Managing Partner Update

Managing Partner Update Tom Hood,
CPA, CITP, CGMA May 13, 2019

MACPA Thanks our Preferred Providers!

Top Challenges 5 T’s 1.
Taxes, Regs, Stds 2. Talent 3. Technology 4. Time or lack thereof 5. Transformation …two overarching concerns in the minds of the profession’s leaders: the impact of new technologies, and accounting’s ability to adapt to the rapid pace of change. Source: Accounting Today Top 100 Most Influential People - 2018

Chair Elect Ray Speciale, CPA
Educator Secretary/Treasurer Avonette Blanding, CPA Middle Market Industry Past Chair Ken Kelly, CPA Retired Public Company Executive Committee Keith Parker, CPA Young Professional Council Karen Syrylo, CPA Tax Consultant Chair Samantha Bowling, CPA Small Firm Jeff Cook, CPA Consultant Leon Katsnelson Public Member Andrew Page, CPA Public Company Mark Cissel, CPA Mid Size Firm Christine Aspell, CPA Int’l Firm Denise West, CPA Middle Market Industry

Pre-session 2019 Legislative Agenda Offense
CPA Firm License Mobility Defense ● Comparative Fault - High Risk ● Sales Tax on Professional Services - High Risk ● State Deregulatory Risk - State Board & CPA License - New ● Increase in employment issues and laws ● More complex tax issues (TCJA Impact) ● Impact of Supreme Court Wayfair ruling on Sales Tax ● Stop excessive Data Protection & Privacy Legislation - New “It is much more important to kill bad bills than to pass good ones.” - Calvin Coolidge 30th President

2019 Legislative Agenda Offense CPA
Firm License Mobility - Passed Defense ● Comparative Fault - No bill - 13 related bills ● Sales Tax on Professional Services - No bill ● State Deregulatory Risk - State Board & CPA License - No bill ● Increase in employment issues and laws ○ Overtime Modernization Act – Defeated in Committee ○ Wage History – Died in Committee ○ Service Contracts – Work Verification (Govt Contractors)- Withdrawn ○ Noncompetes – Amended to limit exemption to employees making $15/hour ○ Criminal History for Licensing – Passed with amendments ○ Ban the Box – Passed with Amendments ● More complex tax issues (TCJA Impact) - No bill ● Impact of Supreme Court Wayfair ruling on Sales Tax - No bill ● Excessive Data Protection & Privacy Legislation - Defeated 2,481 bills introduced - 850+ passed during the 90-day legislative session. We weighed in on 50+ bills

Legislative Advocacy - One of
the best regulatory environment for CPA Firms in the US! ● Individual & Firm License Mobility ● Comprehensive Definition of Attest ● Top Firm Liability Environment - Contributory Negligence (1 of 5 states) ● Non-CPA Ownership (simple majority) ● Separate State Board of Accountancy Fund ● Marijuana / Cannabis Policy ● Second lowest Licensing Fee in US $28 per year ○ DC - $110 4X ○ PA - 100 3X ○ VA - 60 2X

Regulations - CPA Exam State
Board Continuous Testing ● Eliminate the testing "window" concept ● Offer year-round testing without restriction, other than waiting to receive scores from prior attempts of the same exam section ● More candidate convenience and reduce a barrier to entry for the profession https://cpaguide.macpa.org

Talent ● NASBA CPA Exam
Fees are down 11% from prior year ● Finding & Retaining Talent in top issues for 5th year

#FutureReady - our value proposition
Watch the video https://youtu.be/rRcpnYCc3hQ Future Ready is the ability to be aware, predictive and adaptive of emerging technology, demographics, regulatory and business trends in the environment. The #futureready professional is proactive versus reactive and capable of moving from historical services to strategic foresight. 1. Advocacy 2. Helping me stay #FutureReady 3. Helping my Career - Learning 4. Watching future trends 5. Connecting and networking Note: These three have steadily risen from our research and polling with Maryland firms and our members.

