AICPA Town Hall – December 11, 2024

Theme: Tech Trends, Talent Pipeline & Beneficial Ownership Information (BOI) Updates

Main Episode Overview

This AICPA Town Hall, hosted live from the Digital CPA conference in Denver, dives into three crucial themes shaping the accounting profession in late 2024:

1. The accelerating impact of artificial intelligence (AI) and tech trends on firms
2. Ongoing developments in talent recruitment and pipeline strategies
3. Updates and best practices around Beneficial Ownership Information (BOI) reporting under current legal uncertainties

Hosted by AICPA executive leads, the episode features in-depth discussions, expert insights, and audience Q&A on these pressing topics, making it essential listening for practitioners adapting to rapid changes in the field.

Key Discussion Points & Insights

1. Digital CPA Highlights & Tech-Driven Firm Transformation

• CAST Services Growth & SARs 21 Update
  • The Client Advisory Services (CAST/CAAS) sector continues to outpace overall firm growth, reporting a 17% year-over-year increase and 29% growth in net client fees per professional ([01:13]).
  • Firms specializing in niche verticals (more than 50% of revenue from one area) reported over 20% growth ([02:14]).
  • SARs 21 Section 70: New exposure draft means compilation standards may not need to be applied to CAAS engagements, leading firms to move toward consulting standards. Feedback is encouraged by December 20th ([03:53]).

Notable Quote:

“CAST leaders see this as a huge step forward in making the CAS services more efficient and effective while maintaining that focus on the public interest protection.”
— Lisa Simpson ([04:04])

2. Washington D.C. & Legislative Updates

Government Funding & Tax Reform

• Government funding deadline is December 20, likely leading to a continuing resolution (CR) until March 2025, raising concerns about a possible government shutdown coinciding with tax season ([05:27]).

• 2025 will be a major year for tax reform; two budget resolutions may push actual tax changes later into the year ([06:52]).

• Key Cabinet Picks:

  • Scott Besant (Treasury): Hedge fund background, focus on extending TCJA provisions, possible spending cuts ([08:33]).
  • Paul Atkins (SEC): Likely to revise or scrap some recent enforcement-heavy SEC rules ([10:40]).
  • Billy Long (IRS Commissioner): Recent Congressman, background in ERC work ([11:48]).

3. BOI Reporting and Corporate Transparency Act

• Texas Court Decision: Recently declared the Corporate Transparency Act likely unconstitutional, issuing a nationwide injunction barring FinCEN from enforcing BOI reporting for now ([13:18]).
• Best Practices:
  • Inform clients about the injunction and need for a written decision on whether to file BOI ([14:31]).
  • Collect relevant client info now in case requirements change suddenly.
  • AICPA is actively advocating with Congress for further BOI reporting delays ([17:31]).

Notable Advice:

“The client needs to decide if they would like to continue with the BOI submission process. Make them tell you that in writing.”
— Lisa Simpson ([16:27])

4. AI Trends & Opportunities in Accounting

Keynote: Pascal Finette (AI/Innovation Expert)

• Mass Adoption:
  • In just one year, practitioner use of AI tools like ChatGPT, Gemini, and others has soared from 20% to nearly universal among Digital CPA attendees ([18:56]-[21:30]).
• Tech Landscape:
  • Leading models (GPT-4o, Claude, Gemini, Llama, etc.) are similar in performance.
  • Industry shift toward vertical-specific models (e.g., medical, tax) and models with large memory windows ([22:30]).
  • New AI search tools (Perplexity AI, NotebookLM): Streamline research, can even auto-generate “fake” podcasts summarizing dense regulations ([26:48]).
• Frontier & Responsibility:
  • LLMs only predict the next word—they do not understand content, leading to possible “hallucinations” ([27:26]).
  • Practitioners must test AI limits continuously—capabilities are not binary or always predictable ([28:12]).
• Enterprise Use:
  • Most value today is in text management (code generation, summaries, chatbot support), while agent-based automation is still developing ([31:35]).
• Strategic Planning:
  • AI improvement is inevitable; strategic planning must account for rapid change, multiple contingencies, and ongoing disruption ([35:09]).

Notable Quotes:

“This AI you’re using today is literally the worst it will ever be. So if you’re not happy with it today, just wait a little bit, it’s going to get better.”
— Pascal Finette ([35:09])

AI in Practice: Avni Desai (CEO, Shellman)

• Rapid Adoption: Security and compliance professionals have moved faster on AI than on previous technologies like cloud computing ([37:12]).
• Practical Use Cases:
  • Internal chatbots improve HR response, accelerate employee training, and assist in marketing content generation.
  • Early forays into agentic AI for automating control and audit procedures—progress evident, but error rates remain a barrier.
• Risks & Reality Check:
  • AI is a productivity multiplier, but expectations of an “overnight fix” are unrealistic (“AI is the corporate Ozempic — everyone thinks it will cut the fat overnight, but it’s not”) ([41:36]).
  • Data security, privacy (especially regarding client data/CCPA/GDPR), and over-reliance remain top concerns—professional oversight is crucial.
  • Firms must practice “trust but verify” when leveraging generative AI in critical workflows ([41:36]).

