families, not just the soldiers, give so much to protect me and my home. It’s the least I can do to repay their service,” said Operation CPA volunteer Elizabeth Kroll, CPA of Pease & Associates Inc. in Cleveland.

I love the idea of this program and others like it. As I sit here typing in my safe, dry, warm office enjoying life’s freedoms, I find myself feeling extremely grateful for the sacrifices made by those brave folks who serve in the military today–and for those who served in the past. We truly would not be here without them. Thank you.

Lane County Area Soldiers Reunite With Families

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The Best Thing About the Future is That it Comes One Day at a Time

During a recent chat with Eric Majchrzak, Director of Marketing of BeachFleischman, we got to talking about how even small firms need international tax proficiency these days. Sitting there in Tucson, Arizona, you can naturally imagine their business clients requiring cross-border experience and expertise when it comes to tax work, regulations knowledge and more. This forward-thinking $16 million firm is representative of what we’ve heard in conversations with public accounting firms–and on the accounting conference trail–this year. Whether or not your small accounting firm has this depth of ability or not, a decision had to have been made (or will be made) along the lines of either having international skill and ability or not. There’s no right or wrong answer. Many firms are doing it, acquiring it or developing it; other firms simply want to outsource international needs. In the words of the Rush song Freewill … “if you choose not to decide, you still have made a choice.”

The bigger question, though…is your firm savvy and moving toward the future?

International Business

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