CPA Financial Planner Sample Presentation

Report
It's Never Too Early (or Too Late)
To Specialize: Is a Career in
Personal Financial Planning
Right for You?
[presenter name/business name]
[presentation date]
Introduction
About the PFP Section & PFS Credential
• The AICPA PFP Section provides information,
resources, advocacy and guidance for CPAs who
specialize in providing estate, tax, retirement, risk
management and investment planning advice to
individuals and their closely held entities
• The CPA/Personal Financial Specialist (PFS)
credential distinguishes CPAs as subject-matter
experts who have demonstrated their financial
planning knowledge through experience, education
and testing
Personal Financial Specialist
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Introduction
My background in accounting
My story about becoming a CPA/PFS
Personal Financial Specialist
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Agenda
What is personal financial planning (PFP) & what is
a CPA financial planner
Why specialize in PFP
What are the business opportunities in the
profession
How to pave your own unique career path as a CPA
financial planner
How to gain the experience you need within the CPA
profession
Personal Financial Specialist
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Traditional Areas Provide the Base for Specialization
BASE
Specialization
Clients ask about
planning
CPA
Tax
Provider
Clients ask about gift &
estate valuations
Audits resulting in
valuation requests
CPA
Auditor
Fraud suspected or
found during audit
Audits leveraging
automated tools, IT
audits, application
control reviews, SOC
Financial Planning
CPA engages in tax, estate,
retirement, insurance and/or
investment planning
services
Business Valuation
CPA provides business
valuation expertise for
taxes, M&A, expert witness,
and other engagements
Financial Forensics
CPA engages in forensic
work around fraud
investigations, etc.
Information Technology
CPA works on information
management & business
intelligence engagements
Credential
Personal Financial
Specialist (PFS)
Demonstrates
expertise through
exam , experience
and education
Accredited in
Business Valuation
(ABV)
Demonstrates
expertise through
exam , experience
and education
Certified in
Financial
Forensics (CFF)
Certified Information
Technology
Professional (CITP)
Personal Financial Specialist
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What is financial planning?
RISK MANAGEMENT
INVESTMENT
RETIREMENT
ESTATE
TAX
Personal Financial Specialist
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What is a CPA financial planner?
CPA financial planner who practices in one or more
of the following areas of financial planning:
•
•
•
•
•
•
•
•
•
Cash flow planning
Risk management and insurance planning
Retirement planning
Investment planning
Estate, gift, and wealth transfer planning
Elder planning
Charitable planning
Education planning
Tax planning
Enhance your technical credentials with the CPA
Personal Financial Specialist (CPA/PFS)
• More on this later in the presentation
Personal Financial Specialist
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Why specialize?
Client retention
Added revenue and profits
Staff retention
Balance workload throughout year
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Why specialize?
The most significant challenge facing CPA firms of all
sizes across the nation today is client retention and
firm growth.
Jim Metzler AICPA vice president for small firm interests.
Another significant challenge to CPA firms is staff
retention and succession.
Many in the younger generation are eager to develop a
broader expertise that includes financial planning.
Personal Financial Specialist
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What do younger CPAs want professionally?
Less compliance/routine work (Type 1 work)
More Future oriented and Value driven work (Type 2)
such as:
•
•
•
•
•
Financial planning
Strategic planning
Profit improvement planning
Benchmarking
Key performance indicator (KPI) monitoring
2020 Survey, Chris Frederiksen, CPA/PFS, Chairman
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Why specialize?
A study by CEG International found more than half
of wealthy individuals are likely to obtain financial
services from their CPAs
Financial planning is too important to be left in the
hands of unqualified professionals
CPAs are quite possibly the single most important
decision makers for individuals and businesses, and
it is time to realize that we do more than just taxes
Personal Financial Specialist
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Specialization will drive accounting sector
growth
Growth Rate
4x
Accounting Industry
1
Forensic Accounting
2x
Financial Planning
Business Valuation
1x
IT Consulting
1
Risk Management
2012
Sources:
1 IBISWorld 2012
2013
2014
2015
2016
2017
2 Deloitte
Personal Financial Specialist
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Why specialize?
% of major firms growing their practices in these disciplines….
Business Valuations
75%
State and local Taxes
73%
International Tax
72%
Litigation Support
70%
Estate/Trust/Gift Tax Plan.
69%
Forensics/Fraud
Industry Specializations
Source
68%
63%
1 Accounting Today
Personal Financial Specialist
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Why specialize?
