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- [00:01]
A
Welcome to the AICPA Town Hall Series, your resource for the latest news and updates on pressing issues facing the accounting profession.
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B
Good afternoon and welcome to the AICPA Town Hall. I'm Eric Ouskerson, one of your hosts for today. We've got a great program in store for you. Today is February 5th, so we're going to kick things off with a fantastic firm leadership discussion with Jeff Weiner, who is very, very well known in the profession. Then we're going to have our DC Update. We're going to have a technical update on what's happening at the irs. We're going to have an interesting session on spotting and preventing burnout, some new PCPS resources, and then we're going to talk about a new important initiative being launched by the AICPA called the Profession Ready Initiative, which we'll be getting into. So what I want to start off with me here in our New York studio is Jeff Weiner. Just a little bit of background on Jeff. Jeff has had an amazing career. He joined Markham in 1981 after being at Deloitte for a short time. Marcum at that point had seven employees. The growth of Markham started. Jeff became managing partner in 1990. He built it into a $1.3 billion firm. It was acquired in 2024, at the end of 2024 by CBIZ. I can tell you he's widely recognized as an innovator, one of the leading firm CEOs, and someone who's been very, very supportive of the profession. So looking forward to the discussion, Jeff. So thanks for being with me here in New York.
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C
Thanks for having me, Eric.
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B
So let's just start a little bit and let's start talk a little bit about your journey from joining that seven person firm or six person firm. You know, there's many people on the town hall right now who are in firms of that size.
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C
Yeah, it was an overnight success that took 40 years and it was six people. I was the seventh person back in 1981. We did $300,000 of Reven. But it was, you know, we were on a mission and we were on a journey and we worked hard, we got lucky and, you know, the profession changed. Private equity started coming in in 2021 and all of a sudden the firm had value outside of just the retirement. So it was one of those things that it was never the intention, but it worked out well.
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B
Let's talk a little bit about, you know, a lot of these new business models that are emerging. You and I have had a couple of discussions on this I mean, there's many different options. Everyone's talking about pe, but when you look at the journey of Markham, there was a lot of things that you did to drive growth that were not PE related.
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C
Yeah, well, but listen, we started in 1981, so that was probably 40 years before PE came into the profession. We just wanted to grow the business. We were always motivated by servicing our clients well, not having our clients outgrow us. So we always invested in two things, which were talent and technology. And as we kept growing and learning, there were bigger clients who paid bigger fees. We kept reinvesting in the resources we needed to get those clients. So it just was a journey. You know, we went to work every day to build the firm.
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B
Well, Jeff, talk a little bit about investments in people in technology. It was about six years ago when you started looking at to accelerate some of those investments. You looked at some options that were available to you to help with your financing.
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C
Yeah, it was interesting. We started on our national expansion in 2008, and prior to that we were a New York based firm with two offices. And by that time, I think we're about $100 million with 450 people. And when the recession hit in 2008, we decided that we had to look for other ways to grow besides organic, because in 2008, 2009, there was very little organic growth. And we set out on this national strategy to become a national firm. And along the way we talked to firms bigger and smaller than us. And sometime you said, about six years before, I got introduced to a guy named Sam Shaw, who at the time was the CFO of Grant Thornton and today runs a company called Riveron. And Sam educated me as to the way the larger firms capitalize themselves, how they managed their balance sheet, and how they had tapped what was then the institutional market for long term debt. And it was an interesting conversation. And I said, well, if Rand Thornton can do it, why can't Markham?
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B
And what size were you at that time?
- [05:10]
C
Oh, this probably. We closed our debt offering in 2021. I would say we were somewhere between 6 and 700 million dol at the time. Sam had shared with me Grant Thornton's balance sheet. And I said, well, they're a couple of times bigger than us. So if you look at, I think they had $150 million of long term bonds. I said, well, Markham should have 50 and they had a line of credit behind it. I said, well, I just extrapolated down and went to our bank and I said, I need to get $50 million of long term debt and I need $150 million line of credit. I wasn't sure what I was going to use it for, but spent about six months with my bank and lo and behold, in the summer of 2021, July of 2021, we closed on a long term debt offering with two insurance companies and closed on a new revolving line of credit. All of it unsecured by the way. And we now had a war chest. And little did I know this was July of 2021, little did I know a month later, my friend Charlie Weinstein was going to go bring the first private equity deal into the accounting profession. I always tell people sometimes it's better to be lucky than good. But what that did is the long term bonds coupled with the revolving line of credit gave us the war chest to be able to do the same things that Charlie and then Joe Cooperman did with Citron. We had the capital to go out and compete with them and continue to do mergers and acquisitions.
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B
So when you think about the large G400 group, the 400 firms below the top 100, even firms smaller than that, do you think looking at financing options is something that they should consider when they're looking at M and A or tech investments?
