With McGovern's assistance, the Stewarts have put together a financial team at a price range and level of service that fits their business to a T. Years ago, companies this small never could have split their accounting business into multiple, smaller accounts and then scanned the marketplace for specialists to satisfy each need. "The users of accounting services are getting much smarter," says McGovern. "Small and big companies can now shop around for exactly the expert they want. And if someone is an expert in Service A but not in Service B--well, they can shop around and find that person, too."
And it's working for the Stewarts. "We hire Donna to come in two or three days each month to help us with our closing, kind of like a part-time chief financial officer," Julie explains. "Her responsibilities include compiling our monthly financial reports and analyzing our cost of goods--something we never knew how to do before. She also helps us with business plans for new projects we're considering." Julie, with the help of a financial clerk, handles Sportsheets' accounts-receivable and -payable operations. That clamps costs down, while keeping her abreast of the company's day-to-day financials. About once a month the company brings in its outside CPA to handle its corporate-income-tax work as well as some tax planning.
"I look back on the time before we had both of them as a dark period, when everything was in a flurry of product in, product out, and we never really knew if we were making any money," says Tom.
Forget the Number Crunching
Where's the growth taking place in large accounting firms? According to Public Accounting Report's survey of the nine national accounting firms in the United States, the growth in management-consulting services dwarfed that of accounting and auditing and taxes.
|
1995 revenues (in millions) |
% change since 1990 |
| Accounting and auditing |
$6,004 |
+2.9% |
| Taxes |
$3,197 |
+13.1% |
| Management-consulting services |
$6,371 |
+117.7% |
Source: Public Accounting Report, Atlanta, August 1996.
The New Accountants
Believe it or not, some accountants thrive on change. Take Stephen King, a CPA refugee from Ernst & Young, whose activities would probably thrill and chill more accountants than the books of his novel-writing namesake would.
His business plan originated with one horrific vision: "Small-business owners hated their accountants, who were either too big to pay enough attention to them or too small to serve all their needs." So King, whose rÉsumÉ includes a stint as the chief financial officer of Amnesty International USA, created a New York Citybased accounting firm called Virtual Growth Inc.
"We're attempting to redefine accounting services for small businesses," King says, "by putting together a network of small local accountants who together are part of a big data center. We supplement their expertise and their technology with our own. And together, we can offer our clients everything from advanced accounting-system design and strategic business planning, to the outsourcing of bookkeeping or other financial services, to sophisticated tax preparation and planning, and more."
Here's how it works: A small-business owner goes to a local accountant who's part of the Virtual Growth network. When his or her accounting needs exceed that local practitioner's expertise, the owner calls on other accountants in the network, usually by computer or telephone. For business clients who don't need on-site hand-holding, all accounting needs can be serviced by specialists assigned from the network.
The Internet plays an important role in King's business plan. "We're prepared to function as a company's virtual chief financial officer as well as its virtual accounting department." In such cases, clients transmit financial results weekly or biweekly, including new sales, invoices, and the like, by computer to Virtual Growth's headquarters. "Then they can download anything they want from within their data file anytime, which means they have access to financial information 24 hours a day--which is much more than most growing companies can say now," King says.
Just one year old, Virtual Growth already has 12 accountants and two M.B.A.'s in the network and more than 80 corporate clients.
Where the Jobs Are
Accountants are difficult to categorize into the three tiers partly because accounting licenses and other trends are tracked by state and are not uniform. Here's one estimate of how the profession stacks up:
Of the roughly 525,000 accountants licensed by the National Association of State Boards of Accountancy...
Source: Public Accounting Report, Atlanta, August 1996.
79% were solo practitioners or were employed by small firms (those with less than $8.5 million in net revenues)
17% were employed by Big Six firms
4% were employed by the 94 next-largest firms
Resources
AMERICAN EXPRESS TAX AND BUSINESS SERVICES, Bob Basten, IDS Tower 10, T-20/605, Minneapolis, MN 55440; 612-671-9578 63
BOWMAN'S ACCOUNTING REPORT, Arthur Bowman, 950 E. Paces Ferry Rd., Suite 2425, Atlanta, GA 30326; 404-264-9977 63
CICCO AND ASSOCIATES, John Cicco Jr., 221 Rainprint Sq., Murrysville, PA 15668 63
F. DAVID FOWLER, School of Business and Public Management, George Washington University, 710 21st St. NW, Washington, DC 20052; 202-994-6380 63
ED KETZ, 203 Beam Bldg., Dept. of Accounting, Pennsylvania State University, University Park, PA 16802-1912; 814-865-6914 63
BOB NASON, Grant Thornton, Prudential Plaza, 130 E. Randolph St., Chicago, IL 60601-6050; 312-856-0001 63
JAY NISBERG, 9 Chipmunk Ln., Ridgefield, CT 06877; 860-350-1664 63
PUBLIC ACCOUNTING REPORT, Suzanne Verity, 590 Dutch Valley Rd. NE, P.O. Box 13729, Atlanta, GA 30324-0729; 404-881-1141 63
VIRTUAL GROWTH, 37 W. 28th St., 12th Floor, New York, NY 10001; 212-532-8060; 63, 103