Findings from 2013 AICPA Compensation Survey
• Median total compensation for CPAs is $160,200. That is, exactly half
of all CPAs earn more and half less. The average total compensation is
$236,600.
• The data show that total compensation is higher among credential
holders. On average, specialty credential holders receive a total
compensation $26,700 higher than non-credential holders.
• Many CPAs believe credential holding leads to higher compensation
and hiring and promotion opportunities.
- 31% say holding a credential leads to increased compensation
- 51% say holding a credential makes a difference in being
promoted, and
- 66% say holding a credential makes a difference in being hired
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What qualities make a good CPA financial
planner?
Interpersonal skills
• Working with a variety of client personalities
• Communicate complex financial concepts in easy-to-understand
language
• Willingness to help others.
Analytical mind/detail-oriented
Desire for life long learning
Strong ethical responsibility
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How to become a CPA financial planner
Education
• College level
• Beyond (CPE, web seminars, conferences, PFS exam review
courses and education)
Become a CPA
• Bolster your CPA credential with the PFS credential
Experience
• Develop soft skills
• Develop technical skills
Understanding the business
• Engage with other successful CPA financial planners
Personal Financial Specialist
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Years of
Experience
Job Position
Specialized Credential Career Path / Goals
Expert
10+ Years
Years 8-10
articles/
speeches/
seminars
Years 5-7
Year 3-4
Partner / Managing
Director
(continue
specialized training
– advanced)
specialized
work
experience
work
experience
specialized
training intermediate
work
experience
CPA
specialized
training advanced
Director
obtain
specialized
credential
Manager
training - intro /
beginning level
Senior
Staff
Year 1-2
work
experience
training - general
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Why does being a CPA matter?
True, you can be a financial planner without being a
CPA
BUT
CPAs are the “most trusted advisor”
CPAs are required to be objective
CPAs have a broad base of knowledge
CPAs must follow the Code of Professional Conduct
AND
The CPA/PFS credential demonstrates your
expertise and clearly differentiates you from other
CPAs and non-CPA financial planners.
Personal Financial Specialist
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The CPA as the Personal Financial Planner
Legacy of the CPA profession & multigenerational
perspective
• Century of experience sets the CPAs apart the trusted adviser
• Independence & objectivity hallmarks of the CPA profession
Informal advice morphed to formal profession
• CPAs wrote the book on college planning, tax planning and
generational wealth planning.
• CPA is the personal CFO, simplifying the complexity that wealth
brings & often “quarterbacking” other advisers
Taxes an integral part of all PFP decisions
• Overall picture of a client’s financial situation
• Tax returns offer details of cash flow/income situation
• Planning decisions have tax implications
Personal Financial Specialist
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Business models
Personal Financial Specialist
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Business Opportunities
Endless!
You are already the trusted advisor in most
cases
• CPA credential
Familiar with tax strategies and tax law
•
Impacts all areas of PFP advice
Know the client situation
•
Tax returns
Diversify your client base and revenue
streams
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Scope of Services
Segmented financial planning
Comprehensive financial planning
Financial planning with assets under advisement
Financial planning with assets under management
Financial planning with assets under management
and product sales
Personal Financial Specialist
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PFP Entity Structure
Service within CPA firm or separate practice
dedicated to PFP
CPA firm affiliated separate entity (RIA)
Separate entity (RIA) not affiliated with CPA firm
Referral partner
Personal Financial Specialist
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Investment Advisory Business Models
Investment Adviser
Investment Adviser Representative
Broker-Dealer
Registered Representative
Solicitor/Referral
Portfolio Manager
Compensation Models
• Fee-Only Financial Adviser (RIA – fiduciary) – most CPAs use
this model
• Fee-Based Financial Adviser
• Commission Payments
The CPA's Guide to Investment Advisory Business Models
Personal Financial Specialist
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Where to look for a job as a CPA financial
planner
There is no “right” path – almost everyone’s looks
different
CPA firms (Tax department)
Wealth management firms
Banks and brokers
Start your own financial planning practice
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Creating Your Own Career Path
Unlike public accounting firms, personal financial
planning firms come in all shapes, sizes, and areas
of specialization
Determine where your strengths lie and the work
you really want to do
Find the firm that most closely matches your goals
or…
Create your own firm to fulfill your vision
Personal Financial Specialist
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Bolster your CPA license with the CPA/PFS
credential
Distinguish yourself from other CPAs and non-CPA
planners
Affirm your expertise independently by the largest
and oldest association of accounting professionals
Demonstrate dedication to continual professional
improvement in financial planning
Enhance your image as a trustworthy adviser to
your financial planning client’s with the AICPA’s
Professional Code of Conduct
Personal Financial Specialist
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Why choose to be a CPA/PFS?
