Today's Features
PRICING, FEES & BILLING RATES

Why Pricing Is So Disruptive

Kick familiar to the curb and get paid what you’re worth.

By Jody Padar
Radical Pricing  – By The Radical CPA

The familiar is always more comfortable than something new. Shifting your pricing model is bound to be disruptive because the billable hour is what we know and have always known. It is the default billing model of every new firm. It’s comfortable, familiar, embedded in our DNA and seems like the easiest billing solution.

MORE: The Radical Pricing Model: Start with $25K | Three Critical Factors Drive the Value Pricing Trend | Accounting Disruptors Are Heading Your Way … with Deep Pockets | The Convergence of Trends Makes Pricing Changes Imperative | Stop Looking for Talent that Does Not Exist | Advisory Work Must Be Priced by Value, Not Hours
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Certainly, there are some pros to billing by the hour. Profits remain relatively stable. If you work 40 hours, you know you’re going to bill and hopefully be paid for those 40 hours. There’s a clarity and certainty to it. But there are only so many hours in a week. By embracing the billable hour, you’re putting a profit ceiling on your firm.

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AUDIT & ASSURANCE

S Corp Clients Beware

“Reasonable comp” audits are coming.

By Eric Green

“The IRS never audits reasonable comp, so don’t worry about it.”

Have you ever heard this phrase? Well, when it comes to IRS priorities and increasing enforcement, S corporations and their owners will find themselves in the crosshairs of the IRS.

MORE in TAX: Eight Steps to Getting Started with AI: A Guide for Tax Professionals | What’s Your Value to Your Tax Clients? | Are You Excited About Tax Season? | What the Corporate Transparency Act Means for Accountants | Train Now Before It Costs You Down the Road | Surge Pricing: What Works for Uber Could Work for CPA Firms | Uncooperative Partner Might Not Be the Problem | It’s Time to Fix the Problem of QTIPs and LLCs

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In 2020, the U.S. Treasury Inspector General for Tax Administration (TIGTA) reported more than 10 million non-filers, many of them high-income earners. Then, in 2021, a TIGTA Report told the IRS to begin cracking down on S corporation owners who take little to no compensation to avoid employment taxes effectively.

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MARKETING & SALES

Stop Operating from a Scarcity Mentality

Coins and small bills in a plastic box

Ten questions for reconsidering your prices.

By Martin Bissett
Business Development On a Budget

Undercharging – or lowballing as it’s also called – is the scourge of the profession. It has always been present, and unfortunately, it will probably be with us for the foreseeable future.

Undercharging is directly related to fear – fear of rejection.

MORE: Firm Not Thriving? Five Fixes | Five Questions About Facing Challenges | Be Clear About Your ROI Proposition | It’s Time to Prepare the Next Generation | Who Are You More Committed to, Your Firm or Your Clients? | Nine Checkpoints Before Every Prospect Meeting | Three Questions about Conversion | Six Keys to Turning Prospects into Clients | Don’t Overlook Internal Communication
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When you are building your pipeline according to the process, you have assigned fees you think might be in the ballpark of what you believe you could get from a new piece of work or a new client. You may tend to estimate on the low side, which is not a bad idea in theory, because it lets you be pleasantly surprised when it’s anything beyond that.

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CHARTS & GRAPHS

Tax Pros Close Season Handling 53% of E-filings

data table

The mark has been steady for three years now.

By Beth Bellor
CPA Trendlines Research

April 15 has come and gone. Finally, tax season is over!

Hahaha! Sure, it’s true for the 140 million+ represented on the returns filed so far, but it doesn’t speak to their neighbors who aren’t quite there yet. You know, the ones you filed extensions for.

MORE: Tax Refunds Up About 4% | Tax Pros Own 53% of E-filings | Tax Stats Still Playing Catchup | Tax Pros Take the Edge in E-Filings | Tax Pros Gain Ground, and DIYers Maintain Lead | Tax Pros Handle 46.4% of E-filing | Tax Refunds, Tax Pro Market Share Trending Up | Refunds Up as Tax Pros Tackle 41.5% of E-filings | Tax Pros Handle 37.7% of E-filings | Tax Pros File 33% of Early Returns
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Still, it’s a national touchpoint, so let’s take a peek at the data the IRS just released for April 19, just after the deadline.
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PRO Member Exclusive

Could Mobile Phones Be Next on the Extinction List?

Image: Rabbit Tech

It’s not technically a phone, but it does almost everything a phone can … and some things a phone can’t.

By Rick Richardson
Technology This Week

Rabbit is a startup that stunned the world in early January with its surprising AI hardware announcement. The Rabbit r1 is a device similar to a smartphone, but it runs a different AI experience compared to what you know from ChatGPT, Copilot, Gemini, Claude and other chatbots.

