MACPA Statement // Fall 2020

STATEMENT MACPA’S

FA L L 2 0 2 0

CPA leaders offer thoughts on how to build a more diverse and inclusive accounting and finance profession

‘AN

IDEAL

WORTH FIGHTING FOR’ AN EXCLUSIVE INTERVIEW WITH

Avonette Blanding and Kimberly Ellison-Taylor Page 4

ALSO INSIDE Finding a balance: Planning for reopening offices Page 13 Maryland Association of Certified Public Accountants, Inc.

Planning for separation or divorce Page 17

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CONTENTS Fall 2020 | Maryland Association of Certified Public Accountants, Inc.

CHAIR’S COLUMN.............................................................................. 2 FEATURES An Ideal Worth Fighting For’ ................................................................................ 4

DEPARTMENTS Business & Industry.............................................................................................. 13 Tax Corner............................................................................................................ 17 Financial Planning................................................................................................ 20 High-Tech Solutions............................................................................................. 29 MACPA Volunteers.............................................................................................. 34 From Our Sponsors.............................................................................................. 36

MEMBER NOTES................................................................................ 53 CLASSIFIEDS........................................................................................... 54

MEMBER SERVICES Lauren Baker Sydney Glen PEER REVIEW

2019–2020 BOARD OF DIRECTORS Avonette Blanding, CPA Chair

Cora Edwards

Lexy Kessler, CPA Vice Chair

E-LEARNING

Herbert J. Geary III, CPA, CGMA Secretary/Treasurer

Emily Trott SEMINARS/CONFERENCES Cyndi Powers

Ray Speciale, CPA, Esq. Immediate Past Chair Christine Aspell, CPA Pat Byer, CPA

GROUP LEARNING

Tricia Griffis, CPA

Natalie Atonakas

Leon Katznelson

Chris Dougherty

Tim Samuel, CPA

Jennifer Stevens

Richard C. Stang, CPA, ABV, PFS

Ryan Wey

Thomas White, CPA, CGMA

SPONSORSHIP / ADVERTISING SALES

Jeff Wilson II, CPA, PFS, CFE, CGMA, CDFA

Amy Puente Krislyn Suljak

SENIOR STAFF Tom Hood, CPA CEO Jackie Brown COO Skip Falatko, CPA CFO Bill Sheridan, CAE CCO Rebekah Brown, CPA Director of Development Pam Devine Director of Group Learning & Sales Mary Beth Halpern Director Technical Services/ Regulatory Affairs Dee Sullivan Director of Learning

WE WANT TO HEAR FROM YOU! See below to submit content Bill Sheridan | MACPA Dulaney Center II 901 Dulaney Valley Road Suite 800 Towson, MD 21204 FOR CONTENT SUBMISSION: bill@macpa.org feedback@macpa.org TO ADVERTISE IN THE STATEMENT: krislyn@macpa.org P: 410.296.6250 F: 410.296.8713 Toll free: 800.782.2036 The MACPA reserves the right to edit all submissions for grammatical style and / or length. Statement of fact and opinion are made by the authors alone and do not imply an opinion on the part of the officers or members of MACPA. The Statement is published four times a year by the Maryland Association of Certified Public Accountants, Inc. Bill Sheridan, Editor Krislyn Suljak, Advertising Sales

FALL 2020

CHAIR’S COLUMN CPAs: What a difference they make BY AVONETTE BLANDING, CPA / CFO, MARITIME APPLIED PHYSICS CORPORATION I had an interesting epiphany the other day. What if CPAs are the direct line between chaos and calm? Between complexity and order? Between questions and quality of life? What if CPAs are the answer? During a recent AICPA Governing Council meeting, AICPA President and CEO Barry Melancon spoke about the important role accountants play not just in the financial world, but in the world. Period. He said accountants help prepare and ensure the quality of financial statements ... and those financial statements provide access to capital ... and that capital improves the quality of people’s lives.

For the CPA, that value is in the future opportunity and freedom it provides. For the general public, it’s in the protection a CPA aims to provide.

when problems arise. I want the profession to have that kind of diversity of thought so we can continue to improve the quality of life for those we serve.

No one is better equipped to do that than a CPA.

To make that happen, we have to hold ourselves — and others — accountable. Consumers are holding our clients, and many of us, accountable because people have died — people are dying. We can’t allow that to happen any longer. We must hold ourselves accountable for making the changes that will lead to real reform. Our organizations, associations, and affiliations are making statements and pledges and vows to do more, but what do all of those statements mean without accountability?

And yet we still have many challenges to overcome. Let’s start with numbers. Enrollments in accounting programs have fallen, and fewer graduates are planning to take it to the next level and earn their CPA designation. We need to create a pipeline of future CPAs who have the necessary skills and tools to advance their clients and the profession to the next level.

What a difference we make.

The MACPA is working hard to build that pipeline by partnering with universities, organizations, and other invested parties who understand the connection between quality of finance and quality of life. We are committed to flooding that pipeline with qualified candidates who are determined to help our profession — and, more importantly, our world — emerge after COVID-19 stronger and more resilient than ever.

The world is going to lean heavily on difference-makers like us in the weeks and months and almost certainly years to come as we try to re-balance the scales in a postpandemic world.

We can’t accomplish that unless we have a profession that is as diverse as the world it serves. Given that technology has removed geographical barriers, that’s more important than ever.

As businesses around the world reckon with the challenge of COVID-19, one thing is clear: There is no going back to normal. Our charge is to reinvent an entirely new economic reality – our “next normal.”

As of 2016, just 1 percent of CPAs employed by public accounting firms were black. And 0.3 percent of partners at those firms were black. That’s in a country in which roughly 13 percent of the population is black. And the numbers for other people of color weren’t much better. Women fare a bit better: As of 2017, women made up about half of all staff at CPA firms, but they accounted for just 22 percent of partners.

I wish everyone who is considering what they want to do with their lives could have heard that — that our ability to provide financial help to someone can improve the quality of their lives, and that by improving the quality of their lives, we’re improving the future of their families, and their friends’ families, and their communities.

In a world shaken by a global pandemic, economic unrest, and societal injustice, CPAs are one of the only professions in which the public can still believe. CPAs play a pivotal role in the social and economic heartbeat of this nation. That’s why we must learn how to become anticipatory, agile, and adaptable. These are the futureproof skills that will see us and our clients through the economic storm. Simply put: It’s about becoming an indispensable resource to our organizations, our clients, and our communities. That speaks directly to the value of the CPA license.

I would love to see our profession become much more diverse. That diversity is as much about diversity of thought as anything. Someone who is asthmatic and can’t play a sport will think of things differently than an athlete does. Someone who likes to hunt will think of things differently than a vegetarian does. All of those different ways of thinking help provide better solutions

This happens over and over again. Someone else dies a needless death, and we release statements, and do research, and publish studies and whitepapers, and produce podcasts. And then the demonstrations die down and barely anything … ever … changes. How do we avoid that this time? How do we hold ourselves — and others — accountable for making those changes stick? By continuing to have honest conversations, despite how uncomfortable they feel — by evaluating actions after promises and pledges have been made. We can do this. We can lead our profession and our clients forward in a post-pandemic world. We can build a pipeline of enthusiastic future CPAs who are committed to making a difference. We can create a more diverse and inclusive profession that leads the way for the rest of the world. We can do all of these things. Any problem, no matter how challenging, can be solved if enough people care. My challenge to you is to join us in caring. Pledge to make a difference, and then do it! Don’t just talk a good game. Hold yourself — and others — accountable. We can move the needle in all of these ways. But it starts with me, and with you. And it starts now.

STATEMENT

‘AN

IDEAL

WORTH FIGHTING FOR’ CPA leaders offer thoughts on how to build a more diverse and inclusive accounting and finance profession AN EXCLUSIVE INTERVIEW WITH

BY B ILL S HERIDAN, C AE This has been a tough year, and I’m not talking about COVID-19. Ahmaud Arbery. Then Breonna Taylor. Then George Floyd. Then Jacob Blake. And after each assault, we found ourselves asking, “Why?” Why does this keep happening, and what can we do to stop it? CPAs won’t solve this problem. It’s bigger than our profession, and it goes deeper than we can dig. What we can do is work on the problem that’s in our own backyard. Inclusion in our profession remains a huge issue. As of 2016, just 1 percent of CPAs employed by public accounting firms were Black. Just 0.3 percent of partners at those firms were Black. That’s in a country in which roughly 13 percent of the population is Black. The numbers for women and other people of color weren’t much better. What’s the difference between how we treat people of color in our profession and how we treat them anywhere — everywhere — else?

AVONETTE BLANDING @AvonetteB_CPA

It happens over and over again. Another Michael Brown, or another Freddie Gray, or another George Floyd dies, and we feel like we need to say something, and so we do. We release statements, and we publish studies and whitepapers, and we produce podcasts. And then the demonstrations die down …. and nothing ever gets done. How do we change that this time? How do we actually do something? Avonette Blanding and Kimberly Ellison-Taylor have some poignant insights that might help us take the first step. Avonette is chief financial officer at Maritime Applied Physics in Baltimore, which designs and builds advanced technology systems and vessels for the Defense Department. She is also chair of the Maryland Association of CPAs. Kimberly is executive director of finance thought leadership at Oracle. She is a past chair of both the MACPA and the American Institute of CPAs, and just the second chairperson of the Association of International Certified Professional Accountants. She’s a fixture on Accounting Today’s list of the most influential people in accounting.

K I M B E R LY E L L I S O N - TAY L O R @kellisontaylor

More to the point for our discussion, they are both Black women who are true leaders in our profession, and they have insights, and life experiences, and mindsets that the vast majority of our profession simply doesn’t have. Let’s start here, with an open and honest conversation with two of the more inspirational leaders in our profession.

STATEMENT

Bill Sheridan: Avonette, Kimberly, I didn’t quite know where to start, so I’ll start here: What’s your mindset these days? Avonette Blanding: There’s so much going through my mind, Bill. With everything that’s going on, I don’t want to lose sight of what I would like to see happen, and that is accountability — that someone be held accountable for the actions that have been committed. I see all of these companies posting about diversity and inclusion, but at the end of the day, when I’m driving through Baltimore City on my way home or going to see family, if I’m pulled over by the police, my life is still potentially in jeopardy. It doesn’t matter that I’m a CPA. It doesn’t matter that I’m the CFO of an engineering company. When I’m going out as a normal citizen, it’s still an issue. When my husband is out and he’s working and he’s volunteering in the community, if he has an encounter with the police, that’s still a concern. I support all of the efforts related to diversity and inclusion and I’m an active volunteer. But at the end of the day, I don’t want to lose sight of the fact that there are people dying because of certain actions, and we need to hold people accountable. Kimberly Ellison-Taylor: In the first couple of days, Bill, I was griev-

ing. I was so hurt, so upset, because every time it happens, we get together, we post hashtags, we say, “Black lives matter.” People post tweets of support. And then it happens again, and again. I also don’t want us to lose sight of the senseless deaths. We all know them. They’re our uncles, our brothers. They’re us. I just think — I have to think — that there’s more that can be done with regard to training. There’s more that needs to be done with people identifying in their own belief systems where they may have had racist and discriminatory actions against African Americans. When I think about the Central Park video incident with Amy Cooper, I am horrified, but I also recognize that that incident probably plays out over and over across the United States and probably around the world with no video camera, just one person’s word against another person making the allegation. If the police were to show up, who would they believe? I’m ready now for action. We have taught and admired the notion of inclusion long enough. We have figured out some complex issues. We are working on complex challenges with COVID-19. Let’s apply some of that same thinking to this challenge, which has been systemic and institutionalized for far too long. BS: This year’s demonstrations feel different. The demonstrations that followed Michael Brown’s death were largely localized in St. Louis. After Freddie Gray’s death, they were pretty well confined to Baltimore. This time, demonstrations are happening throughout the world. Do you feel like we’ve reached a certain tipping point here? KET: I would say so … because enough is enough. We all saw ourselves in George Floyd. When he called out for his mother, my heart broke a hundred times. What if that was my son? What if that was my husband? I want to recognize our allies and champions, our colleagues who support us, who work with us, who are standing out there on the front lines with us saying this is wrong and there’s more we can do.

