THE OFFICIAL MAGAZINE OF THE VIRGINIA SOCIETY OF CPAs
MAY/JUNE 2019
VSCPA.COM/DISCLOSURES
CREATING A CULTURE OF
innovative THINKERS
+
spark innovation at work | a convo with Lynne Doughtie, CPA
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CONTENTS
Features 16
Creating a Culture of Innovative Thinkers Yes, you can push your employees to think creatively and strategically.
22
Secrets of a CPA Traiblazer
Columns 12
Young Professionals Level up your networking
14
Innovation Idea tournaments
Departments 4
President’s Perspective
6
Line Items
8
Tech Talk
10
Advocacy
26
VSCPA News
33
Classifieds
34
Spotlight
FIND US... CONNECT connect.vscpa.com TWITTER @VSCPANews LINKEDIN tinyurl.com/ LinkedInVSCPA FACEBOOK facebook.com/VSCPA INSTAGRAM instagram.com/VSCPA SNAPCHAT @VSCPA
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FROM THE CEO
4309 Cox Road Glen Allen, VA 23060 (800) 733-8272 vscpa.com
disclosures vscpa.com/disclosures disclosures@vscpa.com MAY/JUNE 2019 Volume 32, No. 3 Managing Editor Jill Edmonds disclosures@vscpa.com Contributing Editor Chip Knighton cknighton@vscpa.com Editorial Task Force Olaf Barthelmai, CPA Cheri David, CPA Mike DellaRipa, CPA Melisa Galasso, CPA Genevieve Hancock, CPA Karen Helderman, CPA Alesia Lewis, CPA Gabriele Lingenfelter, CPA Harold Martin Jr., CPA David Peters, CPA Mark Plostock, CPA Barbara Sukramani, CPA Disclosures is published six times a year by the Virginia Society of Certified Public Accountants (VSCPA). The magazine’s mission is to communicate information of value to VSCPA members, including professional issues and VSCPA initiatives. The materials and information in Disclosures are offered as material only and not as practice, financial, accounting, legal or other professional advice. Statements of fact and opinion are made by the authors alone and do not imply an opinion on the part of VSCPA officers, members or editorial staff. Publication of an advertisement in Disclosures does not constitute a VSCPA endorsement of the product or service. Copyright © 2019 Virginia Society of CPAs.
VSCPA Preferred Providers
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Leading through disruptive change “Think different. Be bold.
Move fast.” Those are the quick-hitting lessons from American Institute of CPAs (AICPA) President & CEO Barry Melancon, CPA, about leading in times of change. That topic has been a major focus for the VSCPA for the past few years, starting with the development of the VSCPA2025 strategic framework and continuing through our upcoming Leaders’ Summit, where change management is the subject of several sessions. We’ve heard loud and clear about what we need to do in order to lead. Our training and continuing education on disruption topics has largely been in the leadership space, and that’s by design. Change starts at the top in any organization, and the leaders that navigate it successfully will be the ones who can get comfortable in that space. Promoting certainty, direction and stability for your organization in a period of constant upheaval is as valuable as anything you can do. It’s possible to take that too far, of course. You want your staff to be able to depend on you, but you still need to push to make bold choices. The world is changing, and leaders must change with it. We want to make sure you’re equipped with the tools you need to make the necessary changes. Our Center for Innovation is a major part of those efforts. It’s a cornerstone of how we view the future of the profession. We’ve also entered partnerships with Innerwill, Dale Carnegie and Frontier Academy to develop leadership and peer sharing programs and revamped our Leadership Academy. We’re renovating our building to
include more spaces where members can meet, interact and collaborate. And our new Technology & Innovation Showcase is focused on educating members on the technology trends transforming the profession, with customizable education, interactive demonstrations and opportunities to engage with solution providers. Those are just a few ways we’re trying to help our members lead their organizations, and the profession, into a bright future. By bringing our members together and facilitating idea exchanges, we hope to help the entire profession rise to the challenges disruption bring. n
Stephanie Peters, CAE, has served as VSCPA president and CEO since 2007. speters@vscpa.com
@StephPeters
connect.vscpa.com/StephaniePeters
Imagine... a chair without a desk
Delivering Results - One Practice At a time Wade Holmes 888-847-1040 x2 Wade@APS.net
www.APS.net
LINE ITEMS
A new look for the VSCPA You might notice that this magazine looks a little different than previous issues.
EVOLUTION OF A LOGO
That’s because the VSCPA unveiled its new brand at the beginning of March, including a new corporate logo, brand colors and design approach. Why a new brand? We want to create strong messaging and consistent visuals across VSCPA communications and marketing to convey an innovative organization that is evolving and future-forward. The new brand also helps us create a sense of community and storytelling to enhance our members’ connection to the Society. We have a VSCPA2025 bold strategy of being known for a dynamic culture of leadership, professional experience and stellar reputation — and the new brand seeks to support those goals. “The new VSCPA logo and brand align with the VSCPA2025 vision and showcase a creative evolution of our brand that is on trend, future-forward and utilizes best practices in design,” said VSCPA President & CEO Stephanie Peters, CAE. You can find more information on the new brand and download member logos at vscpa.com/Brand.
SNEAKY WAYS TAX SCAMMERS STEAL
Today
2015–2019
2009–2015
The U.S. Internal Revenue Service (IRS) again warned taxpayers this year about the aggressive ways that scammers attempt to steal their money and personal information — especially during tax season. While many of these scams have been on the IRS’s “dirty dozen” list for years, scammers are evolving tactics and finding new ways to get inside taxpayers’ pockets. Remind your clients that the IRS will NEVER contact them via email or phone! The 2019 “dirty dozen” included: > > > > > > > > > > > >
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Phishing Phone scams Identity theft Return preparer fraud Inflated refund claims Falsifying income to claim credits Falsely padding deductions on returns Fake charities Excessive claims for business credits Offshore tax avoidance Frivolous tax arguments Abusive tax shelters
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2001–2009
2000 and previous
LINE ITEMS
TICKER 1.5 The percent increase in charitable giving in 2018 versus 2017. While large- and medium-sized nonprofits saw giving increases, small nonprofits saw a decline.
62 The average age of nonprofit donors in 2018.
40 The percentage of Americans who say their No. 1 savings goal is an emergency fund. Retirement was the top priority of 26 percent, though 74 percent of Americans put 10 percent or less of their monthly paycheck toward savings. Twenty-three percent save nothing.
SHUTDOWN AFFECTED TAX SEASON, REPORT SAYS Taxpayers felt the squeeze of the federal government shutdown when dealing with the U.S. Internal Revenue Service (IRS) this year, National Taxpayer Advocate Nina E. Olsen said in her annual report to Congress. According to Olsen, the IRS began its tax season after the shutdown faced with myriad correspondence, phone calls, prior year audits and identity theft cases to address. And hampering its ability to do its job? Antiquated technology. “The IRS’s core information technology (IT) systems are among the oldest in the federal government, limiting the agency’s capabilities in significant ways. Partly due to historic poor planning and execution and partly due to lack of funding, the IRS has been unable to replace these antiquated systems,” the report states. The Taxpayer Advocate detailed the most serious problems facing the IRS, some of which include:
pAnswering taxpayer questions: The IRS currently only answers tax-related questions during the tax season window.
pNavigating personnel: It can be difficult for taxpayers to find the correct IRS personnel to help with their specific issues.
16.7 The percentage increase in demand for workers with master’s degrees expected to occur through 2026.
654 MILLION The amount of U.S. acreage devoted to pastures, the largest use of land in the country. That’s followed by forests (539 million), cropland (392 million), special use (169 million), urban (69 million) and miscellaneous (70 million).
2 The number of Virginia locations on Inc. magazine’s list of the best places to start a business in the United States: Richmond (No. 35) and Virginia Beach (No. 49). Austin, Texas, was No. 1.
pUnderutilization of Free File: The IRS is not dedicating resources to boost Free File usage and improvement.
pFalse positives: IRS fraud detection results in a lot of false positives, which drain agency time and resources. Check out the full report and all the Taxpayer Advocate’s recommendations at taxpayeradvocate.irs.gov.
Renewal is open! It’s time to renew your VSCPA membership! Renewal is now open at vscpa.com/Renew. The deadline is May 31.