MORE: AI Named the Highest-Paying In-Demand Tech Skill for 2024 | AI Generates Revolutionary New Battery Design | Breakthrough Implant Uses Excess Blood Sugar to Generate Electricity | Nuclear Battery Could Keep Your Future Phone Running for 50 Years | MIT Tests New Ingestible Vital Signs Sensor | Study: Solar Will Lead Global Energy by 2050 | New Tech Could Let EVs Go 3,000 Miles on a Single Charge | AI + MRI = Diseases That Doctors Might Miss | Your Boarding Pass Could Onboard Hackers | The First Police Officer on the Scene Might Be a Drone
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The Rabbit r1 will handle chats like ChatGPT, sure. However, its primary selling point is a different type of AI experience. The r1 features a unique Large Action Model (LAM) that lets it interact with apps for you.

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OUTLOOK & ANALYSIS

Disruptors: Talent Crisis? What Talent Crisis?

Disruptors Wiley, Deshayes, Satterley, Etienne, Penczak and Vanover offer their takes on staffing in the accounting profession.

By Amy Welch

In a post-pandemic gig economy, the rest of the world laments the staffing crisis. However, while the solutions may not be easy, they seem to be pretty simple.  

Follow the Disruptors here

MORE THOUGHT LEADERS: James Graham: Drop the Billable Hour and You’ll Bill More | Karen Reyburn: Fix Your Marketing and Fix Your Business | Giles Pearson: Fix the Staffing Crisis by Swapping Experience for Education | Jina Etienne: Practice Fearless Inclusion | Bill Penczak: Stop Forcing Smart People to Do Stupid Work | Sandra Wiley: Staffing Problem? Check Your Culture | Scott Scarano: First, Grow People. Then Firm Growth Can Follow | Jody Padar: Build a Practice that Works for You, Not Vice-Versa | Ira Rosenbloom: With M&A, Nobody Wants a Fixer-Upper | Peter Margaritis: The Power Skills Every Accountant Needs | Joe Montgomery: Find the Sweet Spot of the Right Clients, Right Services and Right Prices | Marie Green: Your Bad Apples Are Ruining You | Megan Genest Tarnow: Hire for Curiosity Rather Than Compliance | Clayton Oates: One Way to Keep Clients for Life |

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In the CPA Trendlines Disruptors one-on-one interview series with Liz Farr, some of the profession’s most innovative thinkers suggest solutions ranging from re-examining your firm’s culture to tapping into two-year colleges for new talent. Here, several weigh in on what they see as the potential answers to one of the most troubling issues in the accounting profession.

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AUDIT & ASSURANCE

Let Interns Fix the Staffing Shortage?

Source: IIA

Critical demand for data analytics, cybersecurity, and artificial intelligence skills.

By CPA Trendlines Research

Internships could play a pivotal role in addressing the talent needs of the profession, according to a new study.

MORE in TALENT & CAREER DEVELOPMENT: Talent Crisis? What Talent Crisis? | Why Would Anyone Become a CPA? | Five Questions About Facing Challenges | It’s Time to Prepare the Next Generation | Fifteen Strategies for First-Time Supervisors | Measure Knowledge Gaps (Then Close Them)

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With 74 percent of internships designed to lead to permanent employment, these programs are not just supplemental but foundational to preparing students for professional roles.

Still, only 28 percent of college programs make internships integral to the curriculum. READ MORE →

AUDIT & ASSURANCE

Before the Audit: More Than Just Checklists

Effective inquiry starts with knowing how to ask the right questions.

By Alan Anderson, CPA
Transforming Audit for the Future

To weave relevance into the fabric of your firm culture, your team must shift from just getting the work done, with relevance as an afterthought, to putting the client at the center of the audit. That starts by building a foundation with the four U’s of understanding your client, the industry, the standards and how to audit.

MORE: Are You Correctly Identifying the Relevance Intersection? | Lack of Relevance Drives Audit Commoditization | Five Crucial Attributes for Successful Audit Leadership | Traditional Audits Don’t Deserve Premium Billing | Four Basic Understandings Every Auditor Must Master | Put the Ethics Code to Work for Your Clients and Your Firm | Turning Audit & Accounting into Assurance & Advisory | WANTED: Great Audit Mentors | Is Audit in Crisis Because of Definitions? | Stop Sending the Wrong Message to Audit Teams | Closing the Audit Expectations Gap
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To master these, you first need a natural sense of curiosity. Out of curiosity comes inquiry. We’ve all been taught that inquiry is one of the fundamental components of the audit process. But too often, inquiry doesn’t go any further than getting some answers to the questions on a checklist. And too often, those questions are the same ones that get asked at every audit engagement. The client has probably heard them (and answered them) more times than you can imagine.

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