BS: Avonette, you told a story a couple of minutes ago about leaving the house, about watching your husband leave the house for what seemed like routine errands and the worries that come with that. How can we help people who don’t have that type of life experience understand that concern? AB: About the video of George Floyd: I didn’t watch the entire thing. I already knew how it was going to end. It wasn’t a movie. It wasn’t something where I was going to see the credits roll at the end. I didn’t watch it and I don’t plan to watch it, because I don’t want to see that. My heart hurts just from hearing that he cried out for his mother. I can’t answer that one honestly, Bill. I don’t know why it’s hard for some people to understand that experience. But I will share my stories with people, because being able to share your story gives you that connection. And even though every person might not appreciate it and every person might not connect with it, I’m sure there will be at least one. If I can change at least one attitude, then I’ve done something. I come from a very large family. My mom is one of nine children and my father is one of 13, so I have lots and lots of cousins. And one of those cousins was killed by the police a few years ago. And I happened to be volunteering at the time at a (Future Business Leaders of America) competition. I was serving as a judge, and I got a phone call that said, ‘Your cousin was killed.’ And it just broke my heart. And a few years ago, I got a call from my husband saying that he had been arrested because the police officer didn’t like the way he responded to him. KET: We all get our most restful sleep before our kids arrive. And when our kids arrive, those nights of restful sleep disappear because in the back of our minds, we’re always wondering: Will they be safe? Will people love them? Will people appreciate them? If we provide them with a great background, will that help them? The answer is: Probably not much, because most people aren’t looking beyond skin color. BS: I appreciate your openness and honesty. I do want to talk about diversity and inclusion in our profession. It’s an area in which our profession has struggled for generations. Why can’t we seem to move that needle? KET: We could start with grade school, or college and university resources. We could start with the money that it might take to get through college or a fifth year or the CPA exam. That’s why I’m so proud that the AICPA Foundation is offering a scholarship to help defray some of those costs. It’s not for everyone, but at least there’ll be 50 candidates who would be eligible to get that kind of scholarship. Every little bit of support is necessary. That’s across the board, but certainly Black candidates and other people of color are more than encouraged to apply and take advantage of the resources. There are so many different aspects. For me, it started with someone coming to my school and giving visibility to our profession. I think we need to see people who look like us. If we get to an interview, we need to sit in front of an interview panel that has at least one person who looks like us. Suppose my manner of delivery isn’t what you’re used to, but it might be what my culture is used to. The person who’s familiar with that manner of delivery could speak up and say, “That is just a cultural difference. Let’s focus on the value that she will offer.”

CONTINUED ON PAGE 6

FALL 2020

CONTINUED FROM PAGE 5

A lot of it, Bill, comes back to this: Do you see people who look like you? If we see more people who look like us, if we highlight more people across the entire spectrum ... our profession is so wide with opportunities and possibilities of things. Why not highlight our Black government leaders, people who are with not-for-profits or in public practice who are at different levels, and especially at the partner level? Why can’t we highlight those who are in business and industry and even in consulting roles? We have so many different places for students to choose from. I don’t think we do a great job of letting them know there’s a seat for them at the table. AB: We need an introduction to the profession at a very young age and see it continuously once we’re introduced to it. Accountancy is that life skill that we all see every day when we’re growing up in our households. We see it when our parents are taking care of our families and start to include their kids in discussions about budgets. You don’t realize at the time that not only are you doing accounting, but you’re also doing entrepreneurship. You’re serving as a CEO or a CFO, you just don’t realize it. It’s great to be able to say to kids who look like me, “Listen, I did this. You’re doing it now, you just don’t realize it.” And every company needs an accountant. Let’s say you don’t get to play in the NBA. You can still help a team manage their books to make sure the players get paid, to introduce them to statistics and auditing, and all of those things. If we can introduce students to what the profession is and the possibilities in the profession at a young age, and they’re able to see someone in this profession who looks like them, and they’re able to hear just how much we enjoy what we do, it becomes a lot more enticing. BS: This may be a long game that we’re playing. It might take some time to move that needle. AB: Definitely. I don’t think it’s going to be an overnight thing. If it were, we wouldn’t be having this conversation right now. Close to two decades ago, there were initiatives to increase the number of underrepresented people into the profession. And even after two decades, there hasn’t been a large increase. I definitely don’t think that we should give up. There’s definitely hope, if we can look at different ways to make the profession appealing, to make someone believe that they can actually accomplish it. BS: We’ve seen some progress in recent years in creating more opportunities for women in the profession. Does that apply equally to women of color as well? KET: It absolutely does not. I think we are making progress, but women are nowhere near where we need to be. We are not as well positioned for S&P 500 leadership positions, and we’re certainly not in as many board positions as we’d like to be, and maybe not as commensurately represented in partnerships. So there’s work to do. It’s compelling when you look at the numbers. And I would make the same argument with other underrepresented minorities as well. I am the vice chairman of the AICPA National Commission of Diversity and Inclusion, and I have not forgotten that there are other groups that don’t have great numbers as well, who also need support, who also need encouragement, who also are not showing up in leadership ranks. They are just as important.

Black women have not had the same success that we’ve seen with our Caucasian colleagues. We want to replicate that and identify when it’s sexism and when it’s racism. And when I grew up, my mother would say, “Listen, you’ve got two strikes. You’re black and you’re female.” When we look at women of color, we just don’t see that. How many managing partners? How many CFOs? How many CEOs? How many board seats? And unfortunately I feel like — and maybe many of my black female colleagues feel like this, too — that when we’re there, we’re being counted. “We got our one.” So if we walk into the room and there’s already one of us at the table, then we have to be thinking in the back of our minds, “Is this organization already saying they’ve got one?” It takes more than one to have intentional diversity. AB: There’s definitely a difference. We’re just trying to make sure the opportunities exist, and we’re given the ability to show that we have all of the skill sets, and that we deserve to have the positions just like anybody else. Having supporters and promoters is definitely important. Companies need to see the value that it represents. Like Kimberly said, saying “diversity and inclusion” isn’t enough because we’re not seeing a huge amount of change. We need to be intentional and understand what the barriers are. Having those honest conversations and taking an introspective look and asking ourselves, “Do we really want this? And if we do, what do we need to do to achieve it?” BS: Kimberly, you wrote an article for the Journal of Accountancy recently that focused on this. It seems like every couple of years we talk a big game about diversity and inclusion, and we publish research and whitepapers about it and do podcast interviews about it, and still the needle doesn’t move. What should we be doing this time to make sure we are actually making some progress? KET: That’s a great question. I would say the first step is acknowledging that there is a challenge. If we cannot align around the notion that there is a problem, then we’re not going to get anywhere. That’s why I always started discussions about acknowledgment and understanding. Walk in my shoes first and understand what it might be like. Then, we have to see the end from the beginning. Let’s talk about a unifying message. My approach is to get us to be for something, as opposed to being against it. We need to get everyone aligned around why this is good for business. There have been reports of CEOs or business owners who forgot that the majority of their customers are African-Americans. When they got the backlash, I think they truly were surprised because they did not understand that their customer base was going through that pain every day. Let’s pay attention that this is good for business. Yes, there are people dying, and I could take you right down that path, and there will be half a dozen people, Bill, that would understand why, from a human rights perspective, we should be focusing on a different path forward. But there are some who need to hear that this is good for business. It’s good if you have a more inclusive set of skills, resources, diversity of thought. It’s going to help you minimize disruption. It’s going to help you look around corners. CONTINUED ON PAGE 8

STATEMENT

INNOVATION

EXPERIENCE Moving from ESSENTIAL to INDISPENSABLE Change was moving fast before the pandemic — and it’s moving even faster now. We have reimagined our CPA Innovation Summit as an exciting and interactive virtual event that will help the CPA community redefine and reinvent our path forward — and accelerate us in a post-COVID-19 world.

WHAT YOU NEED TO KNOW

Kick off Event: Anticipate and Reimagine What’s Next October 2 | 12:00 p.m. – 1:00 p.m. ET

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CPA Innovation Summit: Moving from Essential to Indispensable December 15 | 9:30 a.m. – 12:15 p.m. ET

Platform: We will utilize MatchBox, an interactive platform with a chat feature that lets all speakers, attendees, and our strategic partners participate in the panel discussions. The speakers will answer your questions along the way, while fellow attendees share their own experiences and insight. This gives the chance to flesh out ideas in a meaningful and practical way, while connecting with fellow professionals. In the final session, this is your chance to play a key role in designing the future! Break out room video chat discussion will be tackling a specific question or challenge we are facing as a profession. Choose the room most relevant or compelling to you. The insights shared will be captured into an eBook made available to all attendees. Panelists: Three panels of leading CPAs in all areas of our profession will be moderated by national accounting press editors (Dan Hood of Accounting Today and Gail Perry of CPA Practice Advisor), discussing what they see coming after the pandemic.

Accounting Ecosystem Webcast Series:

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LEARN MORE

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CONTINUED FROM PAGE 6

It’s going to help you identify new products, goods and services. It’s going to help you better respond to your customers’ needs and your business partners. It’s going to help you review areas and issues that you didn’t even know were there. Being diverse and having an inclusive leadership style is good for business. When people lose sight of that, they let their personal feelings out. At the heart of it, we’re talking about racism. I don’t know your heart, but I can determine from your actions what your personal feelings are. Why would you pay two people dramatically different salaries when they have the same basic skill sets? Why would your interview panel be made up completely of one group without any kind of diversity or inclusion metrics around it at all? In your candidate pool for promotions, why aren’t there any African-Americans? In your leadership suite, why don’t you have any African-Americans? If you have amazing team members — and I have every reason to believe you do — that’s awesome. Keep them there. Let’s stay focused on what the objectives of the mission, the value, the purposes are of your business. But the next time you have the opportunity to bring someone on board, did you fully consider the full suite of capabilities across a wider audience? I am going to wonder why you didn’t do that. And please don’t say, “We hire the best and the brightest.” For many of our colleagues, when we hear that, we hear discrimination. Are you saying that you can’t get the best and the brightest and also get someone who’s African-American? It’s important for a leader, Bill, to create a unifying message that doesn’t divide us. How do we ensure that everyone has opportunity and access? And so, when you ask the question, “What should we do,” my answer is: “Acknowledge and understand.” See the end from the beginning. Look at your data and be data-driven about it. Ask the tough questions. If someone has been in a role for seven years and you notice that everyone else around them is moving up, someone should say, “What’s happening?” Either that person needs more training, or we’re not providing the right environment, or — yes — they may not be performing as well as we would like. If that’s the case, we owe them that critical feedback. But there are some actions that should be triggered from the data we see, and it goes back to being accountable. To some degree, it really isn’t fair to our Caucasian colleagues to be in an environment in which they are not armed, in which they don’t have the information they need or know what they should or shouldn’t say. The (diversity and inclusion) training that we’re getting doesn’t go far enough. This sense of belonging or respect for others is so politically correct that it doesn’t peel the onion enough to arm our Caucasian colleagues with the knowledge that, for instance, it’s OK to say “Black,” but they shouldn’t say “a Black.” They may not even know what they should say. They know not to say the n-word, but many of our colleagues probably know only that: Don’t say the n-word. There’s so much more to know.

