As we head toward Thanksgiving, the start of busy season is only weeks away. But as stressful as it is, busy season was always my favorite time of year. Why wouldn’t it be, when our six-person firm made 60% of its income in that 14-week period? I’d start getting excited about the challenge ahead early in the fall, but I’d also start planning to make our lives easier and more efficient when the season began. Although it may be a profitable time, I also know it’s a tough one. About 90% of practitioners said workload compression was a top 10 issue for them, according to a survey by the CPA Firm Management Association (CPAFMA) in association with PCPS. What steps can your firm take to set yourself up for a successful season?
Make changes to drive efficiency. Building efficiencies was by far the top practice firms used to mitigate the impact of workload compression, according to the CPAFMA survey. Perfecting your processes will improve your efficiency and enhance accuracy, and this is a great time of year to focus on ways to do it. Ask yourself first whether a tech tool could help you eliminate a process completely. We once moved piles of paper around our office as part of our work and review processes. When we first went paperless, we still had a single cover or lead sheet for each file, but even that eventually disappeared, making the process much smoother. Our portal also helped streamline communications with clients. Bottlenecks can still occur in very tech savvy firms, however, identifying them now can make the season easier.
Focus on great clients. Some clients are perennially late, unpleasant to work with or too complicated to be cost efficient. Take the time now to consider whether your firm should really be working with them. The PCPS Client Evaluation Tool recommends rating clients based on criteria such as job risk or complexity; profitability; whether the client is a referral source; the chance to provide them additional services; and payment timeliness, among other issues. Use the PCPS Sample Client Disengagement Letter to frame your communications with those clients that need to be transitioned. If you’re reluctant to tell clients you’re letting them go, having that conversation now offers them plenty of time to find another practice or to get to know other CPAs you recommend.
Reach out to clients early. Instead of stressing over whether clients will get their data in on time, take the initiative and help them get organized early. As yearend approaches, provide updates on what information you have and what you need. With business clients, you can offer these reminders all year long. If you have a niche practice, use your expertise to seek ways to simplify your processes and deadlines. I know one firm that specializes in small businesses that offer back office processing services. Due to this niche service, they aimed to close all of their business clients’ books by January 31. Then they immediately used that data in the corporate and individual returns. Their work all year was organized around those ultimate goals.
Manage client expectations. One great way to avoid disruptions and troublesome delays is by setting a fixed extension date and letting clients know that if any information is received after a certain date, that your practice will automatically put their return on extension. There are some clients who habitually end up getting an extension. In other cases, you can tell in advance that a client’s details probably won’t be ready in time. We made a special effort to identify these clients, then contacted them in January or early February to confirm their probable extension. Setting a firm extension date and making the decision to extend early cut down on the stress of waiting for data and prevented us from scrambling to fit them into our schedule when their material finally arrived.
Look for post-season opportunities. Busy season isn’t just when many firms make most of their income, it’s also a great time to spot new engagement options for existing clients. Tax returns offer a wealth of information that we can use to advise clients and generate additional services. If time is tight now, plan to revisit some of your files later to follow up on these opportunities. In addition, don’t give up on networking. We made sure to stay involved with local community groups, such as the Rotary, Chamber of Commerce, or relevant industry associations. Taxes and financial reporting are hot topics during the winter months, and chatting with individuals at networking events allowed us to offer advice on their current concerns. That positioned us to turn those conversations into new business when the season was over.
Maintain a sense of unity. It’s hard to think about camaraderie when everyone is huddled over their desk. We held a staff meeting over lunch every week during busy season to get status reports, hear about and address problems and enjoy each other’s company. Ways to inject some fun in the season include sponsoring contests, setting days when firm members wear pajamas or wacky outfits to work or offering free snacks or meals. Laughter and strong morale can relieve stress and make the time pass faster.
Best of luck with a prosperous—and enjoyable—busy season!
Carl Peterson, CPA, is the AICPA’s Vice President of Small Firm Interests. Have questions for Carl? Contact him directly at email@example.com or 651-252-4618, and tune into his free Small Firm Update webcasts.