Bill Gates' Win-Win Scenario for CPAs
Microsoft sees business systems consulting in small firms' future. A vanguard of CPAs is pushing the envelope to provide new consulting services unheard of just a few years ago, and it is using technology to do it. Practitioners are advising their clients on improving business processes by offering consulting on a variety of business systems. These engagements use technology for spreadsheet consulting, conducting engagements through email and helping clients set up Web sites, as well as consulting on broad processes such as accounting, manufacturing, human resources, document management, customer management and sales order systems. In addition, the American Institute of CPAs special committee on assurance services has identified assuring the quality and security of electronic communications as an important new service. CPAs need to advise businesses on issues such as taxation on money transfers over the Internet and finance systems that are challenging the traditional paper audit trail. With so many changes in the way businesses and CPA firms are now run, CPAs have to pay closer attention than ever to changes in technology. No company has initiated more changes in personal computing, for as long a period, as Microsoft. Even CPAs who are not using Microsoft's Excel or Word probably own computers with Microsoft Windows or MS-DOS. Recently, the Journal spoke with Microsoft founder Bill Gates, who has been changing the way PCs work as long as there have been PCs. This leading technology visionary shared his thoughts not so much on what Microsoft will be offering around the corner but on what forward-looking CPAs should do to become the premier strategic business advisers of the 21st century. WHERE DO YOU WANT TO GO TODAY?... Microsoft's tag line might well apply to CPAs. Should they risk a move into consulting--will this put their safe, traditional tax and audit practices in jeopardy? But with tax and audit service growth fiat and consulting services growing, "the real risk," said Gates, "is not doing anything." Take small businesses, for example. Gates pointed out that they can buy inexpensive programs to handle their bookkeeping, but they are starved for advice on how to grow their companies and use technology to achieve growth. They're running businesses-they don't have time to become technology experts. "CPAs are the perfect candidates to meet these companies' needs. They know their clients' financials inside out. They're trusted. They understand how to offer cost-effective solutions to problems. You add technology skills to these skills and you've got a winning combination." Ultimately, said Gates, there is no avoiding risk. "But if you have a passion for helping your client build great business systems, I'd say the risk is low. And if any group knows how to assess risk, it's got to be CPAs" CPAs can be confident there is a market for their consulting services. The United States has 7.1 million small businesses, nearly 4 million of which have fewer than 5 employees. In 1996, the Big 6 accounting firms saw an enormous 43% of their revenues coming from consulting while small firms realized only 5% from consulting. And yet the same opportunities exist for small firms: Small family-owned businesses--the ones that have been coming to these small CPA firms for tax returns year after year--have little idea what business systems they need, even though technology is the key to their growth. (And the smaller the business, the less likely it is to use technology.) Who know their businesses better, who have been their trusted tax advisers for years? Their local CPAs. "I see consulting as an inevitable change and a real opportunity for the traditional small firm to diversify and grow" said Gates. Where the future is. As an example, Gates discussed how one technology in particular was going to change all businesses, big and small, and thus open up consulting opportunities for small firms. …