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TECH TALK
EXCELLENT EXCEL
Oldie But Goodie Excel Functions Recently, I was analyzing audit findings in the Federal Audit
Clearinghouse (FAC) and since there are no easy reporting tools, I used some “oldie but goodie” Excel functions to answer a simple question: Which type of compliance requirement results in the most audit findings nationally? Here are the functions that worked for me. Get External Data From Text: Used to import into Excel data from the “Findings” zip file that was obtained from the FAC and unzipped into a text file. CONCATENATE: Used to combine two columns (DBKEY and FINDINGSREFNUMS) to create a unique ID for every report/ audit funding number combination. Ctrl + t: Used to create a table out of the data with headers. Remove Duplicate: Used on the unique ID column that was created with CONCATENATE to remove 57,000 duplicate records for audit findings to have 13,000 unique audit findings remaining.
Changing world = Changing CPA? The rapid pace of change in the business world means that CPAs are developing new, tech-savvy skills. The CPA profession as a whole is taking notice. A new initiative from the American Institute of CPAs (AICPA) and National Association of State Boards of Accountancy (NASBA), called CPA Evolution, seeks to answer the question:
Are the public, our clients and our employers better served if the CPA license and licensure process evolve to better reflect the changing marketplace? The initiative is currently exploring ways the CPA licensure process can integrate technological and analytical expertise, all while continuing to protect the public interest. A working group comprising stakeholders from around the profession is considering feedback and how to carve a path forward. Stay tuned for more information on how the CPA will continue to
COUNTIF and Wildcard: Used the COUNTIF function to count the number of times a certain letter (each letter represents a Type of Compliance Requirement) is listed in the TYPEREQUIREMENT column (your range). I had to add “*” (the wildcard symbol) on each side of the letter being counted in the criteria field of the formula because each cell could contain more than one letter. Conclusion: Nationally, N. Special Tests and Provisions is the most cited type of compliance requirement for an audit finding. While you may not be into analyzing single audit findings at a national level, this shows how a little creativity and a host of Excel functions will allow you to find the answers you are looking for. George D. Strudgeon, CPA, CGFM, is an audit director at the Virginia Auditor of Public Accounts in Richmond. Email him if you have Excel topics you want him to cover. george.strudgeon@gmail.com connect.vscpa.com/GeorgeStrudgeon
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evolve and stay relevant!
WHAT’S THAT MEAN?
Shmishing A mash-up of “phishing” and “SMS” (or short message servicing). It’s phishing via text, when a cybercriminal attempts to steal personal information from a consumer by sending a text message that entices them to click on a link and provide personal information.
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Accountants Professional Liability Insurance may be underwritten by CAMICO Mutual Insurance Company or through CAMICO Insurance Services by one or more insurance company subsidiaries of W. R. Berkley Corporation. Not all products and services are available in every jurisdiction, and the precise coverage afforded by any insurer is subject to the actual terms and conditions of the policies as issued. ©CAMICO Services, Inc., dba CAMICO Insurance Services. All Rights Reserved.
ADVOCACY
CONFORMITY DOMINATES successful session
VSCPA member seeks delegate spot After a few years without a CPA in the General Assembly, VSCPA member Joe McNamara, CPA (R-Roanoke), won a special election last November to claim the 8th District seat. Fellow VSCPA member Lori Losi, CPA, is aiming to join him.
The 2019 Virginia General Assembly
session adjourned Feb. 23, and the VSCPA accomplished its primary legislative goal: ensuring the passage of tax conformity legislation. As reported in the March/April issue of Disclosures, Gov. Ralph Northam signed HB 2529 and SB 1372 into law Feb. 15, ending weeks of complicated negotiations to reach a bipartisan deal that preserved the bills’ emergency clauses, allowing them to take effect with Northam’s signature. The passage of the bill means that, with certain exceptions, Virginia conforms with the U.S. Internal Revenue Code as of Dec. 31, 2018, including changes from the federal Tax Cuts and Jobs Act. You can get the full rundown on the issue, including a Q&A on implementation with the Virginia Tax Department, at vscpa.com/Conformity. The VSCPA also followed several other issues during session and took an official position on one non-conformity bill. While conformity took up most of the VSCPA’s energy during session, the Society also got positive results on these other issues. Here’s a quick rundown of our other advocacy activities.
Procurement. The VSCPA followed several procurement bills, formally opposing one and expressing concern with several others on the grounds that
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they would erode the importance of qualifications in the selection process. The bill that the Society opposed, HB 2804, was presented as a transparency bill similar to others that have cropped up in legislatures across the country. The VSCPA was among several groups, including professional services firms and state agencies, that raised concerns with privacy and data retention issues surrounding the bill. All procurement bills the VSCPA monitored were defeated.
Regulatory reform. The VSCPA monitored several regulatory reform issues during the 2019 session, largely to keep an eye on trends that could affect the Virginia Board of Accountancy (VBOA) in the future. While a few regulatory reform bills were passed, none had any direct impact on the VBOA. We will continue to monitor the issue in future sessions.
Remote sales tax. The VSCPA monitored legislation related to the U.S. Supreme Court’s decision in South Dakota v. Wayfair. HB 1722 and SB 1083, both of which have passed both houses and are awaiting Gov. Northam’s signature, require remote sellers and marketplace facilitators to collect sales and use tax if a seller has more than $100,000 in annual gross revenue sales or at least 200 sales transactions in Virginia.
Losi, a consultant with a firm in Glen Allen, has entered the Republican primary for the 68th District seat, which encompasses parts of Richmond City, Chesterfield and Henrico counties. The Midlothian resident has worked in private industry for most of her career. “I'm running for the House of Delegates to make a positive impact on my community as well as the Commonwealth of Virginia by strengthening our economy and lowering taxes,” she said. “As a former small business owner and accounting and finance professional, I want Virginia's status to continue to improve as a business-friendly state.” Losi received her Bachelor’s of Science in Accounting from Kean University and her Master’s of Business Administration in Finance from Rider University. She is married to another VSCPA member, Ryan Losi, CPA, a shareholder with Glen Allen firm PIASCIK and a former chair of the VSCPA Tax Advisory Committee. In addition to her work in corporate finance for several companies, she co-owned an auto repair business until 2011. She cites the business knowledge and ethical behavior engendered by the accounting profession as major reasons why she would be appealing to voters. u
ADVOCACY
Lori Losi, CPA “Accountants are excellent leaders. We’re known for honesty, integrity and the ability to work through complex issues under tight deadlines,” she said. “Accountants have the ability to keep up with new and ever-changing requirements. In other words, we're adaptable. We’re known for creative solutions with following the law. When you start looking at it from that perspective, I believe I am well qualified to serve as our delegate.”
RENEW NOW WITH THE VBOA Don’t forget to renew your individual and firm license
When Losi is not out campaigning, she is attending her children’s sporting events and spending time with her husband. Ryan and Lori are advanced open water scuba divers and select a different dive spot around the globe each year.
by June 30. Visit www.boa. virginia.gov/CPALicense/ Renewal.shtml.
The 68th District seat is currently held by Dawn Adams, a Democrat who was elected in November 2017. The Republican primary is scheduled for June 11 and the general election is Nov. 5.
NEW! EMPLOYEE BENEFITS & RETIREMENT PLAN SYMPOSIUM JUNE 27, 2019 | RICHMOND CPA CENTER OR ONLINE Do you specialize in employee benefits or human resources? Join us for a one-day Symposium to get the latest updates on issues, guidance and changes affecting employee benefit plans. Learn all about current trends as well as standards/law changes in health care and retirement plans.
SAVE $50 BEFORE MAY 31 vscpa.com/EB
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YOUNG PROS
5 WAYS to level up your networking If you find networking uncomfortable, have no fear. There are ways you can make the professional connections you need to move your career forward.