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C
Yeah, I think certainly we were of a certain size when we did it. So a $30 million firm is not going to be able to go tap the public markets for debt like a $600 million firm was able. I think if you look at business, debt is always cheaper than equity. While private equity coming into the profession I think has been a great thing and will continue to be a great thing. Bringing in equity is always more expensive than bringing in debt. I remember back in 2010 we were a much smaller firm. We were probably closer to 200 million, which is still bigger than a lot of firms. And we had the opportunity to buy the UHY practice in New England. Now at the time that was a 20 some odd million dollar firm. But uh, why was interested in selling it and wanted cash. So we got a very attractive price from UHY and we went to our bank at the time and said, can we borrow $10 million to buy this practice? We had never borrowed money before, but it was well worth buying the practice. Paying back the loan and the revenue, less the expenses and paying back the loan still made money for Markham. So we borrowed money at the bank. It was a secured loan. I think we signed our names away, but it was probably one of the best investments we ever made. So borrowing money is not bad if it's for growth. And you understand the payback?
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B
Yeah, well, I mean, I've heard you say that before. It's critical. You want to use the debt to grow the business and have payback potential. So sometimes maybe using the financing to do a huge tech investment, that could have a lot more risk.
- [08:49]
C
It could have risk, but we always looked at why we were borrowing the money and what the return on it was going to be. And we used a lot of consultants over the years. And back in the day, we had Jay Nisburg at one of our retreats, and Jay drew a sailboat up on the whiteboard and then drew the waterline. You're a sailor, you'll understand this. And Jay put a couple of X's in the sailboat, one above the waterline and one below the waterline. And I'll never forget this, he says, if you take a risk below the waterline where the X is, and you put a hole in the boat, what's going to happen?
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B
It's going to sink.
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C
It's going to sink. If you take a risk above the waterline and there's a hole, well, you'll have to repair it. You'll have some fiberglass bills, but you're not going to sink your boat. And I always remembered that. So, you know, every time we took a risk, whether it was borrowing money, whether it was making an investment, no matter what it was opening an office, we always tried to make sure that the risk we were taking wasn't going to sink the boat.
- [09:43]
B
Some good advice. Well, let's step back a little bit and talk about how you're seeing the M and A environment. I mean, there's a lot going on. There's many key firms that have acquired an accounting firm. A lot of those firms are looking to make other acquisitions. So it's a very dynamic period.
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C
Yeah, no, I think it's great. And I credit Charlie for having the foresight to realize we needed outside capital in this profession for a long time. I said the public accounting business model was antiquated from the way we compensate people to the way we think people are to stay with our firms for 30 or 40 years and retire to the way we capitalize it. Private equity. When Charlie and Joel did their deals in 2021, the starting PE multiple was 10 times earnings to come into the accounting profession. I spoke to my friend Alan Colton the other day, and he was telling me that the latest multiples are closer to 14 or 15. So private equity has come into the profession. They realize there's a value to our companies, the multiples have gone up. There have been probably 15 or 20, I would say platform firms, the Eisner Ampers, the Citron Coopermans, the Cherry Beckerts, the Codenresniks and the Baker Tilly's that have become platform firms. And all those firms have gone on acquisition binges and brought in smaller firm. There's also the roll ups that I call them the Ascends, the Cretes. So what it's done is created a liquid market for accounting firms that did not exist before 2021. The multiples have seemed to stabilize. The run up from 10 to 14 has seemed to stabilize. The big platform firms. There's not as many of them because a lot of them have gone private equity already. But there used to be 44,000 accounting firms. I don't know the number today, but all of those platform firms and some of the rollups are looking for those firms to. And it's a simple model, Eric. If the multiple for the big firms is 14, well, they're buying those firms at 10, 11 or 12. And there's an arbitrage between buying a smaller firm and rolling it into a larger firm. And that's how they're creating value.
- [12:12]
B
Well, Jeff, one thing that you and I talked about earlier today was just the value, the value opportunity. And that's why all this PE money's coming in, is because they see value, the opportunity with technology. Now it's exciting. We talked a little bit about that earlier. So how are you seeing the role of technology, the role of AI with these firms with the value creation opportunity?
- [12:38]
C
Oh, it's tremendous. And I said it earlier. We were always big believers in technology. And technology has changed the kind of work we do. When I started in this profession, we used to do tax returns by hand. We used to reconcile bank accounts with pen and paper. Technology has taken away some of the boring work at Markham. Before AI and before really the adoption of technology, a first year tax associate would sit at a computer and input tax data. W2s, 1099, brokerage statements. Today the computer does all that. You scan it. You can even download it from a broker or an employer. The tax return gets populated by machine, not by a kid out of college sitting there doing key punch. They hated that work. It was a terrible first year experience. So now technology takes care of populating the tax return. And the first year kids are reviewing it and thinking about it. They'd much rather do that than be a key punch operator.
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B
Yeah. And now moving into advisory, the ability to kind of Better support the clients with all this information. In particular, right now, tax research, we're seeing tremendous opportunity with the large language models.
- [13:57]
C
Yeah, you can go on ChatGPT on your computer and ask them about some IRS code. It'll print you out pages. You have to read it. You have to understand that. You have to make sure it's right. But it saves you a lot. So it's a time saver. And it will convert people from doing boring rote work to actually thinking and consulting and make the profession more interesting.
- [14:21]
B
Well, I have a quick comment you and I talked about. A lot of firms are always thinking efficiency, efficiency, efficiency. But in some ways, that's a race to the bottom. You really need to think about the value and the evolution of the service that you can deliver based on these new capabilities.