“I would say the first step is acknowledging that there is a challenge. If we cannot align around the notion that there is a problem, then we’re not going to get anywhere.” - Kimberly Ellison-Taylor The training isn’t doing enough. It’s inconsistently applied and it’s often only the chief diversity officer’s job. The three or four Black people on your team and the CEO are talking about it, but not all of your middle managers may believe in it, and so they’re not executing it. It’s not being lived as a part of your core values. That’s why we get this disconnect between the amazing, charismatic, visionary leader and the people in the middle who are responsible for execution. (Diversity and inclusion) should be part of everyone’s performance evaluation, so everyone is accountable for living the core values of the organization. We need more help, and more people with their eyes on this initiative. BS: How committed do you think the profession is to this goal, Kimberly? Are we seeing more support for real change within the profession? KET: We are committed. I have to believe we are. I have had dinners with our incoming chairs, the past chairs of various state CPA societies, the CEOs who have picked me up at the airport. We’ve sat down and had iced tea together. I am confident there are people throughout our profession who really care about this issue. What I’m concerned about is that some people might think it’s a political issue. The hesitance among some people to do more may come from the thought that this is political. How can people being killed be a political issue? It’s not political. If your political view makes racism political, I’d have to wonder what you believe that makes it political. BS: Avonette, what does the accounting and finance profession of the future look like to you? AB: I hope that it looks more representative of the world that we live in. I hope there will be more people of varying ethnicities and backgrounds that have the opportunity to impact other people’s lives. I attended a recent AICPA Council meeting in which Barry Melancon spoke about the importance of accountants. He said accountants help prepare and ensure the quality of financial statements, and those financial statements provide access to capital, which changes your quality of life. I wish everyone who is considering what they want to do with their lives could have heard that — that your ability to provide financial help to someone will change their quality of life, and by changing their quality of life, you’re changing their families and their friends and the community. What a difference we make.

STATEMENT

I would love to see a much more diverse profession — and that diversity is as much about diversity of thought. Somebody who is asthmatic and can’t play a sport will think of things differently than an athlete does. Someone who likes to hunt will think of things differently than a vegetarian does. All of those different thoughts help to provide better solutions when problems arise. I want the profession to have that diversity of thought so that we can continue to be a resource and protect people. The why in “Why do we want a diverse profession?” is because it’s the right thing to do, but it’s also better for your bottom line, typically. It comes down to answering that “Why?” for you and trying to get buy-in. And as Kimberly said, if it only comes from the top, it’s probably not going to be implemented well. Everyone in the organization has to believe in this effort, believe it is critical to the success of the company. Even beyond the success of the company — it’s critical to the growth of all of us as people and professionals. BS: Kimberly, what about you? When you think about the future of our profession of the future, what do you see? KET: Ideally, Bill, we would not be having this conversation anymore. In an ideal world, the last time we’d be talking about it would be right now. And we would look back on this time, on 2025 and 2030, and say, “Wow, I can’t believe that actually happened!” That would be ideal for me.

But OK, let’s say I’m dreaming and that doesn’t happen. I would hope we would be able to increase the exposure of accounting to students, that we would graduate more students in accounting and they would choose to become CPAs and CGMAs. I would hope that we will have encountered and countered the bias in artificial intelligence that exists when we apply for jobs. And let’s say we actually make it to the interview table: I would hope the interview slates would include as many African-Americans as other candidates. When we arrive for an interview, I would hope we will see people who look like us on the other side of the table. And if we are fortunate enough to be hired, I would hope we will meet people in onboarding and orientation who look like us, as well as other colleagues. I don’t want to leave out our Caucasian colleagues, either. I would hope we will all be working hand in hand on this. I would hope our leaders will be issuing their thoughts virtually much of the time, because that genie’s out of the bottle; we won’t be working inperson as much as we used to. But if our leaders could be there, that would be awesome … and if not, they would be on Zoom. And when our leaders say, “The chief financial officer is going to speak,” or, “The chief operating officer is going to speak,” or, “The controller or the partner over this line of business is going to speak,” I would hope that when we look at the screen, we actually see people who look like us — people who have similar experiences as ours. CONTINUED ON PAGE 10

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And when we look at the C-suite executive committee and executives who advise the CEO, I would hope we will see that they didn’t do the count and say, “We’ve got one Black female, so we’re covered,” or, “We’ve got one Black guy, so we’re covered.” I would hope our C suites will actually have three, or four, or more people of color … or they could have none, but because of the work our leaders have done, if there are none, we will trust that they’ve done the right thing. We will trust that they looked far and wide and still picked the best and the brightest for what they need. We’re not holding them to artificial numbers that don’t mean anything. We want opportunity and access, and if we’re not there, then Bill, we’re not there. As long as we had the opportunity and access.

“I hope there will be more people of varying ethnicities and backgrounds that have the opportunity to impact other people’s lives.” - Avonette Blanding All of these things will reflect a more inclusive profession where everyone can legitimately put their best foot forward and not be worried.

And when we look at our boards, I would hope we will see us reflected around that table — that we will see the diversity of thought as consumers, as clients, as business partners, the voices that are needed to help look around corners and anticipate change. I would hope we will be there, threaded, interwoven into the tapestry of how a business operates and how it sources talent end to end. I would hope it will be there in the way we get paid, that it will be represented in the pool of candidates for promotion, that it will be reflected in retention numbers, because the number of people you recruit doesn’t necessarily matter as much as the number of people you actually keep.

And then socially, Bill, I would hope we will not be worried in the park. We won’t be worried at home. I won’t be concerned about what happens when my son is out driving. I’ll still worry — I’m a mother, after all, but I won’t worry about those things. That is an ideal state. Maybe we won’t get there on every level, but it’s certainly an ideal worth fighting for — and worth fighting for with everyone at that same table, working together to move the ball forward. Bill Sheridan, CAE, is editor of The Statement and chief communications officer of the MACPA and the Business Learning Institute.

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STATEMENT

BUSINESS & INDUSTRY Finding a balance: Planning for reopening offices Companies need to prepare for the reopening of office space and the changed realities of work B Y BRY O N Y CLE A R HILL Note: This article first appeared in Financial Management magazine. For more articles, sign up for the daily email update CGMA Advantage at http://bit.ly/2svn2AY.

MACPA offers guidance on how businesses can safely reopen

As countries lift COVID-19-related lockdowns, more businesses are considering reopening offices. Finance professionals will be an integral part of the reopening decision process and will need to think carefully about how to proceed. While continuing with remote working may help reduce the risk of transmission of the virus within offices or on public transport, some employees might be keen to return to the office. Some may feel burned out after six months of working at home with the pressures of child care and boredom, while other employees may want to be in the office for purely practical reasons — lack of equipment, poor Internet connections, and multiple people working from the same home.

FALL 2020

Every organization is going to be different in the response needed to get offices back open, depending upon who owns the building, the size of the office, and whether employees are likely to use public transport. Whatever the situation for your organization, here are some key considerations for finance professionals to keep front of mind when weighing reopening the office. PRIORITIZE HEALTH AND SAFETY Where offices are opening, business leaders must ensure that health and safety is prioritized. “Wherever possible, employees should work or access the business from home to minimize the number of workers that need to be physically present,” wrote Tom Hood, CPA/CITP, CGMA, president and

The Maryland Association of CPAs has compiled official back-to-work guidance from federal, state and local sources and curated it into a collection of best practices for organizations that want to reopen their businesses in a safe and socially responsible manner. Titled “Reopening the Profession: An Accounting and Finance Professional’s Guide to Safe Work in a COVID-19 World,” the document gathers recommendations from health care, government and business experts and presents it as the generally accepted best advice available for how business leaders can safely return to work. Download the guide in its entirety at bit.ly/BackToWorkCPAs.

CONTINUED ON PAGE 14

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MACPA partners with ‘MyHealthyWork,’ an app that helps create safe, healthy offices amid COVID-19 10 percent discount available for accounting and finance teams By Bill Sheridan, CAE In an effort to help accounting and finance professionals create and maintain safe, healthy workplaces in a COVID-19 world, the Maryland Association of CPAs is partnering with 1Rivet to make the groundbreaking “MyHealthyWork” app available and affordable to its members and customers. The “MyHealthyWork” app offers users safe and easy ways to: • safely monitor and record employees’ health markers as recommended by the Centers for Disease Control and Prevention (CDC); • identify those who may be sick and trace the people they had contact with at work; and • create a workplace in which employees feel safe from the threat of COVID-19. “The goal of the MyHealthyWork app is very simple: Get people back to work and feeling safe,” said Eric Middleton, managing partner and CEO of 1Rivet. “We are so pleased to have this relationship with the MACPA and Tom Hood that will allow us to help more companies open up safely.” The “MyHealthyWork” app is available for both Android and iOS mobile devices. It includes the following features: • Contact tracing: Identify employees who have interacted during the day and identify those affected during an outbreak. • Health status: Dashboard indicates if an employee should come into the office, work from the road, or stay home — and how long they need to stay home. • QR codes and interaction: Use QR codes to identify various locations in their workplaces and use the “Favorites” list to identify employees who sit or work near each other. • “How I Feel” questions: Temperature readings and icons for easy-to-answer health questions. • Outbreak notification: Real-time notifications with identified outbreaks and critical next steps for leaders to take. • Gamification: Awarding employees for participation with virtual points and badges. “The health and safety of our team is our top priority, but we also wanted a solution that would help protect our employees’ privacy,” said MACPA President and CEO Tom Hood, CPA. “Because it relies on self-reporting rather than GPS or Bluetooth tracking, MyHealthWork is a perfect fit for our team — a solution that’s designed to protect their health, well-being, and their privacy as well.” The app works in tandem with the MACPA’s guide to “Reopening the Profession,” which offers accounting and finance professionals the best state and federal recommendations for how to reopen a business in the safest and most socially responsible manner possible. The guide is available at bit.ly/BacktoWorkCPAs. DISCOUNT AVAILABLE TO ACCOUNTING AND FINANCE PROS In that light, 1Rivet and “MyHealthyWork” will offer a 10-percent discount to all accounting and finance professionals who make use of the app. Members of the profession can visit MyHealthyWork.com and sign up with the code “MACPA2020” to receive their discount. In addition, the MyHealthyWork team will dedicate at least 1 percent of its net annual profits to small businesses that cannot afford the app. “Our giving team reviews applications sent to us by businesses in need,” Middleton said. “If your business needs assistance, please e-mail us at GivingBack@MyHealthyWork.com.”

CEO of the Maryland Association of CPAs and the Business Learning Institute, in a recent article highlighting the need to prioritize employees’ health and safety. Hood pointed out a number of ways this can be done, including by requiring face coverings in communal spaces, mandating self-quarantine for any employees with symptoms, providing additional cleaning supplies and handwashing facilities, and reconfiguring office interiors to promote physical distancing. Staff work schedules should also be considered, said Roshni Patel, design and innovation adviser at London-based Reputable.Design. “Organizations may need to stagger when people are working, to limit strain on congregation points like lifts and canteens,” she said. There are different ways of making this work. Some organizations are looking at splitting teams into groups that alternate time in the office, which as well as reducing the number of people in the office also reduces the risk of a whole team falling ill simultaneously. Other businesses are being flexible with work hours, allowing people to start work much earlier or later than normal to reduce strain on public transport and entrances to offices. ALLOW CHOICE WHERE POSSIBLE Employers must be aware that some employees or someone they live with will have health conditions which make them particularly vulnerable to the coronavirus, meaning a return to the office remains unlikely for many months. Organizations may also find that some employees have discovered that they enjoy working from home and don’t want to come back into the office. The optimal situation is likely to be to give employees the choice of coming into the office or continuing to work from home, where possible. “We will not ask anyone on our team to come back until they are ready,” Hood wrote, highlighting the need to give employees a choice. Some companies, such as Twitter, have already made highprofile commitments to this principle, telling employees that they can choose to move to remote working permanently. STATEMENT

“We will not ask anyone on our team to come back until they are ready.” - Tom Hood SUPPORT THOSE AT HOME COVID-19 is presenting new questions about how far employers’ duty of care to their employees extends. Employers are expected to carry out health and safety checks for office-based working, including ensuring that desks and chairs are fit for purpose. But does this extend to those working from home? Some employers are offering support to help employees set up safe working stations at home, either by shipping equipment to home addresses or allowing items such as chairs to be claimed on expenses.

