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Exploring the issues that shape today’s financial world



BE A WINNER generation blending n legacy building n green tech’s bottom line THE MAGAZINE OF THE

Read INSIGHT and earn up to 10 hours of CPE credit. Visit for details.



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© 2012 Robert Half. An Equal Opportunity Employer. 0912-9012 © 2012 Robert Half. An Equal Opportunity Employer. 0912-9012


Illinois CPA Society members…

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WINTER 2012 |

cover stories 34

Gen B: The Blended Generation Today’s accounting firms are mobilizing multi-generational workforces to boost productivity and meet client needs.


Paperless Super Savings Bolster your firm’s bottom line by opting for cost-saving, productivity-boosting green technologies.


Build a Business Legacy Creating a firm with staying power and an impactful brand is harder than it used to be.

departments 18

Young Professionals Score With the Big Four Five ways to make yourself the Big Four’s next All-Star recruit.


Liability Can You Keep a Secret? What privileges and protections apply to Illinois CPAs and their clients?


Auditing Audit Hike A multitude of factors have conspired to increase audit fee volatility.


Career Top Jobs for CPAs The accounting field is bursting with opportunities. Here’s where to look for them.


M&A The Buy/Sell Guide 10 helpful steps for navigating accounting practice M&As.

columns 4

First Word


Seen & Heard


Tax Decoded Tribunal Power 2013 heralds a new way of doing things for anyone challenging IDOR audit findings.


Capitol Report We Want You! The Military Tax Assistance Program celebrates a decade of serving those who serve our country.


Forensics Insider Think Before You Give In Ronald Reagan’s famous words, “trust but verify” before giving charitably.


PFP Advisor PFP How To The ins and outs of adding personal financial planning to your practice.

48 2



Must-read-must-know news for young accounting pros.

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A Resolution to Keep The elections are behind us, the holidays are over and our New Year’s resolutions….well, let’s just say my treadmill soldiers on as a clothes rack, and my Swiss ball is as deflated as my hopes and dreams of getting in shape this year. But as I sit here contemplating the packet of M&Ms on my desk, I’m struck by a thought. Not all New Year’s resolutions need to go unresolved— particularly those that strive to make our careers more productive, rewarding and successful. 2013 is poised to be a dynamic year, and CPAs are going to be busy. There’s never been a greater need from businesses and consumers for help with fiscal issues. Today’s economy has created even greater complexity in our jobs. As CPAs you need to understand these complexities and be able to make some semblance of order of them for your clients and companies. Easier said than done, right? In an era where every minute and every dollar counts, the Illinois CPA Society is providing you with efficient and flexible solutions to navigate our uncertain financial waters. One example is knowledgehub, our new web-based learning management system which puts content from multiple CPE providers in one easy-to-search place. Designed for firms, companies and individuals alike, knowledgehub allows you to tailor development plans for your staff, and ensure they’re receiving training in the topics that are most critical to your organization. Also, our new CPE onDemand [] provides you with 24/7 access to quality, affordable CPE. What’s more, we all know that learning isn’t delivered solely in traditional classroom and online settings. Thanks in part to the Society’s advocacy efforts, the Illinois Department of Financial and Professional Regulation has expanded what it recognizes as CPE credit. Beginning in this reporting period, you are now able to earn credit for a wider range of education, as well as for activities you’re already doing, such as research and reading professional publications (you’ll find more information on page 6 of this issue). The overarching goal is to keep you up-to-date and competitive—and our resolution for the year is the same as it has always been: To advocate for and support the careers of each and every one of our members, whether in public practice, industry & business, government, education, not-for-profit—or those only just graduating and starting a career in this wide, varied and rewarding profession of ours. While my fitness plans may have fallen flat, the Society remains true to its resolution every single year. Here’s to a successful 2013 for one and all.

INSIGHT MAGAZINE Publisher/ICPAS President & CEO Elaine Weiss Editor-in-Chief/Director of Publications Judy Giannetto Creative Services Director Gene Levitan Creative Services Manager Rosa Garcia Publications Specialist Derrick Lilly National Sales & Advertising Natalie Matter DeSoto YGS Group, 3650 West Market Street, York, PA 17404 P: 800.501.9571 x127 F: 717.825.2171 E: Circulation/Member Services Director Carl Siska Editorial Offices: 550 W. Jackson Blvd., Suite 900 Chicago, IL 60661

ICPAS OFFICER S Chairperson, James P. Jones, CPA Edward Don & Company Vice Chairperson, William P. Graf, CPA Deloitte & Touche LLP Secretary, Edward J. Hannon, CPA, JD Freeborn & Peters LLP Treasurer, Daniel F. Rahill, CPA, JD KPMG LLP Immediate Past Chairperson, Robert E. Cameron, CPA Cameron, Smith & Company, PC

ICPAS BOARD OF DIRECTORS Linda S. Abernethy, CPA, McGladrey LLP Rose G. Doherty CPA, Legacy Professionals LLP John A. Hepp, PhD, CPA, Grant Thornton LLP Margaret M. Hunn, CPA, CFE, CFF, CITP, Rozovics & Wojcicki Geralyn R. Hurd, CPA, Crowe Horwath LLP Paul V. Inserra, CPA, McClure, Inserra & Co., Chtd. Leif J. Jensen, CPA, Leif Jensen & Associates Ltd. Kathleen M. Kedrowski, CPA, Retired, Navigant Consulting Michael J. Maffei, CPA, GATX Corporation Marcus D. Odom, PhD, CPA Illinois University



Floyd D. Perkins, CPA, Ungaretti & Harris J. Bradley Sargent, CPA/CFF, CFE, CFS, Cr.FA, Sargent Consulting Group LLC Marcus F. Schultz, CPA, Dugan & Lopatka CPAs PC

ICPAS President & CEO Elaine Weiss

Thomas L. Zeller, PhD, CPA, Loyola University Chicago

INSIGHT is the official magazine of the Illinois CPA Society, 550 W. Jackson, Suite 900, Chicago, IL 60661, USA. Its purpose is to serve as the primary news and information vehicle for some 24,000 CPA members and professional affiliates. Statements or articles of opinion appearing in INSIGHT are not necessarily the views of the Illinois CPA Society. The materials and information contained within INSIGHT are offered as information only and not as practice, financial, accounting, legal or other professional advice. Readers are strongly encouraged to consult with an appropriate professional advisor before acting on the information contained in this publication. It is INSIGHT’s policy not to knowingly accept advertising that discriminates on the basis of race, religion, sex, age or origin. The Illinois CPA Society reserves the right to reject paid advertising that does not meet INSIGHT’s qualifications or that may detract from its professional and ethical standards. The Illinois CPA Society does not necessarily endorse the non-Society resources, services or products that may appear or be referenced within INSIGHT, and makes no representation or warranties about the products or services they may provide or their accuracy or claims. The Illinois CPA Society does not guarantee delivery dates for INSIGHT. The Society disclaims all warranties, express or implied, and assumes no responsibility whatsoever for damages incurred as a result of delays in delivering INSIGHT. INSIGHT (ISSN-1053-8542) is published four times a year, in Spring, Summer, Fall, Winter, by the Illinois CPA Society, 550 W. Jackson, Suite 900, Chicago, IL 60661, USA, 312.993.0407 or 800.993.0407, fax: 312.993.7713. Subscription rates for non-members: $20 US, $28 Canada, $30 Mexico and $40 for international addresses. Copyright © 2012. No part of the contents may be reproduced by any means without the written consent of INSIGHT. Permission requests may be sent to: Publications Specialist, at the address above. Periodicals postage paid at Chicago, IL and at additional mailing offices. POSTMASTER: Send address changes to: INSIGHT, Illinois CPA Society, 550 W. Jackson, Suite 900, Chicago, IL 60661, USA.






Average percent of total assets invested annually by private companies, versus only 4 percent for similar public firms. Source: Sageworks Inc.

Are Your Clients Following Your Directions? The majority of people who receive financial advice don’t act on it, according to a survey commissioned by financial services firm TIAA-CREF. Despite nearly 50 percent of respondents indicating that they’re worried about their financial futures, only 33 percent actually take action after being advised on what to do. Part of the reason could be that a constant supply of general information on how to reduce expenses, streamline budgets, save more and invest effectively for retirement is simply too overwhelming. In fact, 74 percent of respondents said they’re not sure which sources of financial advice are reliable. TIAA-CREF analysis suggests that individuals provided with recommendations specifically tailored to their financial situations, objectives, risk tolerances and investment horizons are over 60 percent more likely to utilize the advice than people who receive generalized guidance.

Expanded CPE Recognition in Effect


Avoid Mistakes on the Job

Over the last year, the Illinois CPA Society has worked closely with the Illinois Department of Financial & Professional Regulations to broaden the scope of programs and activities that qualify for continued professional education (CPE) credit and meet the requirements for CPA licensure renewal. As a result, you’ll be able to earn CPE for more of the job-specific activities you likely already perform, such as conducting research or consultation with outside experts, attending industry group conferences or webinars, and serving on one of ICPAS' technical committees. You can even earn CPE credits for reading professional publications, like our own INSIGHT Magazine. Visit for more information.

In an Accountemps [] survey, 28 percent of respondents said making a mistake is their biggest workplace fear. With that in mind, Accountemps offers these four tips for dodging the bullet: 1.Plan your week. Prioritizing responsibilities and delegating when possible will increase efficiency and confidence. 2.Ask for direction. If a new project is particularly challenging, share this with your manager so you can work together to overcome hurdles. 3.Tru st in a trusted advisor. When preparing a critical project or communication, tap a mentor for advice or ask a confidante for feedback. 4.Lend a hand. Volunteering to assist overburdened colleagues and being quick with praise for outstanding work Forget full-blown accounting solutions and make quarter-end, year-end and sales tax events fosters an environment where colsimple. Outright [] is a streamlined accounting solution for small-business ownleagues regularly help each other. ers that allows users to organize and track their income and expenses from their online accounts, with support for over 4,000 banks and credit cards, eBay, PayPal, Freshbooks, Speaking of mistakes...Please note that Harvest and Shoeboxed. Users can even track cash sales and expenses by manually enterthe Fall 2012 Corporate Financial Leadering the data from paper receipts. In a matter of seconds, Outright produces easy-to-read ship First Word column, A Time to Give charts and graphs, and automatically categorizes transactions to IRS expectations, ensuring Thanks, included a name misspelling. Our sales tax records are always current and accurate. apologies to Illinois CPA Society Diversity Outright is a cloud-based solution that uses 256-bit SSL security to ensure data is always Initiatives Committee Chair, Scott D. Stefprotected. Free Outright apps are available for Apple and Android mobile devices. fens of Grant Thornton LLP for the error.




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CFOs Wanted for Board Service TRENDSPOTTER:

There’s an unprecedented demand for CFOs to serve on corporate boards thanks to increasing regulations, difficult economic conditions and the CFO’s broadening skill set, says Ernst & Young’s study, CFO and Beyond: The Possibilities and Pathways Outside Finance. The report found that many CFOs are interested in roles that can improve their understanding of boardroom dynamics, generate cross-sector ideas and provide exposure to different corporate cultures. In fact, most CFOs said that sitting on the other side of the table helps them fully understand how the boardroom works, and over half see it as an opportunity to learn lessons that have valuable applications in their core roles.

Listen Up Emerging Partners While emerging partners may feel that old leadership models need to be replaced pronto, Jim Boomer of Boomer Consulting Inc. advises them to gain a deeper understanding of current partner culture. For starters, realize that they have years of experience to tap into, and have paved the way for today’s partners to rise. What’s more, they may find it hard to let go of what they’ve helped to build, and deserve respect for their views when new ideas are presented. Understanding this will ultimately make for a far smoother partner transition.

GREEN YOUR MEETINGS Socially responsible businesses are increasingly in demand. The Vianova Group [] offers these tips for greening your meetings. n Me et onlin e: Online discussion forums, chat functions, teleconferencing and webcasts all provide ways to connect while reducing carbon footprints and travel/meeting expenses. n Meet locally: If you must meet face-to-face, reduce travel time and distance by choosing a centrally located meeting place that’s convenient for all meeting attendees. If spread far and wide, consider having only those “must-attend” individuals be present while others participate virtually. n Opt for pres entations: Project documents onto a screen so all meeting attendees can follow along without needing to print out paper copies. All meeting materials can be stored in a central online location for viewing at any time. n Recycle at close: Collect and recycle paper, plastic cups, wrappers, trash bags, bottles and cans used in the meeting room. Serving food from washable dishes instead of disposables is a smart choice as well.

Why Your Staff Won’t Leave You Whether or not the economy is turning around, keeping an eye on employee retention is always a priority. According to the American Psychological Association’s [] Workforce Retention Survey, 67 percent of working Americans stay with their current employers because their jobs fit well with other aspects of their lives. A further 60 percent stay because of employee benefits; and 59 percent stay because of either the pay or their enjoyment of the work. Despite consistently high unemployment numbers, only 39 percent of respondents said a lack of other job opportunities was a reason for staying with their current employer.

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Tribunal Power 2013 heralds a new way of doing things for anyone challenging IDOR audit findings. By Keith Staats, JD


Keith is a senior manager of Grant Thornton’s State & Local Tax practice, based in Chicago. Previously, he held the position of general counsel of the Illinois Department of Revenue, where he developed tax policy, evaluated and reviewed tax-related legislation, and oversaw tax-related litigation. *



ecent Illinois legislation has established a new, independent Illinois Tax Tribunal that allows taxpayers to challenge Illinois Department of Revenue (IDOR) audit claim denials. The Tribunal will begin operating on July 1, 2013, and will, with certain exceptions, replace the current administrative hearings function within the IDOR. Drilling down to the finer details, the Tax Tribunal will have jurisdiction over all IDOR sales and excise tax and income tax assessments, claim denials and notices of penalty liability. However, the Tax Tribunal legislation will not alter a taxpayer’s ability to utilize the State Officers and Employees Money Disposition Act (Protest Monies Act) as a method of challenging an assessment. The Tribunal’s jurisdiction will be limited to situations where the amount of tax at issue for the same tax year or audit period exceeds $15,000, excluding penalties and interest. In those instances that assert either an interest or penalty assessment or both, the Tribunal will have jurisdiction if the combined total of all penalties or interest exceeds $15,000. Cases below the $15,000 threshold will continue to be heard by the IDOR administrative hearings division. The Tribunal will not have jurisdiction to review any property tax assessment or any decisions related to the IDOR’s issue or denial of a sales tax or property tax exemption ruling. And it will not have jurisdiction to review a notice of proposed tax liability, notice of proposed deficiency or any other notice of proposed assessment or intent to take action. Proposed assessments, in fact, will continue to be eligible for review by IDOR’s Informal Conference Board. Furthermore, the Tribunal will not have jurisdiction to review any action or IDOR determination regarding tax liabilities finalized by law, including but not limited to liens, levies and revocations; suspensions

or denials of licenses or certificates of registration, or any other collection of activities; any proceedings of the IDOR’s informal administrative appeals function; or any challenges to an administrative subpoena issued by the IDOR. In general, with the exception of Protest Monies Act cases, a taxpayer cannot contest a matter within the Tax Tribunal’s jurisdiction in any other Illinois court. If a taxpayer attempts to file a case in another court, the action, suit or proceeding will be dismissed without prejudice. The Tribunal also will decide questions concerning the constitutionality of statutes and rules the IDOR has adopted, but will not have the power to declare a statute or rule unconstitutional or otherwise invalid on its face. However, a taxpayer challenging this constitutionality can present the challenge to the tribunal to make a record for the Illinois Appellate Court’s review. Failure to raise a constitutional issue will not preclude the taxpayer or the IDOR from raising these issues at the appellate court level. What’s more, the Illinois Tax Tribunal Act includes detailed provisions concerning proceedings before the Tribunal. For instance, a taxpayer will be able to commence a proceeding by filing a petition protesting the IDOR’s determination, and the IDOR will be required to file its answer in the Tax Tribunal no later than 30 days after receiving notification of a petition being filed. (A $500 filing fee will be imposed.) Taxpayers or attorneys representing the taxpayers can make appearances at Tribunal proceedings. Accountants and attorneys employed by accounting firms may not represent taxpayers before the Tribunal, however. Prior to a hearing, the parties can choose to jointly petition the Tribunal for mediation in an attempt to settle any contested issues or the case in its entirety.