Sarah Cloutier Marriott International Tom
White CareFirst BlueCross BlueShield Patrick St. Clair Ellin & Tucker Nicole Schuyler Gary R. Bozel & Associates Mollie Frank RSM US LLP Leah Hahn Davis, Josey, Keating, & Ranes Josh Zimmerman HCFL Katherine Becraft Under Armour Kate Franey Tonneson + Co. Amy Richardson RSM US LLP Remi Omisore CliftonLarsonAllen

#FutureReady Firm “The bottom line
is that CPA firms need to increase their future readiness in order to successfully navigate the fast future of change. In fact, every enterprise in every industry needs to get better at predicting what’s coming. By understanding the metrics (Hard Trends) that influence our future, we can design (with purpose) a better, preferred future. That is the big idea behind future-readiness – to have the capacity to take action with intent and design in order to adapt quickly and thrive.” Source: CPA.com Insight into the CPA of the Future Study 2015

The skills finance and accounting
professionals will need in the future and the emergence of the T-shaped professional. #FutureReady T-Shaped Professional Future Ready Competency Matrix © Copyright Business Learning Institute 2017

#FutureReady Competencies - Foundation Process
Step Common Leadership Competencies Know What’s Next Strategic Thinking External Awareness Vision Continuous Learning Develop Opportunities Innovation Creativity Problem Solving Prioritization Shape the Future Business Acumen Decisiveness Accelerate Success Influencing / Persuading Emotional Intelligence Consensus Building Collaboration “Everyone keeps telling accountants that they need to change their focus from the historic and the backward-looking, and to start being proactive and offering future-focused advice – but no one tells them how. The beauty of the Anticipatory Organization program is that it actually gives you a set of tools to harness the hard trends that are shaping the future, and use them to create new value for your firm and your clients.” - Daniel Hood, Editor-in-Chief, Accounting Today http://www.blionline.org/ao Elevate & accelerate your firm’s culture and build the skills needed for the future

Top FutureView Themes in AOAF
Firms 1. Support a collaborative, people-centric & anticipatory culture 2. Embrace flexible and remote working environments 3. Recruit & retain a diverse workforce 4. Leverage technology to create better user experiences for both staff and clients 5. Shift from away from compliance to a become a consultative, advisory services firm 6. Expand service offerings and create more industry verticals Transformation

Transformation - Resources ● CPA
Firm Innovation/Transformation Roundtable - June 25th 11:00 am - 1:00 pm including Lunch ● #FutureReady Learning Lab feat. Tech solutions and strategic partners 1:00pm - 4:45pm ● MACPA Emerging leader track - Beach Retreat - June 27th MACPA.ORG/BeachRetreat ● MACPA Leadership Academy - August 21-23, 2019 MACPA.ORG/LeadershipAcademy ● Strategic Planning / Anticipatory Organization Learning

Call to Action ● Support
membership - Strength in numbers = political strength ● Support our PAC - we will send you a partner solicitation ● Women to Watch - nominate your clients https://www.macpa.org/product/2019-women-to-watch-awards-breakfast/ ● Support our programs - Experts in your backyard and keeps our organization sustainable ● Give us feedback https://macpa.cnf.io

MACPA Transformation Journey 1. Create
an anticipatory, innovative and collaborative culture 2. Develop a mobile first, frictionless experience for members 3. Build a curriculum to help members adapt to exponential change 4. Innovate in learning and specifically e-learning 5. Create a flexible, agile mobile cloud infrastructure to support rapid changes in business and allow for remote work

• Data entry • Compliance
tasks • Transactional tasks • Repetitive, rules-based jobs Technological innovations + Changing marketplace demands = • Advisory services • SOC services • Technology and big data • Higher-level analysis CPA Evolution Project AICPA - NASBA

macpa.org/vote 1) Navigate on your
device to macpa.org/vote 2) If already logged in, scroll down to vote! If not yet logged in, log in using one of the social logins or by entering your email address to receive a code. Vote!

• Anticipation • Strategic Thinking
• External Awareness • Vision • Continuous Learning • Innovation • Creativity • Problem Solving • Prioritization • Business Acumen • Decisiveness • Influencing/Persuading • Emotional Intelligence • Consensus Building • Collaboration • Inspiration • Risk Management • Communication http://www.blionline.org/ao

If there is a conversation
about the future of the profession, you're bound to hear Hood's name mentioned as one of the people leading the way. – Accounting Today Tom Hood, CPA, CITP, CGMA • CPA Practice Adviser Accounting Hall of Fame • Named the Second Most Influential in Accounting by Accounting Today Magazine 2011-present • Top 100 Influencer by LinkedIn • Member of the Forbes Finance Council • Top 25 Influencers in Learning & HR by HR Examiner • Top 25 Public Accounting Thought Leaders by CPA Practice Adviser CEO Maryland Association of CPAs (MACPA) macpa.org Business Learning Institute (BLI) blionline.org linkedin.com/in/tomhood