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The legal situation will also vary by country and industry, so business leaders should ensure that they are not opening their organization up to the risk of legal action being taken by employees who have not been supported to create a safe working environment at home. “It all comes down to the balance,” Patel said. “What are the risks of people from working at home versus the risk of hundreds of people using lifts, touching everything, and not being able to distance? At the moment, most organizations are seeing reopening as the bigger risk.”

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Management accountants need to consider these risks and ensure they are effectively mitigated. Whether organizations are ready to reopen offices tomorrow or decide to hold off for now, listening to employees and understanding their concerns is absolutely key. “An organization’s culture and the voice of employees is really important,” Patel said. “It’s not about dictating how things are going to be done, but instead bringing in the viewpoint of employees to understand what they want.” Bryony Clear Hill is the associate manager of ethics awareness for CIMA and is based in the UK. To comment on this article or to suggest an idea for another article, contact Drew Adamek, an FM magazine senior editor, at Andrew.Adamek@aicpa-cima.com.

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STATEMENT

TAX CORNER Planning for separation or divorce The ongoing effect of the Tax Cuts and Jobs Act on child support and alimony B Y F E R R I E R S TILLM A N A N D KE RIANNE K EMMERZELL agreements and court orders. It is also important to note that alimony payments made pursuant to an agreement or court order signed before Dec. 31, 2018, must continue to meet the tax-law definition of alimony to receive the pre-TCJA alimony tax treatment. That means the payments must: 1. be made pursuant to a written instrument (including agreements and court orders), 2. be paid to a former or current spouse, 3. not state that such payments are something other than alimony, 4. not be made to a spouse or former spouse who is still living in the same household, 5. be paid in cash or cash equivalent, 6. not be paid as child support, and 7. not extend beyond the death of the recipient spouse.

It may not be news that the Tax Cut and Jobs Act passed in 2017 has changed the way alimony payments and exemptions are reported on tax returns for both the economically dependent spouse and primary wage earner. However, the actual effect in divorce cases of these legal changes contribute both to opportunities to settle cases and impediments to settlement. The TCJA provides rules about alimony, exemptions, and the Child Care Tax Credit that are different than those under the former law. However, these changes don’t suddenly prevent settlement of divorce cases. They just have created a different set of rules within which to negotiate alimony, child support, and tax savings. ALIMONY Marital settlement agreements and court orders signed after Dec. 31, 2018, can no longer make alimony payments tax deductible to the payor and taxable income to the payee. This change effectively shifted the tax burden from the recipient spouse to the paying spouse and cannot be overridden or circumvented by agreement between the parties. However, if after Dec. 31, 2018 the parties modify an existing agreement reached prior to Dec. 31, 2018, which made alimony tax deductible to the payor and taxable to the payee, then the parties, only by agreement, may keep that provision. This was a significant change to federal tax law, which affected — and continues to affect — most alimony provisions in both marital settlement

When planning for a separation or divorce, it is important that individuals and their advisors are aware of the changes to the alimony tax law as well as the requirements for payments to meet the tax-law definition of alimony in cases in which one party is trying to modify a court order or agreement that was entered prior to Dec. 31, 2018.

The decision as to which parent will claim the child tax credit and dependency exemptions can be an important bargaining chip when negotiating a marital separation agreement or parenting agreement. EXEMPTIONS AND THE CHILD TAX CREDIT Personal exemptions have been suspended, beginning with the 2018 tax year, and this also can affect negotiations over a marital settlement agreement. Of course, this means taxpayers are no longer able to claim personal exemptions for themselves, their spouse, and their dependent children or relatives on their federal income tax return. CONTINUED ON PAGE 18

FALL 2020

TAX CORNER CONTINUED FROM PAGE 17

However, the standard deduction amounts for all taxpayers and the Child Tax Credit increased. The standard deduction for joint filers increased from $12,700 to $24,000. The head of household increased to $18,000 and all other filers increased from $6,350 to $12,000. The child tax credit increased from $1,000 to $2,000 per qualifying child, and a $500 credit for other dependents was added. In addition, for tax years 2018 through 2025, the Child Tax Credit phases out at an adjusted gross income of $400,000 for joint filers and $200,000 for all other filers, compared to $110,000 and $75,000, in 2017, respectively. For some taxpayers, these increased deductions compensate for the suspended exemptions. Conversely, for taxpayers with many dependents, these changes result in a higher tax bill. This federal tax law change is in effect through the 2025 tax year.

The decision as to which parent will claim the child tax credit and dependency exemptions can be an important bargaining chip when negotiating a marital separation agreement or parenting agreement. The TCJA still provides room for negotiations about alimony and child support, but just with different factors than in the prior law. It is important that individuals and their advisors know the current thresholds and exemptions when negotiating a marital settlement agreement, but equally important that they know the law may change again in 2025. Ferrier Stillman, Esq., represents clients in complex family law cases throughout Maryland on behalf of Tydings & Rosenberg. Kerianne Kemmerzell, Esq., is an associate in Tydings & Rosenbergâ&#x20AC;&#x2122;s family law group and litigation department. This article is for informational purposes only and does not constitute legal, financial, or tax advice.

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FINANCIAL PLANNING LGBTQ focus: The importance of estate planning B Y R I C H A R D L . A DA M S, E SQ . in your best interest. Depending upon your planning needs, language related to power over trust agreements, gifting your property, and changing your beneficiary designations can be included. This document also helps avoid the need to petition the Circuit Court for guardianship over your property when you are no longer able to handle your affairs, as the attorney-in-fact can manage them on your behalf. 3. Advance medical directive / health care power of attorney / living will. This document allows you to appoint someone else to make medical decisions on your behalf, in the event you are unable to do so. It also allows your agent to interact with your medical professionals, serving as a resource to you related to any ongoing medical needs. The document also provides guidance as to your end-life wishes, such as in the event you face the end of a terminal illness or are in a coma, whether or not you want to receive pain medication, and includes your directions related to organ donation. This document also helps to avoid the need to petition the Circuit Court for guardianship over your person / body if you are unable to make those decisions yourself. A proper estate plan is critical for everyone, no matter their level of wealth or income. At its core, estate planning is not really about the value of assets involved, but the desire to control and ensure that your wishes are honored when you are no longer able to speak for yourself. Donâ&#x20AC;&#x2122;t let yourself be silent by failing to plan for the inevitable. With this in mind, the following documents should be in place for all, regardless of wealth or income status: 1. Last will and testament. This document allows you to control how the assets held in your name alone, called probate property, will be distributed upon your death. It allows you to provide distribution of specific property to individuals outside of your family. You can also nominate guardians of your minor children and name a personal representative of your choosing to handle your affairs. A will allows for incredible flexibility as to bequests to individuals or entities that you wish to benefit from your estate upon your death, regardless of their family relationship to you. For those who wish to provide for their beloved animals after they are gone, a â&#x20AC;&#x153;pet trustâ&#x20AC;? can be created under a will, providing guidance and resources to a caretaker of your choosing. 2. Financial power of attorney. This document allows you to appoint an agent or attorney-in-fact to handle your financial affairs on your behalf. It grants very broad powers, giving them the authority to basically perform any action related to your finances or contract, along with the duty to perform said actions

Depending on your specific situation, you may also wish to implement the following documents: 4. Trusts (revocable / irrevocable). Trusts are useful tools that can be created to serve a variety of purposes, for the benefit of your spouse, children, friends, extended family members, or other loved ones. Unlike a last will and testament, which must be publicly filed when you die, a trust is a private disposition of your assets. It can also be a useful tool to protect funds for those with special needs, assisting them in maintaining eligibility to receive government benefits, while also providing additional resources for their supplemental needs. Trusts are also useful to shelter funds from those who are not responsible with money. The trustee also serves as an advocate for the trust beneficiary, ensuring that they have a safe, secure, and comfortable life. 5. Deeds. The titling of real estate is important to any estate plan. There are different ways to hold property that may coincide with your goals, such as holding property as tenants-by-the-entirety with your spouse, or by owning a life interest in your property so that upon your death, the property would flow directly to your children, by operation of law. Another important aspect of the estate planning process is the desire and ability to engage in charitable planning. Often, members of the LGBTQ community prefer to leave a portion of their assets to support charitable endeavors, including those that specifically support and protect vulnerable members of the community. Working with your advisors can help you identify potential charitable goals and resources.

STATEMENT

FINANCIAL PLANNING Often, members of the LGBTQ community prefer to leave a portion of their assets to support charitable endeavors, including those that specifically support and protect vulnerable members of the community. Working with your advisors can help you identify potential charitable goals and resources. Essential to any estate plan discussion is a careful review of how your assets are titled, including the beneficiary designations currently in effect for your retirement accounts and life insurance policies. These are considered non-probate property and are not controlled by your last will and testament. All of these financial pieces need to be reviewed and considered when putting a plan in place, and whenever a major life change has occurred.

who does not agree with your membership in the LGBTQ community, or would not honor your wishes, is granted broad authority over you. Current law assumes that such power should be granted based on blood relation, rather than personal connection. Thus, it is essential that members of the LGBTQ community have such documents in place.

In Maryland, if you do not have these documents in place, the decisions related to your body and assets, both when you are alive and when you pass away, are controlled by the state of Maryland, rather than you. Sometimes, this can mean that a family member

Richard L. Adams has been an associate attorney at O’Byrne Law, LLC, since October 2019.

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FINANCIAL PLANNING Gift and estate tax planning: In 2020, anticipate the worst B Y K E V I N F. BRE SS consider the havoc that may be wreaked on Wall Street after the presidential election, which is certain to be a spectacle. Clients may want to have their collective fingers on the trigger to make their big gifts should their portfolio values plummet. MARYLAND’S NEW SPOUSAL ELECTIVE SHARE LAW A rude awakening awaits children of blended families who lose a parent after Oct. 1. If the surviving spouse decides that the testamentary assets left to them are not as much as they could receive under a formula that Maryland will roll out this fall, a substantial chance exists for intra-family litigation.

While more than 99 percent of all Marylanders are not likely to be subject to federal or Maryland estate taxes at death, given the high exemption thresholds, conventional wisdom is that our clients should not get too complacent. It is likely that federal and state governments will be looking to dig out of a postpandemic budget crisis next year. One area due for a tax hike is within the gift / estate tax regime. Wealthier clients have already been advised by their forward-thinking estate planners to use gift tax exemptions to take maximum advantage of the generosity Congress has bestowed upon us with high exemption limits. And in Maryland, there has never been a gift tax. It’s anyone’s guess what the post-pandemic “payback” will be for the gift and estate tax. But by the time your clients see what is being proposed in Congress, they may be snared in the trap where any rollback of exemptions carries an effective date

equal to the date such legislation was first introduced. Don’t count on being able to suggest deploying a large gift once the law change has come to light. Accomplishing large gifts to family members is easy and should be considered now. The familiar tools to affect gift transfers are trusts established for a spouse or for children, which take advantage of certain valuation discounts when computing the amount of the gift. The question is when to pull the trigger. Another reason to consider taking action now is that the law establishing the generous federal estate and gift exemption (presently $11.58 million) is set to sunset on Dec. 31, 2025. Per Treasury Regulation §20.2010-1(c), taxpayers who now take advantage of the high gift exemption will not be subject to an IRS clawback after the taxpayer’s death if the exemption in the year of death were lower. For those holding appreciated stock portfolios, two factors should be considered. It’s quite likely that if the virus resurges in late fall, shutdowns may re-emerge. And

A widow(er) need only make a simple filing of a form during the probate proceedings to initiate their claim for a higher percentage of the entire pot of assets available. This “spousal election against the will,” as it is referred to, is not new in Maryland. But beginning in October, the election will extend to assets that did not pass through probate and passed to others directly. This could result in a much greater “spousal share” for the widow(er). Stepchildren could find themselves being pursued by the surviving stepparent, who, even if on great terms, will be in the awkward position of clawing back from their stepchildren a percentage of certain assets such as IRAs, life insurance, and other beneficiary-designated accounts. Previously, such assets passed to named beneficiaries outside the scope of the will, known as passing by “operation of law.” Heretofore, those assets were not fair game for the election in most cases. Subpoenas may be the tool of choice for the stepparent to require stepchildren to disclose what assets were received by operation of law from their parent, only to see some portion of those accounts or life insurance disgorged.

