| EXECUTIVE
SUMMARY |
 CPAs CAN USE THEIR
UNDERSTANDING of business
structures, familiarity with financial
reports and disciplined, analytic
thinking to succeed at other endeavors.
Those who have launched alternative or
auxiliary careers emphasize the resources
being a CPA can offer. A SELDOM-TOUTED ASSET OF
BEING A CPA, particularly in
public practice, is that accountants have
a window into diverse client companies.
They’re aware of the most profitable
ones, those that are interesting and
those whose owners want to sell.
DUE DILIGENCE FOR CONSIDERING
a new enterprise should include
not only looking at the financials but
also within yourself. Professionals who
are considering a big change should
consult advisers, family and perhaps a
business coach and carefully think
through their goals before making a
decision.
CPAs CAN USE THEIR SKILLS as
a foundation for preparing a
company’s business plan,
streamlining management, organizing
finances more effectively, ramping up
marketing efforts and initiating other
steps that will optimize productivity and
profitability.
PRACTITIONERS SHOULDN’T
UNDERTAKE a big change without
researching the market, having capital
for the long haul, having a network of
professional and personal support and
caring about what they propose to do.
CPAs WHO ARE SATISFIED doing
what they do can relax and enjoy the fact
that they have an even wider range of
professional options than they thought.
|
| ELIZABETH DANZIGER is president
of WorkTalk, a Los Angeles-based company
offering writing training and consulting
services to financial professionals. She
writes frequently on communication
skills. Her e-mail address is lizd@worktalk.com. |
 n
this faster, leaner, meaner modern world, many
professionals—by choice or
necessity—will have more than one career
before they reach retirement (and perhaps even
another one after). Fortunately, the skills that
make for being a successful CPA are an excellent
foundation for a segue into another enterprise if
the economic winds or your heart changes. Young
practitioners can capitalize on the field’s
broad-based financial knowledge to seize an
entrepreneurial opportunity, and all CPAs can use
their understanding of business structures,
familiarity with financial reports, exposure to
management styles and disciplined, analytical
thinking to succeed at other endeavors. This
article will help you answer key questions such
as: What are my goals? What are my choices?
Should I buy a business or start a new one? What
pitfalls should I be aware of? It also profiles a
few practitioners who have launched alternative
or auxiliary careers. Their experiences show some
of the opportunities available to CPAs and point
out skills they found useful.
Job
Satisfaction
Almost
three-quarters of entrepreneurial
America—those who classify
themselves as self-employed or as the
owners of small businesses—say that
being self-employed is their dream job.
Source:
Monthly Hudson Employment Index, www.hudson-index.com.
|
DECIDE WHAT MOTIVATES YOU
One seldom-touted
asset of being a CPA, particularly in public
practice, is that you have a window into diverse
client companies. You’re aware of the most
profitable ones, those that interest you and
those whose owners want to sell. Sometimes a good
opportunity just comes your way—perhaps a
client asks you to work for or buy into his or
her company or a spin-off, a former colleague
mentions an interesting business is for sale or
you hear about a lead at a chamber of commerce
meeting. Due diligence should include looking not
only at the financials but also at yourself.
Consult your advisers, family and perhaps a
business coach and think through your goals.
Answer questions such as
 What would I accomplish
by making a career change? If your aim is to
broaden your professional scope, starting your
own firm or adding a business valuation,
technology consulting or personal financial
planning niche may bring new depth to your career
(see AICPA
Resources). If
it’s to pursue deferred dreams, another kind
of change may be right for you.
Is my job likely to be
downsized? If the answer is yes, develop a
fallback plan.
What would I enjoy
doing—and where? When you visualize the
answer to this, pay attention to what you’re
most excited about. Is it spending more time with
people, earning more money, working in a new
occupation, serving the public good, seeing
direct results from your work, having more time
to pursue special interests or something else?
What would I like to be
doing in five years? Imagine yourself five
years after a career change and five years after
you retire.
Do I want an
entrepreneurial retirement? If you think
work will keep you alert, active and engaged, it
is possible you do.
How can I use my
strengths as a CPA to create success in a new
field? List all your professional assets and
strengths, both intangible (what you know) and
tangible (your credentials and contacts). What
skills prepare you to be a manager or owner?
Analyze the full set of aptitudes you can bring
to a new business.
A business opportunity already
may be present for you within your network of
associates. Answering questions such as those
above will help you to evaluate possibilities as
they come your way. As the French philosopher
Blaise Pascal said, “Chance favors the
prepared mind.”