- [14:37]
C
Right? So take just a simple thing like a tax return. If somebody was paying you thousand dollars for a tax return and it was costing you $600, without technology, they're still willing to pay you $1,000. If you can reduce the cost of delivery. Let's say using technology, you can reduce the cost of delivery down to 100, but they're still willing to pay you 1000. What else can you do for them that they will appreciate? What's the value add you could add on top of that tax return to give the client. So you give them better service, you give them value, and you don't reduce your revenue. You know, you have to be smart about it. Accountants have a tendency to want to charge less, and that's the reason that someone's hiring them. I would tell you, charge more and give the client a reason to pay you more rather than less.
- [15:24]
B
Well, and those are the kinds of things that we're thinking through, just the evolution of the services. You need to change the service, even change it, you know, if it's an annual tax service, change potentially to a subscription tax service where you're just giving continual advisory input on how they can drive a more successful business. Well, let's talk a little bit about leadership. I mean, you've thought a lot about this over your career. So maybe some leadership principles for the town hall community.
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C
Well, leadership is a tricky thing. You can't lead unless they're willing to follow. That's number one. You have to remember what your job is and make it not all about you. You can certainly reap the benefits, but if you're going to lead, you have to create an environment that people want to work in. And I will tell you, before we sold to CBIZ at the end of 2024, we had 4,000 people at Markham. It wasn't a place for everybody. It took a certain person. We were highly accountable, we were highly motivated. So if you wanted to hide, if you didn't want to succeed, it probably wasn't the place for you. But for the people that wanted to be there, it was the best place to work in public accounting. And my obligation was to create the environment that these people could work and succeed, that supported them, that provided them the resources they need where we could get the clients we wanted. But, you know, leadership is a big responsibility. And, you know, every night I went to sleep knowing I had to support 4,000 people and make sure that every two weeks they could get paid, manage that balance sheet. But, you know, we had 4,000 people working for us, which means that we were paying 4,000 mortgages or rent. We were probably paying seven or 8,000 car payments. We were feeding. If you extrapolate out with kids and stuff like that, probably 10 to 12,000 people a day. And when you realize the, the enormity of the responsibility, you realize leadership is not just about getting up in front of the room and speaking and getting a big paycheck, but it's the responsibility that comes with it. And the people who are sitting in the audience, the people who are working with you, are entrusting their career, their livelihood, their well being to you, not screwing it up.
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B
So someone starting out today, what advice would you provide them?
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C
You know, it's interesting I've said this before, But I have two older children and my second son, Leo works for TD Bank. He's had that job. He's 31 years old and he has that job since he came out of college. And when he started his job, I said, leo, I'll give you three pieces of advice that no matter what job you have, what career, or what your aspirations are, if you want to succeed, there were three simple things to do. And back 10 years ago, it was be the first one in, be the last one out, and whatever they ask you to do, do more. And I think those hold true for whatever profession or industry you're in. When Covid happened and people started thinking, well, working from home is the end all and be all, I added a fourth to that, and that was show up. You know, people have to know your name. So you know, Leo would make sure that who, anyone in the office who he worked with knew his name was Leo. So this way, you know, business goes in cycles and anyone who thinks when the down cycle hits and they're looking to thin out the herd. The people they know, the people they see are going to be the last people on that list. You may do great work, but if they don't know you, there's no connection. That's a problem. So be the first one in, be the last one out. Whatever they ask you to do, do more and show up.
- [19:17]
B
Well, Jeff, I mean, thanks for sharing these reflections. It's great of you to come in here, come into the studio. You are missed by many. I've been at a few events and recently there was a big, large, firm event and it was the first one you hadn't been at in a number of years. And your name was brought up by many. So thanks for your leadership. Thanks for being here with us today.
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C
Thanks for having me, Eric.
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B
Thank you. So now we're going to move to the DC Update. Let me bring up Rachel Dressen. Rachel, great to have you as always. Plenty going on in Washington, D.C. so let's jump right into it and talk about the state of the government.
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D
Yeah. Great to be with you, Eric. So first of all, I'll talk a little bit about government funding just to update the town hall community on the latest, not even be aware, but there was a partial government shutdown this past week. It started on Saturday morning at 12:01am the six of the 12 appropriations bills that had not been passed, the funding expired. And that did include treasury and the SEC and irs, which Melanie will talk a little bit more coming up on the impact of that on the irs. But there was a shutdown and it lasted until Tuesday afternoon. They were able to come up with enough votes to pass legislation to fund five of the six remaining appropriations bills. So those five, which includes treasury and therefore SCC and irs, they are funded until the end of the fiscal year, so through September 30th. So they are fully funded. The one that is remaining is the appropriations bill to fund the Department of Homeland Security. So for that one, they did an extension of the funding. So it's called a continuing resolution or a cr. And they are funding the Department of homeland security until February 13th. And that is notable just because it also includes funding for tsa. And so anyone traveling, they will be following that one to see whether or not the Congress can come up with a longer extension of that or to continue to fund the Department of Homeland Security through the rest of the fiscal year. Otherwise, there could be a shutdown of that, which would include tsa. But also they also do the processing of visas. So that is something that we are following. I also just want to mention that we've talked about this on the town hall before. Just the very narrow majority in the House that Republicans have. So this last week they swore in a Democrat member who won in a special election in Texas, which means that Republicans only can lose one vote on the House floor when voting on a bill if it's party line. So that majority has gotten even smaller. So that's just something to keep in as we look throughout this year on legislation that they are working on trying to pass that they are dealing with a very narrow majority if Republicans are trying to pass legislation on a party line vote.