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FINANCIAL PLANNING Look for a resurgence in the use of prenuptial agreements, and maybe a scramble to implement postnuptial agreements, as those instruments may offer the best protection from the spousal election. SECURE ACT LIKELY TO CAUSE BACKPEDDLING OF PRIOR BENEFICIARY ADVICE One of the most popular justifications for advising clients to bite the bullet and pay income tax to effect a rollover of their traditional IRA to a Roth, was to take advantage of the enormous tax-free accumulation that would occur for a Roth over the lifetime of the designated beneficiary. Prior to the SECURE Act changes, naming a grandchild as the Roth beneficiary was the best way to keep the required minimum distributions (RMD) to a minimum, given

the much lower annual withdrawal required by the IRS tables. A minor’s annual distribution amount was certain to be lower than the earnings that Roth IRA would post year-over-year. This approach would likely cause the Roth balance to actually grow for many decades. The SECURE Act changed the RMD requirement, even for inherited Roth IRAs, to require the beneficiary to complete the withdrawal of the entire account within 10 years. Whether the named beneficiary is a child or a grandchild, the former stretch provisions have ceased to apply, and the stretch strategy has lost its lure.

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PERSONAL FINANCIAL PLANNING CONF ERENCE Learn more at the 2020 PFP Conference Kevin Bress will offer a deeper dive into estate planning issues during the MACPA’s 35th annual Personal Financial Planning Conference, which will be held live online on Oct. 27. Get complete details and register at MACPA.org/pfp.

Kevin F. Bress is a managing director in the law firm PK Law.

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PERSONAL FINANCIAL PLANNING CONFERENCE SERIES Your clients trust you with their financial security – make sure you’re advising them with the best information available. The Personal Financial Planners Conference Series is designed to give you comprehensive insight into the issues and trends that are reshaping local, regional, and global markets. You’ll leave with practical takeaways to help your clients, along with the economic context and understanding you need to prepare them for the future.

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FINANCIAL PLANNING A new world of long-term care solutions B Y TI M O T H Y K E LLY, CLTC LIFE INSURANCE WITH ACCELERATED BENEFITS FOR LONG-TERM CARE These are structured to allow the policyholder to access 100 percent of the death benefit for long-term care services but offer no extension of benefits. These policies require underwriting for mortality and morbidity and charge an additional premium for the rider. Therefore, these policies are primarily sold to your healthier clients who understand that they need a long-term care plan but who do not want traditional long-term care. To sell these products, advisors have to complete the same continuing education requirements that exist for traditional long-term care.

As we continue to navigate through uncharted waters in 2020, you should be well on your way to adding linked benefit long-term care solutions to your portfolio. These products include life insurance with long-term care and chronic illness riders as well as annuities with long-term care riders. Why have these products become so popular with advisors and consumers? Most of us can come to the logical conclusion that it is smart to plan for long-term care. However, there have been some major impediments in the marketplace that have stalled traditional long-term care sales. The major objections to traditional long-term care insurance that exist can be answered with a linked benefit product. Traditional long-term care insurance offers the most leverage initially for your clients of any solution in the market. However, not everyone wants it or can qualify for it. We should have alternatives for these clients.

As we continue our journey into a new world of long-term care planning, we must come to a greater understanding of the myriad solutions that are now available to our clients and where they fit. ASSET-BASED LIFE INSURANCE WITH A LONG-TERM CARE RIDER These products offer value to the consumer, whether they ever need care or not, in the form of a death benefit or a return-of-premium rider. This overcomes the typical â&#x20AC;&#x153;use it or lose itâ&#x20AC;? objection of traditional long-term care policies. They also offer significant leverage in the form of long-term care benefits that vary based on age and health but average three to five times your single premium deposit. They do this by offering not only the ability to accelerate the death benefit but also extending those benefits after the death benefit is exhausted. These products allow you to extend the monthly long-term care benefit for up to an additional four years or even lifetime benefits.

LIFE INSURANCE WITH ACCELERATED BENEFITS FOR CHRONIC ILLNESS These products are structured to allow the policyholder to access a portion of the death benefit for long-term care expenses. Therefore, they provide fewer long-term care benefits than the linked life policies with long-term care riders. These policies do not require underwriting for morbidity (the long-term care risk) and they do not charge an additional premium for the rider. Generally, the rider is automatically added to all policies that receive a Table 4 or better in the underwriting rating class. The niche for this product is for clients who have conditions that are insurable for life insurance but not long-term care insurance. There is a charge against the death benefit at the time of claim for the early acceleration. No additional CE requirements exist to sell these types of riders. ASSET-BASED ANNUITIES WITH A LONG-TERM CARE RIDER The underwriting on these products is a little more aggressive than traditional longterm care or life products. These solutions are structured as single premium deferred annuities (SPDA) with a long-term care rider. The annuity value will accumulate at CONTINUED ON PAGE 26

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FINANCIAL PLANNING CONTINUED FROM PAGE 25

a fixed rate of interest just like any other SPDA. The long-term care rider allows you to double or triple the amount of your single premium in long-term care benefits. The entire annuity value, including the gain in the contract, will be distributed income tax-free as a tax-qualified long-term care benefit if withdrawn to pay for qualified long-term care expenses. The annuity value is used first to pay long-term care expenses. After the annuity value has been exhausted, the benefits from the long-term care rider are distributed income tax-free for qualified long-term care expenses.

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Offering multiple solutions to supplement your traditional long-term care sales is a must in this new long-term care marketplace. Once again, traditional long-term care policies still offer the most leverage initially, but we should have alternatives for clients when this is not an option because of their health, finances, or preferences. Timothy Kelly, CLTC, is senior vice president of sales with Individual Commercial Brokerage, Inc.

R ETU R N OF THE ECO N OM IST

PERSONAL FINANCIAL PLANNING CONF ERENCE Learn more at the 2020 PFP Conference Timothy Kelly will address “How to Select Products / Features to Meet Various Needs for LongTerm Care” during the MACPA’s 35th annual Personal Financial Planning Conference, which will be held live online on Oct. 27. Get complete details and register at MACPA.org/pfp.

V IRT U A L & IN T E R A CTIVE EVENT

COVID-19 has rocked what had appeared to be a nearly invincible economy; one associated with substantial job growth, multi-decade lows in unemployment, sturdy compensation increases, robust retail sales, low inflation, and strong financial market performance. Underneath that strong performance, however, was a set of fragilities that have been exposed by the pandemic. This webinar speaks to our current economic circumstances, how difficult things are likely to become over the foreseeable future, and the contours of the brisk recovery to come thereafter.

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REGISTER TODAY: macpa.org/Economic-Update *These events are collaborative sessions from the Business and Industry and the Personal Financial Planning Conference Series. 35 TH ANNUAL

PERSONAL FINANCIAL PLANNING 26 CONFERENCE SERIES

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HIGH-TECH SOLUTIONS COVID collaboration: Leveraging new tools B Y C H R I S R O CHFORD While most firms use Teams for internal communications, there’s also an outwardfacing model. You can invite your clients as guests within a team. If your clients are already familiar with this tool, it’s a good way to provide a more ever-present way to communicate and send updates.

The Boomer Consulting team has been using Zoom for video conferencing for years – long before COVID-19. It’s an excellent tool, and many new Zoom users have only scratched the surface of its features. That said, it’s not the right solution for every occasion. Zoom and other video conferencing apps are just a few of the ways that remote teams can communicate and collaborate. Today, I thought I’d share a few we’re using right now. MIRO If you’ve ever gathered a group in a conference room for brainstorming with a whiteboard and some sticky notes, you should feel right at home in Miro. It’s a digital whiteboard that allows people to collaborate any time, anywhere. Miro has several pre-built templates, from business model canvases to mind maps and more. Or you can start with a blank page and use features like digital markers and shapes to create your own collaboration space. You can even embed documents, spreadsheets, PDFs, and images on your board. Our team has used Miro to collaborate internally on project diagrams, process flows and even icebreaker conversations. It’s also an excellent tool for strategic plan-

FALL 2020

ning or other consulting engagements with clients. As your firm builds out its portfolio of tools for remote consulting engagements, consider Miro. The free version allows up to three boards with unlimited collaborators if you want to give it a try. MICROSOFT TEAMS Many of the firms we work with have implemented Microsoft Teams in the past year. It’s an all-in-one platform for chat, video conferencing, calls, and sharing documents. One of the best things about Teams is that it allows for threaded discussions on specific projects, topics, or departments – however you want to scale it. You can set up multiple teams, and each team can have multiple channels. This allows for communication between the whole team, but also breakout discussions for different topics or projects within that team. At Boomer Consulting, we created a team for each of our communities: the Business Transformation Circle, Talent Circle, Managing Partner Circle, etc. Within those teams, there can be channels for different topics, like attracting and retaining talent, selecting a document management system, remote work policies, and more. New channels can be developed as needs arise – for dealing with COVID-19 issues or something more evergreen.

VirBELA One long-term outcome of the pandemic is that firms are thinking differently about how they meet with co-workers, peers, clients, and solution providers going forward. For our Boomer Technology Circles Summit this year, we could have used Zoom, but we decided to explore some new virtual reality tools that would allow us to keep one-on-one as well as facilitated group discussions. After considering a few alternatives, we selected VirBELA, a virtual 3D environment with presentation tools and avatar interactions that allowed our attendees to meet as a group and break into small groups or one-on-one meetings as easily as they could in a physical space. The event was a great success, and we’ve ended up using VirBELA since then. When Zoom was having technical problems at the same time as our all-team meeting, we were able to move the meeting to VirBELA rather than reverting back to a conference call. The three tools I’ve mentioned above certainly aren’t the only solutions for virtual communication and collaboration. There are lots of alternatives, and this field will undoubtedly grow in the near future. However, I hope that seeing how our team has found success with new tools will encourage you to experiment with some new solutions. Don’t silo yourself in one video conferencing app just because it’s familiar. There’s a world of tools out there to try. See what else might work for you and start leveraging them. Chris Rochford is technology and business analyst for Boomer Consulting, Inc.

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HIGH-TECH SOLUTIONS AICPA, CPA.com launch .cpa domain Initial application period runs through the end of October F RO M T H E A I CPA The American Institute of CPAs and its business and technology arm, CPA.com, have begun an early-phase rollout of .cpa, a restricted Internet domain that allows CPAs to connect with clients and the general public with greater trust, security and verification.

“The .cpa domain will signal you’re doing business with a licensed CPA firm or individual CPA, so it provides an additional level of trust, security and brand recognition in online interactions.”