THIS
IS WHAT YOU KNOW
You can use your CPA skills for preparing a
company’s business plan, streamlining
management, organizing finances more effectively,
ramping up marketing efforts and optimizing
productivity. Here’s what being a CPA has
equipped you with:
You can analyze
financial statements. This mainstay
of CPA work lets you review and understand the
financial health of any enterprise that interests
you.
You know how to
structure a business. While some
would-be entrepreneurs are dithering over C
corporations, S corporations and limited
partnerships, you already know the business model
that will serve you best.
You know how to
market your skills. Every
successful CPA is an adept self-promoter.
You know how to
manage the financial side of a business. Whether
you have hands-on experience in financial
management or vicarious experience through
clients, your CPA skills are a strength in any
enterprise.
You have helped
businesses grow. If you have worked
in finance or consulting, you can apply such
knowledge to your own business.
THINK
IT THROUGH
Experience has shown you the risky side of
business, too, so proceed cautiously. The basic
choices are to buy a company, buy a franchise or
start a new business. Buying an existing company
often has the advantage of offering a guaranteed
income stream from day one, a physical plant
and—if you’re satisfied with the way
the business is run—trustworthy management.
But a potential drawback of buying an entity is
that it may have entrenched problems. Still,
sources say it is easier to work with an existing
business.
While starting a business gives
you maximum control over the structure and focus
of the enterprise, it is riskier than buying an
existing one. If you think you might want to make
the leap into something new, organize an
approach:
Make a plan. If
you have an idea for a business, start writing a
business plan. The process will make your ideas
more concrete.
Look for new
possibilities. Watch for
opportunities in and out of the field. Do you
have a client who is looking to sell his or her
business? Do you see a market for a spin-off
business? Perhaps your client will want to be
part of the new enterprise.
Tell friends
and colleagues you are looking for a business to
invest in. Go to chamber of
commerce meetings and other places where you will
meet businesspeople. The best opportunities often
come from friends and their circle of
acquaintances.
Research
carefully. For example, if you are
interested in purchasing a franchise, research
the market and the company carefully. Study the
financial statements of the target company. Speak
to several current franchise owners, and get a
solid estimate of how much the franchise will
cost you.
Work with a
business broker. A good one can
match you up with a business that won’t
break your budget and will fit your interests.
For instance, one of the largest national
brokerage services is Sunbelt Business Advisors
at www.sunbeltnetwork.com.
Don’t undertake a big
change without analyzing the market, having
capital for the long haul, having a network of
professional and personal support and caring
about what you propose to do. The choice to
reinvent yourself involves trade-offs. For some,
the risk-taking element of starting a business
can be exhilarating, while others will find it
terrifying. Here are some people who are finding
pleasure and success in using their CPA knowledge
as the underpinning of other careers.
Kick-Starting
a New Trade
Brian
Cardozo, CPA, was
a partner at BDO Seidman where he specialized in
helping midsize companies grow. When he decided
to buy a Harley-Davidson dealership in San Jose,
California, he was able to apply all he had
learned about effective business practices to
gearing up his franchise. By focusing on customer
satisfaction, offering excellent repair service
and expanding the sales of ancillary
Harley-Davidson products, Cardozo increased the
business by 50% in two years, transforming a
small local shop into a leading dealership in the
San Francisco Bay area. “We applied the
lessons of the ’90s to a business that
hadn’t changed since the ’60s,”
Cardozo says. “I wrote a business plan,
which I update every year. I’ve also
established a marketing plan and set specific
goals for our return on investment. My ability to
analyze the company’s financial data has
been enormously helpful. The emphasis on customer
service also has yielded big results.”
From
Accountant to High School Teacher
Greg
DeVito, CPA, always
loved coaching soccer and working with kids.
After seven years at an accounting firm in West
Hartford, Connecticut, he decided to reduce his
hours as a CPA so he could take a second job
teaching accounting at a local high school. His
firm was flexible enough to allow him to work
evenings and weekends on tax returns while he
spent his daytime hours teaching and coaching. As
his teaching position increased from part-time to
full-time, he gave up his accounting firm
position.
DeVito went to night school to
get his teaching certificate and got his first
job through a client when the firm audited the
school district. He mentioned his plans to a
clerk in the superintendent’s office, and
she told him there was an opening in business
education coming up soon. “Through the audit
work, I knew the superintendent and principal at
E.O. Smith high school in Storrs, Connecticut, so
they felt comfortable hiring me,” he says.
