BLUECHIP: Parrish: What do you look for when evaluating a CPA?

Evaluating a Certified Public Accountant (CPA) may be about as much fun as selecting a paint color for a ceiling.

OK, maybe it’s not that bad. But I mean, really. Who wants to paint a ceiling? Just the thought of it brings to mind so many questions. Should the paint color be light or dark? (That depends on if you want the ceiling to appear higher than it really is. If so, go light.) Should you paint the ceiling yourself, or should you hire someone? If you’re more of a do-it-yourselfer, then don’t forget to think about scaffolding, because you’ll probably need it. Maybe it would be better to hire a painter. How do you find the right painter for the job?

OK, maybe it is bad. And being a CPA myself, that analogy is at the very least close to my perception of what it must feel like to evaluate a CPA. But there are traits that a CPA should exhibit, I believe, three traits in particular that should be considered closely in an evaluation process: ingenuity, integrity and humbleness.

Ingenuity

Ingenuity relates to the CPA’s education and training. In the field of accountancy, there are many specific “boxes,” so finding a CPA who “thinks outside the box” will provide your business with different perspectives, and different is good.

A CPA must pass a nationally administered test, such as the National Association of State Boards of Accountancy Uniform CPA Exam. Surprisingly, however, the candidate does not have to have a college degree in accounting. On the surface, a CPA without an accounting degree may seem to exhibit ingenuity by proving to be successfully self-taught, especially if the candidate has passed the national exam. But I would wave a cautionary flag. Why? Because the core curriculum for an accounting degree includes very important nuts and bolts, or debits and credits as they say in the profession, that are integral to a CPA’s foundational knowledge.

Furthermore, a graduate degree in accountancy delves beyond the core knowledge base, focusing on the theory of accountancy. A master’s degree in taxation is favorable, too, but that specifically focuses on income taxation, while the master’s in accountancy covers all areas of accountancy in addition to helping the CPA develop the critical thinking skills necessary to exhibit ingenuity.

Integrity

Integrity is the second trait that I believe is critical for a CPA to put forth. I evaluate the levels of integrity as if the rungs of a ladder. Those CPAs and accounting firms who simply don’t keep their word or fulfill their contracts, they are actually off the ladder, exhibiting no integrity. On the lowest rung of the ladder sit those who fulfill their contracts, but don’t keep their word. Slightly above that rung of the ladder sit those who keep their word, but can’t seem to complete their contracts. Obviously, at the top of the ladder are those who do both, keep their word and their contracts. Throughout my career, I have seen integrity levels on all rungs of the ladder, and so anyone evaluating a CPA should keep a discerning eye on this trait.

Humbleness

Finally, humbleness is important. Having spent half my career on the inside of firms, I’ve noticed that CPAs have pride in their profession, and some strongly believe that a business is successful because of their work. True, a CPA is helpful to a business, but they are far from being the crucial ingredient of a successful business. Humbleness allows the CPA to see their part as one cog in a business’ many successful workings.

Humbleness is also present in the way a CPA treats the support staff. Wouldn’t you want to do business with a CPA who treats all people kindly and with respect? Evaluating a CPA relationship, therefore, involves getting to know the professional over a period of time, or even interviewing them at a first meeting to get a feel for their personality. In evaluating, remember that ingenuity, integrity and humbleness are so important in developing a long-term, trusting relationship that will serve all of your business accounting needs.

Now back to the drawing board on painting the ceiling.

Erik Parrish (erikp@kingestate.com) is a financial executive for King Estate Winery. He is a Certified Public Accountant and is an advocate for regional economic development.