Tribunal hearings will be open to the public, but taxpayers can petition to close portions of the hearing for good cause. All information received by the Tribunal as a result of a hearing or investigation will be public, except for tax returns and information received under seal or in relation to any mediation proceedings. Also, taxpayers may petition the Tribunal to require that certain pleadings or evidence be filed or admitted under seal to prevent economic or other harm to the taxpayer. The Tribunal will be required to issue written decisions within 90 days of briefs being submitted or by the end of the hearing if no briefs are filed. The Tribunal can extend the 90-day period for an additional 30 days, but the decision becomes final 35 days after the issuance of the notice of decision. The tribunal is required to index and publish its decision in print or electronic form within 180 days. The taxpayer and the IDOR will be entitled to judicial review of a final decision in the Illinois Appellate Court. This provision is different than the current administrative hearings system in two respects: First, under the current system, only taxpayers can seek an administrative hearings decision review; second, the first level of judicial review currently occurs in the circuit courts. The legislation that established the tax tribunal also clarifies the IDOR’s settlement authority in informal proceedings. A new provision explains that offers of disposition of a proposed audit adjustment may be proposed during the informal assessment review process. The Informal Conference Board should consider disposing of a matter if 1). it’s uncertain whether the proposed audit adjustment is correct and 2). it’s not in the IDOR’s best interest to issue an assessment or claim denial due to factors such as the potential hazards of litigation. Despite the fact that accountants won’t be able to represent taxpayers before the new tribunal, the tribunal has the potential to enhance the role of accountants in providing assistance to taxpayers under audit. As I’ve noted, the legislation enhances and clarifies the IDOR’s settlement authority during the informal review process, and once a case is filed with the tribunal—an independent body—the IDOR arguably has less control over the matter than it does now. This combination of factors may encourage resolution of audits at the audit level, including the Informal Conference Board process where accountants and accounting firms can, and do, provide valuable assistance to their clients.

TAX UPDATES You Need Now Be Prepared for the 2013 Tax Season January 9 | Chicago

State & Local Tax Conference January 9 | Chicago

IRS Audit Practices and the Viability of FLP Planning Workshop January 9| Chicago, Joliet, Moline, Naperville, Springfield, Webinar

Small Business Entity Tax Forms Workshop January 10 | Chicago

Payroll Taxes, Benefits and 1099 Reporting: Everything You Need to Know January 11 | Chicago

Tax Update for Pass-Through Entities: S Corporations, Partnerships and LLCs January 16 | Webinar

Taxation for the 21st Century: Why Tax Reform is on the Table and How to Help Your Clients Understand January 17 | Chicago

Preparing Individual Tax Returns for New Staff and Para-Professionals January 18 | Chicago

The Complete Guide to Preparing Limited Liability Company, Partnership, and S Corporation Federal Income Tax Returns **NEW

January 28 | Chicago


New Medicine: Key Issues CPAs Need to Know About the Patient Protection and Affordable Care Act **NEW

January 28 | Chicago


Should Client Expenditures be Capitalized or Expensed? A Guide to the New IRS Regulations **NEW

January 29 | Chicago


Advanced Technical Tax Forms Training -- Form 1040 Issues January 30 | Springfield

Preparing Individual Tax Returns for New Staff and Para-Professionals January 31 | Chicago

Corporate Tax Update January 31 | Springfield

The Complete Guide to Preparing Limited Liability Company, Partnership, and S Corporation Federal Income Tax Returns Register at | WINTER 2012



We Want You! The Military Tax Assistance Program celebrates a decade of serving those who serve our country. By Marty Green, Esq.


n a letter to Illinois CPA Society President and CEO Elaine Weiss, Thomas R. Lamont, assistant secretary of the Army, wrote:

Photo: Courtesy of the US Air Force

“On behalf of the men and women of the United States Army and our sister services, I would like to thank the Illinois CPA Society for sponsoring the Military Tax Assistance Program for deployed military members and their families. Military deployments take a tremendous toll on our military members and their loved ones. The program relieves the anxiety of tax preparation for those deployed and their families. Most importantly, it helps to relieve the burden of separation. I know that our military members who have benefitted from this program are greatly appreciative of your efforts….[P]lease extend the Department of the Army’s appreciation to your member volunteers who give of their time to assist military members and their families.”

Marty is the ICPAS VP of Government Relations, a practicing lawyer and member of the Illinois Bar...and a Lieutenant Colonel in the National Guard. He previously served as executive assistant attorney general for Illinois Attorneys General Lisa Madigan and Jim Ryan, and as director of the Governor’s Office of Citizens Assistance and assistant to the Governor for Public Affairs, both under Governor James Edgar. * @icpasgovt

Volunteer Now To volunteer for the Military Tax Assistance Program, contact Jill Loeser of the ICPAS Government Relations Office, 217.789.7914 or



Over the past decade, more than 300 military members have been served through the Military Tax Assistance Program, which began with Operation Enduring Freedom in Afghanistan and Operation Iraqi Freedom. Partnering with the IRS, CPAs provide military tax assistance to members of the Armed Forces (both those on active duty and reserves) who have served in a combat zone or in a contingency operation during the tax year. Qualifying military members are matched with volunteers in their community or regional location. The volunteer initially meets with the military member or family member for basic information and then schedules a follow-up meeting to review, complete and execute the tax return. This also can be done remotely via email, phone and fax. As a Lieutenant Colonel in the National Guard, I can vouch for the fact that this program has a huge impact on the lives of military personnel and their families. You don’t have to take my word for it. As Military Tax Assistance recipient LTC Clay Kuetemeyer of the Illinois National Guard explains, “I first heard about the program during a briefing on post-mobilization benefits after returning from Afghanistan… David Hensley was our ICPAS volunteer tax preparer. He was enthusiastic and responsive when we contacted him for

assistance. Not only did he do a thorough, professional job of reviewing and preparing our returns, but he took the time to get to know us and understand our situation.” Hensley owns his own practice in Springfield, Ill., specializing in tax, accounting and consulting services. He has been a Military Tax Assistance volunteer for more than five years. When you visit Hensley’s office, you’ll see a folded American flag that flew over a US base in Afghanistan prominently displayed on his wall. The flag was given to him by a Marine Corps officer he assisted. When asked why he volunteers for this program, Hensley explains that, “I have family members in the military and I realize that they don’t get some of the benefits of the private sector. Military members deserve all the benefits they can get.” With tax season fast upon us, we’re actively searching for volunteers who can help with this important project. Volunteering is very easy. You can devote as much or as little time as your schedule allows. You don’t have to be a tax specialist, per se; the ICPAS and the IRS provide training materials and resources to help you with the process. Ultimately, the ICPAS Government Relations Office works with volunteers to match them with soldiers and airmen who qualify for assistance. Even if you only have time to

complete the training and assist one service member, you’ll make a huge difference. “I make it as easy as possible for [military personnel] to complete their taxes,” says Hensley. “I typically email them before our meeting introducing myself and sending them some paperwork to complete before they come to the office. If they call with questions, my staff has instructions to put them through to me directly. I treat them special.” I recently spoke with another Military Tax Assistance volunteer who told me the story of a couple who both were in the military and had small children back at home. Due to continued, multiple deployments for both, they were behind in several years of income tax filings. This was a source of constant worry for them. Our Military Tax Assistance Program volunteer went above and beyond to prepare their tax forms and explain their unique circumstances to the IRS, which waived all penalties and interest accrued. Even though our nation recognizes the beginning of the end of 10 years in Afghanistan and our withdrawal from Iraq, military members and their families still need our help. Our friends and neighbors who belong to the Guard and Reserves, as well as service members from Scott Air Force Base in Belleville, Ill. and Great Lakes Naval Base in Northeastern Illinois, are still performing hazardous duty in dangerous places. We recognize that your time is valuable. By being a Military Tax Assistance volunteer you’ll meet some of the finest men and women who serve our country. I guarantee that it will be both a personally and professionally rewarding experience—one you won’t soon forget.

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Think Before You Give In Ronald Reagan’s famous words, “trust but verify” before giving charitably. By Brad Sargent, CPA/CFF, CFE, CFS, Cr.FA, FABFA


Brad is the managing member of The Sargent Consulting Group, LLC, which specializes in forensic accounting and financial investigation. He is a frequent lecturer and chair emeritus of the American Board of Forensic Accounting. A member of the Illinois CPA Society since 2002, Brad also serves on the Society’s Board of Directors. *



he holiday season may have been and gone, and with it the “for-profit” world’s bid for our disposable income, but the desire to give to nonprofits and charities lingers far beyond the festivities for many of us. At all times of year, and especially during the winter, churches, homeless shelters, local food pantries, animal welfare organizations, children’s charities, veterans’ groups, community outreach groups, and more, actively seek donations of food, clothes, money and time to help those less fortunate survive. But are they always worthy causes? What if the charity you’re eyeing is, in fact, a scam? Take this scenario: A phone call from someone representing a charitable organization, looking for donations of clothes and household items, will have a truck making pick-ups in your neighborhood. You’re not home during the day, so you tell the caller you’ll leave the items on your front porch. Who, exactly, have you just invited to your empty house? Will the neighbors think twice when a big truck starts loading your household items when some of them are already out on your front porch? Did you also mean to “donate” your cash, jewelry and electronics? Floyd D. Perkins, Esq., CPA, is a member of the Illinois CPA Society Board of Directors and a partner at the law firm of Ungaretti & Harris, LLP. He concentrates his practice on counseling businesses and charities on financial and compliance matters, litigating business and financial disputes, and representing clients in contested probate and chancery matters. Prior to joining Ungaretti & Harris, Perkins was bureau chief of the Illinois Attorney General’s Charitable Trusts Division for 14 years, where he was responsible for many of the office’s complex financial and business litigation matters concentrating in the chancery and probate practice. Perkins offers this simple advice: “Give but give wisely. Know who you’re giving to; the cause may be great but the people

soliciting may not be delivering to the cause. Check them out before giving.” Another caveat: Even the most legitimate charitable organizations may not always exercise an appropriate level of internal due diligence. Many individuals join charitable organizations (accepting lower compensation in the process) for the reward of doing something for a cause in which they believe. Fraudsters are aware of this altruistic culture and seek to embed themselves within an entity, gain trust and steal at will. Sadly, the very attributes that make these legitimate organizations effective in their missions can lead to a failure to maintain proper internal controls. Many large-dollar frauds are committed in the charitable sector, but are almost never reported since nonprofits rely heavily on their positive public image. I’ve investigated major frauds that rose to criminal levels, yet the respective boards chose to resolve the matters quietly. I urged them to set a more rigorous tone at the top and pursue all means to prosecute the fraudsters, and in return was given a personal tutorial on the precarious nature of these entities and their public personas, and a primer on how discretion is essential for their continued existence. Lisa M. Noller, Esq., is a litigation partner with Foley & Lardner LLP, where she is a member of the firm's Government Enforcement, Compliance & White Collar Defense, Business Litigation & Dispute Resolution, and Securities Enforcement & Litigation practices, as well as the Health Care, Medical Devices, and Life Sciences Industry teams. She is an experienced trial lawyer, having spent more than 15 years investigating and litigating complex criminal and civil cases. Her practice focuses on responding to government investigations, conducting corporate internal investigations, and litigating a wide variety of civil and criminal matters in state and federal courts. Noller states that, “The government doesn’t differentiate for purposes of charging,

plea negotiating or sentencing; fraud is fraud. Charities and nonprofits would do well to follow their for-profit counterparts and implement rigorous compliance programs and institute internal controls to detect and combat fraud. Doing so doesn’t undermine the traditional culture of nonprofits. Rather, with strong policies and procedures for internal audits, investigations and remediation, nonprofits and charities can ‘trust but verify.’” The “trust but verify” phrase is often attributed to Former President Ronald Reagan, when he addressed the former USSR and its leader, Mikhael Gorbachev. Upon hearing Reagan’s proclamation, Gorbachev famously responded, “But you say that at all of our meetings!” In reality, Reagan quoted a Russian saying which he knew would be familiar to Gorbachev. Regardless of the source, these words ring true. Arm yourself before you give; look into the organization or individual contacting you, validate that your assets will be allocated to a worthy cause, and conduct due diligence to provide assurance that your assets will be used wisely and in pursuit of the cause of your choice.






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PFP How To The ins and outs of adding personal financial planning to your practice. By Mark J. Gilbert, CPA/PFS


think you’d agree that the best CPAs don’t merely prepare a tax return or an accounting write-up, but rather help their clients make decisions for the future. That’s where personal financial planning (PFP) comes in. As a client’s trusted advisor, CPAs are a natural choice for personal financial planning services. After all, you understand your clients’ hopes and dreams for the future, as well as their finances. For those aspiring CPA personal financial planners out there, here’s a basic guide to adding these services to your practice.

PFP Defined A principal in the financial planning firm of Reason Financial Advisors, Inc., Mark’s 25-plus years of finance and accounting experience includes 13 years in personal financial planning. An ICPAS member since 1982, Mark currently serves in the IA/PFP Member Forum Group and on the Structure & Volunteerism Committee. *

Personal financial planning is a practice area in which advisors provide clients with direction in any or all of the following areas: cash flow, insurance and risk management, investments, taxes, retirement and employee benefits, and estate planning. After thoroughly reviewing a client’s current situation, the advisor provides observations and recommendations for improvement. Depending on the engagement, the advisor may implement insurance or investment products as part of the planning process.

Designations & Memberships The personal financial planning marketplace is increasingly demanding that advisors demonstrate their expertise through select professional credentials, particularly the Certified Financial Planner (CFP®), Chartered Financial Consultant (ChFC®) and Personal Financial Specialist (CPA/PFS), which is awarded only to CPAs who are members of the AICPA. Each requires completion of a rigorous college-level program of study, although CPAs may challenge and waive the CFP educational requirement. In addition, the CFP and CPA/PFS both require successful completion of a nationwide certification 16


exam. Finally, each designation requires three years’ work experience in the field. In practice, the CFP is the most common of the credentials. The CPA/PFS traditionally emphasizes tax planning, while the ChFC emphasizes insurance planning. We CPAs know the benefits of belonging to professional associations such as the ICPAS for training, education, problem-sharing and networking. The largest financial planner organization is the Financial Planning Association (FPA), while the AICPA’s Personal Financial Planning (PFP) division supports CPA financial planners. Financial planners who operate on a fee-only basis (and will not accept insurance and investment product commissions) may join the National Association of Personal Financial Advisors (NAPFA).

Registrations & Licenses Generally, CPAs and others who advise on investments as part of their PFP services have to register with either the state in which they do business or with the SEC. Investment advice includes both client investment recommendations (non-discretionary management) and buying and selling investments on behalf of clients (discretionary management). In Illinois, state registration is required when client assets are less than $100 million. Otherwise, planners must register with the SEC. Registration takes place at both the firm level (as an investment advisor) and at the individual level (as an investment advisor representative), except in certain solo practices. Also note that financial planners who intend to sell commissionable investment and/or insurance products have to be affiliated with a broker-dealer firm, and become a registered representative of that firm. Investment advisor representatives and registered representatives must also success-

fully complete one or more securities license exams in order to do business. These exams are administered by FINRA, the Financial Industry Regulatory Authority, which is also charged with supervising broker-dealer firms and registered representatives. Investment advisor representatives have to pass the Series 65 exam, while registered representatives have to pass the Series 6 exam to deal in mutual fund and other investment company products, or the Series 7 exam to also deal in corporate securities, municipal securities, options and direct participation programs.

Business Models At the onset of establishing a personal financial planning business, CPAs have to decide whether they intend to collect commissions on the investment and insurance products they recommend, charge fees to clients for advice or services, or both. Those who collect commissions are able to sell insurance products, and often include lower net-worth clients as part of their target market. Most planners, however, choose to earn compensation through both fees and commissions, thereby expanding their services to the widest market available. This type of dual registration means you’re subject to the compliance requirements of both FINRA and the state or SEC. In light of professional liability, CPA personal financial planners often operate their planning businesses out of a separate LLC or other entity.

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PFP Benefits From a business perspective, adding personal financial planning services to your practice helps you to diversify your revenue stream. It also smoothes the typically cyclical nature of cash flows during busy season and other tax-filing deadlines. From a personal standpoint, practitioners can develop their practices any way they want to. If you want to target a niche market like corporate executives or retirees or teachers or athletes, you can do so. If you want to offer limited services like hourly consultations, or more complete services like project-based engagements, or comprehensive services such as ongoing portfolio management and performance reporting, you can do that too. There are thousands of ways to offer some form of personal financial planning. The challenge is getting up to speed on PFP practices and determining what’s the best fit for your interests, experience and skill set.

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Score with the Big Four Five ways to make yourself the Big Four’s next All-Star recruit. By Derrick Lilly


hether you’re an accounting student or a young professional still getting your feet wet in the accounting and finance world, there’s likely one thing you’re pining for: Big Four experience. Having a Big Four name on your resume simply looks awesome. The only problem is, most of your peers are chasing the very same dream. “The competition is fierce,” says Alyson Ryan, a former campus recruiter for KPMG and PwC, and director of Business Career Services at Loyola University in Chicago. “It’s not unusual for recruiters to get 800 resumes during a single four-hour career fair.” And don’t forget that every applicant is competing for a limited number of widely marketed positions, posted on campuses, at career fairs, on the firm’s website and on job boards across the web, among other places. Here, then, are five ways to stand out from all that competition. 18


1. Make the right moves Your first steps: Check your ego at the door, take advantage of every opportunity to make contacts and don’t get discouraged along the way. You can absolutely find a position with the Big Four, and it never hurts to ask for help. “It’s hard to get in if you don’t go through the right channels or get referred by someone within a firm,” says Ryan. “Applicants can’t be shy about using their contacts for referrals. If you’re still in college, take advantage of the incredible amount of access to recruiters that you’ll never have again. It’s critical to meet campus recruiters and career advisors, and then stay in contact with them.” “The most important thing is to keep every line of communication open,” adds Warren Smith, Ernst & Young’s Midwest People Leader, especially for experienced hires. “We’re in a highly relationship-oriented business, and your ability to network and connect with people is

always important. About half of our experienced hires are by way of employee referrals.”

