February 7, 2020

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Accountants’ CFO dreams aren’t dead yet

These days, if being a CFO is still on your accounting career bucket list, you’ll have to ditch the S&P 500 CFO path. There’s only 500 of those jobs, after all, and the companies trying to filling them aren’t craving your hot accounting know-how:

CFOs have traditionally emerged from the accounting ranks, with reputations as masters of cost management, corporate finance strategy, accounting standards and reporting requirements. But the role has morphed to the point that accounting expertise is often no longer required.

At the 1,000 largest U.S. public companies, the portion of CFOs who are certified public accountants fell to about 36% last year, according to data from organizational consulting firm Korn Ferry. That is the lowest figure in the six years Korn Ferry has been collecting the data, down from 46% in 2014.

Okay, so there are 1,000 of those jobs, but get real; you’re still unlikely to land one.

Time was, though, especially in the wake of Sarbanes-Oxley, that the CFO needed serious accounting chops. The numbers had to be right, by god, and companies wanted a CFO with an eminent accounting mind to make sure of it.

Of course once the accounting was done, there was no shortage of other things to do: maybe a IPO, or bond issue or financing a hiring spree or a technological investment. And so, over the last couple of decades, those other things have increasingly become a bigger part of a CFO’s job while accounting has become less so. Not for the want of trying; accounting has continued to become more complex, but now a CFO can just delegate to their chief accounting officer.

I get it, a CAO doesn’t have the same cachet as a CFO. It seems to me, then, that the best way to realize your CFO dreams is to….go into, or go back to, or continue your public accounting career and become a CFO-for-hire. The vast majority of small businesses will never hire a CFO. Even for growing companies, it’s a late-stage hire, but it does not diminish the impact one can have on the finances of virtually any business.

But don’t take my word for it. CFO advisory aka virtual CFOs aka outsourced CFO services are one of the fastest-growing areas for smaller accounting firms today. Which means many of your peers are living the CFO dream already, whether they dreamt it or not.

Auditor life

For those of you who started your careers as Big Four auditors, I imagine that most of you are happy to put “former” in front of that particular job title. However, this year is especially notable for being grateful for leaving BIG AUDIT behind:

Travel restrictions related to the coronavirus outbreak could limit the work of external auditors, possibly leading to incomplete reports, late corporate filings or last-minute scrambles for deadline extensions, securities lawyers and former regulators say.

Governments around the world have imposed entry restrictions on visitors from China, while major airlines canceled flights to China. The Big Four accounting firms, which conduct audits for many of the biggest U.S. public companies, have also imposed travel restrictions on employees.

I remember several years ago when China was stonewalling the Public Company Accounting Oversight Board over inspections. Even if China was welcoming PCAOB inspectors with open arms, the hazard bonus pool wouldn’t be nearly big enough to get an adequate number of auditors over there.

Elsewhere: Coronavirus Forces World’s Largest Work-From-Home Experiment

CPA signaling

“Do you have a CPA license plate on your car?” is the headline at CPA Practice Advisor and the answer is “Definitely not,” if you don’t live in Maryland, Mississippi, Oklahoma, New York, or Virginia.

But if you are in one of those states and you do have a CPA license plate, I think the question that everyone has is: Why? Is it a vanity thing? Does telling the world that you’re a certified public accountant in such a public way have intrinsic value? I suppose if there’s a roadside tax return emergency, desperate victims could always flag you down.

The other possibility, I guess, is that CPA license plates are an emerging area of inbound marketing. I admit that I haven’t done the research on this, but it seems unlikely that lots of people are driving around thinking about how they need to find a CPA. If you’ve ever won a new client because of your CPA license plate, please email me about it, and include a picture of your plate. Otherwise, I’m stumped as to why these are a thing.

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Caleb Newquist Caleb is Editor-at-Large at Gusto. In 2009, he became the founding editor of Going Concern, the one-of-a-kind voice on the accounting profession, serving in the role for 9 years. Prior to Going Concern, Caleb worked as a CPA for nearly 6 years in New York and Denver. He lives in Denver with his wife, two daughters, and two cats.

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