5. Talent Pipeline & Workforce Transformation

Lexi Kessler (Chair, National Pipeline Advisory Group)

• Six Pipeline Themes:
  1. Telling a More Compelling Story: Focus on output value, not hours worked.
  2. Addressing Education Costs/Time: Advocates for competency-based (not strictly hours-based) requirements; exploring options below 150 credit hours ([44:00]).
  3. Academic Engagement: Retool introductory/intermediate courses to pull students in, not weed them out.
  4. Employee Experience: Raise compensation, manage workloads, leverage tech for work-life balance ([44:57]).
  5. CPA Exam Support: Improve study support, flexible exam timing.
  6. DEI Expansion: Scale up immersion programs and facilitate transitions (e.g., community college to four-year degrees) ([46:44]).
• Action Step: Pipeline Pledge: Commit to two outreach or mentoring activities per year. Even 150,000 members could have enormous collective impact.
• Compensation is foundational: Raising salary competitiveness is key to attracting/retaining talent ([48:17]).

6. Technical Updates & Tax Issues

• IRS 1099-K Threshold:
  • 2024 transitions to $5,000 threshold (down from $20,000 pre-ARPA), with full $600 enforcement deferred another year ([50:23]).
• ERC Developments:
  • Voluntary disclosure program closed Nov. 22, 2024; AICPA is advocating on IRS mailing errors ([51:30]).
• AI and Tax Practice:
  • Upcoming PCPS toolkit webinars on using AI for tax workflow/automation ([52:45]).

7. Open Forum: Q&A Highlights

• AI Trust and Assurance:
  • Opportunity for accounting professionals to lead in “responsible AI”—future assurance may require standards beyond cybersecurity, covering ethics, hallucinations, etc.
  • “We own the trust industry.” — Avni Desai ([54:07])
• BOI Reporting Under Political Change:
  • Possible but uncertain changes to BOI rules under a new administration; practitioners should plan as law stands ([55:25]).
• Work-Life Balance:
  • Recommended podcast: Transforming Tales of Business Evolution—leaders share real changes in culture and workload management ([55:53]).

Memorable Moments & Quotes

• On AI Pace & Practitioner Readiness:

  “The AI you’re using today is the worst it will ever be.”
  — Pascal Finette ([35:09])

• On BOI Best Practice:

  “The client needs to decide if they would like to continue with the BOI submission process. Make them tell you that in writing.”
  — Lisa Simpson ([16:27])

• On Tech & Work-Life Impact:

  “If we adapt this technology and we're able to save productivity, that means we can improve the employee experience with a work life balance and we'll have more profit to be able to share with our employees and raise starting salaries.”
  — Lexi Kessler ([44:57])

• On AI & Assurance:

  “We own the trust industry. ... as AI grows and we get into ... agentic AI, there’s going to have to be ... controls around hallucination and ethics and who has access and security.”
  — Avni Desai ([54:07])

Timestamps for Critical Segments

| Topic | Timestamp (MM:SS) | |--------------------------------------|--------------------------| | Opening & Digital CPA themes | 00:12–04:41 | | Washington DC/Legislation Update | 05:26–12:27 | | BOI Reporting Uncertainty | 12:35–17:31 | | AI Trends Keynote (Fannette) | 18:56–35:09 | | AI in Practice (Desai) | 37:12–42:19 | | Talent Pipeline Panel (Kessler) | 42:50–50:10 | | Technical/Tax Updates (Simpson) | 50:10–53:33 | | AI Trust & Assurance Q&A | 53:34–54:35 | | BOI/Work-Life Balance Q&A | 55:04–56:40 |

Conclusion

This episode provides a comprehensive, actionable look at the rapid changes shaping public accounting—especially AI’s maturity and pending regulation, the profession’s self-driven pipeline renewal, and ongoing BOI reporting turbulence. The panelists’ practical advice and future-forward perspective underscore the profession’s resolve to both adapt and lead as the next wave of change arrives.

Resources discussed (find links in episode slides):

• BOI Guidance & Risk Alert
• AICPA/CPA.com Generative AI Toolkit
• PCPS & Talent Pipeline Toolkits
• Transforming Tales of Business Evolution podcast

For further community discussion, tune in to the next AICPA Town Hall or access the episode resources in your member portal or newsletter.