Insider Tip: Don’t forget about your campus career center. Both Ryan and Smith strongly encourage current students and alumni to turn to campus career centers for help in making connections, locating internships and career opportunities, fine-tuning resumes and honing interview skills. 2. Make a good impression fast

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“You don’t have a lot of time to make an impression on recruiters at most events, so you have to present yourself professionally, you need to be friendly and approachable, and you have to follow up,” says Ryan. But be forewarned; don’t get too friendly. Chances are you’ll get to know some recruiters pretty well if you frequent career events, but you can’t consider them your friends or be too casual; after all, it’s a professional relationship. Always keep in mind that recruiters and hiring managers are asking themselves, “Is this candidate someone we would feel comfortable putting in front of our clients?” “Firms are looking for well-rounded recruits,” says Ryan. “There’s a misconception that being really book smart is all that matters to succeed in public accounting, but that’s absolutely not true. You have to be personable; you have to be someone who can bring in business as you progress in your career.” “Working everyday hand-in-hand with clients in the professional services business creates a wide range of stressful and challenging situations,” adds Smith. “Being able to flex your style, and connect and engage with different people in different situations, is very important.”

3. Be socially conscious While a good academic track record is important—especially if you’re currently a student—candidates also need to demonstrate attributes such as strong technical and soft skills, relevant work experience, the ability to manage commitments and a proven interest in volunteerism. “Community service experience is becoming more important because clients and candidates are increasingly expecting solid evidence that firms are committed to the community and environment,” says Ryan. “Firms expect their staffs to participate in volunteer initiatives, and are looking for candidates who are already active.” That doesn’t mean you should list each and every club or volunteer initiative you’ve ever been involved in on your resume. “It’s not just the fact that you’re involved or have volunteered; we’re looking at what you’ve done during that process,” Smith stresses. “You don’t want to only be able to say, ‘I’m a member and I go to the meetings,’” Ryan continues. “You want to be able to say, ‘I was elected to this position, and these are my accomplishments.’”

4. Give a killer presentation Of course, the best place to detail your accomplishments is on a carefully crafted resume, so get it critiqued by your contacts and career center staff. “It’s really important to have it in a layout that’s pleasing to the eye and free of unnecessary information,” says Ryan. “Decisions on who to invite to personal interviews often have to be made very quickly, and I commonly see resumes that make it challenging to find the critical information recruiters look for.” Including a clear objective statement unique to the opportunity you’re applying for is critical. “People who can clearly state their objectives and why they feel their experiences are valuable are the ones who really stand out,” says Smith. “We expect applicants to have

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done their homework and to know the organization they’re applying to. Hopefully that’s portrayed on their resume.” Applicants also should pay particular attention to any application rules or requested details to ensure their resumes are accepted in the first place. Meaning, if a firm posts 20 distinct jobs and says to apply for one, don’t apply for them all. “Sometimes applicants think that applying for every single position will increase their chances of getting an interview, but the opposite happens,” warns Ryan. “There have been situations where recruiters simply say, ‘You can’t follow directions, I’m not interviewing you.’”

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your eligibility date on your resume. “Recruiters work backwards from that date to determine where you fit in the recruiting cycle,” says Ryan.

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When you’re called in for a face-to-face interview, be ready to shine. Preparation, performance and punctuation are the “three Ps” that matter, says Smith. First, research the firm you’re interviewing with. You have to understand the organization, what it’s known for, what’s important to it, and what type of person it’s looking for. You can learn most, if not all, of this from the firm’s website. Next, “Be prepared to come in and tell your story,” says Smith. “A lot of candidates look great on paper, but in person they’re less dynamic. Those that do well always have a very cohesive story about why they chose to do the things they’ve done, what they’ve learned as a byproduct of their experiences, and why they fit into the firm.”

Insider Tip: Have a good question ready. “One thing that always baffles me is when a candidate doesn’t have any questions for me,” says Smith. “Surely, you can ask me something that will show me you’ve done your homework and are truly interested.”

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Finally, it never hurts to show your appreciation. “Call me old-fashioned, but I like a ‘Thank You’ note,” says Smith. “It demonstrates your conscientiousness and appreciation, and when it’s not done it sticks out.” “A well-written personalized note that shows a genuine interest in the position can help candidates stand out to recruiters or hiring managers who are still on the fence,” Ryan adds. Remember, though, that landing a Big Four job isn’t the be-all-end-all of your career. “There are advantages to working for small and midsized firms, and there are advantages to working for the Big Four,” says Ryan. “You learn these advantages by meeting and interacting with people who work at these different firms; the Big Four isn’t for everyone and there’s nothing wrong with that.”

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Can You Keep a Secret? What privileges and protections apply to Illinois CPAs and their clients? By Brian J. Hunt, CPA/JD


ot all information is intended for public disclosure, and the law recognizes this fact. The two most common legal protections are the attorney-client privilege and the work-product doctrine. In Illinois, accountants also have their own privilege, known as the accountantclient privilege. Of course, an assertion of protection is easy to make. But, if contested, a court may rule that protections simply don’t apply. Stopka vs. American Family is a case in point. The Stopkas had employed a builder for a single-family home project. The builder, in turn, hired various subcontractors, one of which caused a fire. Subsequently, the subcontractor’s general liability carrier, American Family, was engaged to remediate the construction. Aside from their lawyers, the Stopkas also relied heavily on their CPA and financial advisor, Wolowicki, who provided advice and



acted as their representative in communications with American Family, various remediation subcontractors and their attorney. When the relationship between the Stopkas and American Family broke down, the Stopkas filed suit against the liability carrier and, as is customary, American Family requested the formal production of certain documents. The Stopkas withheld 22 emails sent to and from Wolowicki and their attorney, asserting that these items were protected by the attorneyclient privilege, the work-product doctrine and the accountant-client privilege. The Court therefore was forced to decide on the applicability of these protections. The attorney-client privilege is designed to encourage open discussion between attorneys and their clients. To be enforced, the parties have to establish that the communications 1). were made to any attorney acting in their legal capacity, 2). originated in the belief that they would not be disclosed, 3). involved legal

advice, and 4). remained confidential. The privilege protects communications flowing from the client to the attorney and vice versa, but is to be construed within the narrowest limits possible. By contrast, the work-product doctrine protects documents that an attorney or party representative creates in anticipation of litigation. A lawsuit need not be underway, “provided the prospect of litigation is not remote.” The protection prevents the disclosure of protected documents or communications, but doesn’t protect the underlying facts from disclosure. The statutory accountant-client privilege in Illinois, like the attorney-client privilege, promotes open and forthright disclosures by individuals using accounting services. It has four requisite elements: 1). the communication must originate in the confidence that it will not be disclosed, 2). the confidential element must be essential to maintaining the relation of the parties involved, 3). the relationship itself must be one that public opinion believes should be protected, and 4). disclosing the communication would injure the relationship between the parties more than the underlying litigation would be benefited by its disclosure. Furthermore, the accountant-client privilege doesn’t extend to communications disclosed to third parties, unless those parties have a common interest with the disclosing party. Once the Court compared these privileges, it turned to the question of application. As for the work-product doctrine, the Court concluded that certain documents were protected insofar as they were created just before or soon after the action was filed. However, it concluded that the accountant-client privilege didn’t prevent disclosure, and further noted that the privilege only protects “accounting services involving opinions on financial statements,” and doesn’t extend to non-financial services. Although the Court acknowledged there were services that could be interpreted as giving rise to the accounting privilege, it concluded that the relevant issue wasn’t the general nature of Wolowicki’s work, but rather whether the specific documents named involved activities that were protected. Ultimately, the Court concluded that the Stopkas failed to carry the burden of proof.

For purposes of the attorney-client privilege, the Court separated the remaining emails into two categories: Emails between Wolowicki and the Stopkas, and emails sent to or by one of the Stopkas’ attorneys to Wolowicki and/or the Stopkas. Under the first category, the Court noted that just because an email doesn’t involve an attorney as a direct sender or recipient, it doesn’t necessarily mean that the attorney-client privilege won’t apply. However, the Court also noted that, irrespective of the sender or recipient, the attorney-client privilege extends only to communications that either seek or give legal advice. Concluding that this category of documents didn’t reflect any intention of confidentiality, the Court determined that it wasn’t protected by the attorney-client privilege. Under the second category, the Court noted that the mere involvement of an attorney isn’t sufficient to establish the attorneyclient privilege. Rather, each document has to show all the hallmarks of the privilege. The Court also noted that a privilege can be waived by disclosure to third parties, but that analysis of the attorney-client privilege also has to consider whether the third party is a proper agent of the client. Ultimately, the Court concluded that disclosure of information to Wolowicki, who was a “central cog” in the Stopkas efforts to resolve this matter, didn’t constitute a waiver of the attorney-client privilege. Accordingly, it found that, in those instances where the communication was to or from an attorney and originated in the belief of confidentiality regarding legal advice and remained confidential, the attorney-client privilege did apply. For accountants, attorneys and the people who rely on them, the Stopka decision is a useful example of how information should be generated and shared in order to protect it from disclosure, and how a court ultimately will apply those protections. Brian J. Hunt is the founder and managing principal of The Hunt Law Group, LLC, which focuses on the counseling and representation of CPAs and other business professionals, and on the resolution of business disputes. Brian was recently selected as a “2013 Illinois Super Lawyer in Business Litigation.” Reach him at 312.384.2301 or

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Audit Hike A multitude of factors have conspired to increase audit fee volatility. By Carolyn Kmet


en years ago, SarbanesOxley (SOX) was signed into law. Largely considered to be the most significant piece of reform legislation since the Securities and Exchange Act of 1934, SOX set new and enhanced standards for public companies, and management and accounting firms. Since its enactment, financial transparency and compliance have become an absolute must, and auditors are now part of every company’s front-line force. So what has this meant to audit fees? In 2004, accelerated filers became the first group required to comply with Section 404 of SOX. This section mandated that all publicly traded companies would need internal controls and procedures in place for financial reporting, and that management would take responsibility for these measures. As such, Section 404 was expected to be the most expensive section of SOX to implement. Audit as well as non-audit fee data disclosed by SEC accelerated filers in electronic filings was compiled into an Audit Analytics report, Audit Fees and Non-Audit Fees: A Ten Year Trend. According to this report, the average amount of audit fees paid per $1 million of revenue increased from $405 in 2003 to $596 in 2004, a 47-percent jump. Since then, the report found that audit fees have trended downwards, and in 2011 they reached their lowest value since 2004—$466 of audit fees for every $1 million in revenue. “I believe the downward trend was due to three concurrent factors,” explains Donald Whalen, Audit Analytics’ director of research. “First is the fact that many of the initial costs 24


incurred to implement the requirements of SOX 404 were one-time costs. For some companies it may have taken a couple of years to improve ICFRs (internal controls over financial reporting) to the point of effectiveness. But after the improvement is achieved, those particular costs cease.” Second, says Whalen, “Improved software systems and other procedures enabled more efficient access to information, reducing the costs associated with independent audits. And lastly, audit firms have become more efficient as the process of implementing SOX 404 requirements has become more routine.” However, according to a Financial Executives Research Foundation survey released earlier this year, private companies reported a 7percent increase in external audit fees in 2011, while publicly held companies reported a 5percent increase. The 2012 Audit Fee Survey summarized the responses of executives from 111 publicly held U.S. companies, 138 privately held U.S. companies, four foreign companies and 24 nonprofit organizations. Specifically, publicly held companies reported paying an average of $3.9 million in total audit fees for FY2011. The primary reason given for the increase was more work for internal audit staff and other finance staff. Private company respondents reported an average of $231,200 in total audit fees in 2011. They cited more work for internal audit staff as a primary reason for the increase, as well as inflation. The 2011 numbers deviated slightly from the trend of recent years. In 2008, 2009 and 2010, Audit Fee Survey respondents from both private and public companies reported that fees either increased less than 4 percent over the prior year, or decreased. Even so, Andrew Schrage, coowner of Money Crashers, a personal finance blog, points out that the subtle rise over the past few years is nothing compared to the early 2000s. “Audit fees rose by more than 100 percent from 2001 to 2004, right around the time of SOX and the collapse of Enron and Arthur Andersen,”

The Illinois CPA Society

THE FOLLOWING INDIVIDUALS WHO EARNED THEIR CPA CERTIFICATE IN 2011. A Lauren Abate Malik Abbas Brett Abrams Philip Adeleye Sabina Ademi Jeffrey Aerni Benedict Affetto Janet Afflerbach Mariam Afzal Kolade Agbaje-Williams Ayaz Ahmad Faiza Ahmed Nabeel Ahmed Marwa Akef Kamran Alam Dania Aldouri Christophe Alexandre Elitza Alexandrova Margaret Alikpala Johnny Allgaeuer Kimberly Altergott Steven Altheide Courtney Ambrosch Nikolaos Analitis Brittany Anderson David Anderson Ryan Anderson Lea Andrews Evguenia Andrianova Christopher Anello Ashley Aneloski Danielle Anetsberger Janis Ang Nickolas Angelo Alexa Angotti James Annerino Christine Antrobus Toshiaki Aoyama Angela Appello Basel Arafe Rizwan Arastu Ruben Armenta Karina Arreci Wilson Atiabet Danielle Atkins Arthur Augustynski Matthew Aumick Lina Austrevicius Carolina Austria Betsy Awni Akintomiwa Ayemobola Scott Ayotte Azam Azeem Ausra Azuolaityte

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Sandra Borto Carol Bossenbroek Vincent Botti Adam Bourgeois Dimitra Bourgis Catherine Bowers David Bowers George Bozonelos Melissa Bradford Joel Bradley Kellie Bradley Anand Brahmbhatt Andrew Brainard Joshua Brantner Kyle Branyik Charanjit Brar Alex Braser Allison Brett Ashley Brewer Scott Brillhart Kasie Brink Gavin Bristow Allison Brizgys Kelly Jo Broecker Richard Bronge David Brown Nikki Brown Michael Bruggeman Kim Bruynell Christopher Buck Shelly Buesing Doan Bui Jacqueline Bujdei Diana Burbick Anna Burda Jordan Burdinie Amber Burkitt Brett Burkitt Ryan Burklow Kara Burlinski Brett Burns Christopher Burns Robert Burns Gregory Buschur Bryan Bush Michelle Bush Cassidy Buss Rebecca Busuttil Devin Buswell Barrett Byers Jacob Byers Daniel Byles-Smith Sean Byrne Thomas Byrne

C Niki Cahill Dan Cai Hongru Cai Kenneth Calderhead Jennifer Calderon Robin Callen Laurie Cameron Martha Campusano David Canmann Steven Canny Martin Caplan Marceliana Caragan Michael Caramagno Luigi Carlos Joshua Carlson Stephanie Carlson Henry Carney Janet Carney Maria Carollo Michael Carpin Brian Carroll Logan Casanova Michael Casey

Sarah Casey Rachel Catoe Merlin Cavallin Susan Cellar Lauren Centioli Justine Cezar Jennifer Chae John Chalfant Robert Chamness Simon Chan Tiffany Chan Michael Chandler Chih-Han Chang Sow Chang Mei-Hsuan Chao Yu-Chun Chao Diane Chapel Salima Charania Khushboo Chaturvedi Araceli Chavez Sheena Chawla Stephane Jung Che Wong Chee Shean Liu Chen Lu Chen Robert Chen Wei Chen Xue Feng Chen Zhuoxun Chen Hai Jia Cheng Hung-I Cheng Lu Cheng Nai-Wei Cheng Hiu Tung Cheung Karen Cheung Ketaki Chhabra Ping-Hsien Chiang Marie Annabelle Chico Swapna Chigullapalli Kenneth Childers Steven Chin Yeehwa Chin Catherine Chisholm Francis Chiu Peter Chmiel Robert Chmielewski Meng-Hsuan Cho SungHee Cho Yeon Suk Cho Bo-kyeong Choi Hyo Choi Okjoo Choi Brittany Chorman Joanne Chow Kin Fai Chow Ashley Christenson Jill Christie Lee Christoff-Tempesta Man Ting Chu Troy Chuinard Hayoung Chung Yolanda Chung Patrick Clancy Timothy Clark Charles Clow Misael Cobarrubias Scott Cohen Yana Cohen Barrett Coleman Eileen Collins Jared Collins Patrick Comiskey Benjamin Comstock Colleen Condon Audrey Conley Thomas Connell Blair Cook Justin Cook