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B
Well, there's also some interesting developments at the pcaob.
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D
Yeah. So big news on the pcaob. So at the end of last week there was an announcement by the SEC that we will see four new board members at the pcaob. This is not a surprise. This is something that we were expecting. SEC Chair Atkins came out with a solicitation for applicants back in the summer and so we've been waiting for an announcement on this. The names that he chose is Jim Logo Fetus. He will be the chair of the pcaob. He has a background of having worked for the firm EY for over 40 years and he currently is on the board of the Republic bank of Chicago. Then for the others there is Mark Calabria. He has some DC experience. He currently is at OMB and he's also an advisor at the CFPB as well as he has some experience having worked on the Hill. Then also Steve Lowton. He is actually currently at the pcaob. He is a counsel for Christina Ho who is a board member right now. He's worked in treasury for a number of years before that. Then the other new name is Kyle Houptman. He also has DC experience. He is the current chair of the National Credit Union Administration. Prior to that he was a staffer in the Senate. And then for the fifth board member seat, it's George Bodick. He is currently on the board and he will continue to be on the board. So big news for the pcaob.
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B
There's some really interesting developments there.
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D
Yeah. So now just moving on to the Department of Education. So we've talked about this issue in the past and I'll just give a little bit of background on it for anyone who might be new to the town hall. So back in November it came out that the Department of Education was working on the regulation for a provision in the one big beautiful bill to cap graduate student loans and the cap levels are either $50,000 or 20,500. And what we saw in Novemb was in the list of professions. Accounting was not in that list of professions. So that was of course extremely concerning to us. And we strongly oppose that. We, along with state societies, we came out with a statement as well as sending a letter to the Department of Education. The AICPA also sent a letter with a coalition of others opposing this. We strongly believe that we should be included as a profession. Accounting is a profession. We are a highly regulated profession that has requirements of rigorous education requirements and experience requirements as well as CPE and taking the exam. So we oppose what we saw in November. And just at the end of last week, the proposed rule was published in the Federal Register. So what that means is it kicks off a 30 day comment period. But what is important, very important to note is that in this publication in the Federal Register, they included language stating that the Department of Education in using the term professional student, they're only using it solely for the purposes of implementing these loan limitations caps in the one big beautiful bill and that they are not making a value judgment on whether a graduate student or program is a professional. So that is very promising language and we believe that it is a result of a lot of our efforts and engagement. And we are reviewing what is in the Federal Register and we will be commenting during this comment period. So that's the latest on the Department of Education issue.
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B
And I think one thing we've heard from the town hall community, Rachel, you know, some people feeling that 100,000 cap is enough and that, you know, we understand that and it's more about the issue you well stated here about the profession label.
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D
Exactly. Yes. And these lists, it's a concern because these lists, you know, if they pop up somewhere, they could be used somewhere else in the future. So it's very important that we are designated as a profession.
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B
So crypto, it continues to be top topic in D.C. yeah.
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D
So a lot of activity has been happening related to digital assets over the past year or so. So just as a reminder, the House passed legislation called the Genius act to provide a regulatory framework on stablecoins last summer. And then they also passed the Clarity act, which is a little bit of a broader bill on digital assets. And that Clarity act has some language to fill in some gaps of the Genius act on internal controls and an annual attestation over issuers stable reserves. And just wanted to update everyone that the Senate is working on their version of the Clarity act. And the Senate Agriculture Committee, they marked up their bill this last week. And so the other piece of this would be for the Senate Banking Committee to mark up their bill. They had scheduled a markup in January, but it's been postponed and has not been rescheduled yet. But there is activity continuing to go on on digital assets. So the last issue I wanted to talk about is one in which we are very excited to announce that we expect legislation in the Senate to include accounting in the eligibility for K through 12 STEM grants. And what this would do is it would mean that these existing grants could be used for accounting so students at a younger age could learn about accounting and it might be something that they want to pursue when they graduate and go on to college. So there is a House bill that's already been introduced this Congress, and we are very happy to announce that we expect either today or tomorrow for the introduction of the Senate bill.
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B
Well, that is exciting. So let's hope that makes good progress. It's a big, big step forward. So, Rachel, thank you. A lot of questions coming in, which we'll try to get to during Open Forum.
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D
Great.
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B
So I now would like to bring up Melanie Lauritsyn, who's right next to you there in the DC Studio. Melanie, great to see you.