He now is in his fifth year. When he began
teaching, there were 15 accounting students in
the school. Today there are 75. Besides bringing
in an FBI agent guest lecturer to talk to his
class about financial fraud, terrorism and
forensic accounting, here is what else he does to
generate excitement:
To teach students about the
power of money, one class project is a variation
on the game of Monopoly. Students play for four
periods, each of which represents a fiscal
quarter. They manually record entries in a
general journal on the cash basis every time cash
changes hands, with the option to record
receivables if they choose to extend credit. They
make entries for depreciation and interest on any
loans and closing entries at the end of the game.
Each quarter students update an
Excel spreadsheet that organizes journal entries
and serves as their general ledger, giving them
balances and ensuring they remain in balance
after each entry. They create financial
statements (balance sheet, income statement and
statement of changes) and track their return on
investments by properly showing the amount they
invested in land and houses vs. what they
collected or earned in the trade or sale of each
individual property.
They also perform simple ratio
analysis—current, debt to equity, working
capital and return on sales—and summarize
this information in relation to their business
and to other businesses in the industry (their
classmates). Finally, they prepare a simple
“annual report”; summarize their
strategies, successes, difficulties and results
of operations; and look at the future based on
where they leave off in the game.
DeVito, who also coaches two
boys’ club teams, year-round and one of the
school’s girls’ varsity teams, says,
“I earn less than I would have as an
accountant but I love going to work every day and
that makes it worthwhile.” His advice:
“Decide what is really important to you.
Life’s too short not to do something you
want to do.”
Auto
Racing Is Lucrative Fun
Before he became
the owner of a car-racing track, Patrick Joffrion,
CPA, of Belle
Rose, Louisiana, was in a family-run accounting
firm for 25 years. He ultimately became sole
owner of the firm and also was financial officer
for the local government. Although he needed to
spend more time on administering the business
rather than on day-to-day accounting, Joffrion
found his clients valued his input and kept
asking for his help with their businesses.
“I was stressed,” he says. He decided
to sell the firm to his employees but chose not
to leave abruptly. “It’s about an
eight-year transition to get out of your own
firm.”
During his years as an
accountant, Joffrion had traveled throughout the
South, learning about his clients’ companies
and analyzing ways to make them more successful.
He also bought and sold a variety of businesses
and used his imagination in developing some new
ones. Although he enjoys starting new
enterprises, he does not recommend it for all
practitioners. “If you’ve been
displaced because of downsizing, starting your
own business is kind of tough. It’s easier
to buy an existing business,” he says.
“A CPA can analyze a business to see how it
can make more money. I’ve seen accountants
go into service stations, convenience stores and
other fields.”
Understanding the financial
side is easier for trained accountants than for
non-CPAs, but “if you don’t get out
with your customers, see how their businesses
work and find out what they’re doing right,
you just know how to add one and one.”
Joffrion feels an entrepreneur has to bring more
than financial skills to the table; he or she has
to know how to “get the business in the
door.” He says, “The best thing I can
recommend is to be observant. Leave town and see
what’s happening in other places. Open your
eyes, take notes, then go back to your own area,
identify the need and try to fill it.”
When Joffrion left his
accounting firm, he took his own advice. A
motor-sports enthusiast, he knew people had to
travel to northern Louisiana or as far as Texas
to find a place to race their cars. “There
was no top-notch racing strip in Louisiana,”
he says. With the help of a few friends, he built
a car-racing course and a road course. (A
drag-racing strip is an oval such as the kind one
would see in the Indy 500; a road course has 14
turns and requires a different kind of driving.)
“We invested $6 million, but now we can
gross as much as $300,000 in a single
weekend,” he says with pride.
Joffrion keeps close watch on
the financial side of the business. He still does
his own general ledger and personally enters data
for every paycheck, expense check and deposit. He
now has 12 full-time employees; the staff
increases to 40 or 50 helpers during weekends
when there are races. “It was a big risk to
take, but along with big risks often come big
rewards,” he says. The appraised value of
the racing business is up $2 million from its
actual cost in the past two years. He already has
received several overtures from people who want
to buy it.
“I might just accept an
offer and head to the Caribbean with my lovely
wife,” Joffrion says.