Elizabeth Coop Joel Cooper Adam Corbin Kimberly Corbin Brendan Corboy Neal Corral Renelle Corral Dennis Corrigan Lauren Coste Adam Cotter Brian Coughlin Michael Couillard Jonathan Coultis Jonathan Coutre Alyssa Cowart Rachel Cox Charles Craven Christine Cregg Daniel Crescent Ashley Cribelar Maureen Crinion Melody Crisp Sally Crnkovich Matthew Croghan Travis Cronkhite Keith Crow John Crowe Christopher Cruz Donna Vinna Cruz Luzviminda Cruz Maria Cryns Zdravka Cuckovic Lucica Cucu Ryan Cullen Elizabeth Cunneen Collin Custis Wioleta Czajkowska Michelle Czyz

D Malgorzata Dabkowska Joanna Dabrowska Parag Dadhaniya Andrew Dahmer Xiyu Dai Anthony Dal Compo Daniel Daly Ryan Daly Michael DaMario Agathe D'Angleja Chatillon Kolby Daniel Nathan Daniels Erica Danielson William D'Anna Christopher Dardi Mark Darin Daniel Daufer Catherine Davies Cliff Davis Eric Davis James Davis Kimberly Davis Troy De Guzman Caragh De Luca Erik De Vries Megan Deahr Alex Dean Trevor Dean Kathryn Dearborn Mary DeBellis-Scianna Elizabeth Dechant Aurora DeCook Anthony Deddo Renee DeFour Charles DeGarmo Andrew Deising Irena DeJohn Jeffrey DeLaurentis

Anthony Delbeccaro Dominick DeLeo Jennifer DelFiacco Theresa DelVecchio Manuel DeMoya Aaron Dennis Sara DePalma Lisa Derrickson Biren Desai Prapti Desai Sonia Desai Thomas DeSimone Brandon Deutsch Laura Devany Heidi DeVette Marianne Dewey Nathaniel DeWitt Bishok Dhungana Jimena Di Iorio Glenn Dian Cecilia Diaz Rocco DiBenedetto Paul DiGangi George Dimitrov Chen Ding Ning Ding Nhi Dinh Pham Bryant Dirkmaat Aniko Divicseri Kokou Dogbe-Tsogbe Brynna Doherty Robert Doherty Ross Dolce Yi Dong John Donovan Justin Dooley Erin Doolin Jenna Doran Christopher Doughty Kirk Doughty Nicholas Doukas Iwona Dowhan Laurel Draut Christine Drews Linxuan Du Michael Dudak Timothy Duffin Adam Dugan Bradley Dunajcik Ronald Dunlap-Lassere Katelyn Dunn William Dunne David Dunnigan Nicholas Dunning Gundogan Durak James Duszynski Andrew DuVoisin Randall Dykema

E Kerry Eardley Daniel Eastman Mariel Eben Jennifer Eberman Gregory Eckman Jennifer Eddy Joanna Eddy Yolanda EdwardsSaywrayne Nicholas Ehrlich Leo Ekon Andrew Elkind Chad Elkins Barry Elliott Ryan Elliott James Ellis William Ellis Abdelhamid Elsharkawy Denise Engelke

Jacqueline Englert Elizabeth Entinghe Stephanie Episcopo John Epperson Andrew Epstein Cornelis Erasmus Ayush Erdene Joshua Esser Michelle Evers Jeffrey Eversden Nadezhda Evstiounina

F Mark Falkenthal Xian Fan Xinyuan Fan Karl Fandel Ashkon Farmand Nicole Faron Syed Farooq Brian Farrer Sandra Fasnacht John Faxel Anne Feeks William Feie Steven Fekety Joshua Feld Elan Feldman Brian Fennelly Agron Ferataj Megan Ferris Chad Fetzer Lisa Fifer-Smith Megan Finn Chance Finucane John Fiorelli Holly Fishel Hannah Fisher Robert Fisher Laura Fitch Andrew Fitzpatrick Timothy Flaherty Ryan Flanagan Shaun Flander Trista Flanigan Amanda Fleischman Jonathan Flemming David Fleury Erika Flores Rosario Brian Flynn John Foley Elisabeth Fondell Anna Fontanella-Antonio Steven Ford Francisco Fornaris Ryan Fortman Ryan Fournier Brian Francis Anita Franz Christopher Frazer Jessica Frechette Christopher Freeman Christopher R. Freeman Lindsay Freeman Caitlin French Trevor Frericks Timothy Friedrich Krystal Friese John Friestedt Tina Frodyma Shuai Fu Joseph Furey Steven Furuyama

G Lowell Gaddis Ryan Gadia Tenisha Gadson Phillip Gaffigan

CERTIFICATE RECIPIENTS Sean Gaffney Damian Galazka Rachel Gallanis Valerie Gallichio Michael Gamage Wallace Gamble Mayur Gandhi Danielle Gant Chengchen Gao Chenxi Gao Huihui Gao Xiaodan Gao Yun Gao Matthew Garard Luke Garbarino Alejandro Garcia Roman Garcia Jonathan Garec Vivek Garg Joseph Garigliano Grant Garza Julie Garza Tanya Gascoigne Conrad Gasior Jaclyn Geary Tameka Gee Diane Generoso Zhaoxia Geng Christopher Gent Ryan Geolat James Georgantas Zachary George Brian Gephart Samhita Gera Shante Gerron Amanda Gerson Benjamin Getz Bryan Geuther Chandra Ghalley Adil Ghazali Joseph Giannini Shayne Gibbons Marc Gibbs Gabrielle Giertz Kyle Giglio Stacey Gill John Gillham Robert Gilmer Luke Gilpin Dominic Giosta Maxime Girard Anju Giri Ryan Girmscheid Laura Givler Emira Gjurgjiali Aleksandar Glezev Jeffrey Glickman Daniel Glotzbach Rachel Glueck Samuel Glustein Chung Wah Gnapp Christine Godell Aracely Godinez Thomas Goldrick Jonathan Goldsmith Silviano Gomez Lana Gonzales Blake Goodman Matthew Goodwin Andrew Gordon Nibha Gosai Justin Goss Craig Gossett Tomonobu Gotoda Chunlei Gou Samantha Goudreau Elizabeth Grabin Sherry Grable Pawel Grabowiecki Joshua Gracia Joshua Graham Julie Graham James Grahovac Patricia Grain Jacob Grall Brenda Graves Melissa Gray Craig Green Melissa Green Stacey Green

Ashley Greenaway James Greenwell Samantha Greenwood Cora Gregory Anthony Greif Donald Greiwe Kevin Grenning Christopher Griffin Lauren Griffin Abby Griffith Melissa Griggs Alexander Grinya Angela Griska Christine Groesbeck Brian Gross Irina Grosse Timothy Grosso Douglas Grove Ryan Guedel Jonathan Guerrero Michael Gugerty Ping Gui Jessica Guiang Richard Guidolin Alan Gulamhusein Adam Guldan Jayani Gunasekera William Gundlach Hongye Guo Lisha Guo Shalabh Gupta Lisa Gurrister Charles Gusswein Mary Anne Gutzmer Laura Guzman Leslie Gvillo

H Dena Haag Benjamin Haass James Habel Kayleen Haberkorn Thomas Hack Amber Hackman Fahad Haddad Patrick Haddon Sara Hafezi Brett Hage Amy Hall Gwendolyn Hall Jason Halling Tyler Hamacher John Hammar Ryan Hammelev Moriel Hamui Haiying Han Sung-Moon Han Edward Hanacek Trista Hanauer Sara Hanks Matthew Hanna Rachel Hanrahan Victoria Hansler Nishit Hansoti Jie Hao Irfan Haqui Eiji Harada Michael Hare Laura Harkness Derek Harlan Ari Harper Daniel Harper Shannon Harper Zachariah Harris Danielle Harrison Michael Hart Molly Hartman Cassandra Hartmann Philip Harty Ramey Hassan Kelly Hasselfeld Brian Hassler Tiffany Hauser Frederick Hausmann Christian Haverney Andrew Hayes Laura Hayes Jennifer Hays Weihua He Xin He Xuelun He

Jason Healy James Heavin Amanda Heckinger Jonathan Heideman Matthew Heikes Jansen Hein Cliff Helfer Maureen Hellstrom Kyle Hemenover Travis Hemming Lee Henderson Monique Henderson Ashley Hendricks Daniel Hendrickson Lion Henrichs Adam Heppe Rhenese Herbert Ewa Herdea Elizabeth Hernandez Gabrielle Hernandez Glyden Hernandez Christine Herrera Todd Hespell Elizabeth Hess Jonathan Hess Brennan Hesselberg Sheila Hessler David Hiatt Lontier Hicks Scott Hicks Nina Hieronymus Yoichiro Higa Julie Higginson Christina Hill Nahrain Hinaro Eric Hinkle Brian Hisel Matthew Hisey Aladdin Hiyasat Amy Ho Man Lai David Ho Leslie Hobson Anna Hodapp Wade Hoey Gregory Hoffman Daniel Hofmann James Holb Ninel Holub Sujin Hong Jessica Honness Anne Hopkins David Hopp Blythe Horan Diana Horoi Sean Hostert Ryan Houlihan Kirk Hovde Matthew Howard Steven Howard Han Chih Hsia Chih-Ming Hsiang Wei-Tse Hsu Felipe Hu Runfeng Hu Yang Hu Dijia Huang Hsin-Yi Huang Ping Huang Wei Huang Weixi Huang Wenshan Huang Yan Huang Yinying Huang Dustin Huber Jennifer Huckstep Monika Hudak Ian Hudson Galen Huette Sean Hughes James Hugill Christina Huizar Jeffrey Humbard Brice Humpolick Kuo-Wei Hung Brian Hunt Matthew Hunt Jereline Hur Guo Hutson Isabelle Huynh Jennifer Hynek

I Cristian Ianos Mohammed Ibrahim Reshma Imran Nico Angelo Inocencio Yuji Inoue Bryan Irlbeck Ashton Isenberg Ryohei Iwai

J Nadia Jaber Angelina Jackson Ashley Jackson Dana Jackson Michael Jackson Kevin Jacobson Christopher Jacquier Yash Jadhwani Tristin Jaeger Andrea Jaffe James Jagodzinski Laura Jaicomo Lukasz Janas HyunSuk Jang Nicholas Janis Tannya Jara Jaroslaw Jarmola Katherine Jaronczyk Ryan Jefferson David Jelonek Chelsea Jensen Chaonan Ji Yinhua Jia Qin Jiang Xiao Jiang Ye Jiang Jose Jimenez Dancheng Jin Michael Jo Andrew Johnson Brenda Johnson Bryan Johnson David Johnson Kyle Johnson Laura Johnson Mark Johnson Melody Johnson Michael Johnson Stephen Johnson Timothy Johnson Wesley Johnson Jacob Johnston Aanuoluwapo Jolaoso James Jones Jill Jones Kaitlin Jones Samuel Jones Sterling Jones Timothy Jones Trevor Jones Myong Chol Jong John Jordan Ivan Jovcevski Zi Ju Wen-Ping Juan In Hwa Jun Emily Jung Sung Hee Jung

K Dominic Kaczynski Christopher Kadonsky Wade Kaesebier Thomas Kafkes Matthew Kaftanich Thomas Kaiser Vinod Kalathil Bryan Kalina Yevgeniy Kalinin Christopher Kalogeropoulos Shambavi Kamaraj Jenny Kaminski Michael Kaminski Kenneth Kamps Joseph Kanaval Jiye Kang Katherine Kang Amin Kanji Ashley Karelitz Veranika Karnatsevich

Naeem Katiya Elizabeth Katzenbach DarLynn Kauffman Brant Kaufmann Colleen Kazunas Brent Keegstra Patrick Keeley Kathleen Keen Elizabeth Keeney David Keeter Brian Kehoe Katie Kelch Timothy Kellen Matthew Keller Sarah Keller William Keller Rebecca Kelley Anne Kellman Allison Kellogg Colleen Kelly Christopher Kelso Caleb Kelson Janet Kemp Theresa Kengott Kevin Kenny Timothy Kenwick Brent Kerby Kyle Kett Laura Keyton Abdul Khan Saida Khan Maryia Khanevich Karim Khaoulani Jyoti Khatwani Hasrat Khehra Martin Kicki Allison Kief Brittany Kiefer Kirsten Kienzler Troy Kierczynski Ryan Kieser Katherine Kikut Kathleen Killion Chin Kim David Kim Eui-Young Kim Frank Kim Hansang Kim Hyun Woo Kim Jennifer Kim Jongheon Kim Jung Hyun Kim Kevan Kim Paul Kim Peter Kim William Kim Brad King Kevin King Lauren King Matthew King Zachary King Brendan Kinkopf Kelly Kipp Jill Kirbach Julie Kirbach James Kirkby Jonathan Kissau Andrea Kistner Alexander Kita Michele Kitch Nicole Kitto Danielle Klaffenbach Michelle Klangides Kayla Klauser Evan Klein Stephen Klein Alexander Klemme Courtney Kling Erik Klingenberg Karen Klootwyk Robert Klug Kelli Kluga Melinda Kneedy Ewa Knobloch Heather Knorr Justin Knorr Shane Knouse Jordan Knue Douglas Knutson Franklin Ko

Jae Ko Pei-Chun Ko Justyna Koc Kristin Koch Michael Koch Ashley Koelling Won Ho Koh Kathryn Kohles Gregory Kolar Charles Kolenik Kimberly Kolman Deni Koloper Masamichi Komatsu Jennifer Kong Patrick Konicki Wakako Konieczny Jarrad Koon Keith Koopmans Erica Kopp Allison Koren Dianne Korizon Daniel Korybalski Christopher Kosartes Manali Kothari Katharine Kou Nicole Kouri Panagiotis Kourliouros Karlin Kouvelis Antoaneta Kovacheva Teresa Kowalczyk Ymelda Kratky Daniel Kreisel Stacy Kremer Brian Kristof Kaitlyn Kroeger Kate Krones Semir Krpo Samantha Kruger Kyle Kruke Gregory Krzentz Jamie Kuehl Catherine Kuhn Cheryl Kuhn Michael Kulov Shilpa Kumar Shishir Kumar Thomas Kunst Denis Kurdyukov Ashley Kushner Tyler Kutz Kory Kutzke Ashley Kwak Donghyup Kwak Eujin Kwak Min Jung Kwak Michelle Kwan Kimberly Kyrouac

L Lalaine Labio Anna Lachowicz Connor Lacy Kristen Lady Kristofer LaFore Nicholas Lagattuta Emily Laipple Dawisee Lam Nicolette Lambropoulos Ning Lan Telma Landhorian Richard Landuyt Emily Lane Katherine Lang Michael Lange Doreen Langereis Nikki Lanier Brandon Laning Anne Lardner Jennifer Larvick Matthew Lator Julia Latovin Scott Latter Freeman Lau Kimberly Laube Steven Laube Theresa Lavelle Jean Lavery Mandy Law Nadou Lawson Jonathan League Mark Leaheey

Stephen Leazzo William Lebar Robert LeBourveau Chi-Ching Lee Dennis Lee Eric Lee Gayoung Lee Janet Lee Katherine Lee Lily Lee Megan Lee Meredith Lee Michael Lee Shelly Lee Jennifer Lees Alysia Lehner Nickolaus Lekovish Elizabeth Leleika Michael Lenard James Lenihan Stephanie Lentz John Leonard Claudia Leow Steven Leske Samantha Lesnicki Orissa Leung Ori Lev Andrew Leveque Brent Levitt Bartlomiej Lewandowski Linda Lewandowski Melissa Lewandowski Alexander Lewis Hanli Li Yuran Li Duo Liang Hui Liang Jean Liang Jiayi Liang Simon Liang Yi-Ting Liao Jan Lin Jana Lin Pei-Hsiu Lin Tein-Chin Lin Tzu-chi Lin Yao-Jia Lin Yu-Chun Lin Nannette Lindberg Brewster Lindblad Kyle Lindquist Nicole Link Christine Lintker Angela Linz Justin Lipow Jason Lipschultz Michael Lipsey Kerry Lisman Andrew Litwin Jia Liu Jia-Ying Liu Lin Liu Luxiao Liu Mingjing Liu Qinglin Liu Yixue Liu Yu Yan Liu Yuan Liu Zhixu Liu Jno-Lyi Lo Candice Lockhart Theodore Lockhart Matthew Lodes George Logothetis Sean Logue Ali Lohnes Candice Long Mark Longo Patricia Lopez Daniel LoPiccolo Kelly Love Sara Lovell Richard Lovitt Erin Lowenthal Shuning Lu WenJun Lu Lijun Luan Jessica Lubczynski Ryan Lubinski Jamil Lucman

CERTIFICATE RECIPIENTS Timothy Ludwigson Ifeoma Lueg Andrew Lueke Gloria Lui Ka Young Lui Yuen Yan Lui Jamie Lukaszewski Elizabeth Luken Jieping Luo Wenchen Luo William Lustgarten Jennie Ly Kate Ly Lora Ly Stacy Lybe Ryan Lydon Jennifer Lynch Kamy Lynch Mark Lyznicki