- [30:12]
E
Likewise, Eric. So let me go ahead and jump in with a continuation of what Rachel was talking about, the government shutdown. The IRS, the shutdown is over and they are funded through September 30th, which is great to hear. Now, in anticipation of the government shutdown, the IRS did come out with a contingency plan, which is what you see. And they fully, fully accepted 100% of IRS employees, meaning that they were still going to work for five business day and that funding was going to come from the Inflation Reduction act, which was some leftover money that they still have. Also, in anticipation of a government shutdown, we went ahead and we moved forward with a comment letter asking for the irs to be 100% accepted. And we felt, well, you've always heard me say there are no winners in a shutdown. But in this particular year, we felt it was even more critical the IRS could be maintained open. What we saw from the Treasury Inspector General, Tax Administration, they came forward with a memo in which they covered the IRS readiness for this filing season. And what we saw were some glaring statistics. And they compared the paper backlog from 2019 to 2024 and then 2024 to 2025. And essentially from 2019 to 2024, the paper doubled from 2024 to 2025, it increased a quarter which overall, that tripled the paper backlog. So shutdown could have had some detrimental effects. The other information that this ticked a report said that there were 17% less seasonal employees. And those are the employees that pick up the phone during the filing season. And that actually would bring it back to staffing levels of 2022, which is where there were concerns. And that is with when the Inflation Reduction act funding came along to try to improve taxpayer services. Moving on to the next slide, Erin Collins actually released her annual report to Congress on 2025. And she also gave her thoughts for 2026. And she described it as complexity amid constraint for 2026. And she brings that up because obviously with HR1, there were over 100 changes to the tax code. So there definitely is compl there, which means programming and also guidance that people need to see. But then overall with the workforce, there was a 27% loss of workforce. But it wasn't just all the workforce. A lot of it was leadership. And there were substantial numbers of people who left that had tenure and brain. It became a brain drain for the irs. And of course, under these circumstances, they still have to maintain the levels of service. And what she does disclosed in the report, was that for 2025, the IRS actually processed about 165 million returns. Of that, about 104 of those returns had refunds averaging about $3,000. But then she also talked about the delays in refunds. And one of the areas where there's severe delays has to do with victims of identity theft. And there is a current backlog of over 300 cases in that area. And of course, finally, there's the level of service that we have where IRS tries to achieve 85% level of service during the filing season. And that's the rate at which they pick up the phone. And in 2025, they achieved 60% moving to the next slide. And of course, all of this is what we will be tracking. But Erin Collins also came forward with the most serious problems that taxpayers are facing. And I'm sure a lot of you could commiserate. And I will only highlight two of them, one of them being the Tax Pros online accounts, where she goes on to recognize that, you know, taxpayers work in conjunction with the irs, and if we have the right tools, we're able to achieve a lot of the work and help with reducing the burden and workload for the irs. And so therefore, it is one of her focuses. And she has recommendations for the Tax Pro account, specifically saying that, you know, any to be more reliable, more consistent more access to information. Wouldn't it be great if we could see all client notices in one system or even just their W2s or 1099s? So definitely that is something that is near and dear to our hearts. She also brought up the issues with the centralized authorization file, the CAF numbers, where she highlights that there is still manual processing of those powers of attorneys. And because of that, right now they have about 35,000 numbers backlog of those, which means that those practitioners are prohibited or can't move forward with representing their clients and clearing backlogs and information that need to occur. So take a look at the report. The link was on the previous slide for that report and I'm sure you guys will empathize with a lot of what was in that report. Then moving on to our round robin, the IRS last week did release some FAQs with the mandatory electronic payments and but at the end of the previous week they also relieved FAQs with regards to qualified overtime. Now for both of those FAQs there is not new information and we've actually reached out to the IRS with the electronic payments because the new FAQs actually keep stating that guidance will be released before the start of the filing season. And we have not seen that guidance and we're confirming whether or not, hey, have we seen all the guidance we're going to see or is it going to drop in the middle of filing season? But for now, as a recap, you can still submit paper checks to the irs. And as far as the electronic refunds, if they aren't able to deliver it to you within six weeks, they will send you a paper check. Also, the IRS did announce relief in extended period to file amended IRAs through at least December 31st of 2027. So just be aware of that. And finally, I want to highlight a webcast which is the reimagining the tax season with AI that that's February 11th at 2pm Eastern time. And that webcast is really going to focus with how you can use AI in your practice to alleviate some of those burdens during this busy period of time. Eric, back to you.
- [36:39]
B
Well, thank you Melia. A lot covered both of you and I can take a look at the questions and maybe answer one or two during Open Forum. So thank you very much now. Now I'm looking forward to bringing up this important overview of this important new resource that PCPS is releasing and Lexi Weber. Lexi, it's great to have you on the town hall. I think this might be one of the first Town hall you've been on. Lexi is part of Lisa Simpson's team AICPA Leadership Academy grad, 10 years of experience public accounting and now with the AICPA. So so welcome Lexi and I'll let you introduce Lauren.
- [37:23]
F
Thank you Eric. Yeah, I'm excited to be here. This is my debut on Town hall and it's great to have a full circle moment being a Leadership Academy graduate, now overseeing Leadership Academy. So it's been, it's been a special moment but I have Lauren Baptiste here with me as well today and Lauren is the founder of Ekoloa Wellness. She's also a burnout prevention expert and executive coach who helped us build our PCPS Burnout Prevention toolkit. So we're excited to have her on Town hall with us today to talk about why burnout is so important of a topic for us to talk about and discuss consistently, but especially this time of year. So on the next slide I just wanted to highlight, the toolkit was really developed to help individuals and firm leaders, organizations and mentors really identify those signs of stress and enable them to create a culture that prevents burnout in the future. So we've come together through emerging professionals, which is the area that I oversee PCPS and Lauren with Akoloa to build out the toolkit which aware has awareness for a self assessment and really building out how do we prevent this from happening? Because it's such a hot topic that we've continued to discuss year over year and we also have a podcast that'll go further into it that you can also also click on when you download the slides. So on the next slide I just wanted to first start off and ask Lauren, why is burnout such an important topic to talk about?