Top-level domains are the letters found at the end of an Internet address, with the most common being .com. The use of specialized or restricted top-level domains has grown dramatically in recent years as businesses, organizations, and online communities seek to promote their visibility and authenticity in the digital world. The restricted domain designated for the CPA profession is .cpa.

firms are free to apply for any available .cpa name on a rolling, “first come, first served” basis. In January 2021, the process will open up to include individually licensed CPAs.

The AICPA was awarded ownership and management of the .cpa top-level domain last year by the Internet Corporation for Assigned Names and Numbers (ICANN).

”Trust is a crucial commodity in business and on the Internet, and it’s a cornerstone of the CPA profession,” said AICPA President and CEO Barry Melancon, CPA, CGMA. “The .cpa domain will signal you’re doing business with a licensed CPA firm or individual CPA, so it provides an additional level of trust, security and brand recognition in online interactions.”

“The digital presence of firms has never been more important,” said Erik Asgeirsson, president and CEO of CPA.com. “The .cpa domain will reduce risks associated with phishing and spoofing attacks and the growing number of online bad actors. Just as importantly, it will give clients and the public-at-large greater peace of mind they’re dealing with legitimate CPA firms.”

The institute has contracted with Neustar, one of the largest registry service providers in the world, to maintain and secure all .cpa domains. CPA.com will be responsible for managing the outreach of the service to firms in the United States.

- Barry Melancon, CPA, AICPA President and CEO

For additional information on the .cpa domain, please visit domains.cpa.

All firms can begin submitting applications today at domains.cpa. The goal of this initial period, which runs through Oct. 31, is to help firms acquire domains that are most consistent with their current digital branding. To apply, firms must be licensed and agree to use the domain they acquire. Licensed firms that apply during the early registration phase will be able to register their existing .com domain using .cpa. Firms will be notified of the outcome of their domain applications no later than early November. The initial application phase is designed to ensure domains are issued systematically, according to logic-based criteria that has been verified by an independent third-party. After the initial period closes on Oct. 31 and the first batch of domains are awarded,

FALL 2020

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MACPA VOLUNTEERS An update from the MACPA’s Forensics and Valuation Services Committee B Y R O B E RT W. CA RTE R There have been many changes in our profession during 2020. As a result, the MACPA’s Forensic and Valuation Services Committee would like to provide MACPA members with a committee update related to the impact of these changes. Over the next year, the committee will be monitoring regulations regarding in-person events due to COVID-19. For the foreseeable future, all events will be virtual. The FVS Committee is planning to host a CPE webinar in November and another one in January 2021. Details regarding these webinars should be made available shortly. Additionally, the committee is expanding our outreach program to college students and hopes to formally schedule presentations to local colleges and universities regarding the forensics and valuation field. As schools settle into their distance learning setup, the committee plans to host a second recruiting event for students similar one that was held last year, but in a virtual format. The event last year was very suc-

cessful, and committee members hope to build upon its success going forward. All MACPA members are welcome to attend this recruiting event. In May, the committee hosted its virtual Forensic and Valuation Services Conference. Committee members would like to thank MACPA members who attended, as well as for their feedback. The MACPA recently sent out an additional survey regarding the FVS Conference. Please take time to fill out this survey as it will help the committee plan its 2021 conference and select topics that are of interest to members. Any suggestions regarding presentation topics in the areas of valuation, forensics, or litigation are welcome. The committee is tentatively planning the 2021 conference to be in-person but will be prepared to host it virtually if necessary. Depending on the ability to meet in person, the FVS Committee is also preparing to schedule its “mock trial” event,

which takes place every few years and is a member favorite. The event is a great opportunity for practitioners and students alike and will promote networking and training as well. Since the mock trial works best in-person, the committee will determine if it is reasonable for it to occur in 2021 or if it will need to be postponed due to health risks. Committee members will keep the MACPA membership updated as they make their decision. If you have an interest in joining the Forensic and Valuation Services Committee, please reach out to me at rcarter@ hertzbach.com or Cyndi Powers at cyndi@ macpa.org. Robert W. Carter, MS, CPA/CFF, CVA, CFE, CEPA, is a partner with Hertzbach & Company, P.A. and leads the firm’s Litigation, Forensics, Valuation Department. He is chair of the MACPA’s Forensic and Valuation Services Committee.

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Avoiding Bankruptcy – Surviving a Recession (A case study approach) with Frank Ryan

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FROM OUR SPONSORS How to reinvent your firm: The AccountantsWorld 2020 Promise B Y H I T E NDR A PATIL As an accountant, you have tremendous power. Unfortunately, most accountants don’t realize it. When we ask accountants which systems they use, we often hear, “We use whatever our clients use.” How do your clients know what the right accounting solution is for them? Most small businesses don’t have the expertise to decide. Instead, their decision is influenced by the massive marketing from the do-it-yourself solutions directed to small businesses. This trend shows two disturbing realities of the accounting profession: • The companies that sell their accounting solutions to your clients have a stronger influence over your clients than you do. • They dominate over your accounting practice and weaken your control over client accounting. How can you be relevant under these circumstances? You must regain control over client accounting and your client relationships if you want to become relevant and do what’s best for your clients and your firm. Thanks to COVID-19, we have all experienced an unprecedented crisis. But what if you could help your firm emerge stronger? Not only can you bounce back, you can thrive for years to come — if you take what happened as a wakeup call to reinvent your practice. There are two important things in your favor: 1. By helping your clients get PPP loans and aiding through other means, you show them the crucial role you play in their business. 2. Clients still need help to achieve a full recovery and get their businesses on a sound footing for future survival and long-term growth. And because of the much-needed help you provide in a time of crisis, they’re more willing than ever to follow your lead. In fact, you can help save many businesses and a lot more jobs. If you rise to this occasion, your firm will soar to heights it has never reached before. This is a tremendous opportunity for you to do what’s good for both your clients and your firm. SO HOW DO YOU RISE TO THE OCCASION? Many experts have suggested offering advisory services, but it’s simply not enough. You have to become more relevant to your clients’ businesses. Being relevant requires you to change your mindset and the way you run your practice. You have to start viewing things from your clients’ perspective. That requires you to look inward by thinking about how your firm can acquire the capabilities needed to do what’s best for your clients. You may have to change the solutions you are using, revamp your processes, and retrain your staff.

Being relevant requires you to change your mindset and the way you run your practice... This is what the AccountantsWorld 2020 Promise helps you accomplish. AccountantsWorld has helped thousands of accountants enhance their practices over the years. Our 2020 Promise is an extension of what we have been doing all along. You bring your expertise and your drive to thrive. We augment it with the most powerful suite of cloud solutions ever created for accountants, plus the training, resources, and unwavering support you need. This synergy will take your practice to heights that were never before possible. To learn more about AccountantsWorld’s 2020 Promise, call (866) 956-9173 or visit Our2020Promise.com. Hitendra Patil, Director of Customer Success at AccountantsWorld.

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In the new normal, is your priority to do better? It’s a diﬀerent ballgame now than it was before the crisis. And while working in this new normal might pose challenges for many accounting firms, it also provides opportunities for forward-thinking firms like yours that are willing to revamp and adapt their practice. AccountantsWorld’s 2020 Promise is here to help you through those changes. The goal of our 2020 Promise is to empower you to make your accounting practice more relevant, more rewarding, and more profitable. You bring your expertise and your drive to thrive. We augment it with the most powerful accounting and payroll cloud solutions ever created for accountants; plus the training, resources, and unwavering support you need. This synergy will allow you to grow your profit margins from your accounting practice by 20% or more while adding value to your clients’ businesses. AccountantsWorld has helped thousands of accountants enhance their practices. Our 2020 Promise is just an extension of what we have been doing all along. The commitment we have made to your practice is unprecedented. Don’t miss the opportunity to take full advantage of it.

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FALL 2020

FROM OUR SPONSORS Today’s top retailers map tomorrow’s path to purchase with technology B Y M E G A N H IGGIN S With digital commerce on the rise, your business or clients might benefit from new insight into customer experience and expectations. The COVID-19 pandemic is further refining digital commerce and pushing vendors to adapt to changing expectations. To better understand this fast-growing area, Avalara has commissioned business intelligence platform PSFK to research key trends and technologies that define a successful experience. The resulting free report, available at avlr.co/2QdEzfp, highlights key trends of customer experience and outlines the importance of back-end technologies to enable a seamless experience. Here is a brief summary of our findings. THE STAKES ARE HIGH Consumers expect retailers to have e-commerce and mobile capabilities. Their expectations are high. They bank on researching each stage of the purchase journey online. Real-time accuracy and transparency are essential, as is a seamless experience. There’s a lot at stake. Global e-commerce totaled more than $3.5 trillion in 2019. By 2023, online retail sales in the United States alone are expected to reach $969.7 billion. To succeed in this increasingly crowded field, retailers must deliver an exceptional customer experience at all stages of the customer journey, from discovery to post-purchase support. Technology is a key component of success, helping to build trust and therefore loyalty. Mobile has elevated expectations. Consumers count on retailers to deliver a true omni-channel experience, tailored to them, no matter how they shop. Retailers who sideline mobile risk alienating a growing portion of the market. Mobile sales have doubled since 2015 and are expected to account for 44 percent of e-commerce by 2024. In short, retail today must be digital-first, fluid, and agile, as the current pandemic has highlighted. In recent months, retailers reliant on physical stores alone were often unable to connect with customers. Those with an established online and mobile presence could meet consumers where they were — at home or on the move. No matter the circumstances, the more agile a retailer’s overall digital infrastructure, the better the experience for customers passing through these five stages: 1. Discovery 2. Store experience 3. Shopper education and assistance 4. Payment and tax 5. Fulfillment and support

DISCOVERY Consumers shop across all digital platforms in today’s hyper-connected world, including through social channels as well as through Alexa, Google Assistant, or Siri. Managing customer relationships is key. A dynamic outreach with visual search streams and shoppable content helps retailers rise above competitors. STORE EXPERIENCE To convert browsers to buyers, e-commerce retailers need more than an online storefront. The entire shopping experience must be streamlined, secure, and increasingly curated. An adaptive homepage and social shopping options help provide the experience consumers crave, as does augmented retail. People respond well when given the option to virtually try on products. SHOPPER EDUCATION AND ASSISTANCE Online shoppers are increasingly coming to expect personalized support at key moments, as they might receive in a brick-and-mortar store. They value well-timed expert opinions. Authentication tools and artificial intelligence-powered chatbots help customers navigate product catalogs, and retailers understand when human interjection is necessary. PAYMENT AND TAX Checkout must be seamless on the front and back ends. Customers are one step closer to a purchase when their payment information is automatically (and securely) provided. Other best practices include offering one-click purchase options, digital layaway options, and in-cart optimization. Currency conversions aid crossborder sales, as do accurate tax and customs calculations. To foster trust, reveal shipping, tax, and other applicable charges up front. FULFILLMENT AND SUPPORT What happens after a customer clicks “Buy now” is an integral part of the customer experience. Flexible delivery options, including in-store pickup and returns, are a must in the age of near-immediate gratification. A.I. and machine learning can help streamline logistics and reduce costs. Customer loyalty can be fostered with product setup, ongoing support, as well as programs that encourage customer evangelization. Megan Higgins is the Vice President and General Manager, eCommerce and Marketplaces at Avalara. In her role, she leads the business development team for Avalara’s global eCommerce and online marketplace business. Megan has deep experience in leading teams, developing and executing on strategic initiatives, and driving growth enterprises for technology companies.

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FROM OUR SPONSORS Productivity trends and COVID-19 Lessons learned and a roadmap for the next normal B Y M I K E SA B BATIS processes to allow for remote and flex work prior to COVID-19 adapt with minimal interruptions to operations,” said Mike Sabbatis, CEO at XCM Solutions. “Meanwhile, firms that had delayed making these decisions were forced to act fast and experienced significant delays.” KEY FACTORS FOR ENABLING AND INCREASING PRODUCTIVITY Staying connected and being able to communicate and collaborate across teams is especially challenging in the “new normal.” For management, ensuring that work is getting done and knowing where specific projects are within the process is more difficult. Workflow technology can streamline and automate complex business processes, and the right tool can enable you to gain greater clarity, control, and accountability over your team’s projects, tasks, and deliverables.

