Counting the numbers – and more
From tax time to succession planning, accountants provide many needed services

By Susan K. Godfrey

Local accounting firms do more than help companies at tax time. They support local businesses and individuals year-round and are actively involved in their communities.
IAccountants help everyone from startups to corporations to nonprofits with bookkeeping, payrolls, quarterly payroll reports, monthly financial statements, bank reconciliations, tax returns and tax excise reports, audits, reviews, planning, business profit analysis and much more. They also assist individuals with financial and retirement planning, and personal succession of estates including businesses.
Accountants can work in a public or private setting. Public accountants work for a range of entities, while private accountants usually work for a single company, the government or an individual.
Certified Public Accountants must have at least a bachelor’s degree – some study five years – with an accounting concentration and pass a rigorous three-day, four-part examination. Once certified, accountants must take continuing education courses to retain the license. That involves taking 150 semester hours with the minimum of a bachelor’s degree and a concentration in accounting, passing the CPA examination and an ethics exam. CPA candidates must also complete experience requirements, which are attainment of seven competency criteria over a minimum of 2,000 hours and 12 months, verified by a licensed CPA.
The ongoing continuing education requirement is a minimum of 40 hours per year to retain the license because accounting, auditing and tax regulations may change, and accountants are expected to keep abreast of how those regulations impact their clients.
Most are affiliated with the Washington Society of Certified Public Accountants (WSCPA) and the Washington Association of Accountants (WAA), and may also affiliate with Washington State Tax Consultants. National associations include the American Institute of Professional Bookkeepers and the American Institute of Certified Public Accountants. Women accountants may join the American Society of Women Accountants.
The WSCPA offers training sessions in “financial literacy” and other benefits; the WAA offers continuing professional education including seminars in taxation, accounting, estate planning, technology, financial management and more.
Bellingham’s Stephanie Artino of Metcalf Hodges is President-Elect of the Northwest Chapter of WSCPA and Steve Padgett of Padgett and Padgett in Mount Vernon serves on the chapter board.

Taxes
Tax preparation is the first reason businesses turn to accountants, and a deadline just passed for those filing an extension for payment. That’s often the most challenging time for accounting firms. Artino says, “We encourage our clients to bring in their year end information early, but there is an unavoidable seasonality to our work. Until the government allows for staggered filing dates for the federal income tax returns, we will have the seasonal ‘crunch.’ Clients do their best to collect the documents, but often they are waiting on others to provide the information needed, so it creates a domino effect. We make liberal use of the allowed extensions when the timing gets too tense,” she says.
Aaron Brown, director of operations for Larson Gross of Bellingham, Lynden and Blaine, says he’s involved with clients year-round to plan ahead for tax crunch time, but that “people may be disorganized in their records or haven’t had a chance to organize for countless reasons, including changes in their accounting systems.”
Travis Huisman, a local Moss Adams manager, says, “There are going to be some who will always wait until the last minute. That is fine, but they should remember that no one does their best work under pressure. Would you want your return prepared when your adviser has time to consider tax planning, or when they are so rushed the only thing they can do is get it filed on time?”
CPA Kathy Varner of Varner Sytsma Herndon (VSH) of Bellingham says they “feed staff a lot of pizza, pretzels and doughnuts along with lots of coffee” after reminding clients of their due dates and making sure they can do all they can to get their books together.

Wireless Paperwork
“One of the exciting new opportunities in public accounting is the ability to work from home using remote access,” Artino adds. “Now that we are a completely paperless office – and please note that it does not mean we do not have and use lots of paper – we can come into our physical office through a secure Internet portal and work on client files as if we were sitting at our desk down the hall. In the past, when we had paper files, we could not take those files out of the office for security reasons. Now that we can come into the office via the Internet, those files never leave and we can do the work and then check them back into the file server, or forward them to another person in the office. This innovation has made our work team more productive and accessible,” she adds.
At VSH, CPA Varner says some of the 20-member staff can telecommute especially during the area’s winter snowstorms.
Huisman, however, adds, “The challenge with telecommuting is client contact and the infrastructure necessary to make client files assessable to the telecommuter, considering the privacy and security issues. The industry is beginning to get comfortable with alternative work schedules and telecommuting, some more than others, but it is not all the way there yet. Even while telecommuting, anyone wishing to advance in this career has to enjoy client contact and face-to-face advisory meetings.”