- [38:50]
A
Thank you Lexi. It is great to be here. If there's one thing we know about burnout and accounting is that it rarely starts with a breaking point. It builds day by day through ongoing pressure, increasing demands and a constant expectation to over deliver. This looks like client deadlines, staffing shortages, busy seasons that seem to feel like they never quite end and the pressure that many of us put on ourselves to always perform at a high level. The AICPA engaged me to develop the Burnout Prevention toolkit after recognizing the need for practical profession specific guidance that helps firms and professionals recognize burnout earlier and respond in a more intentional way. Because if we want consistent performance, we have to build smarter ways of working. This toolkit gives individuals, managers and leaders shared language, clear frameworks, actionable tools so that burnout can be addressed earlier. Not when somebody is already struggling.
- [39:50]
F
Thanks, Lauren. And you know, I think it's something that's so interesting to talk about as well, because so many of us has probably felt burnout at some point in our professional careers. So I think a lot of our members who are on town hall today are probably thinking, well, where do I get started? So if you were an individual or a firm or organization, how would you get started with addressing burnout in the workplace?
- [40:14]
A
The best place to start is with the burnout awareness self assessment. We designed it to create immediate clarity from where you are from a physical, cognitive and emotional capacity standpoint, which is so important in the work that we do. Many high performers don't actually recognize they're trending towards burnout until it begins to already impact their focus, their decision making, or even how they show up in their annual performance reviews. For individuals, this is a powerful self check. For managers, it creates a more informed starting point for conversations with their teams. And at the firm level, it acts as an early diagnostic, helping leaders spot patterns before before they in turn into retention issues or performance challenges. Importantly, it's that this tool is not meant to label anybody. It's about awareness. Once we have a baseline, then we can make smarter decisions about how we work and how we resource our teams.
- [41:11]
F
Thanks, Lauren. And I know you highlighted the burnout self assessment. And if somebody were to start with the self assessment, what do they do after that? I think that's always the common question is, okay, here I took the self assessment. I know where I fall on the scale of burnout, but what do I do after that? How do we start to identify those early warning signs of burnout for ourselves and our team members?
- [41:34]
A
Absolutely. Once you understand your baseline, then the next step is understanding the early signs of burnout. Because for many of us professionals, burnout doesn't feel dramatic. It feels like an ordinary day. I in the life. Because we've normalized the pace of long hours and working hard, this might look like logging in tired, struggling to focus on work that used to feel manageable. Rereading the same email over and over, maybe even feeling more irritable than you used to be. Maybe second guessing decisions or at the end of the day, wondering what you actually accomplished. Many of the professionals that I work with are highly successful on paper, but they're operating at a pace that simply isn't sustainable. Because this level of pressure has become so normalized, we often assume it's just part of the job, but it's not. That's why the toolkit includes The Early Warning Signs guide as a tool to help professionals spot patterns sooner. We also pair that with the weekly burnout prevention check in handout for short moments to step back and ask yourself what's my capacity right now? What's creating the most pressure? What needs to shift this week? When these conversations start earlier, teams can respond earlier and better before the strain compounds.
- [42:53]
F
I love that. And making burnout something we can talk about is so important. So on the next slide I really want to zoom out into the organizational level. How can firms and organizations implement a toolkit as part of their strategic planning or firm culture initiatives?
- [43:10]
A
This is where burnout shifts from individual awareness to organizational resilience. And that's exactly how we structured this. We can see it as me, the human who needs it, but the organization who's made up as humans. Just like Jeff mentioned earlier, talent and technology, which we can talk about later. But across firms, we want a proactive strategy around burnout because truly it's one of the ones that's most needed and often most delayed as an area of of focus. Because when deadlines come up, the conversations can get pushed till after busy season, after the deadline when things are easier. But the cost of avoiding burnout is significant. Replacing a single experienced professional can cost firms hundreds of thousands of dollars per employee. Just when you factor in lost productivity, recruiting, onboarding and institutional knowledge. The PACE Framework was created to help leaders step in earlier and lead intentionally. PACE stands for pinpoint, analyze, calculate and engage. Pinpoint the early signs before performance is impacted. Analyze what's actually driving the pressure. Calculate the cost of inaction because burnout is an expensive operational and leadership issue that can direct directly affect your retention and then engage by making thoughtful adjustments to create a more effective way to operate not only for the business but for the people that are in it. In order to support this initiative, we also have the Implementation Guide inside the toolkit which provides leaders with a step by step process for integrating burnout prevention into how your firm already runs. You don't have to overhaul just by thinking through the small steps of onboarding and performance conversations, even thinking about how we plan our engagements, or even thinking about team discussions. The firms that proactively incorporate burnout prevention see stronger engagement in the near term and higher retention in the long term.
- [45:18]
F
Thanks Lauren. And you know one thing I want to point out to the viewers as well in the resources within the town hall, we did add in two PDFs that are one pagers for you. The first one goes through the burnout self assessment and how to access that as well as our podcast and the toolkit. And then the secondary one goes through the PACE framework and it just gives you a one page overview that really highlights it. The toolkit will get much more into it, but I know we just threw a lot of acronyms at the audience and I know we just gave a lot of different tools and resources. So there's so many great things that are in this toolkit that you can really take from a practical and simple approach. Which is really what the goal was when we were creating it, Lauren, was just to figure out how do, how do we do this and tackle this without making it feel like such a daunting task.