M C Yee Gallant Ma Wajahatuddin Macci Carolina Maciel Eric Macke Colin Maclaughlin Megan Madden Mark Madeck Stephen Mahalick Denis Maher Alfie Mahmoud James Mahon Cheryl Maier Stephen Maier Paul Mailhot Zuzana Majtanova Tushar Makwana Marisa Malave Paul Malayter Roxana Maldonado Kathryn Malham Maura Malloy Kaitlyn Maloney Matthew Malpass Diana Mammoser Delora Mancera Rajitha Mandepudi Emily Mangan Shawn Mangan Joseph Mangano Sarah Manijak Nataliya Manina Joshua Mann Amanda Manon Claudia Manos Rajender Mantra Michael Many Vanessa Maravilla Tara Mareth Jennifer Mark Steven Markowitz Jeanne Markus Patricia Maroney Gena Marquez John Marrin Blair Marsh Robert Marsh Kimberly Marshall Michael Martens Hugo Martinez Gregory Martyn Arlie Marx David Marzec Justin Mascarenas Eric Mason Kelly Masquida Elaine Massner Ryan Masterson Thomas Masterson Daniel Mater Chea Matherne Joseph Mathew Taylor Mathson Akiko Matsui Brittney Mazewski Kristina Mazouch Peter Mazur Jonathon Mazzanti Amanda McAbee Cheryl McAllister Sean McAndrew

George McCague Mark McClellan David McClelland Julie McClure Lauren McComb Justin McConkey Jennifer McConnell Jessica McCormick Alicia McCoy Shawn McCullough Eamonn McDonagh Katrina McEnerney Linda McField Michael McGovern Rebecca McGrath Mazda McGregor Sean McInerney Allison McIntosh Samuel McKay Kathryn McKechnie Terrence McMahon Lynne McMillan Patrick McOmber Sarah McWhirter Claire McWilliams Krista Mealor Michael Meek Alap Mehta Aman Mehta Lichen Mei Steven Meilleur Jaime Mejia Nicole Melander Ryan Melville-Gray Thomas Melvin Ulysses Mendoza Jeffrey Mensch Michael Mercier Rebecca Merten Jennifer Mette Brittany Metz Brett Meyer Jennifer Meyer Jeffrey Meyers Ryan Meyler Sarah Michels Daniel Migacz Nicholas Mihalopoulos Michael Milazzo Amanda Millard Benjamin Miller Brett Miller Erin Miller Jason Miller Laura Miller Milton Miller Craig Millspaugh Stephen Minich Brittany Minkler Borislav Minkovskiy Tom Minnes Kathleen Minor Karine Mirzoyan Gregory Mitchell Takumi Miyakawa Nobukazu Miyoshi Pawel Mizak William Moeller Abdullah Mohamed Fatima Mohammad John Molner Koji Momiyama Md Moniruzzaman Justin Mooney Matthew Moore Kevin Moran Wesley Moran Yuliana Moreno Elizabeth Morlock Olha Mormul Stephanie Morrison Timothy Morrison Daniel Morrissette Gregory Morrissey Megan Moss Michael Mounts Chiarath Moutairou Gary Moy Tyler Moynihan Kristen Mroz

Ryan Mroz Nola Mucllari Kristin Mueller Zeeshan Mughal Melissa Mui Sean Mulchrone Megan Mulherin Mohammedamin Mulla Anne Munaretto Jagjyot Mundi Brian Munin Muhammad Munir Syeda Munir Celestin Munyansanga Ashley Murphy Paul Murphy Richard Murphy Karelyn Murray Matthew Murray Shelley Muszynski Boniface Mwangi

N Chad Nagelberg Ron Naidu Seiko Nakafumi Adam Nakis Padmavati Namuduri Heidi Nance Sabahat Naseer Jonathan Nass Paul Natalino Katherine Nauert Christopher Navratil Joachim Nchunda Spencer Nedved Joseph Neiman Michelle Nelson Trevor Nelson Bradley Nemeth Kyle Nesslar James Neumann David Neven Donald Newman Kelly Newsome Yeuk Chu Ng Ngoc Nguyen Samuel Nguyen Min Ni Anna Niemkiewicz Iris Noblet Colleen Nolan Matt Noonan Jessica Norman Marc North Michael Novitski Joseph Novotny Brandon Nowak Jeremy Nuzzo Carlton Nwankwo

O Bede Obasi Michael O'Brien Richard Ochenkowski Joseph O'Connor Michael Odling Ryan Ogasawara Jamie O'Gean Ekene Okafor James O'Keefe Yulia Okun Nicholas Olivares Samantha Olschansky John Olsen Bryan Olson Marie Olson Nanciann Olson Gerard O'Malley Victor Omiyale Alex O'Neil Andrew Opeitum Anthony Orlando Robert Orozco Sebastian Orth Lisa Ortner Richard Osei Peter Osei-Amoako Megan Osmond Tara Osterhoff James Ouderkirk


John Pach Laura Pacheco Oscar Padilla Erica Palag Jennifer Palarz Itza Palma Alonzo Palomares Qianqian Pan Matthew Panzica Kaushal Parekh Edward Park Mihwan Park Nimish Parker Thomas Parker Orlando Pastore Jay Patel Jignasa Patel Kayur Patel Komal Patel Michelle Patel Neal Patel Pritesh Patel Sachin Patel Samir Patel Shilen Patel Zachary Paterick Sivakanthan Pathmanathan Chad Patterson Nathan Patterson Eric Patton Benjamin Patzik Clint Paul Lucia Paul Marissa Paulsgrove Whitney Paulsmeyer Stephanie Payne Aaron Pearce Ardenia Peart Joseph Peck Rachel Peckler Akushla Peduruhevage Jeffrey Pellin Alexandria Penaranda Pei En Peng Nicholas Penn Aleksandra Perets Ian Perez John Perkins Toni Perkins Laura Persons Yan Pesotskiy Zlatomira Petersen Mario Petrovic Jennifer Pettis Alex Peurye-Hissong Dane Pfister Ha Phan Adam Phillion Denise Phillips Galena Phillips Patrick Phillips Paul Phillips Christopher Piatek Lisa Pieper Jeremy Pierce Roger Pierce Kyle Piereth Roman Pietryka Charles Pikul Jeffrey Piotrowski Michael Piper Michelle Pitts Alex Platt Bruce Plum Matthew Poczatek Samantha Podwika Daniel Polhill Charles Polke Sarah Pollard Margarita Polyakova Oleg Polyatskiy Adam Pontious Lawrence Pope Daniel Popiela Elizabeth Postlewait Chithra Potty Jane Powers Jason Powers Mark Prampero

Samuel Pranckus Richard Pratt Kenneth Preiksaitis Lyle Prempas Joshua Prince Danielle Protexter Rita Proulx Matthew Prucha Maxime Puech Elena Pugh Marc Pugh Joshua Puterbaugh Vinu Puthenveetil Jossy Kristine Putnam

Q Meng Qi Lynn Qiu Joseph Quebbeman Leon Querubin Michael Quinn Lauren Quirke

R Imanuel Rabrich Linda Raddatz Marisa Rademacher Ashok Raghavan Scott Ralston Renee Ramel Jason Ramey Ali Rampurawala Giuseppe Randazzo Cameron Randle Sarah Randquist Janet Ranzzoni Mary Rathert Joseph Raupp Gabriela Rayas-Baker Nicole Rebbe Robert Recht Sonila Reci Bryan Redder William Redpath Amanda Reed Greg Reedman Kevin Reeve Jonathan Reeves John Regan Daniel Rehor Amy Reimer Bruce Reinhart Kristina Rengel Patrick Reynolds Mikhail Reznik Maurice Richardson Michael Richardville Robert Ridlen Courtney Rieth Rocco Rinaldi Fayelyn Riordan Paul Ripsky Dana Rissley Stephen Roach Bernadine Robbins Daniel Roberts Kimberly Roberts Claire Robinson Kory Robinson Paulina Robledo Jacob Rockafellow Armando Rodriguez Kelly Rogers Kyle Roggensack Daniel Rohr Agustin Rojas Jacek Rokosz Daniel Romero Robert Romo Elizabeth Ronge Adam Rooney Andrew Rosset Teresa Rossi Christian Rothe Scott Rousse Krystal Ruan Xiaoran Ruan William Ruddy Brian Rudge Paul Rumschlag Dana Rupczynski Jessica Rus

Jonathan Rush Paulina Rusin Alison Russell Nijika Rustagi Leslie Ruyle-Barnett David Rybak Catherine Rybarczyk

S Ilissa Sabath Edwin Sadik Elnara Safronova Elena Sahaydak Melih Sahiner Raj Sai Inderjit Saini Alyssa Sajkowski Mark Sakats Ider Sakhiya Natalie Salazar Eduardo Salcedo Kyle Salvatora Jason Samikkannu Stephanie Samuelson Benjamin Sanchez Heriberto Sanchez Quentin Sandberg Scott Sandberg Jennifer Sanders Nathan Sanders Sarah Sanderson Yvonne Sandner Nathan Sandoz Oliver Santos Aarti Sardana Nicholas Sarkisaw Rachael Sarson Robert Sass Kozue Sato Jacob Sault David Savage Alejandra Sayavedra Anthony Scarcello Jeffrey Schaeffer Joseph Schanz Brian Schaper Scott Schaper Scott Scheidecker Richard Schiller Michael Schilling Zachary Schlechte Ryan Schleich Ryan Schmidgall Sarah Schmidt Kyle Schmitz Matthew Schmitz Philip Schmitz David Schneider Lisa Schneider Nicholas Schneider Gregory Schonefeld Tony Schopen Brittany Schram Brian Schreiber Lisa Schroeck Cynthia Schulz Michael Schulz Kai Schumacher Patrick Schwappach Steven Schwarz Monika Schwesig William Schwindt Karolina Sciuckiene Imelda Scott Patricia Seaman Adam Searles Holly Seegers Eric Seelbach Urime Seferi Robert Seifert Christina Selby Ben-David Semel Anna Semenova Megan Sennett Mallory Sevcik Daniel Sfiligoj Ami Shah Arpita Shah Maheki Shah Mansi Shah Ujwal Shah

Leah Shales Kavita Shankar Brent Shannon Manling Shao Bhrikuti Sharma Poudyel Danielle Sharp Elizabeth Shaufler Jason Shaw Michael Shaw Howard Shaw III Kathryn Sheedy Yuriy Shefer Muneer Shehadi Rong Shen Xiaoli Shen Yingying Shen Nicole Shenouda Erin Shepet Ying Shi Ai Shibusawa Nicole Shick Kelly Shillair SooYeon Shim Machiko Shimono Kang-Kyu Shin Sooyeon Shin Michael Short Yelena Shulman Abigail Shusis Yu SI John Sibilano John Sibley Thomas Sibo Dawn Sickles Sami Siddiqi Joshua Siebert Daniel Siebold David Siebold Caitlin Siedlecki Lauren Siemienas Valerie Sierzega Lion Siin Jing Sima Igor Simkin Reid Simon Archana Singavi Jessica Singleton Ken Sinn Dinesh Sinniah Thomas Siwicki Ashley Siwula Latoya Skeine Katie Skibbe Cara Skowronski Polly Skutta Noah Slabotsky Jason Slafer Casey Slager Matthew Slama Paul Slaughter Jessica Slean Kristen Slusarczyk Kelly Smidl Benjamin Smigielski Andrew Smith Brian Smith Cody Smith Colleen Smith Jason Smith Jonathan Smith Kari Smith Laura Smith Lauren Smith Mandie Smith Matthew Smith Nicholas Smith Brooke Smits Ryan Sneed Jonathan Sniegowski Marie Sniegowski Anna Snow Hanjo Soh Rena Solano Katarzyna Solarczyk Jong Ho Son Brian Song Cindy Song Yousun Song Zhenqi Song

CERTIFICATE RECIPIENTS Reshma Soni Alan Sorba Kent Sorenson Alain Sothikhoun Veronica Soto Fernandez Megan Sowash Debora Spagnolo Alexandra Spellman Marcin Spik Sharon Sritong Ryan St. Joseph Valerie Stables Heather Stachnik Jason Stanckiewitz Kim Standen Lauren Stanley John Starr Jackie Staudacher Erica Stein Stephanie Steinbach Eli Steinberger Jeanne Steines Kendra Stephens Emily Sterling Ross Stern Natalia Sterrett W. Brett Stetson James Stevens Tamara Stockinger Megan Stockwell Gregory Stoerger Kristin Stojcevski Julie Stoller Ann Stone James Stonehocker Dominic Storto Scott Stosek Matthew Stosich Erica Stout Jason Stratton Margaret Stremel Adam Strode Kevin Strutz Dzmitry Stsihneyeu Brendan Stuart Joseph Stuckel Ross Stuursma Gayathri Subramanian Racheal Sudkamp Nilesh Sudrania Bruce Sufranski Daisuke Sugyo Erin Sullivan

Katie Sullivan Maura Sullivan Patrick Sullivan Ming Sun Ro Chia Sun Zhu Sun Sunith Suresh Stella Suryanto Douglas Sutherland Michael Sutis Robert Sutter Elena Suvorova Azumi Suzuki Yasushi Suzuki Corinne Swan Matthew Sweeney Samuel Swisher Michael Szaflarski Kinga Szendala Suk Szeto Suk Keung Szeto

T Miki Takahashi Midori Takenaga Ryuichiro Taki Arthur Tam Joseph Tamburello Wenwen Tan Michi Tanaka Neha Tandon Kathryn Tandy Allan Tang Lin Tang Van Tang Jeffrey Taxe Benjamin Taylor Bryan Taylor William Taylor James Temple Daniel Teper Bradford Terry Dhara Thakkar Sunny Thakkar Linda Theres-Jones Christopher Thiersch David Thompson Kyle Thompson Mark Thompson Susan Thompson Tara Thompson Erin Thorson YiShan Tian Celine Tischler Susanne Tisljar

Staysha Titus Matthew Toczylowski Denica Todorova Alison Toman Tara Tometich Peter Tomkie Daniel Toni David Toni Amanda Torello Steven Trapp Brent Travers Daniel Trevino Abhigna Trivedi Clayton Trolard Chi Tao Tsai Samuel Tsamoulos Andy Tse Amanda Tucker Tara Tunpicharti Bryan Turner Molly Twigg Franceska Tylka James Tyner Sarah Tysk

U Yasuyo Uchida Timothy Ulaszek Scott Ulbrich Ana Ulla Katri Ulmonen Laura Unger Jillian Urbelis Veronica Uwumarogie Rachel Uytenbogaart

V Vinson Vadakara Eugene Vakhovsky Robert Valdes Christopher Vallez Janis Van Durme Adam Van Eperen Lisa Van Geem Nicholas Van Horn Christopher Van Sickle Annelies Van Thillo Joan VanderLaan Julia VanderLaan Richard Vanhoeven Danielle VanHouten Micah Vant Hoff Jeremy Varel Nicole Vari Monica Velamakanni Violeta Velkovski

Kara Venegas Anthony Venezio Alissa Ventrelli Brooke Venvertloh Jose Verastegui Derly Vinchery Jerod Violett Sandeep Virk Gregory Visser Peter Vitale Corey Vnoucek Martin Vogel Carmen Voicu Paul Voswinkel Barbara Vrabel Laura Vrana

W Kevin Wade Elzbieta Wadowska Keiji Wagatsuma Naoko Wakabayashi Brett Walker Brooks Walker Eileen Walsh James Walsh Zoey Walters Alison Walton Nathaniel Wandel Hong Wang Hui Wang Jing Wang Lan Wang Ling Wang Liying Wang Manqing Wang Mengxuan Wang Michael Wang Pengfei Wang Qiang Wang Shuo Wang Tsung-Huei Wang Xiang Wang Xiao Wang Xiaoxue Wang Xin Wang Xun Wang Ye Wang Yinglin Wang Yongmei Wang Yuan Wang Saranporn Wangmuang Michael Warneke Ahmad Warner Jason Warner

Candice Warren James Wascher Santi Wathinanon Deborah Watts John Wcisel Kathryn Weaver Lance Weber Michael Wehrli Catrina Weinum Benjamin Weishaar Josh Weiss Patrick Weisseg Andrew Weissenburger Ori Weisz Jessica Welborn Stephanie Welch April Wells Camelia Welsch Michael Welton Fei Wen Jin Wen Li Wen Nathan Wentz Jenny Werronen Tyler Westman Holly Wettstein Andrew Wetzel Maureen Wheeler Meagan Wheeler Bethany White Courtney White Dorothy White Jeffrey White Budi Widjaja Robert Widman Eric Wiersema Brittany Wiese Heather Wiesemeyer David Wilbur Michael Wilczek Christopher Wildman Douglas Wiley Johnathon Wilhite Michael Willer Benna Williams Kimberly Williams Jason Williamson Kristal Williamson Samantha Willis Candace Wills Aaron Wilson Michael Wilson Elisa Winata Daniel Winiarski

David Winkler John Wittenbrook Matthew Wloczkowski Jacek Wlodek Norman Wohlschlaeger David Wolfe Benjamin Wolfson Justin Wong Tammy Wong Kenny Wong Haines Erik Wood Tatiana Wood April Worman Elizabeth Wright Kevin Wright Nicole Wright Faith Wu Kuan-ying Wu Ming-Yin Wu Pin-Chu Wu Rina Wu Adam Wunschl Matt Wunschl

X Xi Xi Qili Xie Xiaoqi Xu Yan Xu Jin Xun

Y Barbara Yager Fang Yang Meng Yang Robin Yang Wei-Ning Yang Olya Yashchenko Wei Ye Brianna Yelle Jessica Yen Dong Wan Yeom David Yerly Isa Yeung Michelle Yeung Nigel Yin Wen Yin Vesela Yondova Jessica Yonto Andrew Yoo Christine Yoo Joo-Yun Yoo Kevin Yoo Heejin Yoon Ja Young Yoon Ayako Yoshihara

Chiu Yin Edward Young Fang-Yun Yu Zhaohui Yu Zhujing Yu Sheila Yuckman Jeany Yuen Igor Yukhvidin Cheuk Ki Yung

Z Matthew Zaba Karl Zabiello Ayesha Zaffar Syed Imran Zahidy Lauren Zahn Daniel Zahren Monika Zajac Ivan Zalessov Anton Zandi Joel Zandstra Charles Zane Andrew Zang Sara Zanghi Ma Abigael Zapata Carmela Zappani Wanees Zarour Youyang Zeng Amanda Zentefis Gaoxiang Zhang Hao Zhang Kevin Zhang Lei Zhang Wei Zhang Weiqi Zhang Xuemei Zhang Zhifei Zhang Jing Zheng Lu Zheng Qun Zheng Ying Zheng Qijun Zhou Wanqing Zhou Xiaoxian Zhou Dan Zhu Jie Zhu Puyu Zhu Tony Zibert Kelly Zoellick Oleg Zolotarev William Zook Jeffrey Zwier

ILLINOIS CPA SOCIETY 2011 EXCEL AWARD RECIPIENTS The Excel Award is granted to Illinois CPAs who achieved a total average score of 90 or more and completed all four parts of the exam within two consecutive testing windows and were in the top five percent of the scores of those who completed all the requirements in 2011 in Illlinois.