Variety
Diversity in the work environment is a plus for accountants. “We have the opportunity to play an important role in the success of many different businesses and meet a great many wonderful people in different industries,” says Artino. “We get to learn about the different industries, which are always intellectually stimulating”.
Varner adds that it is a great job for all different types of personalities: “We need a mixture of technical, service-oriented and social types. The combination of personalities and skills is what makes a great CPA firm. The most enjoyable part of a CPA’s life is the variety that no day or client is alike and it is an always-changing environment with rules and law and technology changes.”
Her partner Kathy Herndon adds, “Our firm believes in ‘a balanced approach.’ We are a full-service CPA firm that takes into consideration all aspects of a client’s business and personal life. A lot of times business owners get caught up in making the business successful and looking at the current situation. It is very important to keep business owners looking outside their current surroundings to the entire business and their entire life.
“For example we assist clients in evaluating what adding a salesperson could add to the company environment and the bottom line, or if a new line of business is added how would that impact the business, and what changes need to happen to take the business to the next level. In addition we are firm believers in planning for retirement and children’s education, and we have recently added a full-service investment planner to our company to ensure clients are taking action in areas they have determined are important to them.”

Specialties
Several of the firms have evolved specialized areas of practice. For example, Larson Gross provides a variety of specialized services including assistance to Canadian clients doing business in the U.S. or vice versa. “As the U.S.-Canadian exchange rate has shifted in favor of the Canadian dollar it has made cross-border investment an attractive option for many Canadians, and we can help with these transactions,” says Brown. “We advise clients around issues such as the tax implications of their entity choice, transfer pricing, or the interpretation of applicable tax treaties between the two countries.”
In addition, Larson Gross leverages its affiliations with other firms and professional organizations such as the RSM McGladrey Network to provide industry specific expertise to clients in agriculture, construction, healthcare and manufacturing, as well as assistance with certain human resource and technology issues.
Artino describes her company’s initiative to grow small businesses, a program called “Ran One,” which involves helping businesses target opportunities, perform cost-benefit analyses for their particular product or service, and identify potential operating efficiencies.
Moss Adams has experts in tribal law and educational institutions to serve those sectors as well as banks and contractors; and Huisman says this Moss Adams branch’s bread-and-butter clients are mid-market privately held companies such as construction companies and banks, but he adds, “I am passionate about having readers understand there is so much more to accounting services than taxes and financial statements – services we do that may not be typically associated with CPAs.”
The 95-member Bellingham Moss Adams office specialty practices include not only tribal and nonprofit clients but other government clients and international services. Other office specialty practices include agriculture and food processing, timber, distribution, construction and hospitality clients. They also have a business owner succession service.
Padgett and Padgett, a two-member firm located in Skagit County, has a branch in Shanghai, China. Steve Padgett, junior member of the two-person firm with his father, Ray, have combined 50 years in the business and both are CPAs working with a wide range of standard clients: construction, insurance, medical, real estate, manufacturing, retail and food services. Ray has worked both in financial management as well as accounting, taught accounting at the college level, and has served as WSCPA Northwest Chapter President. Steve is currently on that group’s board of directors. Steve also teaches a workshop on “Understanding Financial Statements” at Skagit Valley Business College’s Business Resource Center, while managing the company’s computer technology services.
Steve’s interest in expanding the company’s work to China grew out of personal interest as his mother and wife are Chinese, as well as understanding that more U.S. businesses are impacted by China. Through family connections they opening an office in Shanghai three years ago and work with small and mid-size companies both here and there in areas of joint ventures, mergers and acquisitions and business proposals. Businesses range from satellite communications, to opening a coffee shop in a Shanghai business and technology park. As a regular traveler there, at least four times a year, Steve said he missed his coffee, so he opened Classico Café, practicing what he preaches as a supporter of small business.

