Corporate leaders are demanding more and more from their tax and accounting partners. Is your firm on top of the latest Internal Revenue Service guidance on Paycheck Protection Program loan forgiveness? Does it offer Environmental, Social and Governance (ESG) reporting services? Does it use data analytics to help you grow your business?
“If you’re going to be a partner with the C-suite, you have to care about what they care about,” says Matt Armanino, CEO and managing partner of San Ramon, California-based Armanino. Today that means focusing not only on how to do the core duties of accounting and tax better, but also how to contribute to clients’ strategic decision-making. “We look at tax and accounting, not as a limit, but as a great platform and privileged position of trust to ask: ‘How can we do more for you?’” he says.
Is your tax and accounting firm doing all that it can for you?
For the third year, Forbes has partnered with market research company Statista to create a list of the most recommended firms for tax and accounting services in the U.S. For more on the methodology, see the bottom of this story.
Here are some issues to talk about with your advisor—or a prospective advisor—going into 2022.
Covid-relief and ever-changing tax laws. 2021 was another tough year for businesses and advisors when it came to new tax laws and evolving guidance from the federal government around Covid-relief. Will 2022 be any better? “A year ago I would have said 2021 will probably be a quieter year than 2020; now I’m not sure it will stabilize next year,” Armanino says.
As the pandemic continues, it’s reasonable to expect there will be new laws and ongoing guidance from the Internal Revenue Service and the Small Business Administration to deal with. Two examples from last month: The IRS issued three revenue procedures on how to treat Paycheck Protection Program loan forgiveness. And in the Infrastructure Act, Congress ended the employee retention tax credit of up to $7,000 per employee three months early.
“We’re constantly circling back to clients updating advice. It’s been challenging,” says Sarah Belliveau, CEO of BerryDunn in Portland, Maine.
This month could be a doozy. The fate of the Build Back Better Act, which passed the House in November and is before the Senate, will determine if any tax changes go into effect on December 31 that require last-minute tax planning. A corporate minimum tax and higher taxes on the wealthy are in the mix.
Meanwhile, advisors are already working on prepping clients for the upcoming 2022 tax season—despite the fact that the IRS still has piles of 2020 returns in processing. In a recent survey, the AICPA cited tax complexity around Covid relief programs, shifting tax deadlines and challenges when working with the IRS as top concerns among CPAs. Is your advisor ready?
Embracing advanced technology. One way tax and accounting firms are dealing with complexity is by embracing technology. Is your firm up to speed? “Many tax and accounting firms are struggling with the idea that they’re not built for change in a world that requires a rethinking and reimagining of what we do,” says Armanino.
Sure, your tax and accounting firm’s first goal should be acting as the trusted advisor to the CFO. That’s where it starts, but as the CFO role has grown functionally, the best tax and accounting firms are growing with it. Businesses are requesting more insights. How do we make sense of data? Clients want full AI solutions, chat bots and RPA (robotic process automation) technology.
“Some day we’ll be able to push a button and audit a year’s activity in a matter of hours as opposed to something that’s labor intensive today; we won’t get there overnight, but we’re moving in that direction,” says Belliveau. Ask your advisor: How do they use tech to innovate tax and audit processes—and more?
Meeting ESG expectations. The rise of environmental, social and governance (ESG) standards to evaluate corporate practices is a wave that’s coming, says Armanino, who pegs ESG reporting as a bigger opportunity for tax and accounting firms than financial statement audits. “If you’re a surfer, you have to start paddling to catch it,” he says.
In March, Armanino became a certified B corporation, demonstrating a high standard of corporate responsibility, joining the likes of Ben & Jerry’s and Patagonia. Now Armanino is helping clients achieve their ESG ambitions. Is your advisor putting ESG front and center?
PwC has a product called ESG Pulse that helps companies assess ESG metrics like employee diversity and greenhouse gas emissions to show progress to investors. KPMG announced in October that it’s committing $1.5 billion over the next three years to its new global ESG “Impact Plan” that will help its clients make a positive difference. Ask your advisor: What’s your ESG commitment and how can you help us?
Tying it together. Tax and accounting firms are facing these issues head on themselves—and for their clients. “To really thrive, corporations need to be resilient and agile. They’re looking for the same thing with their professional services partners,” says Belliveau.
Methodology. To create the list of America’s Best Tax & Accounting Firms 2022, the market research company Statista considered survey responses from CPAs, enrolled agents, tax lawyers, accountants and CFOs between August 3 and September 13, 2021. Survey participants who worked for a tax or accounting firm could name up to ten firms for tax and ten firms for accounting that they would recommend if their company were not able to take on a client. Survey participants who worked in a company on the client side were asked to name up to 10 firms each in tax and accounting that they would recommend based on their professional experience during the last three years. The firms that received the most recommendations were included on the list. Self-recommendations were not considered. The final list consists of 223 firms, with 200 recommended for tax services and 200 recommended for accounting services. (177 companies received an award on both lists, and 46 were awarded in one area.) Approximately 4,400 recommendations were considered in the final analysis.