Ekaterina Saeva

Tyler Schehl

Yao Xiao

University of Illinois, Urbana-Champaign Ernst & Young LLP, Chicago

University of Illinois, Urbana-Champaign CNA Financial, Chicago

University of Illinois, Urbana-Champaign


Dennis Kreiter

Timothy Fornero

University of Wisconsin, Madison Deloitte & Touche LLP, Chicago

University of Miami, Coral Gables PricewaterhouseCoopers LLP, Chicago

University of Michigan, Ann Arbor PricewaterhouseCoopers LLP, Chicago

Fang Fang

Ellen Rewalt

Tania Tomanova

University of Illinois, Urbana-Champaign PWC Shanghai, China

University of Michigan, Ann Arbor PricewaterhouseCoopers LLP, Chicago

University of Illinois, Urbana-Champaign Ernst & Young LLP, St. Louis

Adrienne Green

Benjamin Schnelle

Justin Knobeloch

University of Michigan, Ann Arbor FASB, Norwalk, CT

Southern Illinois University, Edwardsville Millers First Insurance Company, Alton

Bradley University, Peoria RLI Insurance Company, Peoria

Mathieu Abernethy

Geoffrey Bowers

Daniel Quinn

University of Notre Dame, South Bend Deloitte & Touche LLP, Chicago

Marquette University, Milwaukee PricewaterhouseCoopers LLP, Chicago

Indiana University, Bloomington Ernst & Young LLP, Chicago

he says. “This makes the recent 5-percent and 7-percent increases seem paltry.” Certainly, there were other factors affecting audit fees besides SOX. Tom Thompson, senior associate, research, with the Financial Executives Research Foundation, explains how the increase in internal Section 404 compliance costs reported by some companies was mainly due to the implementation of new IT systems or acquisitions. Other survey respondents reported a decrease due to automated controls and the restructuring of business and financial systems. The 2012 Audit Fee Survey also suggests that risk management will remain an area of focus for finance professionals. According to the survey, 73 percent of public company respondents who were accelerated filers said their companies had a risk-management process in place. However, of the non-accelerated filers, only 40 percent had such processes in place. Finally, of the companies that did have risk-management processes in place, a clear majority of each responding group indicated that risk management lay within management’s jurisdiction rather than within internal audit or the audit committee of the board of directors. “Given the current state of businesses, risk management will remain an area of focus for finance professionals,” said Financial Executives International President and CEO Marie Hollein in a press release. Dr. Thomas Weirich, CPA, is a professor of accounting with Central Michigan University and a former Academic Accounting Fellow with the U.S. Securities and Exchange Commission. He says that, “Audit fees increased not only as a result of SOX compliance, but also due to more detailed audit work as additional scrutiny of an entity’s financial statements was required due to various financial statement frauds. With the major frauds being reported, auditors also tried to control audit risk with related litigation issues, which also resulted in more detailed work and thus an increase in audit fees.” According to the Audit Analytics report, litigation risk exposure also has imposed cost pressures on the audit industry. “The litigation inventory against the Big Four firms is daunting,” the report states. “For example, while not admitting to any wrongdoing, an auditor settled the Parmalat securities classaction matter that was filed in January of 2004, for $149 million. These types of payments and the ongoing exposure from outstanding litigation must be factored into (audit) fees.”

Business globalization is another factor driving audit fees upwards in recent years. Globalization results in a significant expansion of company operations into emerging markets. The Audit Analytics report suggests that these emerging markets lack strong corporate governance and operate under different business practices and accounting policies, all of which create additional audit work to consolidate operations and to comply with local legal and regulatory requirements for statutory reporting. On the flip side, it’s possible that a rise in audit fees could be related to marketplace price correction. Cameron Keng, founder of Autotax, an SaaS solution, explains. “During the Arthur Andersen years, accounting firms were artificially offering audits at fees well below cost. Audits were used as loss leaders to attract lucrative consulting projects. The realization rate on $375, or one hour of chargeable staff time, was as low as 20 percent, or $75.” Keng also believes that economic conditions artificially deflated audit fees. He says that since accounting firms are generally detached from seasonality, the economy rarely affects them. “But then the world came crashing down,” and clients started disappearing. “All of the Big Four firms began to undercut each other. Projects were being aggressively discounted in order to avoid layoffs.” Firms were willing to do this in order to retain their staff and ride out the downturn. “Audit fees are going to continue to rise because they’ve been artificially lowered for years. They’re simply returning to market rates according to their real value.” Certainly, the consensus is that audit fees will rise, and for a variety of reasons. “The Public Company Accounting Oversight Board (PCAOB) has proposed a mandatory rotation of external audit firms, something most businesses vehemently oppose,” says Schrage. “Should this measure pass, you can most certainly expect a significant price jump.” Indeed, according to the Audit Fee Survey, 95 percent of public company respondents and 85 percent of private company respondents don’t support the PCAOB proposal. Before panic sets in, Thompson emphasizes that the PCAOB measure is still in the very early stages. “At the moment it’s just a concept release,” he says. “It would still need to go through the proposal process. But if it were to become a standard, this could impact a company’s audit fees.” The bottom line is clear: You’ll likely be shelling out more cash for audits in the future.

Illinois CPA Society

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Top Jobs for CPAs The accounting field is bursting with opportunities. Here’s where to look for them. By Selena Chavis


t’s a great time to be a CPA. A Bureau of Labor Statistics forecast, in fact, indicates that the number of accounting and auditing jobs in the United States will increase 16 percent (or 190,700 positions) by 2020. Specifically, the Bureau believes that demand for comprehensive financial documentation will increase in response to ongoing financial crises and regulatory changes. “The accounting industry is one of the best career fields at providing stability, longevity and mobility. That’s something we all seek in our careers,” says Jeramy Kaiman, area managing director for Garelli Wong. Kaiman points to Forbes’ recent article, “25 Best Jobs of 2012,” noting that three jobs typically performed by professionals with accounting backgrounds landed in the top 15—financial analyst, accountant and financial advisor. As the supply-and-demand equation continues to tilt in favor of CPAs, many are seeking out those career paths that best equip them for the future. “A CPA designation with specialization often equates to higher income,” explains Marilyn Bird, Chicago-based district president for Robert Half International (RHI). “That gets a lot of people’s attention.” There are a number of drivers currently impacting the momentum of certain specializations. The complex nature of IT investments, for example, is driving demand for accountants who understand technology frameworks. And an ever-expanding regulatory environment continues to boost the need for accountants with astute knowledge of compliance issues. “At a really high level, accounting is a great field to go into for the opportunities, flexibility and variety of experiences,” says Grant Thornton Midwest Managing Partner Mike Hall. “When you talk about specialization and what’s hot, you can look at the business environment and simply analyze that.” 26


The outlook for anything related to analysis is good, says Bird, adding that, “Looking at data and helping an organization formulate a strategy—that’s where you see the most investment being made in those with a CPA designation.” Here, then, are some of the hottest areas for CPAs in the coming year.

Financial Analysis According to RHI’s 2013 Salary Guide, demand for financial analysts often exceeds supply. Companies are seeking help from CPAs who can identify key trends and offer financial insight into investments. With a starting salary that ranges from $70,000 to $94,000, these professionals analyze financial data; prepare reports and charts to illustrate technical information; interpret data directly affecting investment programs; and monitor economic, industrial and corporate developments through outside sources. Financial analysts specializing in M&A valuations in both public accounting and corporate settings are in particular demand, says Kaiman.

Business Systems Analysis Expertise in IT-related initiatives remains a top specialization for CPAs. According to RHI’s Salary Guide, companies are specifically seeking experts to identify IT infrastructures that will produce the greatest ROI. “We’re bringing in more IT professionals just because of advances in technology. When you look at clients expanding globally, there are all kinds of technology considerations,” Hall explains, citing cloud computing and social networking as examples. Typically those placed in the role of business systems analyst need knowledge of both financial and business systems in order to analyze the best course for IT implementation, upgrades and enhancement. The ability to respond quickly to market conditions and technological advancements is key to this role. Starting salaries typically range from $54,000 to $75,000, peaking at more than $100,000 for management roles.

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Top Industries Now Across the board, experts agree that the healthcare industry represents one of the greatest opportunities for CPAs. From a rapidly expanding regulatory structure to the need to implement large-scale, complex IT initiatives, demand for CPAs in healthcare is not expected to keep pace with supply. Current initiatives impacting the industry include the Health Information Technology for Economic and Clinical Health (HITECH) Act, the move to the new ICD-10 classification system and pay-for-performance initiatives. Accounting expertise will be sought in the areas of business analysis, compliance, financial analysis and tax. Financial services is another high-voltage sector for CPAs. As the economic outlook continues to improve, financial services firms have a need for functions such as trade support, operations, compliance and financial analysis. The financial services umbrella covers organizations such as national and multinational banks, insurance companies with an investment arm, hedge funds and other large investment firms.

Technical Accounting

Tax Accounting & Auditing

“The environment is such that we are going to see more regulations,” says Hall. Which means that skills that address this ever-evolving and increasingly complex landscape will remain a top-tier specialty going forwards. The professional specializing in this area is aligned with research, policy development and SEC, GAAP and IFRS compliance. Adding to the demand for technical accountants are the federal Foreign Corrupt Practices Act, which, amongst other things, addresses accounting transparency requirements under the Securities Exchange Act of 1934, and International Financial Reporting Standards and international tax structures. While not all niche areas of accounting will equate to more pay, technical expertise typically does raise salary levels, says Kaiman. Starting salaries for compliance professionals in a large company range from $62,000 to $83,000 and peak at more than $220,000 for Chief Compliance Officer roles. These roles will be particularly strong in the healthcare arena going forwards, thanks to rapidly evolving regulation of the industry.

Tax and auditing functions remain in high demand and offer accountants both future flexibility and mobility, Kaiman explains. These professionals have broad-based knowledge that intersects with a multitude of areas, including global business and forensic accounting. “There’s such an overlap in skill sets for audit and for tax structuring,” says Hall. “If you look at the market, there are shortages. International tax in particular is a hot area.” Starting salaries for tax and auditing professionals in public accounting firms start in the mid-$40,000s and go all the way up to $58,000-plus in midsized firms. Salaries can reach beyond $183,000 for management-level positions in large firms.

Forensic Accounting Integrating accounting, auditing and investigative skills, the field of forensic accounting provides accounting analysis of financial systems and operations suitable for courtroom deliberations and dispute resolution. The most obvious example is an investigation of corporate fraud and embezzlement.

According to Hall, forensic accounting often crosses into various other specializations, including valuation work and technical accounting. “We have a very robust forensics group that deals with issues such as foreign corrupt practices, contract disputes and monitoring. Demand for forensic accounting has been generated by large damages cases,” he explains. Salary ranges for forensic accountants start at $60,000 and can reach the mid$90,000s based on experience. Senior managers in this field can make upwards of $150,000.

Cost Accounting Hiring trends in the manufacturing sector of Chicago have seen particular improvement, says Kaiman. And, in fact, the RHI Salary Guide indicates that demand for cost accountants will hold steady nationally over the next year. “One of the most high-demand jobs is cost accounting,” Kaiman notes. “Most companies struggle to fill cost accounting positions at all levels.” Cost accountants help manufacturers institute efficient operational practices and process improvements by systematically reviewing the costs associated with the development or distribution of a product. Salaries range from the low $40,000s to mid-$60,000s for entry-level positions and those with a few years’ experience. Senior managers can earn more than $100,000 a year in a large company. The opportunities are wide and varied for accountants, and the outlook going into 2013 is extremely positive. “It’s an exciting time for the accounting field,” says Hall. “It’s a rigorous profession, and people need to be prepared.”

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The Buy/Sell Guide 10 helpful steps for navigating accounting practice M&As. By Sheryl Nance-Nash


here’s strength in numbers. It's not surprising, then, that during the past few years there’s been an increase in merger and acquisition deals involving CPA firms, especially among a number of regional firms like J.H. Cohn, LarsonAllen, Dixon Hughes and Baker Tilly. Despite the rarity of “mergers of equals” in the industry (the vast majority are consolidating deals with dominant acquirers), the success of the EisnerAmper merger in 2009 proved the value of successfully integrating capabilities and combining scale. According to Dino Mauricio, a partner with Schaffer Consulting, which specializes in merger integration and leadership development, one of the most interesting CPA deals in the past two years was a global merger involving the acquisition of Weiser, LLP in New York City by Paris' $1billion revenue player Mazars. “They had to overcome several challenges, including cross-border integration, cultural 30


gaps and regulatory hurdles, but they are now the sixth largest in the world, generating about $1.2 billion a year,” Mauricio comments. The market is currently very active. Many professional services firms are evaluating their portfolios and building M&A strategies to pursue higher growth alternatives, says Jim Tunney, a partner leading the Chicago deals practice of PwC. “There’s also been some selling activity driven by motivation to realize gains prior to potential post-election tax increases. This has created some fuel for an active deal market,” he says. According to Allan Koltin, CEO of Koltin Consulting Group, a Chicago firm that consults with CPA firms on practice management issues, managing partners at the top 100 CPA firms today spend no less than 25 percent and as much as 75 percent of their time on mergers and bringing in high-level lateral talent. “For many, the role has evolved from CEO to part-time investment banker. The range of time is usually a philosophical one dealing with how aggressive their growth plans are, as well as how they want to go about growing—organic versus lateral talent,” he explains. There are plenty of reasons for all this matchmaking. “Succession issues are driving a lot of transactions,” says Howard Allenberg, CFO of BDO USA in Chicago. “The Boomers don't want to work forever, and some are finding they may not have partners in their firm who can succeed them or want to take on the financial obligations associated with such changes, so they’re combining forces to settle the leadership/succession issue.” For many CPA firms, an M&A-driven growth strategy is a priority. “But the ability to execute that M&A strategy into tangible results will distinguish the winners over the next decade,” says Mauricio. There's much at stake. “Essentially, successful acquirers will be able to grow at a faster pace to maintain a competitive edge over those solely reliant on organic growth. Other advantages

include the opportunity to selectively acquire niche and industry experts (as the market moves more towards specialists and away from generalists), to proactively deal with succession planning issues and better leverage the firm's cost structure,” he explains. Although an M&A might be a smart business move, it can create its own chaos. Whether buying, selling or valuing a practice, be guided by these 10 critical steps.

however they won’t work well together,” states Dan Galante, national managing partner of Transaction Advisory Services, with Grant Thornton in Chicago. “If two firms have the same strategy and different cultures, the acquisition won't work, they won't effectively fit together. They will clash and lose components of the one firm that made it successful.”

4. Find promising candidates Whether done alone or using third-party assistance, acquirers need to invest the appropriate time and resources into finding target CPA firms that precisely fit their criteria, and must conduct proper due diligence to evaluate client mix, systems, litigation matters and financials, says Mauricio.

1. Define your long-term strategy “Be sure the kind of growth that you seek, whether it’s geographic, new capabilities, longterm profits, acquiring talent, or to solve succession planning issues, is clearly defined,” says Mauricio. Cost efficiencies or overhead consolidation can be benefits, but should never be the primary drivers for acquiring CPA firms.