You’ve heard the old adage — it’s not what you
know, but who you know. Check your phone right now. How many applications do you have that involve social media in some way? How many followers do you have on Twitter? How many connections do you have on LinkedIn? These are all individual relationships that comprise your network through both professional and personal relationships — and they prove just how important networking is in our daily lives. Brandon Pope, CPA
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Networking is a vital key to our careers and the professional relationships we form can significantly affect our lives. Studies have shown that more and more jobs are never even listed but are being filled by internal and external networking candidates. Recruiters often have interested applicants reach out proactively, time and time again, and individuals who have networked properly will be remembered when it comes time for interviewing. This means that
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professionals looking to switch positions may need to do more than just search job postings — brushing up on networking skills is ever more important. CPA professionals in public practice find even more importance in networking through expansion of business contacts. Business development, or professional networking, are two very important concepts to professionals who are charged with growing their practice and bringing in new business. Finding the right contacts and leveraging positive business relationships can significantly affect a business’s growth. In public accounting, technical knowledge will always be necessary, as the CPA designation continues to be the gold standard. However, as professionals climb the corporate ladder, bringing in new business and establishing professional relationships help prove value. While networking is commonly viewed as an
YOUNG PROS
uncomfortable task or activity, it’s time for professionals to get comfortable with stepping outside of their comfort zones. With repeated practice and intentional efforts, professionals can become better networkers and establish increasingly valuable business relationships. Networking doesn’t have to be uncomfortable. Finding volunteer activities, attending social events and getting involved with professional development programs are three easy ways professionals can start networking immediately.
someone who looks overly stressed or like they would rather be somewhere else. Chances are when you’re at a networking event, everyone has a similar goal in mind — to mingle and establish professional relationships, too. Offering a gentle, inviting smile can alleviate pressure for you and the people with whom you’re trying to network.
In Richmond, ChamberRVA has an organization named “HYPE.” On its website, ChamberRVA notes that “HYPE has three areas of focus: Connect YPs, Professional Development, and Community Engagement. Since 2007, HYPE (Helping Young Professionals Engage) has worked to develop talent and strengthen the YP culture in RVA through events and programming designed to help empower and ignite the passions of Richmond’s future decision makers. HYPE’s goal is to connect and engage YPs to develop individual, business and community success for a vibrant RVA.” Other cities have very similar organizations that aim to achieve very similar results.
Epictetus said it best when he noted “we have two ears and one mouth, so that we can listen twice as much as we speak.” I often find myself at networking events where the rooms are noisy, and everyone is trying to talk over one another. While it’s important to establish a healthy dialogue and remain engaged in conversation, listening well is not only polite, but can also be very informative. If you find yourself in a group-setting conversation, consider resisting the urge to chime in and respond to each comment made, but rather lend a listening ear to the connections you are looking to make.
Much like studying and performing an art, to gain the most from networking, professionals must employ proper techniques. Below are five practices I’ve found the best networkers use:
COME PREPARED. Much like anything we do in life, to truly be successful, we must adequately prepare. Professionals who attend networking events often receive the list of attendees in advance. Skilled networkers will study the list and identify the relationships they aim to establish or nurture further. Knowing what you’re looking for in networking is crucial, but knowing what you’re looking to avoid can be equally as important. There are many types of people at networking events and some individuals can inadvertently keep you from your desired goals. If you find yourself in a situation where you need to exit the conversation, develop polite and prepared remarks to excuse yourself and regain your focus.
DEVELOP A NETWORKING ELEVATOR SPEECH. College students looking to make an impression on recruiters are often told to have an elevator speech ready. This same concept can be applied to networking. Be familiar with the environment around you, know your audience and be up to date on current events so you can develop succinct remarks that can be used in multiple, short conversations.
SMILE AND BE INVITING. No one wants to actively start a conversation with
LISTEN WELL.
FOLLOW UP. Part of proper preparation is bringing business cards to all networking events. Good networkers will request business cards from the new people they meet. Hold on to these cards and reach out in the following days. Also, consider connecting on LinkedIn and setting up a lunch or happy hour in the future to network further and develop your professional relationship. If the connection you make is in a similar line of work or industry, consider what referral options are available. Success is often found by helping others succeed. Networking doesn’t have to be as cumbersome as it can initially appear. Recognizing that networking is an important part of business, identifying networking opportunities available and employing best practices that suit your personality are all key areas to focus on to implement a networking style that best suits your own personality. Make sure that you foster the professional relationships you’ve already established and strive to continue making new ones. You may be surprised just how beneficial networking can be. n
Brandon Pope, CPA, is an audit supervisor at Keiter in Glen Allen, serving primarily financial services and nonprofit clients. He serves on the VSCPA Young Professionals Advisory Council (YPAC). bpope@keitercpa.com connect.vscpa.com/BrandonPope linkedin.com/in/brandon-pope-cpa-9b60a96b
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INNOVATION
IDEA TOURNAMENTS: Gamifying innovation Creating a challenge can inspire a culture of innovation. Here’s how.
Employees at all levels of an organization are continuously generating new knowledge, collaborating, learning about the market and opportunities for growth, creating solutions and workarounds and identifying stress points for both the company and its clients. Tapping into this brainpower can be a powerful force for innovation. One method is to design and launch an innovation tournament. The goal of an innovation tournament is to use a competitive format to leverage the intellectual and creative capital within an organization. Its primary intent is to have a little fun while creating a pipeline of ideas that can be commercialized. Studies indicate that, given the objective of generating ideas, people working independently will generate more ideas than if the same people worked together in a group. This is due in part to groupthink, fear of being criticized and the sequential and linear nature of conversation.
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Tournaments should therefore be designed to generate and capture a great number of ideas starting with the individual. There is no one perfect design for innovation tournaments. Details may vary depending on the industry, the size of the company, the geographic spread of employees and other details. But several common characteristics can be found in many successful innovation tournaments.
Challenge-focused. The most important component is an emphasis on solving a specific problem or addressing a specific opportunity. The challenge should be framed in simple terms so that employees in both broad and narrowly defined functional areas can contribute. If it is framed too narrowly, only a few employees will truly understand or the ideas received will be off-base. If it is framed too broadly, the ideas themselves will lack focus. If the problem to be solved is big and complex, consider framing it through smaller, more digestible challenges.
INNOVATION
Time-sensitive. Tournaments can be conducted over the course of one day, several months or a year. Daylong tournaments may be well-suited for small companies or departments in which the ideas can be expressed through software coding or simple, quick prototypes, such as a new e-commerce storefront or a new marketing slogan. Longer tournaments may be better suited to solving complex challenges that require more deliberation. Either way, a balance must be struck between adequate time for employees to consider the challenge and express ideas with the need to create a sense of urgency. Too little time may result in lower-quality ideas; too much time may result in procrastination and a loss of momentum. Equally important is the time-sensitive nature of the problem or opportunity to be addressed. It should be significant for the business and inadequately addressed with existing resources.
Incentives. Setting up rewards for employee participation can be tricky. The cultural impact of incentives is long-lasting. Intrinsic and extrinsic rewards should be considered. To encourage a culture of innovation, intrinsic rewards should be emphasized as they will be more sustainable and will permeate employees’ approach to innovation beyond the tournament. Intrinsic rewards include recognition, positive visibility and creating a feeling that motivates people and encourages ever-lasting behavioral change. That does not mean that a monetary reward to the winners of a tournament should not be offered, but any offering of this kind should be paired with intangible benefits such as visibility, recognition or the opportunity to work on a new high-profile project or a stretch assignment. While this may sound unappealing to some employees, it will be appealing to high performers — the group of employees who should be kept engaged and retained for sustainable innovation.
Transparency. The rules, processes of how ideas are vetted and selected and decision makers should be open and clear from the start. The evaluation criteria for screening
and selecting ideas should also be simple and clear so that, as employees consider the challenges and express their ideas, they know how their ideas will be assessed.
Multiple rounds. To narrow the field of ideas while maintaining transparency, multiple rounds for idea selection may be ideal. A side benefit to multiple rounds is that some ideas may be combined or new ideas conjured up by building on existing ideas. This can be as simple as having an initial screening round to filter ideas followed by a voting or pitch round. A simple framework to screen ideas is to consider the size of the problem and clarity of the solution, the risk/reward of implementing the idea, the strategic fit of the idea with the company’s growth ambitions and whether the company’s competitive advantage can be strengthened by implementing the idea. Voting or pitching rounds can be virtual or in-person. The ultimate winner should be selected by a group of people rather than one person. This can be achieved virtually (e.g., all employees vote on the top ideas) or in person (e.g., screened ideas are pitched to a panel of judges). If using a panel of judges, consider constituting the panel with a mix of executives and lower-level employees to ensure a diversity of perspective.
Tension. Seek opportunities that may spark widespread disagreement. This tension encourages more critical thinking thereby yielding creative and unique ideas. Don’t be afraid to seek ideas that might cannibalize an existing business line or go against established assumptions within the business. Embrace this tension because provocative ideas such as these have the potential to disrupt industries and businesses. Progressive companies seeking genuine innovation should heed the call of provocative ideas.