Know your client and, as their trusted
advisor, help them plan and make
decisions with their entire financial
picture in mind
Be a leader for your client by initiating
advice and coordinating other advisors
to your client
Be an advocate for your client, to help
your client achieve his/her goals
Be a coach and educator to your
client, to empower your client to make
informed decisions
Navigate complex issues that your
client faces on a regular basis
Gain personal satisfaction from
working with clients on their path to
achieving their goals
Personal Financial
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Who can benefit from being a CPA/PFS?
The CPA/PFS credential demonstrates the expertise and
experience that a CPA has in personal financial planning. This
can benefit many CPAs who practice financial planning:
•
•
•
•
Tax practitioners who also focus on estate and retirement planning with their
clients
CPAs providing broad-based comprehensive financial planning services
CPA planners focusing on niche areas like wealth management or riskmanagement planning
Young CPAs with qualifying experience to gain recognition
The CPA/PFS credential validates the CPA’s understanding of
the overall financial planning issues faced by his or her clients.
This allows CPAs to meet their client’s needs and expectations
regardless of how their financial planning business model is
structured.
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CPA/PFS Qualifications
A CPA license and AICPA membership
Education
• 75 hours of PFP-related education in the last five years
Examination
• PFS exam, CFP exam, or ChFC exam
Experience
• Two years of full-time PFP-related experience (3,000 hours, can
include 1,000 tax compliance work)
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Next Steps
Join the PFP Section
• See Sarah Bradley at the AICPA booth for a special conference
discount.
ThisWaytoCPA.com
• Website dedicated to upcoming and newly minted CPAs
• CPA profiles, career tools, info CPA exam and licensure
Social Media
• Search Young CPA Network on Facebook, LinkedIn and Twitter
Contact us: [email protected]
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Resources for CPAs to take next steps…
PFP Practice Center (aicpa.org/PFP/practicecenter)
The CPA’s Guide series (http://bit.ly/YJoXkI)
• Includes guides on developing and managing a PFP practice,
technology in PFP, investment advisory business models, etc.
Join the PFP Section (joinpfp.org); Become a CPA/PFS
(aicpa.org/PFP/PFS)
Forefield Advisor (aicpa.org/pfp/forefield)
PFP Pathway: From Tax Preparer to Financial Planner
(aicpa.org/PFP/Pathway)
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Using a tax return for developing
personal financial planning
Visit aicpa.org/PFP/pathway to access this checklist and other free resources.
Analysis of a Tax Return for Personal Financial Planning
Done Dependents and Filing Status
Does the client have children?
Understand any education planning opportunities.
Discuss gifting opportunites with the client.
Consider income shifting to take advantage of the children's low tax rate.
Have gift tax returns been filed?
Do the number and ages of dependents indicate that income continuation needs are likely to be high?
Does the client have elderly parents whom they care for?
Discuss estate planning with the client.
Review the dependency rules to be sure the parents can be claimed.
Discuss the future financial commitment of this care with the client.
Is the client divorced?
Consider filing status and dependency exemptions in divorce situations.
Done Income
What is the source of the client's income?
Understand their sources of income - wages, self-employment, partnership, etc.
Are there any income deferral opportunities available given the client's investment income source?
Discusss the benefits of saving through 401(k), 457, 403(b), SEP, or IRA's.
Does the client have income from a retirement plan still held with former employers?
Discuss rollover of funds to an IRA or consolidating IRA's with the client.
Does the client have social security income?
Consider whether any of the social security income maximizing strategies might apply.
Is the family income dependent on one wage earner?
Are maximum 401(k) contributions being made?
Done Schedule B
What are the sources of the client's interest income?
If it's taxable, does it come from bonds, CD's, savings accounts, etc?
If it's tax-exempt, understand the state tax impact.
If the source is savings accounts, consider the FDIC limits
If the source is municipal bonds, consider the safety of the bond.
Does investment income indicate a liquid fund has been established for emergency needs?
What are the sources of the clients dividend income?
Is it mostly from mutual funds or stocks?
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Questions?
Visit aicpa.org/PFP
RISK MANAGEMENT
INVESTMENT
RETIREMENT
ESTATE
TAX
Personal Financial Specialist
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