You Expensed What?

Years ago, when I first was taught how to fill out an expense account, I was probably more hesitant to write something off than I should have been and thus, probably spent more of my own money than necessary.

In fact, the only thing I can remember being kicked back by the accounts payable department was a $7.95 box of cold tablets I desperately needed once in New Orleans - fighting galactic congestion while navigating a conference in a city that at the time was hovering at 97 degrees with 90 percent humidity.

Upon my return I discovered one of the women in the classified section of the company had been fired for attempting – I kid you not – to write off a fur coat as an expense. Another employee, a group publisher, submitted a receipt for a $1,000 dinner – allegedly with business contacts. Only he was far from discreet and a colleague had spotted him at the restaurant in question with a woman other than his wife.

I harken back to those halcyon days of seeing what you could and could not get away with when I saw the results of a recent survey that concluded business travel fraud is costing U.S. businesses nearly $2 billion a year.

Meanwhile, according to the Association of Certified Fraud Examiners expense reimbursement fraud makes up 17 percent of all business fraud.

The “Drive” To Pare Down Debt

During the 25 years I spent in publishing, I’ve taken more car service rides to airports or events than I care to remember. I used to keep a tally just for kicks but stopped at about 250.

So, a number of years ago when ride-sharing companies like Uber and Lyft debuted, I stubbornly continued either to avail myself of my local transportation service or use my personal car– which during convention season meant sticking it in long-term parking at JFK and LaGuardia.

Last month I’m sure I became just about the last person in the U.S. to take an Uber. The booking process was relatively easy – even for a technology Luddite like myself and the rides showed up promptly and certainly less expensive than my former method of getting around.

What Are You “Wearing?”

For Mother’s Day my daughters decided to pitch in and present their mother with an upscale fitness tracker that resembles an oversized watch. Actually, it is an oversized watch. Since she’s a faithful gym attendee, it was both a practical necessary gift – although the early returns are in and she’s paying far more attention to it than she is any of us.

Recently, I had been noticing more gym members with fitness “wearables” obsessively monitoring their heart rates and oxygen levels (often to my annoyance while endlessly waiting to use a piece of equipment) and decided to perform some ad hoc research on the market.

Turns out that some 315 million wearable devices were sold worldwide last year and by 2022 – just four short years from now, sales are expected to top $75 billion, (yes, that’s with a B). Obviously high-profile wearables such as the Apple Watch dominate the category and according to tech research Gartner, sales of smartwatches will hit 81 million units within a span of three years.

That gave me pause.

Although I’m about three area codes of being knowledgeable on future tech trends, I could not help but harken back some 37 years ago when IBM rolled out its version of the PC and in just a few short years revolutionized back office accounting.

So my question is how long before wearable technology beings to make inroads into accounting?

Not long. In fact it already has.

Getting Your House in Order

Recently I went to a local restaurant with friends for a “quick” post-event meal – emphasis on “quick,” which turned out to be anything but. A glass of house wine arrived a mere 15 minutes after ordering and the specialty flatbread took almost an hour.

Our server could not be found on the side of a milk carton and as far as water was concerned, you could have gotten a refill faster stranded in the middle of the Mojave Desert.

Now to preface this fiasco, the place had recently received a lot of local press, primarily because the owners had opened several other locations throughout the Tri-State area. As one who covered the restaurant industry for 12 years and worked within its confines for another six, I tend to judge my dining experiences with a fairly critical eye but also with a bit of sympathy for those in one of the most demanding businesses there is.

But there are limits to even what I will tolerate.

Instant Replay

Now that another filing season is over, it’s usually about this time of year when my inbox begins to become overstuffed with reminders of upcoming conferences and subsequent links to their respective agendas.

By my count there are 14 prospective accounting-related events that I could conceivably attend by August, but for all practical purposes, will probably settle on one or two.

However like others in the profession, I’m becoming rapidly convinced that the time required, not to mention the expense of traveling to other cities, can be categorized by the law of diminishing returns. That coupled with the fact that the sessions staged in any specific year could simply be copied and pasted to events taking place in 2018.

As an example, I realize CPA firms have trouble getting good people. I’m reminded of it every day when I speak to clients. And yes, few would argue there is a significant cultural divide between Baby Boomers and Millennials that has to be addressed.

But tell me, does that scenario command roughly 14 sessions at several events dedicated to reaching out to Millennials and how to engage them? To me that’s the CPA version of summer television where reruns are the rule rather than the exception.

Ditto for blockchain and other pending disruptive technologies. At last count there were more than two dozen hours across the board assigned to that topic, not to mention a series of webinars.

Haven’t we seen this movie before?

“Rising” to the Occasion

Over the next several weeks, our company will begin in earnest contacting our CPA firm clients again to gauge their succession readiness or willingness. Or conversely, their lack thereof.

Traditionally, from mid-February until the end of April, our calls to clients are treated with equal disdain to those peddling replacement windows or the latest vacuum cleaner models. In other words, it’s one of the slower periods of the year.

So with tax software glitches, last-minute rule changes and of course, tardy clients who feel that it’s perfectly okay to send in their documents at 2 a.m. on deadline day, I like to re-engage these firms as soon as possible so that the aftertaste of another grueling season is not lost to revisionist history several months down the road.

But on a fee basis if nothing else, most of our clients should be pleased with the 2018 filing season as well as other accounting-related services they provide. Even though the oft-debated tax cuts enacted late last year curtailed the amount going this year to the coffers of the U.S. Treasury, the accountants and preparers were on the receiving end of record-breaking largesse in terms of client spending.

According to a recent survey, Americans doled out some $44 billion on accounting, tax prep, bookkeeping and payroll services in the fourth quarter of 2017. For those keeping score at home, that’s roughly $1 billion more than the year-ago period.

Distilling that figure down even further, it translates to about $135 for every person in the U.S.

On the taxpayer end, an estimated 65 percent of filers will receive a tax cut in 2018, according to the Tax Policy Center, averaging $2,200 from the new law’s individual provisions.

Closer to home, my long-time accountant Rocco said that his fees rose nearly 20 percent this year and that was without an increase or a bump up in the number of clients.

So the question arises, are there more people filing or is it a result of fee increases?

After observing the profession for nearly 20 years, my guess is that it’s an equitable mixture of both.

Whatever.

Not to throw out an oft-repeated cliché, but we’ll strike when the iron is hot and begin our annual client canvass when they’re relieved to have survived another season. And it won’t hurt that many of them will have a bit extra in their pocket.

What’s Your Cybersecurity DQ?

For years the measure of someone’s intellect was the Intelligence Quotient or IQ. And anything over 130 was considered high. Growing up I recall there was a girl who lived on the next block who was rumored to have scored 180 as an 11-year old.

Needless to say I was never in any of her classes.

But as time wore on, it was discovered that such things as “environmental factors” can influence someone’s score by 20 points. That must have been why my teacher wrote “see me after class” on my test paper.

Today, with the advent of all things technological, there’s something called a DQ – or digital quotient, which measures your IT IQ so to speak. In a 2014 study conducted by a U.K.-based consulting firm it found that the average adult has a DQ of 96. By contrast, the average six-year-old had a DQ of 98.

I have never been completely comfortable in the tech arena, but with all the new advances encroaching (blockchain, AI, robotics) it has prompted us as a company to expand past our comfort zone of the CPA community and look at pairing our core clients with the higher end advisory and consulting services – HR and medical consulting, family offices, BPO and of course cybersecurity.