The COVID-19 pandemic has had a profound impact on our lives, businesses, and the global economy. Many organizations have had to switch to a remote, distributed workforce practically overnight, and business leaders have had to quickly re-examine workflow processes, try to maintain department productivity, manage new staff scheduling needs, and assess new ways to service customers. At the same time, employees have faced the new realities of staying home, working in a remote environment, adjusting to new deadlines, and new relief legislation. In this turmoil and uncertainty, productivity has suffered. In recent studies, business leaders and employees have reported issues with productivity. In Arizent’s June 2020 COVID-19 Pulse Survey, 62 percent of accounting firm leaders reported that their firm’s productivity has decreased due to staff working remotely. According to Globant’s report, Supporting Employee Productivity During COVID-19, almost half of full-time employees surveyed indicated their work output had decreased. HOW HAVE SOME FIRMS INCREASED STAFF PRODUCTIVITY? Firms that had previously migrated to cloud technology and implemented workflow technology tools have fared much better during the pandemic. “We are seeing firms that made prudent investments in cloudbased technology and implemented standardized workflow

BEST PRACTICES TO OPTIMIZE BUSINESS PROCESS AND WORKFLOW Changing and unforeseen priorities are unavoidable, especially in today’s environment. Identifying the most effective business process and using technology to embed that process in your day-to-day activities can help you optimize and enhance team collaboration, give you full visibility and control, and enable accountability. The following areas are key for effective workflow: 1. Visibility: Having a 360-degree view provides the insight you need to make resource adjustments or changes. 2. C ontrol: Identifying departmental bottlenecks and implementing process efficiencies lets you deliver quality results. 3. Flexibility: Enacting continuous process improvements helps deliver increased efficiency. 4. Accountability: Gaining a real-time and single-source status for every assignment, task, and deadline supports greater accountability. THE ROAD FORWARD: AGILITY IS THE KEY TO FUTURE SUCCESS Business leaders not only need to navigate the challenges with the pandemic now, they also need to consider what reopening and recovery might look like and start planning how to lead their organization into the next normal. According to McKinsey’s article Leading with Purpose, the element of speed and agility, in particular, is crucial because this once-in-ageneration challenge is likely to have a profound impact on who is left standing when the crisis finally abates.

CONTINUED ON PAGE 42

FALL 2020

FROM OUR SPONSORS CONTINUED FROM PAGE 41

So what does business agility look like? It is centered around three key actions: • Sense and react quickly to market changes, both internally and externally. • Respond rapidly and flexibly to client demands. • Adapt and lead change productively and cost-effectively without compromising quality. ROADMAP FOR THE NEXT NORMAL In planning for the “next normal,” the most effective leaders have a mental model to rapid recovery built around “SHAPE” – an approach with five core elements: 1. Start-up mindset 2. Human at the core 3. Accelerate digital, tech, and analytics 4. Purpose-driven customer playbook 5. Ecosystems to drive adaptability CONCLUSION Business productivity has been greatly impacted by COVID-19. Despite the initial issues with productivity, 77 percent of business executives expect the trend toward remote work to continue, even one year after COVID-19 substantially subsides.

Despite the initial issues with productivity, 77 percent of business executives expect the trend toward remote work to continue, even one year after COVID-19 substantially subsides. Cloud-based workflow technology can streamline and automate business processes and improve collaboration, visibility, flexibility, accountability, and control. As we move into the next normal, the ability for businesses to be agile is key not only to survive but to thrive. And finally, organizations will need to not only respond to the current crisis but to plan for recovery and renewal to succeed in the future. Mike Sabbatis is CEO of XCM® Solutions, a strategic partner of the MACPA.

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FALL 2020

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DAY 2 Estate Planning Issues DAY 3 Real Estate and Partnerships DAY 4 State & Local Tax Issues

PEACE OF MIND It’s knowing that the full-circle ﬁnancial wellness of your business is being considered with every business banking and lending service at SECU. Learn more at: secumd.org/more/macpa

Our business offerings include:

· Business Credit Cards · Owner Occupied and Investment Real Estate Lending · SBA-504 lender for owner occupied properties · Equipment Term Loans and Business Lines of Credit · Competitive rates on loans and deposits · Mobile Check Deposits · Business relationship lenders with an average of over 25 years of experience · Competitive rates on money market accounts with balances over $100K · Prime + 0 on business lines of credit exclusively for MACPA members

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FROM OUR SPONSORS Banks, credits unions shifting to better serve clients in crisis B Y D A L E S K I NN E R the Small Business Administration’s Paycheck Protection Program and by donating more than $400,000 to benefit the community and its members as the negative impact of the COVID-19 pandemic took its toll from small businesses and their employees to individuals and families. SECU is financially sound, and that’s apparent in its long-standing, nearly 70-year history. Thus, they’re uniquely suited to offer a broader range of eligibility.

The financial uncertainty spurred by the current pandemic has caused banking institutions across the nation to more rapidly evaluate and adjust how to best serve their customers while simultaneously minimizing financial risk for their own institutions. Some financial institutions have strategically positioned themselves to more aptly weather the storm with increased cash liquidity while creating programs to support their members, while others are faced with a grim reality. There are large-scale traditional banking institutions that are creating more stringent lending regulations for existing customers that, in turn, make it all the more difficult for new customers. And yet, these individuals become lost in the fray. Credit unions like SECU, Maryland’s largest chartered credit union, are strongly positioned to benefit not only their members, but others throughout the state in supporting their financial wellness goals, creating programs to support the communities in which they serve, and to outline specific means to help struggling members and communities in this unprecedented time. This support was exemplified in SECU’s commitment to assist over 200 businesses in preserving more than 1,300 jobs through FALL 2020

However, in order to elevate the banking experience to the next level, SECU’s President and CEO Dave Sweiderk created guiding principles for the organization that serve as an anchor to its mission. These can be seen in every interaction SECU has with potential or current members and in each decision SECU makes to benefit its members, from the simplest to the more complex. Differentiating itself from many traditional banking institutions who are facing tighter restrictions on lending that negatively impact current and potential members, SECU offers more expansive eligibility requirements. For example: SECU relies on standard underwriting guidelines with a baseline of at least two years in business. With a keen eye to the future and a finger on the pulse of its members, SECU continues to evolve, offering a level of service that is not only flexible in its evolution but is strategically aligned with innovation, remaining forward-focused and digitally advanced, and ready to continue offering competitive services, all with the vision of creating and fostering financial wellness. As the banking industry rapidly evolves, SECU continues to embrace technology with Interactive Teller Machines (ITMs) and high-tech bars being integrated into branches. Coming soon, they will launch a virtual banking experience so that members have the convenience of brick-andmortar or virtual banking experiences on

any given day to meet their financial needs, wherever they are. Additionally, SECU rates are among the most competitive in the marketplace on money market accounts with balances over $100,000 as well as through their business interest checking accounts for money deposits. As lenders, not only do they provide greater eligibility compared to traditional banks, but their rates remain competitive with others. SECU is also able to support businesses through: • Mobile check deposits • Highly competitive business rewards credit card • Competitive rates on both loans and deposits • Equipment term loans and business lines of credit • Owner occupied and investment real estate lending • Named a SBA preferred lender for owner occupied real estate • Seasoned business relationship lenders with an average of over 25 years of experience • All loan decisions are made locally by people who live, work, play and worship within our local communities To learn more about the SECU difference, visit www.secumd.org/more/macpa. Dale Skinner is currently the Commercial Sales Manager for SECU of Maryland. He has over 30 years of commercial banking experience. Proudly an alum of Howard University in Washington DC where he spent his years as a student athlete on the Swim Team. He is currently married with 2 wonderful sons living in Bowie MD and spends his spare time with his family, working out and playing golf. He loves giving back to the community and has served on several non-profit boards.

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FALL 2020

FROM OUR SPONSORS How to select the right A.I. platform for accounting B Y A L E X A N D E R H A G E RU P REVOLUTIONIZING WORKFLOW Even in its early stages, A.I. technology is rapidly reinventing the workflow of accountants. When A.I. is appropriately deployed and developed, human input and interpretation will no longer be required. The accountant’s new job will be to review the suggestions from the data A.I. provides. When investing in an A.I. platform, confirm that the company behind the A.I. platform is moving in that direction — where a human will be primarily reviewing the A.I.’s suggestions. Well-trained A.I. should only ask for human input when its confidence is low. The higher the A.I.’s confidence, the less a human has to review. The goal, over time, is that less and less human review will be required. Great A.I. should perform at a higher level than a human is capable of today.

Is your firm prepared for the changes that artificial intelligence and machine learning are bringing to public accounting? Are you truly ready for competitive battles with more tech-savvy accounting firms (and even ERP software providers)? A.I. is the latest technology poised to alter the business landscape, and accounting firms need to take notice. Recent articles from Forbes, the Journal of Accountancy, the AICPA CPA Insider, the International Federation of Accountants, CPA Practice Advisor, and Accounting Today have explored the power and necessity of A.I. innovation in accounting in order for businesses to provide better service to clients and remain profitable. But before you think about how to select the right A.I. platform, you’ll first want to clarify why you’re investing in one. The goal is to find an A.I. platform that will genuinely work for you to streamline time-consuming, mundane tasks. Here are a few things to consider when evaluating what A.I. can bring to your outsourced accounting practice. DETERMINE CRITICAL NEEDS AND ASK FOR PROOF Effective A.I. takes on the burden of repetitive daily routines that can pull you and your team away from other important tasks that require human effort, such as managing complex client service issues and generating ideas to grow your business. A.I. is still new, and as of today, there are few platforms available that can understand and perform accounting tasks. As you consider the options, do your due diligence. Make sure the A.I. company you’re evaluating has developed technology that works as advertised. Ask for a demonstration in a live environment with live documents. And find out if there’s any human effort in the background.

SYSTEM-AGNOSTIC Because this field is rapidly emerging, to protect your firm’s investment and your clients, make sure the A.I. platform you select is adaptable to many other accounting- and ERP-related systems. The A.I. platform needs to be system-agnostic, with the flexibility to connect to many different related systems. You don’t know which accounting or ERP systems your existing and future clients will be using. Also, if your firm wants to have clients on multiple platforms today, your A.I. platform must be able to sit on top of all of your other systems. Consider accounting add-ons like Bill.com and Expensify, which directly plug into a lot of different incumbent ERP systems. The best A.I. accounting platforms will have the same ability. The options for accounting A.I. are constantly growing and can get pretty confusing very quickly. The challenge is not just figuring out what technology to source, but determining what problem your organization needs to address first. Without that key step, whatever A.I. platform you choose, no matter how advanced, may prove to be utterly useless for your purposes. For additional suggestions on what to consider when evaluating your A.I. technology options, check out our e-book, How to Select the Right AI Platform for Accounting and our comparison worksheet. You’ll find them at content.vic.ai/how-to-select-the-right-ai-for-accounting. Alexander Hagerup is co-founder and CEO of Vic.ai.

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FROM OUR SPONSORS Is the LatinX market a key to advisory? B Y J O S E Z AVALA people to help them scale is increasingly difficult. The majority of small businesses can reach the threshold of about $1 million in gross revenues, and then they start to cap out. They find themselves having a hard time scaling past that point, or they do so with a lot of sweat equity. This pain point provides a unique opportunity for those of us in the accounting sector to be the guide for our clients to grow.