Commitment of the organization. The biggest risk of running an innovation tournament is letting ideas linger with no commitment to move them forward or shelve them. A commitment by the CEO, the board or other relevant executive sponsors is critical to ensure that employees take the tournament
seriously. This commitment includes moving winning ideas forward in good faith with adequate resources, attention and followthrough. Providing feedback to employees with non-winning ideas is equally important. After all, they spent time developing those ideas and may appreciate the sincere consideration of them. The absence of these elements could have a detrimental cultural impact on innovation.
Willingness to experiment and fail. Not all ideas selected will prove to be financial or market winners. But the learning gained from executing them will be invaluable. Celebrating failures and, more importantly, learning from them is a critical element of innovation. Without the failure, lessons may not be learned. These celebrations can reinforce the cultural acceptance of fringe ideas, which are exactly the types of ideas that companies should be considering for innovation.
Technology. A multitude of innovation tournament platforms exist that companies can buy or lease with their own branding wrapped around it. The necessity of employing such platforms depends on variables such as budget and internal expertise to design and run a tournament. If third-party consulting help is needed to get a tournament started, these types of platforms may make sense. Otherwise, building a technology solution in-house or using existing internal platforms may suffice as long as the above tenets are addressed. n
Mark S. Brooks is the associate director of innovation and strategic partnerships at the Association of International Certified Professional Accountants. Mark.Brooks@aicpa-cima.com This article first appeared in CGMA Magazine. For more articles, sign up for the daily email update, CGMA Advantage, at http://bit.ly/2svn2AY. ©2017 Association of International Certified Professional Accountants. All rights reserved.
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LEADERSHIP
CREATING A CULTURE OF
innovative THINKERS
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LEADERSHIP
Innovation skills are in high demand, but the
number of people who would characterize themselves as innovators is not so plentiful. Why? We often view innovation skills as an innate characteristic, something that cannot be learned. In fact, when asked to describe something innovative that we have achieved in the workplace, most of us would likely struggle — we do not view our small changes as being particularly deserving of such distinction. Karen Helderman, CPA, CISA, PMP
While it is fair to say some people are inherent innovators, think Bill Gates, Oprah Winfrey or Steve Jobs, most people actually become innovative by working for an organization or in an environment that cultivates the skill — a company whose behavior and attitudes foster an innovative culture. Think for a minute of some companies that are characterized by their innovation. What comes to mind? Apple, Amazon, SpaceX? Do we believe these companies have cornered the market in recruiting all of our most talented and innovative people? Absolutely not! We know innovative companies become such because they promote a culture that encourages its employees to act innovatively, and this is something we can all replicate to some extent.
START AT THE TOP A company’s culture is largely defined by the values, backgrounds and vision of its original founders and is modified through the years as the industry forces those values to change. One fast way to learn about a company’s culture is to read its mission and values statement, but it’s just as instructive to observe what values are emphasized through its rules and policies. If it’s not clear from these documents that innovation is a key value, then modifying the corporate culture is an important first step. So how does a company begin to change its culture? As is usually the case, the first thing is to do is start at the top. Company leaders must take a hard look at themselves, choose to make a commitment to changing the culture and hold themselves responsible for setting the organizational tone. If the desired
tone is one that rewards achieving innovation, then priority must be given to modifying how the company measures success to support innovation, or else a cultural shift will not occur. Leadership should: • Take an honest accounting of their attitudes towards change • Commit to the process • Admit that experimentation and failure are part of innovation and a cost of doing business • Give employees time to innovate • Accelerate the decision-making process to act upon innovation • Acknowledge and reward innovation To send a clear message about its commitment to innovative thinkers, the organization should first set a solid foundation through its mission and values statement and let all employees know that this document affects how they behave each and every day. Second, leadership should review its rules and policies to ensure they align with the revised values statement. For example, if the old policy indicates that promotions are based on seniority, leadership should consider new promotion policies whereby being innovative is also a key measure. Simply saying “we are changing our culture” or only changing certain aspects of a company’s operating norms is not enough. To really change the culture, everyone must commit to the change, ensure consistent messages are sent by leaders to the employees, stop old behaviors that do not conform to the new rules and policies and simply walk the talk. One way to walk the talk is to create programs that give employees the opportunity to learn, practice and gain the capacity to innovate. Here are some low-cost, simple actions that a company can take to foster a culture of innovative thinkers and get the best out of the employees it has. u
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INNOVATE NOW Ready to inspire your staff to become innovative thinkers? These resources from the VSCPA Center for Innovation can help! Visit vscpa.com/innovation for more. XChange Executive Leadership Program vscpa.com/xchange LeadingForward Podcast vscpa.com/LeadingForward Dale Carnegie Certificate Program vscpa.com/LeadershipPrograms
TECHNOLOGY & INNOVATION SHOWCASE Nov. 11-12, 2019, Richmond Visit vscpa.com/showcase for info on attending and exhibiting!
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CREATE OPPORTUNITIES FOR EMPLOYEES TO COLLABORATE Collaboration allows staff to work with individuals outside of their normal business units and areas of expertise. It is through these collaborative activities that the best new innovations or reworks of existing processes occur because different perspectives provoke thought, challenge status quo and offer solutions that a homogeneous group of employees may not consider. Collaboration can be formal or informal. A formalized program may include cross-training, whereby staff have an opportunity to work on a temporary assignment in another department to learn how it operates and contributes to the organization’s mission. This allows employees to learn more about the organization, broaden their professional network, expand their questioning skills and exposes them to individuals who think differently. The expanded network provides new confidantes with whom the employee can consult when in need of feedback about ideas for change. Collaboration also encourages innovation because employees gain exposure to different systems and technologies and learn to appreciate how others perform their work. Innovative ideas are spawned as employees return to their normal jobs and begin to associate what they do with something they learned while cross-training. Collaboration can also be less formalized and can occur by presenting a business idea or problem to matrixed team of employees and asking them to develop solutions. Since a matrixed team brings together individuals from different disciplines, they each contribute unique thoughts and experiences that, when combined, can lead to innovations. One example of collaboration at the Virginia Auditor of Public Accounts (APA) occurred as they readied the
organization for a major upgrade of SharePoint, a document management and storage system. Since this upgrade was expected to significantly alter how SharePoint operated, it presented then with an excellent opportunity to re-engineer how they use the software. To get started, they formed a team of field auditors who brought different expertise to the table along with the SharePoint administrator who could provide information about the software’s capabilities and limitations. This team imagined SharePoint’s potential and delivered a product to the office that radically changed how they organized their work. The new solution now allows the APA to maximize the amount of useful information they can compile simply through improved organization and the use of metadata standards. The new design allows them to adopt better principled practices with regard to the common aspects of their work, making it easier to view the status of an audit and giving them the ability to generate analytical information to evaluate the effectiveness of their audit work by linking procedures and recommendations across all audits. An even less formal collaboration practice is to provide “innovation days,” when departments share information about innovations they have made in hopes of motivating other staff to do the same. Innovation days allow leadership to publicly recognize its innovative staff and provides a networking opportunity for individuals in the organization to meet. Traditionally, many staff choose to opt out of attending these types of events because they are focused on getting their jobs done or do not see how the topic directly affects them. To create a culture of innovators, leadership must demonstrate its support of these activities, clearly communicate why these opportunities are so important and check itself to ensure that getting one’s job done is not the only activity it values.
LEADERSHIP
Leadership can support employee efforts to try new things by giving them some latitude to experiment. The purpose of experimentation is to learn which innovative ideas may work and which are just flat-out failures. Experimentation is risky, however, because it takes time and effort to build and test a new model — reducing the time an employee has to execute work. One way to lessen this risk is to dedicate a small amount of a company’s annual resources toward innovative research and development, and carefully vet and test only the most
promising innovations. Remember, experimenting can be fun! One idea is to conduct an innovation competition — think “Shark Tank.” Give several small teams a real business problem that needs an innovative solution or have the teams brainstorm their own innovation or new service offering. Give the teams a fixed amount of time to collaborate, develop their idea and pitch it to company leadership, with the best ideas being awarded additional time and resources to be more fully developed. This fun competition may generate multiple great ideas and the company may reap rewards in way they never dreamed possible.
