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Search CPA, Find What?

Aug 20th, 2016 | By | Category: Accounting

Published on Sep 15, 2010 by Roy Avila

Hiring a CPA is like hiring anybody else… you are always better off getting a reference or finding someone you know through of word of mouth. If you have the money to spend, you will likely do fine using one of the big four accounting firms (Deloitte Touche Tohmatsu, Price Waterhouse and Coopers, Ernst & Young or KPMG International) or the next tier of national firms (RSM McGladrey, Grant Thornton LLP, BDO Seidman, Moss Adams LLP, etc.).  If you are using a smaller firm, then you most likely should get references that have experience in your current line of business.

The primary functions a CPA fulfills relate to assurance services or public accounting. Within assurance services, the goal of improving the information or the context of the information so that decision makers can make more informed, and presumably better decisions.  These are well known as financial audit services, CPA’s attest to the reasonableness of disclosures, the freedom from material misstatements, and the adherence to the applicable generally accepted accounting principles (GAAP) in financial statements. CPAs can also be employed by a corporation, termed “the private sector”, in finance roles such as Chief Financial Officer (CFO), Controller, or Accounting Manager. Although some CPA’s serve as business consultants, the consulting role is under scrutiny following the corporate climate in the aftermath of the Enron scandal.

Today CPA’s are under even more pressure to comply with new state and federal regulation laws, the most recent talked about, Massachusetts 201 CMR 17.00  and the Red Flag Rule delayed from the Federal Trade Commission.

The scrutiny of accounting firms practices has resulted in divestitures in the consulting divisions. This trend has since reversed. In audit engagements, CPA’s are and have always been required by professional standards and Federal and State laws to maintain independence both in fact and in appearance from the entity for which they are conducting an attestation (audit and review) engagement.  However, most individual CPA’s who work as consultants do not work as auditors. CPA’s also having a niche within the income tax preparation industry tend to follow the same principles. Many firms have both a tax and an auditing department.

Here is a list of services provided by CPA’s.  Whether providing services directly to the public or employed by corporations or associations, CPA’s can operate in virtually any area of finance, including:

  • Assurance and Attestation Services
  • Corporate Finance
  • Merger & Acquisition, initial public offerings, share & debt issuing
  • Corporate Governance
  • Estate Planning
  • Financial Accounting
  • Financial Analysis
  • Financial Planning
  • Forensic Accounting (preventing, detecting, and investigating financial frauds)
  • Income Tax
  • Information Technology, especially as applied to accounting and auditing
  • Management Consulting and Performance Management
  • Tax Preparation and Planning
  • Venture Capital

While some CPA’s are generalists and offer a range of services (especially those in small practices) many CPA’s specialize in just one area, and do not provide all the services listed above. The first successful way to start the process of hiring a CPA and its counterparts is to acknowledge and recognize how close you are to your financial side of your business. The second it to ask around, people like your former student colleagues, customers, and/or vendors. The optimal way is to a trusted person like a friend who owns a successful business, a business associate who has references of the highest caliber and/or from a reliable attorney who has a long lasting relationship with your personal and business endeavors.

Partial References and Credits: Wikipedia

By Roy Avila, ITLNOW

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