Personal
Passion Into “Healthy” Profits
Heather
Johnson-Moreno, CPA, who in 1996 founded PeopleFit USA, a
California-based telephone-coaching fitness
company, developed her business from an activity
she loved. A former manager at KPMG,
Johnson-Moreno gave it all up to devote herself
to helping busy professionals include exercise
and good dietary practices in their lives (see
“To Your Health,”
JofA, Sep.03, page 65). She uses her
accounting experience to help organize and market
her services to corporations that want to provide
fitness coaching to their employees.
Johnson-Moreno recommends that
potential entrepreneurs get advice from the Small
Business Administration about starting and
funding a business and that they join a support
group with whom they can brainstorm ideas.
Informal groups and business groups such as the
National Association of Women Business Owners
(NAWBO), chambers of commerce and other
professional organizations are important sources
of information, she says. Entrepreneurship
seminars and motivational audiotapes also can
help you keep your eye on the goal.
Renaissance
Entrepreneur
Terry
Nolan, CPA, owner
of Standard Printing Co. in Canton, Ohio, has
bought 10 different companies over the past 20
years. “Each time I was able to step into
the business and learn about it as I went
along,” he says. Nolan had his CPA
credential and an MBA by the time he was 23. He
was working for a regional CPA firm when an
auto-dealership client who admired his expertise
offered him a job. He agreed on the condition
that he be able to invest in the company. It was
a family-owned enterprise so they became business
partners in an auto franchise instead. Since then
he has manufactured large signs (including a
life-size neon car) for companies, constructed
aircraft hangars, made brick molds and developed
a start-up company that manufactures
church-collection envelopes. His training as a
CPA helped him every step of the way.
“Business is about people
and taking care of them and knowing how to use
money. Every business has people and money,”
he says. “A CPA learns to manage money,
which helps in becoming an entrepreneur.”
What’s so great about being an accountant is
that you can take the CPA designation and use it
to make a transition into almost any industry.
“Take chances while you’re young,”
Nolan says. “If you’re a hard worker,
there’s always another opportunity around
the corner.”
Leveraging
a Switch
Randy
Lane, CPA, served
as an investment officer with Ford Motor Credit
Co./U.S. Leasing and then as a partner at Arthur
Andersen, specializing in utilities and capital
leasing. He says: “When Andersen laid off
most of its employees, I decided not to go back
into accounting. I grew up in the firm and I
wasn’t ready to switch cultures or
loyalties.” Instead, he applied his
knowledge of identifying, evaluating, structuring
and executing leveraged lease investments to
become head of a company that provides finance
solutions for capital equipment, facilities and
real estate assets.
His knowledge of lease
accounting has helped him to structure a company,
understand business controls and market to
customers according to their tax position. This
financial expertise enabled him to become
president and CEO of Fort Street Capital in
Detroit. “I went into accounting to
understand how successful businesses are
organized and run,” he says. It worked.
Transcription
Benefits
John
Langley, CPA, of
Med-Scribe in Jacksonville, Florida, developed
his medical transcribing company by following up
on opportunities that presented themselves in his
accounting practice. As a CPA he worked with many
physicians. He began his transition to the
medical transcription business when the wife of a
client developed a service that helped physicians
put the correct diagnostic codes on their
insurance claims. Langley advised her in the
start-up process, and she ultimately offered him
a 20% interest in return for his help in
expanding the business. Soon he saw the need for
a medical transcription service and they started
his present business, of which he was 50% owner
and CEO. Eventually he bought her out by
“trading up” until it was his own
enterprise. “I was always looking for
opportunities,” he says. His Internet-based
business currently has 350 employees worldwide,
most of whom work from home. Med-Scribe serves
physicians throughout the United States. Its
outside auditor is his CPA firm from his first
job after college—and he still is a
practicing CPA.
Family
Time…Priceless
Some CPAs look beyond traditional accounting
because they seek more family time or an
opportunity to work in a more relaxed
environment. Scott
Riley, CPA, of
Easy Way Electronics in Elizabeth, New Jersey,
gave up his career as a high-ranking finance
executive for the independence and flexibility of
owning a small business. After years as a
practicing CPA, he became controller of a $500
million division of a large conglomerate and,
subsequently, an assistant vice-president of
finance for a top pharmaceutical company. Riley
found his electronics repair business through
personal networking. When he heard about it being
for sale, “I recognized I had the knowledge
to build a client base,” he says.