Trevor, a young engineering consultant in Cincinnati, described his participation in a corporate competition as not only fun, but also career-changing. His company’s “Shark Tank”-style competition allowed him to work with a previously unknown teammate from another office to brainstorm new applications the company could offer to its main customer, a jet engine manufacturer. The goal was to create a new service offering to make previously difficult-to-interpret simulation reports more intuitive and informative. Trevor and his teammate, along with other teams, had two days from concept to prototype and then they pitched their ideas to the Board of Directors. All ideas had promise and received accolades, u
WOWbinars INNOVATION SERIES Beginning this spring, the Center for Innovation is excited to bring you WOWbinars, a series of FREE webinars that focus on talent and technology topics. Our robust lineup of speakers include Center for Innovation partners and thought leaders who will leave you inspired to innovate. Register online for an upcoming webinar and gain new skills on how to lead, innovate and do business. Each webinar offers up to 1 CPE credit.
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SUPPORT INITIATIVES TO EXPERIMENT BY TESTING NEW IDEAS
vscpa.com/FreeCPE
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but for winning the competition, Trevor and his teammate received a day off and more time and assistance to further develop the application and train the main customer on its use. The public recognition inspired Trevor to continue to view much of his work through an innovation lens, leading him to spend his own time creating even more prototype applications that his company could use and sell. Only one year later, Trevor now leads a team of six engineers specifically pulled together to satisfy the demand for new applications because of the value they add and the money they save. By encouraging employees to experiment, organizations can create an innovative culture that inspires. The main takeaway about experimentation is that it takes time, so employees must feel there is a way to receive the time, and leadership must realize that experiments will fail — but there is stock to be gained from the lessons learned.
ENCOURAGE EMPLOYEES TO EXERCISE A QUESTIONING MIND “The important and difficult job is never to find the right answers, it is to find the right question.” — Peter Drucker Questioning the status quo is scary because it puts oneself at risk of appearing ornery; however, leadership needs to encourage staff to ask why things are done the way they are so they can explore ways to do things better. Interview any innovator and they will likely say their idea was sparked by asking why and forcing themselves to make new associations. However, if innovation is as simple as asking more questions, then why do we fail in this regard? The answer is quite simple: Most of us fear looking foolish by asking bad questions. To improve our chances of asking good questions, staff need training and management must create an
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environment in which even bad questions are treated with respect. Staff’s questioning skills can be improved if we train, encourage and reward them to employ “what is,” “what caused,” “why,” “why not” and “what if” questioning techniques. These are referred to as open-ended questions because they elicit more information than a mere one-word response, and this additional information can spark innovative ideas. After training is given, leadership should have staff retool customer surveys and other customer-facing interactions to focus on asking open-ended questions to maximize the amount and nature of information collected. In addition, internal surveys to staff should be retooled in a similar fashion. Open-ended questions elicit answers that are most likely to suggest a change or divulge a problem that then sparks an innovative solution in the employee’s mind. Another idea to spark employees’ questioning minds is to have them participate in question-storming activities about business operations, product design and service offerings. One questioningstorming technique is known as “Five Whys” and is credited to the founder of Toyota. The concept is to have staff ask “why” five times as so to drill down to the root cause of a particular problem so that an innovative solution can be developed that addresses the right issue. Here is an example: Why did our accounting system go down? Because the system became locked. Why did the system become locked? Because there were too many simultaneous users. Why were there too many simultaneous users? Because we never tested the system to that level.
Why did you never test that level of users? Because we do not have a process set up to test the user load on new systems. Why don’t we have a load test process? We’ve always been a small organization but are now hitting new employment levels that indicate that load tests are more important.
INNOVATION IS FOR EVERY FIRM Creating a culture of innovative thinkers is not limited to high-tech companies and those with huge research and development budgets. Even small firms desire staff who want to improve the organization, save money or create new lines of business, and most employees desire to work for a company that provides a culture that recognizes and rewards innovation. Leaders must remember that their commitment is key and making this change is likely the toughest task — it requires new ways to measure and reward success. Once the commitment is in place, providing opportunities for staff to collaborate, being open to changing things up a bit and engaging staff to ask openended questions are three simple activities that can set you up for success. n
Karen Kyte Helderman, CPA, CISA, PMP, is the executive director of audit and compliance services at Virginia Commonwealth University. She has extensive experience directing financial, compliance and performance audits of state agencies and universities throughout the Commonwealth and is a member of the Disclosures Editorial Task Force. heldermank@vcu.edu connect.vscpa.com/KarenHelderman linkedin.com/in/KarenHelderman
IT’S TIME TO RENEW! BY MAY 31, 2019 YOUR VSCPA MEMBERSHIP EXPIRES APRIL 30 RENEW TODAY • VSCPA.COM/RENEW
LEADERSHIP
SECRETS OF A CPA
trailblazer
A conversation with Lynne Doughtie, CPA, VSCPA member and first female chairman and CEO of KPMG.
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In a profession filled with high achievers, Lynne
The VSCPA recently interviewed Doughtie about topics ranging from her career path to the prospects of women in accounting to the future of the profession in the face of automation and other technological advancements.
Doughtie, 56, works at KPMG’s main offices in New York, but still lives in her native Powhatan County, where her parents ran a family business. She has spent her entire career at KPMG, starting at the firm in the Richmond office in 1985 after graduating from Virginia Tech’s Pamplin College of Business, making partner in 1998. She rose through the firm as an auditor specializing in internal controls and information technology and moved into KPMG’s advisory practice. From 2011 to 2015, she led KPMG’s Advisory practice in the Americas, establishing it as the firm’s fastestgrowing business.
What was your early exposure to the accounting profession?
Doughtie, CPA, manages to stand out. In 2015, she was named chairman and CEO of Big Four firm KPMG, becoming the first woman to hold both roles simultaneously in the Big Four.
Chip Knighton
Since taking over as Chairman and CEO in 2015, Doughtie has increased KPMG’s revenues to $9.46 billion (fiscal year 2018), an 8.3 percent increase from fiscal 2014, the year before she took over. On her watch, KPMG has partnered with AWS, Google, IBM Watson, Microsoft and other technology brands to enhance the firm’s services. Doughtie is a governing board member of the Center for Audit Quality and a board member of Catalyst, Chief Executives for Corporate Purpose, LUNGevity, Virginia Tech’s Pamplin Advisory Board and NAF. Doughtie has received numerous accolades including Fortune’s Most Powerful Women in Business, Crain’s New York Business’ 50 Most Powerful Women in New York, Accounting Today’s Top 100 Most Influential People, the National Association of Corporate Directors’ “Directorship 100,” the National Association of Female Executives’ “Woman of Achievement” and Glassdoor’s 2018 list of Top CEOs. She also received Virginia Tech’s Pamplin College of Business’ Distinguished Alumnus Award (2007) and Virginia Tech’s Distinguished Achievement Award (2018). Doughtie and her husband, Ben, have a son, Schuyler, and a daughter, Evie. She enjoys outdoor sports, including skiing, water sports and golf, and is an avid Virginia Tech fan.
By the age of 10, I was helping my mother make the daily bank deposits and post accounts receivable for the family business. I learned about debits and credits early. Were you always looking to go to a Big Four firm? What educational steps did you take with an eye on getting there? I actually started my college education majoring in computer science, but soon found my way to Virginia Tech’s Pamplin College of Business. I could really relate to my business courses as I had wonderful opportunities to help with our family business growing up. All of the “Big Eight” firms recruited at Virginia Tech and I felt public accounting would be the perfect place to start my career. I joined KPMG as an accountant in 1985 and have benefitted from tremendous professional growth opportunities across multiple service areas and industries. In addition, the culture and values of KPMG, along with people who care deeply about the work we do and about each other, is what has kept me at the firm for more than 30 years. What did you enjoy about working in audit? Was it difficult to leave that side of the house? Being an auditor provided me with meaningful responsibilities early in my career. I served on audit teams working with some of the world’s leading companies and had the chance to learn from and work alongside highly committed professionals dedicated to serving the capital markets. The great thing about public accounting is the wide range of opportunities there are to build new skills and gain experiences in many different areas. In the late 1990s, I began to specialize in IT auditing serving both audit and non-audit clients. My experience in both auditing and advisory helped me to see the various facets of a multidisciplinary firm and positioned me well for future leadership roles. u
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“We have to do more than tell women to raise their hands. We have to identify highpotential women by name
Nov. 11-12, 2019, Richmond
and strategically map them to
Visit vscpa.com/showcase for info on attending and exhibiting!
those who are responsible for advancing their careers.” Your career progression has mirrored the growth of women in the profession. What did it mean to you to become one of the first female CEOs of a Big Four firm? Having spent my entire career at KPMG, I was extremely honored and humbled to be named chairman and CEO. That said, women are still in the vast minority when it comes to leadership roles in corporate America. As a woman, I recognized the tremendous platform I would have to help more women advance and move into leadership positions. It’s interesting that according to KPMG’s latest Women’s Leadership Study, seven in 10 women (69 percent) are open to taking small risks to further their career, but far fewer (43 percent) are open to taking the bigger risks associated with career advancement. Yet study after study finds that companies with more women in leadership roles tend to be considered “higher-quality” companies, with better returns on equity. Companies that utilize female talent effectively also are 45 percent more likely to report improved market share. Was retaining women more of a priority when you were starting out and progressing in the profession than it had been in previous generations? How did that manifest itself? How has the firm (and profession) improved in that area as your career has progressed?