- [46:07]
A
Absolutely. As we think through, where do we go from here? Because this is a big resource, this is a big initiative, but it's very important. We've been talking about burnout for a long time when it came out in 2019 from the world World Health Organization. But if we think about it right here, right now, our profession runs on highly skilled people. Firms can invest heavily in technology, but the organizations that differentiate themselves are the ones that have strong leaders from the get go and focus on them just as much as the people and the systems that support it. So when the talented professionals disengage or they want to leave, the impact extends far beyond one role. We need to be thinking the long term of our teams, our clients continuity, and the future pipeline of our leadership. Burnout prevention isn't about lowering our standards. It's about ensuring that our people can sustain high performance without stress or burnout. When firms strengthen their leadership capability and equip their professionals with the skills to navigate pressure effectively, they don't just retain their people. They build a profession that people want to stay in. Burnout prevention isn't just about supporting people. It's a direct investment in performance, retention and the future of your firm.
- [47:26]
F
Yeah, and I think that's such an important piece, Lauren, that you ended with, with the future of your firm or your organization. Because through our Rise 2040 initiative, we have consistently heard from members from across the globe how important it is to continue to make sure that we fulfill our pipeline. Not only from CPA candidates coming into the profession, but also our professionals that are in our firms right now. And how do we continue to make a great culture for them to be in. And burnout is part of that and being able to prevent that. So I think that's so important and I really can't thank you enough for your expertise and sharing this with us and helping us us create this toolkit, I think it's going to have a really great impact on the profession overall. And just to really re emphasize that professionals are the human nature element of the profession, I think that's what makes it so special. AI can't build relationships with your clients or with your vendors and your co workers. Right. That's something that we have to be able to do on a human level and we have to take care of ourselves first to do that.
- [48:29]
A
Absolutely.
- [48:31]
F
So thank you so much for joining us in this conversation, Lauren. I just wanted to highlight as well, we also have our 2020 PCPS busy season fund calendar. I know we're already one month into busy season, but I promise you there are some great tactical ways within the fund calendar that you can implement right away at your firms and organizations to just help alleviate some of that stress this busy season. Whether you're in public accounting or you're in corporate finance or in industry somewhere, I can promise you I know the pressure is on with month end, year end close, getting those audit and tax returns underway. So this is a great resource as well for you to check out.
- [49:13]
B
Well, thank you both for that session. Well received, a lot of great comments.
- [49:21]
A
Awesome.
- [49:21]
F
Thank you, Eric.
- [49:22]
E
Thank you.
- [49:26]
B
Now I'd like to bring up Carl Mays. Carl, it's great to have you back on a town hall. This is not your first town hall and it's also welcome back to the aicpa. So, Carl Mays, I think many of you know Carl. He was a former VP leading a number of our important quality centers here at the aicpa. Then he left and was part of the national office at aprio, a top 25 firm, and now has returned to the AICPA to lead a number of important initiatives. So welcome Carl.
- [50:03]
G
Thanks a lot, Eric. You know, good to be back. And it really came back, among other things, to lead this initiative. So really excited to share about it here today, you know, if we want to advance to the next slide here. So, you know, profession ready is what we're talking about. And you know, in terms of profession ready, what's our objective with it? When you hear profession ready, I'd say think about skills gap at the entry level and kind of solving for that skills gap. And I go back to what Jeff said earlier in this session. He was talking about how when we came out of school, we were manually completing tax returns. I was manually ticking and tying and vouching and tracing and so on. And a lot of those things are increasingly either being offshored or they're being Automated and folks are less leveraging AI for those purposes. So Profession Ready is about recognizing what we've heard through Rise 2040, which is a need for talent transformation, especially at that early career level, and a need to kind of bridge those gaps. You know, when, when the tax returns already completed, you need a different set of skills. Right? So we're taking kind of a three pronged approach to it. We're going to start with building a skills framework. So what are the skills that are needed in order to, you know, execute responsibilities today versus what they were 20 years ago? And we'll issue a skills framework in 2027, which we'll use to help advocate for the profession and help advocate for the needs of employers with our stakeholders. And we'll talk more about that in just a second. But you know, the second thing that we're focused on here is learning. You know, technology enabled learning. So we've got AI, we' got simulations and so on. Imagine going back to that tax return example. Imagine you have somebody who's going through the process of a simulated tax return completion process and they've done a dozen of them before they ever touch a tax return for the firm. And they've been exposed to all the most common issues. That's a tremendous value. And we're hearing from firms that that's a need. So that's kind of part of this initiative. And then also working with the academic community, when we see gabs coming out of the education system, we want to provide the academics with the best practices and the resources that they need in order to prepare folks for the workplace. So in terms of timeline, you can see down there in the bottom right, you know, we'll be conducting our research throughout 2026. We'll expose in 2027 issue by the end of 2027. And the rest of of our initiatives around learning and academic preparation are following a similar timeline. We want to go to the next slide here, Eric. You know, so success really does rely on your input, guys. So in terms of that research and in terms of us getting a good understanding of what the skills are and what the needs are today, we really do need input from the town hall audience and from the profession in general. We want whatever we produce to be reflective of your needs. So encourage you guys to take the survey. You know, if, if you've identified gaps at that entry level, if you have views on what's going to be needed on a go forward basis from a skills and competency perspective, we'd love to hear from you. And you can see the QR code there, or you can follow the link just below that and provide us with your input. So, looking forward to hearing from you guys and providing additional updates going forward.