Riley earns less than he would
have if he’d stayed in the corporate world,
but the benefits of having more time with his
family far outweigh the costs. “I
didn’t want to be a stranger in my own
home,” he says. Although owning your own
business doesn’t always mean you’ll
have more time with family, his wife says she has
never seen him “work so hard or be home so
much.” In fact, he now works about 50 hours
a week vs. 60 but is able to take five or six
weeks of vacation each year and a couple of days
“here and there” to fish and play golf.
Riley says his CPA training has
helped him “view the business as a business,
not a mom-and-pop operation.” It helps him
to be cognizant of current and future costs and
to evaluate changes in the market that affect
development. He has quadrupled the number of
employees and quintupled the size of his company
by buying and merging with two more businesses of
the same type.
 |
PRACTICAL
TIPS TO REMEMBER |
|
 Inventory
your strengths and weaknesses.
Assess your
degree of comfort with taking
risks. Decide what is really
important to you.
Write up a
business plan. Putting it in
black and white will make your
idea more concrete.
Look for
new possibilities—for
example, through your network you
might hear about a client who
wants to sell his or her
business.
Go other
places to see what’s
happening—be observant, take
notes, then go back to your area,
identify the need and try to fill
it.
|
Get advice
from the Small Business
Administration about starting and
funding a small business.
Join a
support group of entrepreneurial
people with whom to brainstorm
ideas. Informal groups and
business groups are important
sources of information and
support.
Stop
billing by the hour and
restructure pricing for more job
satisfaction and to discover more
time to pursue other interests.
Maintain a
part-time practice to stay
current and to supplement your
new enterprise.
|
|
Comedian
“Debitman” Has Serious Ideas
Frank
Page, CPA, who
bills himself as “Florida’s Funniest
CPA,” says, “Life is too short and
you’re dead too long, so have fun right
now.” A certified public accountant for more
than 20 years, Page is president of his own firm,
Business Development Partners Inc. in Orlando,
Florida. For the past 13 years, he also has
worked as a stand-up comic, spoofing the
accounting profession in comedy clubs and
business conventions nationwide. He recently
wrote his first book, Exercise From a Lawn
Chair. Page (his performance persona is
“DebitMan”) is out to shatter the myth
of the humorless accountant with his comedy
routine. He takes the stage and proclaims himself
the “Champion of the World Accounting
Federation” and proceeds to poke fun at
virtually all of the profession’s
stereotypes.
Page reorganized his firm
completely to create the time to pursue his
passion for comedy. He is a champion of value
pricing. He says: “I used to do hundreds of
returns for individuals and corporations. Then I
fired a bunch of customers and raised my
rates.” The biggest change he made in his
business was to stop billing by the hour.
“We do not sell hours,” he says.
“We sell deliverables.” He advises
other practitioners to consider restructuring
their pricing if they are looking for more job
satisfaction and more time to pursue other
interests. “You work fewer hours per week
and earn more money,” he says. Because he
has fewer, more profitable clients, he is able to
nurture long-term business relationships with his
most valuable ones (and that’s no joke).
From
Practitioner to Professor
Joanie
Sompayrac, CPA, spent
a year as a tax accountant at Arthur Andersen
before deciding to study law in Cincinnati.
During law school and for two years after getting
her JD she worked for Coopers & Lybrand. From
there she moved to Ernst & Young and, after a
brief stint, decided education was her passion.
So she took the leap into academia.
“While I always enjoyed
the work in tax, I felt I was using my skills for
the wrong causes,” says Sompayrac, who
admits to being an altruist by nature. “My
clients gave little to charity, and that bothered
me. So my first job at the university was working
as director of planned giving.” She held
this position for five years while teaching in
the business college part-time. When a full-time
job opened up, the dean of the college asked her
to apply, and the rest, as they say, is history.
Sompayrac has been teaching
accounting, tax and business law full-time for
six years. “I love it,” she says.
“I try to impress on my students that being
a CPA will let them do anything. It has opened
doors for me.” She still maintains a tax
practice with about 30 clients to help her stay
current and to supplement her university salary.
“The transition has been challenging in many
ways,” she says. “But I cannot imagine
doing anything differently.”
ENJOY
YOUR OPTIONS
These stories suggest how the range of
analytical, financial and marketing skills CPA
training and experience provide can be used to
follow your dreams in many fields. Focusing on
your personal values and passions may enable you
to see how you can use your CPA training as a
basis for new career opportunities if that’s
what you want. But if it turns out you’re
happy doing what you do—well, relax and
enjoy the fact that you have options.
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