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2. Be realistic about value There can be “unreasonable expectations of value….There can be a big disconnect. Sellers need to accept the reality of their particular situation and the marketplace,” says Allenberg. “Don’t use the old rules because things have changed,” adds John Martinka, of Martinka Consulting, which specializes in business acquisitions. “Many years ago the AICPA proclaimed that CPA practices are valued by a formula that is a function of revenue (one times annual revenue with a 25-percent margin either way). This hurts the profitable practice that is not dependent on the owner or one particular partner. Valuing the practice based on profit will often yield a higher price.” “There’s no one-size-fits-all approach to valuing these transactions due to the differing fact situations, differing profitability and differing practice models,” adds Larry Blust, a partner with the Chicago law firm Barnes & Thornburg.

3. Cultural fit is vital Good cultural fit can vastly improve the odds of M&A and integration success. “Understand your own culture and what are ideal cultural characteristics of potential partners that can mesh well,” says Mauricio. Quite simply, “If you wouldn't like going out to lunch with your target, you shouldn't do the deal,” says Mark Basinski, principal with Transition Advisors, specializing in consulting for the accounting profession. Organizational structure has a big impact on culture. For starters, “Is this a CEO-run organization that encourages collaboration or an accumulation of fiefdoms where people eat what they kill. Both can be successful,

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5. Who controls your clients?

7. Structure a win-win deal

“The most important fact in these transactions is who controls the clients the buyer assumes it will get for the purchase price,” says Blust. “Particularly in the case of small firms and practice sales, you need to know where each partner controls his or her own clients. Do those with control of the business have non-compete agreements in place, or are they willing to executive noncompetes that will assure the expected business transfers?”

Make sure both parties are satisfied with the structure and economics of the deal, with all “deal-breaker” issues vetted early on in the negotiations. “This must include partner compensation terms for the seller and expected benefits for the buyer,” says Mauricio. “Rarely do acquisitions of CPA firms succeed when the deal is one-sided; both sides must be engaged and enthusiastic about the merger. Sometimes parties may even build in 'demerger' clauses to reverse the merger at a specified time if certain anticipated synergies are not realized.”

6. Assess your liabilities When you acquire your target firm, will you assume the obligations of that firm? What are the firm's liabilities and risk exposures? A common big picture issue is the unfunded retirement benefits of senior people and how they need to be handled. Small and midsized firms often have unfunded nonqualified retirement or termination benefits. At the other end of the spectrum, senior partners who control most of the business planning may be tempted by a transaction that benefits the few, while leaving the remaining partners with very little, says Blust.

Who do I choose?

8. Focus on integration Developing and remaining committed to agreed-upon integration plans that cover the new organization’s structure, staffing, key processes and new business development initiatives is vital to long-term postmerger success. Client retention, in particular, is key. “Assuming client retention as a given is a big mistake,” says Mauricio. The more clients that stay, the more valuable the new entity becomes. Most client attrition

happens in the second year of the change, adds Basinski.

9. Monitor & measure success Both parties must be able to track and validate goals. Setting timelines, metrics and key milestones along with a process for periodic evaluation and review is extremely important, says Mauricio. Be clear about how you’ll measure success. “What synergies do you expect from top-line revenue? How many clients and staff have remained?” asks Galante.

10. Talk to key stakeholders Employees, clients, affiliated parties and other stakeholders should expect timely and informative communications on the success of the newly combined business and how the anticipated synergies will benefit them in the future. Mergers and acquisitions aren’t likely to slow down anytime soon. Says Tunney, “Expect to see continued high levels of M&A activity. Given the relatively slow growth in the United States and the recession in Europe, many firms will struggle to grow organically.” For many CPA firms, it's not a question of if an M&A will happen, but when.

Your Toolkit... for Communicating Your Value as a Licensed CPA

The IRS designation of Registered Tax Return Preparer has the potential to create confusion in the marketplace. The Illinois CPA Society has developed resources for members to use in helping their clients understand the facts and make an informed decision when choosing a tax professional. Toolkit resources can be personalized with your firm information and include:


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Serve on an Illinois CPA Society

Committee or Task Force Use your expertise and leadership skills to help govern and guide the work of your Illinois CPA Society. From developing new member services, to upholding quality assurance standards, to responding to technical issues, your service helps to enhance the value of the CPA profession. In return, you’ll broaden your knowledge base, receive first-hand information on emerging issues, and develop powerful professional connections. Committee & Task Force service is open to all Illinois CPA Society regular and affiliate members. Positions are limited and all requests may not be able to be accommodated. Visit for full descriptions and to apply. APPLICATIONS DUE FEBRUARY 11, 2013.

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Professional Practice Not-For-Profit Organizations Regulation & Legislation Taxation - Business Taxation - Estate, Gift & Trusts Taxation - Flow-Through Entities Taxation - Individual Taxation - International Taxation - Practice & Procedures Taxation - State & Local Quality Assurance & Public Protection Accounting Principles * Audit & Assurance Services * Employee Benefits Ethics* Governmental Accounting Executive* Governmental Report Review Peer Review Report Acceptance* Programs/Special Issues CPA Exam Award Task Force Outstanding Educator Award Task Force Outstanding Leadership In Advancing Diversity Award Task Force Women’s Executive Women’s Initiatives Task Force Young Professionals Group Education Conference Planning Task Forces (visit for a listing of available conferences)

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GEN B: The Blended Generation

Today’s accounting firms are mobilizing multigenerational workforces to boost productivity and meet client needs. By Clare Fitzgerald


blend of four generations comprises today’s workforce, bringing with it a host of communication, management, recruitment and retention challenges—as well as opportunities. Accounting firms in particular, with hiring models that target all experience levels, are keenly aware of generational divides. Attracting, managing and retaining talented employees from all generations is critical in an industry that often struggles to find diverse, high-quality talent. “A lot of CPA firms are focusing on generational issues,” says Janel O’Connor, director of human capital at Naperville, Ill.-based accounting and professional services firm Sikich LLP. “The ones that are creating awareness and have a plan in place are the ones that are really a step ahead.” While achieving the perfect blend of seasoned and fresh talent can boost productivity and bottom-line results, ensuring all generations work together seamlessly isn’t easy. That’s why firms of every size are focusing on generational awareness training and offering a range of work and benefit options to appeal to staff at all career levels. In the process, they’re fielding their most diverse and innovative client service teams ever. That said, “I certainly don’t think any firm has it all figured out yet,” admits Terrance Moreno, senior manager of human resources at Baker Tilly in Chicago. “It’s something we’re all wrestling with, and we’ll continue to look for ways to boost awareness and generational interaction. Despite the weak yet slowly improving job market we’ve seen in the past few years, people have choices. Firms need to be innovative and competitive to attract and retain the best people to serve clients.” “As a firm, we’re focused on continuing to grow, and that’s dependent on having the right people coming in,” says Paula Frerichs, director of recruiting at accounting firm Plante Moran. “We want to take advantage of the ambition and ideas of new generations to push the firm into new areas. And we’ll have to transition knowledge and clients eventually. That transfer of knowledge is a necessity.”




A Unique Blend Supporting a multi-generational workforce requires an understanding of the influences on each generation’s attitudes, communication styles and work patterns. According to Amy Lynch, consultant at BridgeWorks, a Minneapolis speaking, training and consulting firm that educates organizations about generational differences, the four generations at work today break down into the following general groups. n Traditionalists: Born before 1946, traditionalists account for about 8 percent of the workforce. Many are working longer into their retirement years, and some are retirees who have rejoined the workforce in part-time roles. n Baby Boomers: An enormous group of nearly 80 million, Boomers were born between 1946 and 1964. They comprise the largest chunk of today’s workforce. n Generation X: A much smaller generation, Gen Xers are in their 30s and 40s—at the mid-career level and rising. n Millennials: The newest entrants to the workforce, Millennials (also known at Gen Y), were adolescents in the year 2000. Each has been shaped by the unique historical events and economic conditions of their generation. And each brings different strengths to the workforce. For example, Traditionalists were influenced by their experiences in World War II and the Great Depression. Fifty percent of the men served in the military, and they brought a top-down style to business. “The boss was the boss,” explains Lynch. “He wasn’t going to ask for opinions. He gave a command and expected his people to carry it out.”

Boomers lived through the social unrest of the 1960s and the civil rights and women’s movements. Shaped by economic optimism, they had great expectations and a competitive drive. “In the workplace, Boomers pushed back on the Traditionalists’ style to some degree, but they also learned how to play by the rules and get things done within a multi-leveled framework,” says Lynch. “They developed a formal, diplomatic and careful communication style.” Gen Xers grew up during the great push for globalization and in a time of economic volatility, with a bleak job market, soaring divorce rates and political and corporate unrest. Seeing that there are no guarantees in life, they developed a skeptical outlook and a direct, to-the-point style. Millennials came of age during a time of great technological change. They watched tragedies such as 9/11 and the Columbine school shooting unfold, but they weren’t discouraged by the events they witnessed. Instead, they adopted a resilient, can-do, collaborative attitude.

A Voice for All Having a multi-generational workforce in place is one thing, but managing it successfully is quite another. According to Lynch, communication is the place to start. “Awareness training is important,” she says, “but if you can get the communication right, teamwork, trust and innovation will follow. Each generation has very different, and often at odds, modes of communication,” she explains. For example, Boomers may need to dispense with some formalities and learn how to be more direct and transparent with Gen X

“Find ways to attract, retain and leverage the contributions of all generations to continue to breathe new blood into the organization.”



professionals. On the flip side, Gen Xers may need to adopt a little finesse when communicating with Boomers. And Millennials may need to do a better job of knowing the right time and place to express their opinions, and how to present ideas more formally than they might when working with a fellow Millennial, and so on. “People need to be trained on how best to present something so they are more likely to be heard by different generations,” Lynch advises. “Be yourself, but adapt so that people can hear you. That’s the key.”

Terms of Engagement When it comes to perks and benefits, Lynch advises organizations to provide a range of options and to focus on the things that all generations value—time and independence. “Having control over one’s time is important to everyone, even if for different reasons,” she says. “The more control people have over their time, the more rewarded they feel.” Traditionalists and Boomers may be looking for reduced workloads, Gen Xers may need to leave early for a child’s school function and Millennials might be pursuing advanced degrees. Accommodating personal needs and offering options like flextime and the ability to work from home will go a long way towards engaging employees at every level. “Leaders need to recognize that times have changed. We’re working in a 24/7 world, and when their roles allow it, people need to be able to work at their own pace in their own space,” says Lynch. “Offer flexible benefits that allow people to pick and choose what they need based on their life stage,” adds Jan Ferri-Reed, consultant and president of KEYGroup, a Pittsburgh-based consulting firm that helps companies create workplaces that attract and retain talent. At Sikich, a holistic approach is taken to employee benefit programs. “We strive to appeal to our professionals at all stages of life, whether they are single, nearing retirement or starting families,” explains O’Connor. For Moreno, offering options is the key to supporting a diverse workforce. “We need to attract and retain the best talent, so we need to be sensitive to their work needs.” At Baker Tilly, that means offering robust flexible work arrangements and other additions to traditional benefit plans, such as gym memberships and paid time off to volunteer with charitable organizations, to name a few. Demonstrating a commitment to career development and continuing education is a bit of a no-brainer, with savvy firms providing various training options and offering reimbursements for tuition, professional licenses and professional membership dues. Lynch also advises managers to be open to nontraditional career paths. Gen Xers and Millennials, for example, may want to try a role in a different department or take on an assignment outside of their job descriptions. Embrace that sentiment, and leverage your employees’ enthusiasm for the benefit of the firm and your clients.

Bringing it All Together Building and supporting a multi-generational workforce doesn’t automatically give you a workforce that’s interacting and working together well. It takes constant effort and monitoring. Ferri-Reed suggests that leaders find both formal and informal ways for the generations to regularly interact, ensuring that junior

employees have access to the institutional knowledge of older generations, and that older generations tap into the technological capabilities and new ideas of younger generations. Sikich is reinvigorating its mentoring program with precisely this goal in mind. The firm matches junior talent with more seasoned professionals and encourages an open-door policy. The same open style is emphasized at Plante Moran, where “Junior staff can walk into a partner’s office, and our client engagements allow for regular interaction across all levels,” explains Frerichs. And at Baker Tilly, “Accessibility is built into who we are, and we know that’s something Mellennials value,” says Moreno. “They want to talk to partners to find out what their journey was like. That’s why our partners are very involved in mentoring our staff members and in our college recruiting process.” These efforts are especially important to professional services firms, which too easily fall into a “this is the way we’ve always done it” attitude, explains Ferri-Reed. “Professional services firms tend to err on keeping the status quo in terms of what has worked in the past. But they need to work on ways to diverge from that mindset to keep young talent longer,” she says.

Maximizing the Generational Mix Firms that successfully integrate fresh ideas from younger talent with the wisdom and experience of seasoned professionals will see positive effects on staff retention and the bottom line, says Lynch. “You’ll discover the managers that get results, and you’ll be able to appoint your best communicators to key positions. Holding on to the wise Traditionalists and Boomers, productive Gen Xers and collaborative Millennials will help to draw more clients to your firm. Firms will find that their client base starts to mirror their own workforce,” she explains. “You’ll be able to appeal to organizations that have an older person at the helm as well as to the startups and other organizations that are infused with youth,” Ferri-Reed adds. Plus, “Firms that are progressive in this area and that do things sooner rather than later have a much stronger employer brand. They become known as a great place to start and develop your career.” “We’re always looking at ways we can work more effectively across generations and build more collaborative client-facing teams,” O’Connor remarks. And at Baker Tilly, “We hire at a variety of levels, ranging from directors with significant experience, to the mid-level and the entry-level right out of school, so that naturally creates quite a diverse workforce. And we need that diversity from a business and client service standpoint,” says Moreno. Essentially, Ferri-Reed recommends that firms, “Find ways to attract, retain and leverage the contributions of all generations to continue to breathe new blood into the organization and to sustain and grow its client base and profits.” And what of those that don’t make a strong effort to bridge generational gaps? “Roles aren’t clear and deadlines don’t get met when people can’t hear each other,” says Lynch. “Organizations can lose valuable input and see high-volume turnover.” | WINTER 2012


paper super savings less Bolster your firm’s bottom line by opting for cost-saving, productivity-boosting green technologies.By Derrick Lilly


he rapid advancement of green technologies has made both bottom line-focused and sustainability-minded CPAs a happy lot. “Most CPAs are profit-oriented. When it comes to technology, we only buy into what will help us become more profitable,” explains Al Kutchins, president of tax and accounting firm Kutchins, Robbins & Diamond Ltd. In Kutchins’ case, making the commitment in 2008 to stay “on the cutting edge, not the bleeding edge,” led his 52-person firm to adopt technologies designed to support a paperless, digital office. The result: Approximately 50percent volume growth and continuing efficiency gains and cost savings. Kutchins, Robbins & Diamond isn’t the exception. “Far and away, the paperless movement is THE big green thing for accounting firms,” says Bill Niles, owner of strategic IT consulting firm IS Consulting. “By going paperless, you’re absolutely going to reduce costs and increase efficiencies; documents will be at your—and your clients’—fingertips, communication will improve, and you’re going to attract the talent and clients that are increasingly looking at a company’s green status.” All of which ultimately helps to bolster the bottom line. Of course, maximizing the perks of a digital office requires the right technology investments. | WINTER 2012


Scanners: Increase capacity Scrapping the file room for digital documents is going to cut waste and expenses beyond the obvious paper, toner and postage costs. Niles says he has seen “firms recover up to 10 percent of their office space that can then be reused for things other than filing cabinets, which can lead to better space utilization or a smaller space with reduced rent.” “Scanning all of our paper files allowed us to reclaim 600 to 700 square feet of office space,” Kutchins estimates. “What was once our file room is now revenue-producing offices and work stations that have increased our capacity without us renting more space or moving to another building.” “Choosing a scanner for the…accounting office is nothing like choosing a scanner for your home photo collection,” cautions Dave McClure in an article for The Progressive Accountant. “For the accounting office…it is far more important to have networking capability, a Twain-compliant driver…and the ability to output the finished scan to email, to fax or to a folder.” McClure also recommends selecting a scanner that includes a quality OCR software package so you’ll be able to instantly convert scanned files into editable documents. You’ll have no trouble finding intuitive and energy-efficient businessclass scanners for firms of all sizes from leading manufacturers like Brother, Canon, Epson, Fujitsu and Xerox, to name a few.

Multiple Monitors: Ease workflows Kutchins has sought further efficiency gains by arming each workstation with multiple monitors, making it that much easier and faster to work with multiple digital documents. “With two monitors, we’re able to look at last year’s work papers and tax returns while doing this year’s, for example,” says Kutchins. “But what’s better is three monitors. Because we also need to keep track of time, monitor email, and run other programs, the third monitor serves as a utility screen that allows everyone to run at their greatest efficiency.” The Association for Accounting Administration’s 2011 Paperless Benchmarking Survey found that 90 percent of firms are using at least two monitors, while 38 percent are using three, 11 percent are using four or more, and 40 percent are deploying dual monitors with employees heading into the field. How green is running multiple monitors? There’s a wide variety of low-wattage, ENERGY STAR-qualified monitors available from popular manufacturers like ASUS, Dell, Lenovo, Philips and Samsung that produce little to no heat and run on only a few dollars worth of electricity annually. In a paper-heavy industry, the costs of multiple monitors can certainly offer a long-term advantage.