- [53:41]
B
Well, Carl, I think this is an exciting initiative that you're leading and it's an important one. And when you think about what's happening, there's massive evolution going on in the practices. I mean, technology is transforming and technology is transforming the practice of finance and accounting. But what we like to talk about is the technology, it's the people, and it's the process. So firms are going to be evolving their processes and you got to continue to evolve the talent story. So it's a talent story at all stages. So I think this initiative, in parallel with a lot of practice transformation that's occurring, it's really going to help propel things forward. And I think it's something that we need to do. But the profession is well positioned because as we were talking about earlier in this town hall, there's just a lot of value opportunities, a lot of value opportunity with these new technologies, a lot of productivity gains, but also evolution of service gains. So thank you.
- [54:41]
G
Yeah, thanks, Eric.
- [54:44]
B
So we're going to move into our Open Forum session so we can drop the slides. One thing, you know, this is, you know, I think, was it Monday or two Monday or Tuesday was Groundhog Day, Carl. Right. Which day was it this week? Do you remember?
- [55:00]
G
So it's the second and he's only right 35% of of the time from what I understand. So just take that for what it's worth.
- [55:06]
B
I want to bring up one thing here because we got corrected. This isn't a Groundhog Year. We are in 2026. I said 2025 to start out, so that was my Groundhog Day moment. Apologize for that. So anyway, we're definitely in the new year, so I got a few happy New Years out there. So, Melanie, any questions that you saw from the tax group here that you'd like to tackle?
- [55:35]
E
You know, there were a lot of questions still with the mandatory electronic payments. And we went into a little bit more detail in the last town hall. So I definitely recommend going into the archives. But yes, you can still submit paper checks to the IRS for now and trust to get a carve out, because that was another question I saw coming in quite a bit.
- [55:55]
B
One there was about the link. There's questions about the toolkit. So we will include, you know, the links to the burnout toolkit in the newsletter. So if you had any issues downloading those Let us know. Here's another tax related question. Any updates on the extension payment for Safe Harbor?
- [56:17]
E
So that's a safe act and that is still a priority. We do know that the TAs or the taxpayer Assistance and Service act discussion draft, the TAS act discussion draft is beginning to be looked at more closely now on the Hill and so we are hoping we will see movement on that soon. So still a priority, still moving forward.
- [56:40]
B
Lauren and Lexi, here's a question regarding your session. You know, what should we do first? We notice one of our coworkers beginning to show burnout symptoms.
- [56:52]
A
Lexi, do you want me to take it?
- [56:53]
B
We're in a little bit of a lightning round here too.
- [56:55]
F
Go ahead and take that, Lauren.
- [56:57]
A
Yeah, what I recommend if you notice your colleague is experiencing burnout, the toolkit's a nice way to be like as a team. We're going to go through this or here's a resource. You don't want to say you're burned out. Here you go. You want to say, oh, I took this quiz. What do you think? Where do you rank on it? Busy season's coming, so make it fun. Even consider the calendar as a way to reduce stress without pointing at your burnt out. We have a problem with this person. Let's get creative and be kind and see how we can all lift one another up.
- [57:30]
B
That's thank you. And just Carl, just a lot of we'll get you the comments. A lot of encouragement for this profession ready initiative that you have underway. And there's a couple comments from people in academia saying they're really looking forward to seeing the the results of the survey as well.
- [57:51]
G
Absolutely. I mean I think it's a great opportunity for us as the aicpa. I mean we heard this is a need and this is what we're about, man. It's a chance for us to advocate for the profession and a chance for us to help close that gap. So really excited to work with all stakeholders including the education community.
- [58:12]
B
Okay, well thanks everybody. Thanks for being on today's Town hall and let me just walk walk through some resources and updates. So start. We've got this webinar moving back one slide related to reimagining tax season with AI. This was already referenced earlier by Melanie so you can learn, you know, about the power of this AI tax based research capability that is being brought forth by a number of entities, one of them being Blue Jay. We also have other resources related to firm transformations and that we've been talking a lot about. The first is a white paper here on automation and what that means for the firm, a number of ways to drive growth that were outcomes from our digital CPA conference at the end of last year. And then we've just got our overall CPA.com AI Initiative resource area, which you can leverage. So the upcoming town halls the next one will be February 19th. Then we've got two scheduled in March. On the March 5th town hall, we will have Dan Hood from Accounting today and he's going to give us a preview of the top 100 reports. So that should be really interesting. So here's our resource page. We will be doing a rebroadcast of this town Hall Monday, February 9th at 1pm and you have all the resources available at this site and we also will be pushing our newsletter to you on Tuesday, which will have a lot of highlights from today's town hall. So great being with you. Hope you all stay warm. It seems like it is getting a little warmer and we really appreciate being with you today.
- [60:13]
D
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- [60:22]
E
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D
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