The CPA: An Asset to Your Business Endeavor

This article originally appeared in the Long Island Business News.

By Alan E. Weiner

Certified Public Accountant - words that have over 100 years of history in New York State and have come to mean skilled, reliable and trustworthy.

That translates into a valuable asset for business in the United States, in New York State and on Long Island, which has long been a place of business diversity. What was once farms and rural communities has transformed itself into industry, businesses providing services worldwide and locally, resort areas, construction, suburbia, horse farms, and perhaps the most unlikely of all, vineyards.

Each one of these businesses needs the financial services provided by the Certified Public Accountant.

The CPA has evolved from the stereotype green shade and "bean counter" to a person or firm that helps businesses grow and plan its financial future.

Long Island CPAs are catalysts for business. They keep their figures on the pulse of everything connected with business. Being a CPA means more than just being smart. It means knowing where to get the answers. The accountant who says, "I know all of the answers," is not necessarily as good as the one who says, "I can get you the answers."

Your CPA has banking relationships to assist you with getting financing on a temporary or long-term basis. Your CPA generally can see Long Island’s economic future and help your business plan for its economic future. Your CPA is knowledgeable in taxes and essential in order to avoid costly tax blunders.

Many CPAs also can assist you with your ongoing (or entry into) international business. And while CPAs are technologically proficient, it does not mean that they are experts. But because CPAs have had personal experience with the technology in their own offices and with that of other clients, they can assist you in selecting software, hardware, or a company with expertise in the technology that you may be seeking.

Corporate CPAs will understand your business. They will make a point of spending time with you and your employees initially and periodically thereafter, so that they can translate what has been seen into an accurate financial picture.

For businesses that require budgets, CPAs have been trained to assist you. It will force you to analyze every aspect of your business and then track your actual performance to the budget.

Budgets are not inflexible and they can be changed throughout the budget cycle, but the reason for variances will help a business grow and avoid repeating mistakes.

You’ve probably heard and read about Y2K until you wanted to scream. But Y2K is a perfect example of an item that virtually no business budgeted for, but one that is costing the American business community hundreds of millions of dollars. Many budgets were (and are being) modified as a result of Y2K.

The New York State Society of Certified Public Accountants has 32,000 New York State CPAs as members (there are probably 350,000 CPAs throughout the United States) and it has 11 chapters throughout New York State. Until about 25 years ago, there was one Long Island Chapter; however, as the Long Island business community grew further eastward into eastern Suffolk, some forward-looking CPAs felt the need for a separate chapter that would better serve the CPAs and businesses from western Suffolk to the East End. Hence was born the Suffolk Chapter. Between the Nassau and Suffolk Chapters of Certified Public Accountants there are about 8,000 (6,000 Nassau and 2,000 in Suffolk). Those CPAs are ready to serve the business community, and some specialize in niche industries.

They may be well known for health care, lawyer support services, publicly traded companies, as experts in the construction industry, tax specialists, experts in the not-for-profit field, restaurant specialists - you name it, and there is a CPA specialist for it. The CPAs range in size from solo practitioners to local offices of the largest accounting firms in the world.

Planning is a key part of the CPA’s value to you and your business. Recently, the Financial Accounting Standards Board, commonly referred to as the FASB, voted to eliminate an accounting concept known as "pooling of interests."

The CPA who is assisting you with an acquisition will be monitoring the progress of this change in the rules and a number of transactions may be accelerated in order to take advantage of the existing rules rather than being subject to the proposed rules.

CPAs generally also are knowledgeable in all types of insurance coverage. That knowledge does necessarily come from having attended college. It comes from having been attentive to their clients’ businesses and having assisted the clients in obtaining the coverage or having seen the mistakes that clients made.

The CPA works with the insurance agent in helping you get the best coverage that is right for you and your business and your family.

There is legislation being proposed nationwide, including New York, commonly referred to as the Uniform Accountancy Act or UAA, one provision of which will permit CPAs to expand the services rendered beyond the traditional accounting services that businesses have come to expect.

Although some accounting firms throughout the United States presently offer various financial services, the laws throughout the 50 States are inconsistent. The UAA will specifically allow CPAs to provide most of their clients with insurance, investment advice and other similar, but previously prohibited, services. "Uniform" does not mean exactly the same law in each of the states.

Also, although CPAs may be permitted to perform these services, they still will have to be licensed, in accordance with the laws of the states in which they wish to operate, by the regulatory insurance authorities and securities’ authorities as well as complying with any federal laws. Previously, the laws of the states and the rules of the CPA profession, prohibited accountants from offering such services. The CPA -- never underestimate the value.

Alan E. Weiner is the senior tax partner at Hertz Rubenstein & Co., Certified Public Accountants located in Melville.