Server Virtualization: Save on power The 2011 Paperless Benchmarking Survey points out that 45 percent of firms have already transitioned to a virtualized server environment, and that number is expected to grow thanks to the remarkable reduction in hardware, software, maintenance and energy costs virtualization solutions offer. Essentially, virtualization allows you to harness the computing power of multiple servers or computers through one super server. “Typical accounting firms need multiple servers for their email, operating systems, QuickBooks accounts, client data and private networks, for example; it used to be that every service needed its own physical server that ate up power, generated heat and required maintenance,” Niles 40


The Simple Stuff “The pieces people often forget when talking about green technology is the simple stuff, like eFiling, online bill pay, online payroll, direct deposit and wire transfers, all of which easily replace the traditional mailing of documents, checks and what not,” says Niles. Cloud-based paperless payroll and HR solutions from Intuit, for example, integrate with Intuit’s other products (like QuickBooks) and include a payroll solution specifically designed for use by accountants who fulfill payroll management functions for their clients. The same goes for ADP, CompuPay, Paychex, Paycom, and SurePayroll, which all offer a variety of accountant-specific solutions as well as versions designed around the payroll, tax and HR needs of businesses of all sizes. So not only can you use these paperless products for your firm, but you can also potentially offer new green services to your clients if you aren’t already active in this area.

Client meetings are another area ripe for business greening. “We just installed a big-screen TV in our conference room so we can start doing Skype conferences,” says Kutchins. “With a suburban office, if I can cut out just one downtown meeting a month I can save three hours of travel time, tolls, fuel and parking expenses. It’s an instant payback, and if I multiply that by just the number of my partners, there’s potential for huge savings. ”There’s a wide variety of web-conferencing and collaboration tools to choose from. Some of the industry leaders include AnyMeeting, Cisco’s WebEx, Citrix’s GoToMeeting, and Skype and ReadyTalk. And those must-attend meetings can be paperless too. “More people are getting comfortable going to the cloud, so our next step may be doing client presentations on iPads. We’ll bring four or five to distribute at a meeting to look at the reports and then we’ll just bring them back; all the files and data we need is accessible through the client portal,” says Kutchins.

explains. “Now, we are able to use virtualization software to leverage new or existing hardware to host multiple servers.” According to TechTarget’s Virtualization Decisions 2011 Purchasing Intentions Survey, VMware is king with 73 percent of the server virtualization market. It also comes highly recommended by Niles. But server virtualization solutions from the likes of Citrix, Dell, Microsoft and Red Hat can all lend a hand in helping firms reduce their footprint in a number of ways, including reducing hardware needs, electricity and HVAC use, and server storage space, etc. What’s more, the servers themselves are becoming increasingly powerful and energy-efficient. ENERGY STAR estimates companies can save $100 or more in annual electricity costs per server by using ENERGY STAR-qualified enterprise servers—some of which use 54-percent less electricity—over unqualified models. ASUS, Cisco, Dell, HP and IBM are all ENERGY STAR-awarded or recognized energy-efficient server manufacturers, and 15 manufacturers now partner with ENERGY STAR to ensure continued improvements.

most up-to-date documents. Our cloud-based solutions solve all of these challenges.” Kutchins’ DMS is part of a cloud-based tax & accounting suite from Thomson Reuters. Solutions from Acct1st, CCH, Doc.It, and Thomson Reuters are all highly rated in CPA Practice Advisor’s “2011 Review of Document Management Systems.” Drake Software and Intuit also have document management offerings that integrate with their products, and it’s expected other leading vendors will follow suit as demand grows.

DMS: Boost productivity A document management system (DMS) is a cloud-based solution that helps to automate the process of gathering, scanning, converting, storing, organizing, retrieving, updating and delivering digital documents so that you and your staff can easily and securely access all of your data from any Internet connection. The AICPA and the Texas Society of CPAs estimate that top performers work 3-percent less and earn 72.4-percent more than average firms thanks to systemized document management workflows. “Six years ago we started taking baby steps to transition to cloud-based DMS because we saw an opportunity for huge labor savings,” says Kutchins. “People were spending too much time updating their systems, walking to the file room, searching for files, making copies, and then refiling whatever they were working on. We also found that people were forgetting to save their work onto our internal network, so not everybody was always working on the

Client Portals: Cut down on costs Cloud-based document management systems and client portals work hand-in-hand to expand accessibility, protect files and elevate the client service capabilities of your firm. These portals— two-way gateways for transmitting all file types and sizes to and from your clients via a secured Internet connection—provide a safe and instant alternative to the traditional methods of storing and delivering sensitive client documents, CDs and jump drives through the mail and even email. What’s more, client portals designed with tax and accounting firms in mind, like those from CCH, cPaperless, Office Tools Pro, ShareFile, SmartVault and Thomson Reuters, ensure compliance with increasingly complex regulations protecting client data. “Although the U.S. Postal Service probably isn’t happy,” jokes Kutchins, “we moved to using a client portal so we wouldn’t be sending out nearly as many printed tax returns or financial statements. Now, our clients can securely access the client portal through our website to upload or download all of their important documents whenever they need to. Even if the client doesn’t want to go to the portal themselves, it’s so much easier for our admin staff to use it to find and deliver client documents.” If you’re anything like Kutchins, who started his career using fountain pens for work papers, the pace of change may feel a bit challenging at times. But he’s now the one who sits in meetings with a BlackBerry in one hand and an iPad in the other. To put it plainly, tech-savvy CPAs are integral to the accounting firm of the future. | WINTER 2012




BuIld A BusINEss lEgAcy Creating a firm with staying power and an impactful brand is harder than it used to be. By Kristine Blenkhorn Rodriguez Legacies are defined by their staying power. Almost two decades ago, little-known researchers Jim Collins and Jerry Porras coauthored a book based on a project at Stanford University. It became one of the best-selling business books ever. Their burning question was a simple one: Why are some companies able to achieve and sustain success through multiple generations of leaders, across decades and even centuries? They systematically studied what separates the great from the merely average. Even now, years later, Built to Last: Successful Habits of Visionary Companies, is used in classrooms and boardrooms as a blueprint for how to build an enterprise that endures. Professional services firms face a unique challenge when establishing a legacy. Their “product� is often intangible and based on not only accuracy and foresight, but also the ability to earn client trust. In order to persist, these firms have to outlast the tenure of any single charismatic leader, allow for change in everything but a core set of beliefs and values, establish a strong and vibrant culture, and leverage homegrown management rather than outside hotshots. | WINTER 2012



hile most of the tried-and-true methods of building a legacy hold firm, today’s business environment has complicated matters. Shorter employment tenures in a competitive marketplace, a digital generation of clients who expect more than just operational excellence, a competitive environment that now includes firms from around the world—all these factors contribute to the hurdles companies now have to navigate. While “legacy” is one of those all-encompassing terms that could mean a multitude of things, for the purposes of this article, we’ll approach the concept from three angles: brand, corporate citizenship and, of course, succession.

Brand Legacy Bruce Freeman, a national columnist on entrepreneurship and president of ProLine Communications, still thinks of brand legacy as a matter of building goodwill. “If you use a doctor, a dentist, an accountant, etc., and he or she retires, they’ll generally tell you who will be taking over the practice. And even if you’ve never dealt with this person, I’d say 80 percent of us will go to the recommended replacement. Why? Because we trust the person making the recommendation.” While this scenario still holds true, technology has added layers to the equation. The rise of digital consumers, in large part due to mobility and cloud computing convergence, has changed the branding game. Facebook, for example, has expanded into a fertile breeding ground for firms committed to developing relationships with clientele of all ages. “Almost any company I see today, even the older established brands, have moved to cyberspace,” says Ellen Rudnick, executive director of the University of Chicago’s Michael P. Polsky Center for Entrepreneurship. “You have to use multiple avenues to get to people and meet them on their preferred turf. For most people under 35 or 40, that’s cyberspace.” Rudnick sees this trend increasing over the next few years as the next tech-savvy generation enters consumer and employee ranks. Building a brand means more than people knowing the quality of your work. Given a level playing field, younger generations will choose the professional whose values most closely match their own. 44


Procter & Gamble capitalized on this both during and after the 2012 Olympic Games. According to branding consultancy Interbrand’s 2012 Best Global Brands study, “Celebrating the role that mothers play in raising Olympians, the ‘Thank You, Mom’ campaign tapped into universal sentiment by honing in on the contribution that mothers make in raising successful, well-rounded children. Launched 100 days before the Opening Ceremony, Procter & Gamble’s biggest campaign in the 175-year history of the company was a huge success, with the supporting brand films garnering almost 15.5 million views around the world. There’s not a product brand in sight, yet its emotional power is unprecedented. The real success of this campaign, of course, is that, without explicitly promoting itself, P&G has accomplished what most marketing efforts fall far short of: inextricably linking the corporate brand with universal human values like family cohesion, mutual love and support, and the dreams of greatness we all have for ourselves and our loved ones.” Proving the power of this approach, Interbrand studied consumer associations with this year’s sponsors in the period leading up to the Olympic Games, and found that P&G enjoyed the greatest increase in brand strength—specifically around values such as credibility and authenticity. Susan Lewis, owner of her own CPA firm for 25 years, sees younger clients looking for two things: “One, you must be absolutely electronically astute—that’s huge. We are on Facebook, we are on Twitter, we have a blog. If you’re not, you’re seen as less than cutting edge. As a 53-year old, you’re tempted to say ‘Really? Can’t we just be good at what we do?’ But it’s the norm today. Two, younger clients look for partners that are socially conscious. We contribute 100 percent of the expenses for Showers of Hope, an IRS 501C3 organization. We cook for the Ronald McDonald House twice a year. We sponsor local youth sports. I’d do this anyway, but it shows potential clients what we’re about.”

Corporate Citizenship In the old days (read: just a few years ago), corporate social responsibility was a media darling for some, and a bitter pill to swallow for others. Those entrenched in traditional business cultures found themselves dismayed that performance excellence was no longer enough

you’RE NothINg WIthout VIsIoN The ability to formulate a company vision is something many downplay as a soft skill. Business leaders, however, who have turned their firms into successful legacies, thriving beyond their tenure, will tell you a different story. Andrew Clarke of Ground Floor Partners, a consultancy advising entrepreneurs and business owners on designing and growing their organizations, sees it as an imperative. “The businesses I see succeed are those that have a vision, have a plan to achieve it and ensure they execute against it. Most businesses fail at all three—which is why most businesses fail. What most entrepreneurs have to remember is that a large company has so much more leeway. Its deep pockets allow it to weather the inevitable downturns of business, particularly those dips companies without a vision are bound to undergo. A small

to earn client loyalty. A new generation of clients wanted something more: Good corporate citizens. Many firms either leaned harder on their philanthropic team (if they had one) or delegated a partner to oversee corporate citizenship. Separate from the firm’s primary culture, this offshoot was generally seen as an expense, and therefore wasn’t mainstreamed into day-today operations. Today, the concept of “philanthropy” has expanded into “corporate citizenship.” And, according to Interbrand, this corporate citizenship reflects how a company interacts with six key constituencies: Employees, customers, suppliers, the government(s) responsible for both regulation and assistance, the communities in which business is done, and the larger environment the business shares with the whole planet. In Interbrand research and client work, the firm found that consumer perception of a brand’s performance in any one of these six dimensions has a type of halo effect on the other five dimensions. This is good news: It gives companies license to laser-focus on an aspect of social engagement that suits their brand identity, and they can expect to see returns in perception as a result. Over time, these perceptions, if they remain steady or increase, create a legacy that defines the firm in both clients’ minds and public perception. For some companies and firms, such as S.C. Johnson and Sundance, a social legacy is central to their purpose of being. And indeed, among Rudnick’s students, organizations such as these are a definite draw. “It’s not enough anymore for a firm just to offer a good salary,” she says. “Young jobseekers are looking for a firm that is a good corporate citizen. They’ll weigh the pros and cons—I can make 5 or 10 thousand more dollars at Firm A, but their values aren’t compatible with what I believe in, so I pass on the opportunity and go to Firm B where I’ll make a bit less but will be happier.” This lure for tomorrow’s most promising leaders brings us to the third aspect of legacy-building: Succession.

Successor Prep The most traditional definition of business legacy refers to having a torch to pass; tangible assets to entrust to the next generation of leaders. A 2012 study by global search firm Russell Reynolds found

or mid-sized firm without that vision as a compass tends to flounder,” he explains. Nancy S. Bishop, who has more than 30 years of marketing experience in the professional services sector, now counsels startups and small businesses through SCORE Chicago, a nonprofit association affiliated with the Small Business Administration. “When people start a business, unless it’s a creative endeavor or a family business, most of the time they don’t have a vision. They’re too worried about the short term—when they will break even or have enough money to hire more people,” she says. Like Clarke, Bishop sees a vision as an imperative for success. “Nearly half of startups fail. But, those you counsel who have a strong sense of what they want the firm to be tend to weather the early storms better and persevere. They’re more likely to be around a few years from now,” she explains.

that the most successful firms are those that address succession planning by constantly assessing and developing rising leaders from within (which is consistent with the findings in Built to Last). While you might think family businesses have succession down to a fine art given the fact that sons, daughters, nephews and nieces likely have been molded for the role of leader from day one, you would, in fact, be quite mistaken. Although according to the Family Business Institute, 88 percent of current family business owners believe the same family or families will control their business in five years, only about 30 percent of these businesses survive into the second generation, 12 percent are still viable into the third generation, and only about 3 percent of all family businesses operate into the fourth generation and beyond. Family or not, succession planning is the key to building a lasting business legacy. In his SmartBlog for Leadership article, “How to find and mentor future company leaders,” personal leadership coach Joel Garfinkle offers these tips for identifying rising stars: 1. Actively look for star performers. Who excels at their work, consistently produces desired results and adds value to the firm? These are the people prime for mentoring. 2. To help you in your search, let fellow executives know that you’re looking for someone to mentor. 3. Acknowledge the efforts of those employees who actively seek to promote themselves. We’re not talking about employees who constantly brag, but rather those individuals who consistently get credit for their work. These are the people who care about their future in your firm. Establishing a strong culture is also critical, says Rudnick. “In a class I’m teaching, we’ll cover a case study on a couple of startups involving one entrepreneur. No matter how competent the employees he hired were, if they didn’t fit his corporate culture, they didn’t work out. It’s that critical. The fit has to be there and be obvious.” Building a business that lasts isn’t the game it used to be, largely due to the rise of a technologically savvy new generation that holds a different set of priorities close to its heart. What this promises for those businesses that get the legacy equation right is a bright, dynamic, profit-generating future. | WINTER 2012


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Talking too much is the most common mistake hiring managers say job applicants make during an interview. Source: Esquire, Working.

4 Tips for Overcoming Networking Anxiety If the thought of attending a networking function gives you heart palpitations, you’re not alone. Many young professionals dread these events but realize they’re an important aspect of their jobs. Here are some pointers to help you approach your next event with confidence. 1. Consider the type of event you’re attending. Look for something that has a built-in activity that will help to break the ice. Knowing there’s something to do when you attend will reduce the panic of walking into a room and striking up a conversation with a stranger. 2. Prior to attending an event, check the news so you’re armed with conversation topics. Many people will turn to current events for small talk and you don’t want to be left with nothing to say. 3. Perfect your elevator pitch so you impress everyone with your introduction. Making a great first impression will help you stand out at a crowded event. 4. Most importantly, relax and be yourself. You’ll be an expert at making connections in no time. [SH]

Is it time to move on? Derrick Lilly ICPAS Publications Specialist

We young professionals often jump at the first full-time gig we can get, not taking the time to evaluate how good a fit it is. Young Money’s article “Good Reasons to Look for a New Job,” points out that it’s time to start looking elsewhere if: You’re not challenged: Have your abilities grown beyond your job Visit description? to learn about the many You’re not treated well: Do you often feel belittled or defeated? volunteer programs offered You’re depressed: Do you struggle to get out of bed and face the through the Illinois office every morning? CPA Society. You’re strapped for cash: If you’re not earning enough to pay off your debts or live comfortably, or you’re not earning what your skills are worth, start shopping around. [DL]

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Are you a slave to social media? Answer these questions—truthfully: Can you go a day without checking Facebook or tweeting? n Do you feel disconnected if you don’t check or post daily? n Do you often lose track of time when checking or posting? If you answered ‘yes,’ then these tips will help to loosen those social media shackles: n Be selective. Don’t friend or follow just anyone. n Trim down what you post. Make it strategic, not a time-filler. n Be picky about which social media venues you use. You don’t have to be active on every single one of them. n Assign specific times of the day to use social media. [CP] n

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INSIGHT Magazine - Winter 2012 - Illinois CPA Society  

INSIGHT Magazine presents both global and local issues of particular relevance to its diverse readers, stimulating discussion and encouragin...

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