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The importance of inclusion and diversity has become front and center. Clients are looking for innovative solutions, fresh thinking and new perspectives. To meet those needs, inclusive and diverse leadership and engagement teams are needed like never before. This creates tremendous opportunities for women to grow and lead. Have you worked to “pay it forward” with other women at KPMG and the profession? As KPMG’s first female chairman and CEO, I have an incredible opportunity to “pay it forward” to other women, and to pass on what I’ve learned. At KPMG, we have a culture that supports our long-time commitment to developing, advancing and empowering women both within our firm and the broader marketplace. At our firm, we continue to enhance career opportunities for women by driving national and local initiatives that support, advance, retain and reward them. Outside of KPMG, we strive to inspire greatness in the next generation of women leaders and positively impact the number of women in C-suite positions in corporate America through initiatives like the KPMG Women’s Leadership Summit. I personally have coached, sponsored and mentored many individuals throughout my career and continue to do so. Helping people grow, develop and move forward in their careers has always given me the most satisfaction. I strongly encourage others to do the same.
What advice do you have for women trying to break into leadership in the profession? Two things. First, make your goals known. Don’t wait for someone to ask you if you are interested. Be vocal about your interests and aspirations; proactively develop relationships with those who can help get you there, like mentors and sponsors. And second, don’t be afraid to take risks. Whenever you leave your comfort zone, you learn and grow the most. What more can the profession do to retain women and get them into leadership roles? It starts at the top. To make a lasting impact, leaders need to drive change that requires getting surgical. We have to do more than tell women to raise their hands. We have to identify high-potential women by name and strategically map them to those who are responsible for advancing their careers. We have to set goals, measure them and hold leaders accountable. How can CPAs maintain their status as vital trusted advisors in the face of automation, AI and other technological advancements? Never stop learning. The advancement of innovative new technologies including data and analytics and intelligent automation are changing the organizations we work with and the role of auditors.
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The profession strongly advocates a culture of continuous learning, especially as advanced technologies enable and enhance our people’s skills, augmenting their judgment and enhancing decisionmaking.
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A demonstration of KPMG’s commitment to lifelong learning and the ongoing development of our people is a $450 million investment we are making in a learning, development and innovation center — called KPMG Lakehouse — in the Lake Nona community of Orlando, Fla. The 800,000-square foot structure sits on 55 acres that will accommodate 1,000 of our people at a time, who will come together to ideate, collaborate and create.
It’s the largest capital investment our firm has ever made. It will be a place that will spark creativity and allow our people to grow by sharpening their skills, exploring new technologies, building deeper relationships and challenging each other with new ways of thinking and working. What philanthropic outlets do you support/donate your time to, and why? I serve as a board member for several nonprofit organizations. I’m passionate about supporting causes that make a positive difference in the lives of others and advance societal change. The
organizations I support align with causes I care about including advancing more women in business, improving education for underrepresented populations in high school and changing outcomes for people with lung cancer. n
Chip Knighton is communications manager at the VSCPA, as well as contributing editor at Disclosures magazine. cknighton@vscpa.com connect.vscpa.com/ChipKnighton @ChipKnighton
How are you Innovating?
WHAT’S NEW IN THE CENTER The Center for Innovation was created to empower our members to think differently and drive CPA relevance through innovative and visionary leadership. Since launching the Center back in November, we’ve created several new programs and partnerships including the Technology & Innovation Showcase, certificate programs with Dale Carnegie (currently 20% off) and WOWbinars. We’ve also shared dozens of resources and white papers. If you haven’t checked out the Center for Innovation yet, don’t miss out on all it has to offer. You’ll find future-forward resources and learning to help you in two focus areas: technology and talent.
vscpa.com/Innovation
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Congratulations to our newest 40-Year Members The Society
will celebrate 58 new 40-Year Members at the VSCPA Honors & Awards ceremony May 16 at the Delta Hotel Richmond Downtown. This recognition honors members with at least 40 years of consecutive membership. We truly value the longtime commitment, contributions and expertise of these special 40-Year members. James M. Albano Jr., CPA, Marion Debra M. Allen, CPA, Lynchburg Alan Altschuler, CPA, Newport News Frank E. Baar Jr., CPA, CGMA, Moneta Steven L. Barley, CPA, CGMA, Richmond Charles A. Bish, CPA, Fairfax Eugene C. Brockwell, CPA, Richmond Richard S. Burke, CPA, Richmond F. Thomas Carmine Jr., CPA, MBA, Newport News James D. Cavanaugh, CPA, Arlington Melanie B. Clements, CPA, Sterling William E. Colesar Jr., CPA, Richmond Gregory J. Cooley, CPA, CFP, Charlottesville G.M. Cundiff, CPA, Winchester Bruce H. Elliott, CPA, Berkeley Springs, W. Va. Harry L. Fagan, CPA, Yorktown David B. Flester, CPA, White Stone William J. Foster, CPA, Danville Hunter B. Frischkorn III, CPA, Richmond Gary A. Gilmore, CPA, Virginia Beach John S. Goode, CPA, Richmond Charlotte H. Goodson, CPA, Round Hill William L. Graham, CPA, CGMA, Glen Allen David F. Graling, CPA, Bethesda, Md. Jerry W. Holleman, CPA, Chesterfield Jan S. Hoover, CPA, Fishersville Michael W. Johnson, CPA, CVA, Roanoke Steven W. Jones, CPA, Virginia Beach Alan E. Klinger, CPA, CGMA, Roanoke Gregory F. Lawson, CPA, Hampton Randolph E. Lee Jr., CPA, MBA, Bethesda, Md. George J. Lex III, CPA, CGMA, Bristow William J. Martin, CPA, Charlottesville Joseph S. Mastaler Jr., CPA, CGMA, Fairfax Warren J. McKeon, CPA, MBA, FHFMA, Midlothian John A. Merchant, CPA, CFE, CFF, Glen Allen Garland W. Nichols Jr., CPA, MBA, Virginia Beach William K. Oliver, CPA, Virginia Beach Mark D. Poteet, CPA, Kinsale
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William A. Prince, CPA, Norfolk George J. Reed, CPA, Delaplane George Wayne Riegel Jr., CPA, Midlothian Stephen D. Semancik, CPA, Abingdon Thomas J. Shaughnessy, CPA, CFF, Manassas Daniel L. Shaw, CPA, CFP, CFE, Vienna Robert P. Speece, CPA, Norfolk Dennis L. Staples, Fort Myers, Fla. Mary E. Szpanka, CPA, Reston Jan E. Thompson, CPA, Haymarket Thomas G. Turner, CPA, CGMA, Raleigh, N.C. Richard A. Ungerer, Moneta Thomas J. Vadnais, CPA, Alexandria Steven B. Walters, CPA, Virginia Beach David C. Warren, CPA, Salem Karen M. Whelan, CPA, Richmond Elise H. Wilkins, CPA, Warrenton Ronald S. Wilkinson, CPA, Danville Alan S. Witt, CPA, CGMA, Newport News
VSCPA ANNUAL MEETING The VSCPA's Annual Meeting will be held May 16, 2019, at 11:15 a.m. at the Delta Hotel Richmond Downtown. Members will vote on the slate of 2019–2020 officers and directors, as announced in the March/April issue of Disclosures.
