Scaling Up a CAS Practice
Tom Hood & Michelle Golden @tomhood @michellegolden December 4, 2018 #DCPA18 #FutureReady

Tom Hood CPA, CITP, CGMA
• CEO of Maryland Association of CPAs and Business Learning Institute since 1997 • Digital CPAAdvisory Board Member • Member Forbes Finance Council • 2nd Most Influential Person in Accounting - Six years in a row by Accounting Today • LinkedIn Influencer with 680,000 followers • Accounting Hall of Fame - CPA Practice Advisor • Industry background before MACPA • Treasurer & CFO of $50m highway construction company for 12 years • Accounting systems manager & accountant prior to that @tomhood

Michelle (Golden) River CPF •
Owner Fore LLC celebrating 1 year (fore means “ahead of”) • Growth & profitability strategist: pricing & positioning subspecialties • Digital CPAAdvisory Board Member • Among accounting’s Top 10 “most powerful women,” Top 25 thought leaders, & Top 100 most influential • Certified Professional Facilitator, author, & frequent speaker (including TEDx) • Accounting background before Fore • Partner at CPA firm K·Coe Isom (ranked #60) 2013-2017 led growth as part of firm’s 5-person leadership team, revenue doubled in 4 years • Consultant to CPAs for 15 years (owner, Golden Practices) serving 135+ firms since 1999. • In-house, public accounting firm 1994-1998. Public company staff accountant 1985-1993. @michellegolden

Today’s Session • Getting to
Know You • Reimagine the CAS Practice • Expansion Challenges • Realign the CAS Practice • Characteristics of a Well-Leveraged CAS Practice • Characteristics of a Strong CAS Leader • Making the Business Case 4

CFO ANTICIPATORY / INTENTIONAL Sophisticated
Forecasting, Budgeting, Business Planning, Financial Modeling CONTROLLER PREVENTIVE / OVERSIGHT Monthly Close, F/S Reporting, Cashflow Analysis BPO WELLNESS / STRUCTURE & PROCESS Data Ecosystem: Integration, Automation, Predictable, Stable TRADITIONAL WRITE-UP TRIAGE / TRANSACTIONAL Bookkeeping, Payroll, Accuracy Accounting to Finance: Functional Models Where are you now?

Does this fit well with
your firm? How does this compare with where you are now? Reimagine the CAS Practice The End in Mind • Values • Ideal client type (future selection criteria) • Work type (tools & leverage) • Revenue model 6

7 Revenue Models ©2018 Fore
LLC

What % of work is
ideal at each level? % by TIME? % by REVENUE? Where Will You Be? 8 CFO ANTICIPATORY / INTENTIONAL Sophisticated Forecasting, Budgeting, Business Planning, Financial Modeling CONTROLLER PREVENTIVE / OVERSIGHT Monthly Close, F/S Reporting, Cashflow Analysis BPO WELLNESS / STRUCTURE & PROCESS Data Ecosystem: Integration, Automation, Predictable, Stable TRADITIONAL WRITE-UP TRIAGE / TRANSACTIONAL Bookkeeping, Payroll, Accuracy

STEPS: 1. Assess 2. Prepare
resources 3. Protect resources Realign the CAS Practice Bridge the gap: • Right values? • Right stack? • software, processes • Right people? • skills, levels, leadership, roles - who does what • Right customers? • add, shift, exit 9

Characteristics of a Well-Leveraged CAS
Practice 10 • Well-defined customers - industry niches / specialization • Preferred or required technology - platform & ecosystem • Clear roles & accountability • Standardized processes • Client experience program & accountability • Help-desk management system & dedicated resources What else?

Specialization: The Riches are in
the Niches 11 • Professional Services – 90% • Construction – 76% • Retail – 75% • Not-for-Profit – 73% • Manufacturing – 65% Most Popular Verticals for Outsourced Accounting Services (CPA.COM) • Wholesale Distribution – 61% • Technology Companies – 59% • Transportation – 48% • Hospitality – 45% • Franchises – 40% • Government – 29%

Standardizing your platform ecosystems can
enable you to shift from compliance- based roles to advisory roles. How will you leverage and scale your practice? Establish Your Platform & Ecosystem 12

Org Chart: Start-Up CAS Practice
13

Org Chart: Typical CAS Practice
14

Do you have the right
people in the right seats? Do they share and align to your core values? Do they GWC? Get it? Want it? Capable of doing it? Org Chart: Well-Leveraged CAS Practice 15 Partner-in-Charge CAS Business Group Business Development Marketing/Sales, Finance, Human Resources, Technology, etc. Director of Client Accounting Services Virtual CFO Implementation & Client Support Services (separate positions as the firm grows) Client Relations (Client Scheduling, Contract Maintenance, Client Satisfaction) Virtual Controller Accounting Manager Accounts Payable Accounts Receivable Payroll Source: CPA.COM

Hire Some Bots - Robotic
Process Automation? 16

Standardize to Increase Leverage •
Consistent/standard Chart of Accounts (COA) as one package price & premium price for a custom COA • Standardized services by industry vertical & by type of service • Standardized Internal Management Reports/Services • Procedures Manuals for each client • Service Order Requests for services outside of the engagement agreement – retainer always on account for these requests & for “concierge” services • Dedicated client-service staff to provide top client experience, while sheltering production staff • Standardized workflow to deliver insight 17

What are YOUR strengths? What
will you work to enrich? Characteristics of a Strong CAS Leader For CAS • Vision: works ON the business, not just IN the business • Strong sense of priority • Stays macro vs micro TIP: Not necessarily the CFO-level provider him/herself 19 Traction’s Five Leadership Abilities TM 1. Ability to Simplify 2. Ability to Delegate & Elevate 3. Ability to Predict 4. Ability to Systemize 5. Ability to Structure

Plan & Execute: 1. People
shifts 2. System & process shifts 3. Client shifts 4. Measurement shifts Making the Business Case Credibility is EARNED not granted. Earn it through: • Articulating clear vision • Honest assessment • Aligning w/firm’s biz proposition • Demonstrating leadership strength • Consistent, solid follow through 20

21 Tools: The EOS® Model
EOS® (Entrepreneurial Operating System) is a complete set of simple concepts & practical tools that’s helped thousands of entrepreneurs get what they want from their businesses. Implementing EOS helps your leadership team in three key areas: Vision – getting everyone in your organization 100% on the same page with where you’re going and how you plan to get there. Traction – instilling focus, discipline, and accountability throughout the company so that everyone executes on that vision—every day. Healthy – helping your team become a more cohesive, functional, healthy leadership team. https://strategyx.blionline.org

What is your ‘Why” for
this practice? Does it fit your strengths? Does this align with your firm strategy? Does your partner group support your Vision and Business Line? Can You Answer the 8 Questions? 1. Core Values? 2. Core Focus? 3. 10-Year Target? 4. Marketing Strategy? 5. 3-Year Picture? 6. 1-Year Plan? 7. Quarterly Rocks? 8. Issues? 22

Contact Info TOM HOOD, MACPA
& BLI Blionline.org tom@blionline.org 443-632-2301 MICHELLE GOLDEN, FORE LLC ForeAdvantage.com michelle@foreadvantage.com 661-360-7968 23