Local Involvement
Both Padgetts are also active in their community, volunteering time doing audits for nonprofits including United Way of Skagit, Whatcom and Island counties. “It’s enjoyable seeing the impact of these groups on the community,” Steve says.
Aside from membership in their professional associations, both women accountants are actively involved in their respective communities. Artino represents her firm in the Building Industry Association of Whatcom County and the Bellingham/Whatcom Chamber of Commerce. She also serves as treasurer and past president of the Board of Directors for Mother Baby Center, is an advisory committee member for the Whatcom Young Professionals, and is chair for the Bellingham Technical College Advisory Committee for Business and Computer Information Systems.
Stites is a member of the Mount Vernon and LaConner Chambers of Commerce, is a La Conner Soroptimist and member of Skagit Women in Business. She is also a board member of the Skagitonians to Preserve Farmland and sponsor of their Harvest Dinner, a member of the Skagit Historical Museum, Skagit Land Trust and LaConner Alliance for Youth and Families, and a recent graduate of Leadership Skagit.
Brown says the company maintains community leadership and most of their 44 employees are involved in community affairs. He says the company’s policy is to provide time for their employees to both participate in those activities to also support local groups “financially and with their expertise.”

Challenges
One issue facing Washington business owners, says Stites, is the excise tax due on gross receipts. “Even if a business is losing money, they may still have to pay huge amounts in state taxes,” she explains. “Washington state’s business and occupation tax (B&O) is based on gross receipts. Virtually all businesses are subject to B&O tax, including corporations, partnerships, sole proprietors and nonprofit corporations. The only major exempt activities are farming and the sale or rental of real estate. What this means to the smaller business owner – and even some larger ones – is that even if you are showing a loss you could still end up owing a lot of money to the state for B&O taxes. They tax you on your gross receipts and allow very few deductions, if any.”
Another controversial issue facing accounting nationally is the Sarbanes-Oxley Act of 2002, also known as the Public Company Accounting Reform and Investor Protection Act, enacted as a result of major corporation accounting scandals involving companies such as Enron and WorldCom. This wide-ranging law establishes new or enhanced standards for directors of all public companies operating in the U.S., including board members, management and their public accounting firms.
A Public Company Accounting Oversight Board is charged with overseeing, regulating, inspecting and disciplining accounting firms as they audit public companies, and addresses auditor independence, corporate governance, internal control assessment and enhanced financial disclosure.
Because the measure applies to small businesses as well as large, Stites says it can impose large demands on the accounting time taken to comply. “All companies have to follow complicated rules that really don’t apply to a small business. Some of the regulations and record-keeping requirements can drive small business owners out of business by trying to keep up with all the paperwork and rules.”
And that, according to two of the accountants interviewed, is one of the reasons for an accounting shortage as smaller staffs try to keep up with larger demands. “Demand is at an all-time high, combined with a shortage of qualified staffing, so recruiting is huge,” says Brown.

Accounting Careers
Academic and Student Relations Administrator Mark Peterson of the WSCPA says his mission is to recruit students into accounting and he’s involved in generating interest starting as early as the high school level, as well as foster academic programs for certification at the AA level and CPA training in four-year colleges.
Accountants have a wide choice of work environment: they can be part of a corporate franchise, have an independent business or go into teaching. The pay range for accounting is about $40,000-$75,000 annually in this area, and slightly higher in nearby larger cities.
Says Huisman, “While salaries in public accounting start out lower than in some professions, and it takes awhile to have the business experience to be a valuable adviser to clients, the top end is very nice.”
Accounting was ranked nationally as the number-one career in demand in 2007 by JobWeb (www.jobweb.com), according to Peterson. In the Puget Sound area, he adds, the demand for accounting, auditing and financial planning is projected to increase by 19.3 percent by 2014, according to projections by the state’s Workforce Explorer.
Why go into accounting? “If you enjoy getting to meet many people and learn about lots of different types of business this is the job for you. One day you might tour a leading aerospace manufacturer and the next, advise a construction company. It is a challenge and is fun,” says Huisman.
Likewise Skagit-area accountant Sherri Stites says the most enjoyable part of her work is to help small business owners comply with government regulations and “succeed in their own dreams.”
“I did it because I just love the numbers,” says Padgett..

Stephanie Artino of Metcalf Hodges says her firm has gained efficiency as a paperless office.