VSCPA
Find your chance to shine The Society's
volunteer program is your platform to grow your leadership, teamwork and public speaking skills and start to define your personal brand — your chance to shine. VSCPA volunteer opportunities give you the chance to flex your leadership muscles and grow the skills you need to advance in your career in a way you might not have access to in the office. Wherever you are in your career, we can help you take it to the next level, whether that’s leadership training for young professionals looking to move up or
more specific expertise to help seasoned professionals improve their skills. We can help you find specific growth opportunities to help you advance in the profession. Our current opportunities include: • CPAs in the Classroom • State-wide speaking opportunities • Writing and profile opportunities in Disclosures magazine • Year-long committee and council positions If this sounds like something you’d like to do, visit connect.vscpa.com/Volunteer.
NEWS TO SHARE? We want to hear from you! Email disclosures@ vscpa.com with news of member awards, appointments or job changes. We also print firm news, such as M&A and community service activities.
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Contact me today to see how I can save you money on your insurance. Ronnie Shriner shriner@nationwide.com 2571 Homeview Dr Richmond VA 23294 Ronnie Shriner Insurance Agency Inc Phone: (877) 683-3364 Nationwide may make a financial contribution to this organization in return for the opportunity to market products and services to its members or customers. Products Underwritten by Nationwide Mutual Insurance Company and Affiliated Companies. Nationwide Lloyds and Nationwide Property & Casualty Companies (in TX). Home Office: Columbus, OH 43215. Subject to underwriting guidelines, review, and approval. *Vanishing Deductible is an optional feature. Annual credits subject to eligibility requirements. Max. credit: $500. Details and availability vary by state. Products and discounts not available to all persons in all states. Nationwide, Nationwide Insurance, the Nationwide framemark, On Your Side and Vanishing Deductible are service marks of Nationwide Mutual Insurance Company. © 2016 Nationwide Mutual Insurance Company AFO-0915AO (03/16)
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CHAIR OF THE VSCPA BOARD OF DIRECTORS:
Gary Thomson, CPA
Gary Thomson, CPA, takes over as the VSCPA Board of Directors chair coming off a fresh reminder of the limitations of his own power. Thomson, a Pittsburgh Steelers season-ticket holder, was recently appointed to a 20-person fan advisory council for the team, and his first meeting came on the heels of the team trading star receiver Antonio Brown. Thomson was under no illusions that he could have done anything to stop the deal.
“They’ve made it very clear that this group I’m on has nothing to do with the team,” he said. “I don’t think they need to hear my voice on Antonio Brown.” The VSCPA, on the other hand, is happy to be the beneficiary of the mental energy he isn’t spending on draft picks and salary cap implications. Thomson, 55, is retiring from Dixon Hughes Goodman (DHG) and public accounting effective May 31 and starting his own consultancy practice focused on succession and transition planning, general consulting and mergers and acquisitions for public accounting firms. And the VSCPA will be a major beneficiary of the time he’s freeing up. “I couldn’t be more excited,” he said. “To have your own peers give you the opportunity to lead is just fantastic. I’ve had the opportunity to lead in a lot of organizations, both local and statewide, but this is a special one for me. My excitement level is off the charts. The fact that it coincides with a change in career makes it more exciting because I feel like I have the appropriate amount of time to do some things that I want to do.”
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Those priorities include an increased focus on the VSCPA2025 theme of driving innovation and vision, as well as advancing diversity in the VSCPA and the CPA profession — and Thomson sees the two topics as very much wrapped up in each other. Hear Gary’s thoughts about innovation at vscpa.com/GaryThomsonInnovation. “What do we need to do as a profession to remain relevant moving forward?” he asked. “How do we get people excited about the profession? How do we engage the next generation? To me, everything ties back to innovation... We’re looking at some diversity initiatives and recognizing what the future of the profession looks like. We need to innovate on the way we attract people into the profession.” We’ve profiled Thomson before when he was named 2017 VSCPA Outstanding Member of the Year, but here are the key points of his biography: He started his career at Arthur Andersen after graduating from Bob Jones University in South Carolina and later started his own firm in Colonial Heights. Eventually, that firm became part of DHG and Thomson was a partner who saw his territory grow to encompass the entire Mid-Atlantic region.
VSCPA
He’s active in the political process and counts current Virginia Speaker of the House Kirk Cox (R-Colonial Heights) as one of his closest friends. He served as chairman of the Virginia Chamber of Commerce in 2014, and he and his wife, Janice, have an adult daughter, Morgan, and a son-in-law, Ryne. He’s a sports fan (Duke University as well as the Steelers) and a pretty decent golfer. Since then, he firmed up his retirement plans and used his political knowledge to help the VSCPA pass its most contentious bill in years, getting tax conformity enacted for the tax season that just wrapped up. He also focused on another pet issue of his, early childhood education — he currently chairs Virginia’s School Readiness Committee, where he’s served since 2016.
The conformity resolution was particularly gratifying for Thomson, who was part of a group who helped the VSCPA champion the issue, along with VSCPA staff and members including former Virginia Sen. Walter Stosch, CPA, and Old Dominion University professor Vivian Paige, CPA. Thomson penned an op-ed in the Richmond Times-Dispatch in support of conformity in addition to speaking with legislators on both sides of the aisle and Virginia Secretary of Finance (and VSCPA member) Aubrey Layne, CPA. “If you go back to the position at the beginning, we didn’t care how they came up with the solution, but we knew what we wanted the solution to be, and I think we basically got it,” Thomson said. “While we had to go around our back
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to get to our elbow and it took longer than we anticipated, if you look at what was passed, the VSCPA’s fingerprints are all over it. That creates a great sense of accomplishment that the Society’s political stature was such that people appreciated us and listened to us.” It all speaks to his comfort in influencing policy behind the scenes. Thomson had entertained thoughts of running for office, and he still hasn’t ruled it out, but more and more he’s embracing other ways of making a difference. “When I was 25 years old, that was something I wanted to do. Now, I want to be engaged with policy and good government, and I want to be in the most effective place to do that,” he said. “Sometimes, playing the consultant/advisor type of role is even more consequential than being the elected official. Being a big believer in divine providence, I would never say I’m never going to do it, but I just want to make an impact, whether it’s in the CPA profession, early childhood education or other arenas. ” For now, he’s focused on his work as VSCPA chair, a little more time on the golf course, much more time with his family and his new business venture, which has him as energized as any new opportunity he had in public accounting. “I feel the same level of excitement now that I did at key milestones in my public accounting career,” he said. “You have that entrepreneurial feeling, the excitement of what’s going to be next, and some nervousness. That’s a good thing. I’m excited about it. I love DHG and my public accounting career. “People ask if I’m ready or excited about getting out of public accounting, and that’s not how I feel. I feel very engaged and fulfilled with what I’m doing right now. I feel like I’m finishing strong. My excitement level here is as high as it ever has been.” n
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VSCPA
NEW VSCPA FOUNDATION CHAIR
Heather Koppe Flanagan, CPA
When incoming VSCPA Educational
Foundation Board of Directors Chair Heather Koppe Flanagan, CPA, CGFM, CISA, finds a groove, she sticks with it — but it was a slight career shakeup that brought her to the Foundation in the first place. Now she’s working on changing the donation habits of professionals like her. Flanagan is a partner in the federal audit practice of KPMG’s Washington office, where she’s worked since graduating from James Madison University (JMU) in 1992. To the best of our research, she’s the first Foundation chair from a Big Four firm, and she’s hoping to expand the Foundation’s donor base while exploring why relatively few of her colleagues are involved with the Foundation and the Society. “I find it interesting that the Big Four is not more involved,” she said. “I’ve been trying to explore that here in my own company. As part of a big firm trying to find the talent, I believe we have an obligation to provide some support for accounting students, and involvement in the Foundation is an excellent way to do that.”
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KPMG had no such problem drawing Flanagan when she was looking for her first job — in fact, as her first choice, her initial employment decision came down to deciding which KPMG office to apply to — Norfolk or Washington. She applied for the Washington position on the advice of one of her JMU professors because of the greater career opportunities in that area. She had no idea just how broad those opportunities were.
hedge fund audits for KPMG’s New York office.
When Flanagan started out at KPMG, the federal government wasn’t even being audited yet. That meant that she and her colleagues had a great deal of leeway in establishing best practices in their fledgling practice.
She’s still working on her priorities for the upcoming year, but one thing she knows will be on the list is getting a wider group of Society members to donate to help fund the scholarships that are the Foundation’s main initiative. Eternally grateful to her parents for supporting her college education, Flanagan hopes others will be inspired to reduce the educational cost burden of our future accounting professionals.
