Accounting Firms Post Three-Year Growth Streak, Demand for CPAs Continues
The accounting industry remains strong, despite a faltering economy. In fact, the top 100 accounting firms have posted double-digit growth for three years running, according to the latest national Public Accounting Report (PAR) survey of highest revenue accounting firms published by CCH, a Wolters Kluwer business and a provider of tax, accounting and audit information, software and services. The results of this survey mark the first time the Top 100 firms posted a three-year streak of double-digit revenue growth rates since 1999, 2000 and 2001.
Executive search firm, A. E. Feldman, reports that recruiting among accounting firms remains highly competitive. The firm says that accounting jobs and international tax jobs exist for candidates who have an understanding of international finance and cultures. A number of top firms are also seeking State and Local Tax accountants as well as Tax Managers and Partners. Accountants with expertise in FAS 109 and FIN 48, in particular, are in high demand.
Top 100 Firms See Double-Digit Growth
The 2008 PAR survey found an average revenue growth rate of 11.4% - up from 10.8% in 2007. Moreover, the survey shows that as in previous years, firms outside the Big Four posted stronger overall results than their larger counterparts, with non-Big Four firms growing their revenue at an average rate of 14.4% compared to 10.6% for the Big Four.
In addition to revenue growth rates for overall firms, composite net revenue per partner also rose to more than $2.87 million, a 6.3% increase over 2007. Meanwhile, net revenues per professional for firms in this year’s top 100 increased 4% to $320,194 compared to those firms’ previous performance, the survey found.
Changing Landscape
Corporate tax and financial executives continue to be confronted by the increasing complexities of changing tax laws and regulations. The pressures of complying with new tax regulations are forcing most companies to focus on their effective tax rate and their sustainable tax rate. Tax departments must devise plans and practices to keep the effective tax rate as low as possible and boost efforts to comply with rulings such as FAS 109 and Fin 48.
FAS 109 (Accounting for Income Taxes) is the governing standard for financial statement accounting for income taxes. It requires separate tax rates for deferred taxes for each jurisdiction where a company is subject to tax. The complexities and resource challenges surrounding FAS 109 have been exacerbated by additional rules governing the Accounting for Uncertainty in Tax Positions released by the FASB, known as FIN 48,
FIN 48 dramatically changes how companies account for uncertain income tax positions. They include a higher standard that tax benefits must meet before they can be recognized in a company’s financial statements. Although FIN 48 is intended to increase the comparability of financial statements, it also significantly increases the calculation and documentation requirements for individually identified income tax exposures.
Applying FAS 109 and FIN 48 amid vague international tax laws can be challenging. Complicating matters, business and tax issues have become more intricate thanks to language barriers, diverse cultures, different currencies and technology as well as complex international tax laws. These growing demands have placed a significant burden on tax departments. Mitch Feldman, President of A.E. Feldman, says, “The pace of globalization is accelerating and it’s creating demand for accountants and finance professionals with an international perspective and expertise.” As a result, firms are staffing up to ensure they find opportunity and create value in a variety of complex overseas tax environments.
IFRS Looming
The looming convergence of accounting standards from U.S. GAAP to International Financial Reporting Standards (IFRS) is also driving demand for candidates with international business experience.
The question about whether the world is going to global standards is no longer ‘if,’ but ‘when,’” says KPMG Chairman and CEO Timothy P. Flynn in a statement. The SEC recently announced it voted to publish for public comment a proposed Roadmap, or series of benchmarks, that will guide the United States through the process of convergence from U.S. GAAP to International Financial Reporting Standards (IFRS). The move could ultimately unite the global business community and move all U.S. public companies under a single global standard by 2014. As a result, more multinational companies must hire professionals with sufficient knowledge of IFRS to make the conversion and to maintain IFRS financial statements, both among domestic and international operations.
A.E. Feldman’s accounting division is constantly researching industry trends and developments. The recruiting firm invites both corporations and accounting firms to contact its President, Mitch Feldman, its CEO, Carol Schwam, and its highly specialized team of recruiters directly to open up a dialogue about the array of accounting issues they face and those they anticipate in the future. A.E. Feldman also encourages candidates to learn more about existing and future job opportunities in accounting. According to Mitch Feldman, “Our lines of communication are open.” Contact Mitch Feldman, and the firm’s expert recruiting teams here.