Let me lay out some data points for you: • Seventeen percent of the U.S. population, or 54.1 million people in the United States. • One in every six individuals and one in every four children. • Fifty-five percent population growth from 2000 to 2011. • $1.2 trillion in buying power. • Thirty-four percent growth in the number of business owners over the last 10 years. • Revenue growth of 14 percent, which has outpaced the U.S. economy. These stats are impressive. The numbers represent strong growth with tremendous buying power. As a firm owner and entrepreneur who is always looking to grow, seeing numbers like this represents a great opportunity. These numbers represent the LatinX market that exists in the United States today. They show a clear growth trajectory. Growing up as a Mexican-American, I saw first-hand the passion and drive in the LatinX community. This is one of the values that was instilled into me as a young child. To this day, I can honestly say that has been

a big part of what has fueled me as an advisor to my clients and as an entrepreneur. The 2019 State of Latino Entrepreneurship, which is published by the Latino Business Action Network and Stanford University, shows a key statistic that cannot be measured by numbers but which embodies the LatinX spirit. The majority of LatinX businesses start out of opportunities instead of necessity. The LatinX small business owner is motivated and fueled by a drive to provide for his or her family. While there may be a language barrier there, that does not stop these entrepreneurs from building their dreams. While LatinX business owners are on the rise and make up the fastest growing demographic for small businesses in the United States, when we start to drill down into the numbers at a more granular level, we begin to see some interesting facts. Revenue growth has increased in this demographic. LatinX entrepreneurs struggle with moving from the solopreneur to an employer with employees. These small business owners understand how to operate their businesses when they run them alone, but they find the jump to hiring

There is continuous talk about moving to an “advisor” role, and it is my belief that an opportunity like this is exactly what that term means — helping our clients make sound decisions that will help them scale their businesses and grow, and ensuring that their tax liability is as minimal as possible. We also have a unique opportunity to guide them in matters of HR, employee retention, and with the pandemic. One of the biggest questions I’m asked is how to approach the market and help the LatinX community. You can begin to answer that question by taking a look at your internal team. Do you have a diverse team? Why is diversity important? Diversity is important because it allows you to approach your business and any problems that come up from different angles. It also allows you to be able to serve a much broader base of people. The best way to work with the community? Hire a Latino / Latina — someone who understands the language barrier (if there is one), the culture, and helps foster that required trust. Diversity, in my opinion, should be at the forefront of every firm looking to scale. This will help you open up your client base to serve those who would normally not be served and give an opportunity to a Latino / Latina to serve their community — and help increase the wealth at the same time. Jose Zavala is CEO of ZTX Advisors.

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FALL 2020

WE’RE HIRING TOP TALENT! Grossberg is a unique environment where talented and highly sophisticated professionals excel. Our staff and partners are some of the best and brightest in their field, operating at the highest level of professionalism and technical expertise. Here, you find a culture of people who enjoy the challenge of untangling today’s highly complex web of business, transactional, financial and tax issues, while enjoying the benefits of working at one of the area’s premier firms. Our mentorship program ensures that everyone has access to one-on-one training by industry experts who encourage their professional development. In addition, the boutique nature of our firm allows us to interact regularly and learn from one another in more casual ways. This provides us with the ability to offer skilled professionals tremendous opportunities for growth and job satisfaction, as well as a great work environment. Our culture is defined by our people. We pride ourselves on fostering an environment of collegiality and camaraderie; we truly care about each other and work together to meet the 10 Things

Professionals Want Most 1. Purpose 2. Goals 3. Responsibility 4. Autonomy 5. Flexibility

demands of our elite group of clients. It is only through this teamwork that we are able to meet our professional demands, advance our business and technical skills, and still support each other to maintain a healthy work/family life balance. This is an integral part of who we are, why we are successful, and how we have maintained our reputation as one of the best ﬁrms in the country. Growth in our business has created new opportunities for

experienced CPAs. If you are seeking to move to the next level in your career, consider joining the Grossberg team!

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Looking for an exciting new opportunity, and a Great Place to Work? Apply at www.Grossberg.com Grossberg Company LLP 6500 Rock Spring Drive Suite 200 Bethesda, MD 20817

Trusted Business Advisor Since 1924

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MEMBER NOTES Athena Beidler has been promoted in in-charge accountant with Lanigan, Ryan, Malcolm & Doyle, P.C. Jackie Cardello, CPA, president and managing partner of GRF CPAs & Advisors, has been named to Accounting Today’s 2020 MP Elite. She is one of 10 managing partners across the country to receive this prestigious recognition. Renee Cordero, a CPA Candidate member of the Maryland Association of CPAs, is one of 133 winners of the 2019 Elijah Watt Sells Award, which honors the top performers on the most recent CPA Exam. A graduate of the University of Maryland Global Campus with a bachelor’s degree in accounting and business management, she is employed with Cvach Financial Services, PA, in Centreville, Md. Brent A. Croghan, CPA, and James K. Green, CPA, have been named co-chief executive officers at Dembo Jones, P.C. Green will continue to lead Dembo Jones’ professional services practice, while Croghan will remain in charge of the firm’s not-for-profit practice. Daniel B. Geehreng, CPA, has been named chief financial officer of Dembo Jones, P.C. He will maintain his role as leader of Dembo Jones’ construction practice.

Robin Magaha, CPA, has been promoted to manager with Lanigan, Ryan, Malcolm & Doyle, P.C.

FIRM NOTES SEK, CPAs & Advisors has been voted “Best Accounting Firm, Runner-Up” in the “Best of Cumberland County” awards for 2020. In The Sentinel’s annual “Best Of” program, readers nominate and vote for their favorite businesses and business professionals. SEK has two offices in Cumberland County – in Carlisle on Brookwood Avenue and in Camp Hill on Trindle Road.

Hannah E. McEntire, human resources associate with SEK, CPAs & Advisors, has successfully completed the certification process with the Society of Human Resources Management to earn the Certified Professional certificate. Leonard B. Rus, CPA, has been named managing partner of Gross, Mendelsohn & Associates, P.A., a 125-person CPA, wealth advisory and technology consulting firm with offices in Maryland and Virginia. Rus replaces David Goldner, who has served as Gross Mendelsohn’s managing partner since 2009. Stephanie E. Shepard, CPA, MSA, has been promoted to supervisor in the Hagerstown office of SEK, CPAs and Advisors. Stephanie provides tax, accounting, and QuickBooks software services to individual and small business clients. She joined SEK in 2016 after earning a master’s in accounting from the University of New Hampshire. Kayla M. Stoner, CPA, has been promoted to senior associate in the Hagerstown office of SEK, CPAs and Advisors. Kayla works in the Audit Department, where she focuses on low-income housing, Housing and Urban Development, nonprofit, investment advisor, and health care clients. Kayla joined SEK in 2018 after earning a bachelor’s in business administration from the University of Pittsburgh. Evan M. Wabrick, CPA, MBA, tax manager at SEK, CPAs and Advisors, has been voted “Best Accountant, Runner-Up” in the “Best of Cumberland County” awards for 2020.

IN MEMORIAM Joel Dackman, CPA, an MACPA life member who joined the association in 1977, died on July 6. He was 67. Robert Sollfrey, CPA, an MACPA member since 1981, has died of complications related to the coronavirus. He was 86.

SEK, CPAs & Advisors has been recognized as the “Readers’ Choice Accounting Firm” for 2020 by Harrisburg Magazine. Readers were invited to nominate who they believe are the best of the best in the Harrisburg area. Other professional services categories included bank, law firm, real estate agency, and more.

FALL 2020

CLASSIFIEDS job openings SMALL ROCKVILLE TAX AND ACCOUNTING FIRM looking to hire a CPA or CPA candidate with at least 2

years experience in tax preparation. Help relieve our load and grow with the practice. We are an informal office with an excellent client base of Individual returns and small businesses. Salary and terms commensurate with experience and potential. A candidate with a small practice of their own would be welcome for discussion purposes. Please respond to MACPA file MD-0001

TAX PROFESSIONALS FOR BUSY SEASON

(or flexible year round). Kenneally & Company, a mid-size Towson CPA firm of highly motivated professionals, seeks like-minded individuals experienced with individual or business income tax return preparation. Familiarity with ProSystem fx is a plus. Flexible hours, excellent compensation and a pleasant working environment. Forward your resume via e-mail to mlindemon@jlkcpas.com or via fax, (410) 321-9809.

EXCEPTIONAL OPPORTUNITY Quality Mid-size Towson CPA Firm seeks the following professionals to help service our growing Client base: Staff Accountant 2+ Years’ Experience Senior Accountant 4+ Years’ Experience Manager 7+ Years’ Experience Candidates will provide tax and accounting services to entrepreneurial clients. We offer challenging work with direct client engagement, limited overtime (no overtime after April 15th), flexible work schedules and excellent compensation package including a built-in partnership-like profit sharing and performance bonus.

mergers & acquisitions ACCOUNTING FIRM IN ROCKVILLE, 2 partners,

wishes to expand tax and bookkeeping services by merging/associating with another local group for the purpose of sharing expertise and staffing. We use CCH Axcess software, and one partner is a financial advisor, separate from the income tax services. We would consider buying a small practice, as long as there is continuation of a qualified staff person to maintain the business. To inquire, please email Robert at r.hausman@lapointeandhausman.com

MARYLAND PRACTICES FOR SALE:

gross revenues shown: Bethesda/Gaithersburg/Frederick Area Tax Firm $117K - strong fee structure, minimal overhead, excellent cash flow over 80%. Baltimore CPA $95.6K - 89% tax, cash flow over 85%; NE Baltimore Co CPA $615K - 41% tax, 43% acctng;, 15% bill pay/consultng. See nationwide listings and register for free email updates at www.APS.net. THINKING OF SELLING YOUR PRACTICE? Accounting Practice Sales is the leading marketer of tax and accounting practices in North America. We have a large pool of buyers, both individuals and firms, looking for practices to purchase. We also have the experience to help you find the right fit for your firm, negotiate the best price and terms and get the deal done. We welcome the opportunity to talk to you about our risk-free and confidential services. For more information please call Bradley Holmes with the APS Holmes Group at 1-800-397-0249 or email Bradley@APS.net.

Experience with ProSystem FX Tax and ProSystem Engagement is a plus. Contact: Kenneally & Company, 660 Kenilworth Drive, Suite 104, Towson, MD 21204 410-321-9558 | E-mail: dmiller@jlkcpas.com

HOW TO SUBMIT A CLASSIFIED AD To submit a classified ad, contact Krislyn Suljak at krislyn@macpa.org, or 443-632-2307. REPLIES TO ADS WITH FILE NUMBER: Email krislyn@macpa.org, or reply via mail: Krislyn Suljak MACPA, Classified Ads 901 Dulaney Valley Road, Suite 800, Towson, MD 21204

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MACPA COULDN’T DO EVERYTHING THAT WE DO FOR OUR MEMBERS WITHOUT OUR

PREFERRED PROVIDERS

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For information about sponsoring MACPA programs or to learn more about advertising with the MACPA please contact Amy Puente at 443.632.2323 or amyp@macpa.org.

FALL 2020

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MARYLAND ASSOCIATION OF CERTIFIED PUBLIC ACCOUNTANTS 901 Dulaney Valley Road, Suite 800 Towson, MD 21204 410.296.6250 | www.macpa.org

Four for Fall is a two-day CPE event offering courses in a wide range of topics. Each day there are two, four-hour CPE sessions, with different options for each session. Attendees can create their own custom curriculum. A total of 16 hours of CPE are available. VOLUME DISCOUNT:

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CUSTOMIZE YOUR CPE Choose 2 courses per day and earn 16 CPE NOVEMBER 23 | LIVE WEBCAST 8 AM

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Interpreting the New Revenue Recognition Standard: What All CPA’s Need to Know Ethics for CPAs in Business & Industry

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