“[Federal audit] was starting to get a framework around it, and by chance, I was assigned to a job with a partner who was trying to develop federal clients. I got looped in that way,” she said. “I liked it because it was new and interesting and the accounting was being formed while we were living it. When we formed a federal practice, without even thinking about it, I thought, ‘Yes, that’s where I want to be.’” She knew accounting was for her from an early age, too. Growing up in small-town Washington. N.J., she always enjoyed math and took her first accounting course in high school. Unbeknownst to her at the time, her mother had also aspired to be a CPA, but didn’t have the backing of her parents to go to college. While at JMU and then KPMG since leaving New Jersey, Flanagan is intentional about expanding her knowledge base. For example, she’s obtained a credential for information technology auditing despite not working in that space, and she’s taken on a sideline as a second reviewer for
Despite her curiosity, it took a push from a supervisor before she took the plunge as a VSCPA volunteer. She first joined the Society’s Governmental Issues Task Force in 2011 and spent three years working for the Accounting & Auditing Advisory Committee on her way to the Foundation board in 2012.
“I want to see if there’s any way we can broaden our donor base to help fund the Foundation scholarships,” she said. “The scholarships are so essential to these students to give them a little extra money to keep them going. We so need that pipeline of smart, bright people to come into our profession. I think anything that we can do as a profession to help support these students, show them the value of this profession, and give them a little help to get here is vitally important.” Flanagan lives in Fairfax Station with her husband and two children. n
Support the profession and donate to the VSCPA Educational Foundation today at vscpa.com/foundation.
VSCPA
Congratulations to the following members!
VSCPA MEMBER WINS E.W. SELLS AWARD
Left to right: Samantha Bell, CPA, Andrew Jones, Paul Whitestone and Kimberly Zingale, CPA VSCPA member Brian Frey, CPA, is one of 110 winners of the American Institute
NEW HIRES
MERGERS & ACQUISITIONS
Claudia Autore has joined Jones CPA Group in Virginia Beach as a staff accountant.
Yount, Hyde & Barbour has acquired Murray, Jonson, White & Associates in Falls Church.
Andrew Jones has joined Mitchell Wiggins in Richmond as a staff accountant.
PROMOTIONS Jones CPA Group in Virginia Beach has promoted Henry Petersen, CPA, to director and Nan Zhang, CPA, to manager. KWC has announced the following promotions: Sarah Holdgriewe, CPA, to supervisor in the Richmond office and Paul Whitestone to supervisor of client advisory services, Sammy Bell, CPA, and Kimberly Zingale, CPA, to manager in the Alexandria office.
APPOINTMENTS & AWARDS Ellyn Bess, CPA, partner at BDO USA in Norfolk, and Angela Kerns, CPA, shareholder at Wall, Einhorn & Chernitzer in Norfolk, were named to the 2018 Inside Business Women in Business list.
of CPAs’ (AICPA) 2018 Elijah Watt Sells Award, given to outstanding performers on the CPA Exam. Frey, 24, is an audit associate at KPMG in Washington and a graduate of the University of Maryland at College Park’s
THE VSCPA’S NEWEST VIRGINIA CPA LICENSEES Caleb Banks, CPA, Glen Allen Amanda Crockett, CPA, Williamsburg Erica Doolittle, CPA, Lynchburg Hailey Fox, CPA, Evington Brandy Frost, CPA, Midlothian Soon Kwon, CPA, McLean Gabrielle Miller, CPA, Washington Kimberly Relue, CPA, Moneta Anne Richards, CPA, Alexandria William Siemers, CPA, North Bethesda, Md. Christie Skillington, CPA, Arlington Kirstyn St. Pierre, CPA, Newport News Tara Treat, CPA, Newport News William Watterson, CPA, Midlothian List from February and March. Compiled March 28, 2019.
Robert H. Smith School of Business, where he received the Accounting Award for the senior class in 2017. He was a double major in accounting and information systems. “I studied both Accounting and Information Systems at the University of Maryland, and I believe that pursuing both degrees greatly prepared me for the CPA Exam,” he said. “I learned how to manage my time to meet the demands of both programs, in addition to all of the other activities I was involved in at college. I was really fortunate to have developed time management skills prior to studying for the CPA Exam as I was able to balance studying for the CPA with work responsibilities and a social life.”
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STAFF ANNIVERSARIES
Member receives prestigious SCHEV award Jill Mitchell
Pictured clockwise: April 9: Peer Review Manager Alan Nicholas, 1 year May 15: Chief Operating Officer Maureen Dingus, CAE, 12 years June 5: Employer Outreach Specialist Janie Medley, 13 years June 6: Member Services Assistant Doris Pennington, 5 years June 18: Member Services & Event Specialist Tara Pennington, 7 years June 19: Senior Manager, Finance & Administration Diane Jones, 13 years
IN MEMORIAM John Kilgore, CPA, of Virginia Beach. A graduate of George Mason University and Old Dominion University, he most recently worked as a consultant for Booz Allen Hamilton. Karen Van Rosendale, CPA, of Poquoson. A graduate of the College of William & Mary, she was a partner at Hart & Steinmuller before that firm merged with Malvin, Riggins & Co. She served on the VSCPA’s CPE Subcommittee and was a member of St. Stephen Lutheran Church in Williamsburg.
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VSCPA member Jill Mitchell, an associate professor of accounting at Northern Virginia Community College (NOVA) in Annandale, has been selected for the 2019 State Council of Higher Education for Virginia (SCHEV) Outstanding Faculty Award. She is the only community college faculty winner for 2019 and the first accounting professor to receive the award in 25 years. Mitchell, 40, has taught principles of accounting and auditing courses on campus and online since 2008. She began her career with Ernst & Young’s Businesses Risk Services practice in Miami. Since starting at NOVA, she has advised more than 300 students on academic and career aspirations and has written recommendation letters for more than 250 students. A South Carolina native, Mitchell earned her bachelor’s in management information systems from the University of Georgia’s Terry College of Business, graduating magna cum laude. She earned her master’s in accountancy from the University of Virginia’s McIntire School of Commerce and is set to earn her master’s in instructional design technology from George Mason University this spring. She has served on numerous VSCPA committees and task forces, including a stint on the VSCPA Board of Directors from 2015–2017 and several years on the Educators’ Symposium Task Force.
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SPOTLIGHT
VSCPA member Summiyyah Badar, CPA
Photography by: Mark Gilvey Creative, LLC | mgcre8v.com
Summiyyah Badar, CPA, ACA, has been in public accounting since 2003. She started her career in assurance and advisory with A.F. Ferguson, a member firm of PricewaterhouseCoopers (PwC) in Pakistan, and later moved to Ernst & Young in the Bahamas. She now works at Wendroff & Associates in Arlington, where she leads the firm’s Government Contracting team.
I am passionate about… Training. I love training and mentoring my colleagues and staff. I trained professionals at PwC at a very early stage of my career. I believe it’s enriching and a two-way learning experience. The conversations I have had have broadened my understanding about subject matter in different dimensions. There is always more than one perspective of looking at things. I have never walked out of a training without learning something new.
start a conversation. Its feels awkward to me. However, I love public speaking. At any time, with or without preparation, I can walk up on that stage and address a room full of professionals without any kind of hesitation. If I weren’t a CPA, I would be… Some other kind of accountant, or maybe an economist or a mathematician. Numbers have always made more sense to me than text ever did. My advice to fellow CPAs is… Success is not an isolated event, its collaborative. Work for, or with, a team that believes in your growth being their growth. Find people who will hold you up and support your colleagues. In this age of globalization, it is important we embrace diversity, cultures, generations, advancements, technology. And please smile and laugh more often — enjoy your profession.
People don’t know this, but… I am terrible at networking. I cannot walk up to a person I am not acquainted with and
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I wish CPAs knew… Technology will take over. There are programs that can do it faster and be more accurate. Don’t be threatened by it, embrace the evolution. Develop people’s skills, build relationships with clients and your team. The ability to connect with your clients and peers at a personal level will be a key skill. Focus on your values and integrity. Stop looking at the past, or how it was done in the past. I never leave home without… My cellphone, my wallet, my keys and a resolution to not spend all my hardearned money. I am a CPA because… I was in sixth grade when I woke up one day and decided that I would be an accountant. I never changed my mind. My biggest inspiration was my mother — she maintained a small diary of all her finances, and I loved reading it as a child. My second inspiration was my grandfather, who himself was an accountant and an educator.
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