Recap of the Accounting Thought Leader Think Tank – The Accounting Technology Lab Podcast – July 2024

Hosts Randy Johnston and Brian Tankersley, CPA, discuss the invitation-only Accounting Thought Leader Think Tank Symposium, which gathered dozens of the most influential accounting technologists, practitioners, advisors, and policy makers in the profession. The event was held just prior to the 2024 AICPA Engage Conference.

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Transcript (Note: There may be typos due to automated transcription errors.)

SPEAKERS

Randy Johnston, Brian F. Tankersley, CPA.CITP, CGMA

Brian F. Tankersley, CPA.CITP, CGMA  00:00

Welcome to the accounting Technology Lab sponsored by CPA practice advisor. With your hosts, Randy Johnston, and Brian Tankersley.

Randy Johnston  00:10

Today, welcome the accounting Technology Lab. I’m with my co host, Brian Tankersley. And we both had the pleasure of attending the recent accounting leaders think tank symposium that was held before the AICPA engage conference. Now this symposium was interesting. I guess I should tell you the date was on Sunday, June 2, it was sponsored by four different vendors have Valera sage instead. And Wolters Kluwer. Interestingly enough, the vendors didn’t really control the agenda or anything like that. There were around 40 attendees, and it was a kind of a mash up, I guess we’d call it between the 40 under 40 thought leaders and the traditional CPA practice advisor, thought leaders, but I gotta tell you, the day was absolutely worth making the trip to Vegas, and Brian, and I thought it was good enough that we want to share some of the insights with you. On today’s podcast, another agenda was supposed to run from eight in the morning until four, we went to almost five now how many times do you go to a meeting where people don’t want to leave and just want to stay and continue talking? That’s kind of how it worked. So Brian, that’s kind of the setup. And, uh, you know, I’m thinking that we should maybe just cover the first major topic, which seems to take the air out of a lot of rooms nowadays, artificial intelligence. But this discussion was a little different than ones that I’ve heard in the past. So what did you observe during the coverage of generative AI and the impact on the accounting profession?

Brian F. Tankersley, CPA.CITP, CGMA  01:52

Well, first off, I think, I think everybody that this was a group where I think everybody in the room had spent some time doing some kind of generative AI. So it was a very thoughtful discussion about it. You know, I think the the big thing weighing over a lot of this is what the regulatory response is going to be from the President’s Executive Order last year, you know, they when when he put out that executive order last fall, one of the things that he did was set deadlines for a number of agencies to come out and set new new new rulemaking surrounding AI regulations and privacy. So that’s, that’s one of the things they’re, you know, it’s a, I thought it was, I thought it was quite interesting that, that, you know, how, how much AI is, is out there. But how much of it is happening more in the startups, and less so in the traditional vendors?

Randy Johnston  02:58

Well, and you know, your observation about pretty much everybody we talked to in the room had had a finger in something that a lot of people had been doing prop prompt engineering, I think we did agree that there was no easy way to record prompts for firms. I think one of my big learning items, honestly, was that even though a lot of us are looking for kind of the revolutionary effects of AI, evolutionary is actually far more useful, small things you can do day to day, of course, the privacy concerns that you and I have expressed in prior podcasts. Clearly, were also in play here. But just what is practical that you can do today, and simply responding to things like email drafting letters, one of my favorite ones, was about responding to irritated clients, or when you’re irritated with a client responding. You remember how that folded out because it was just a very interesting like, hey, if I’m upset, I’m gonna say why I’m upset and what it’s about and let generative AI write it, and then I’ll modify it from there. But handling clients that you’re miffed at I was just a delightful use of a I now,

Brian F. Tankersley, CPA.CITP, CGMA  04:20

and the thing that I love about that group is so many of the, you know, the, the the traditional thought leaders, most of us are consultants to the profession, but the 40 under 40 so many of them are actual practitioners that are out there, out there making it happen every day. And so the the mix up of the, you know, of the old guard and the new innovators, I thought really led to a very productive discussion about a lot of things including the inconsistency of generative AI at responding to tasks and the hallucinations and you know, all of the all of the things I think We kind of achieved a consensus that, that anybody that just puts stuff out by general AI without reading, it is a fool and is committing malpractice. So, you know, we had say, it was an interesting event, to be sure, because so many of the people are have have r&d projects that they’re working on, either as part of their day job or as beta testers or other things. And, and I thought we got were able to have a very, very substantive conversations. I mean, the cool part about this group is that when you go into a topic, you don’t have to worry about whether or not they have the knowledge to go deep. Okay, they you just go. And it’s amazing how how, how good the insights are, you know, when you have that many smart people in a room, absolutely. Self excluded. Yeah.

Randy Johnston  05:53

Understood. But you know, it turns out, you have a fair bit of AI knowledge, obviously, you did the opening keynote, including AI, the next day at engage show with me, which was fun, but you know, staying on topic here, even pulling out things like new generation technology, like the Microsoft Surface copilot, and all of the new HP, Dell, IBM, Lenovo, and frankly, the Apple announcements on AI. You know, we incorporated so many of those types of things and the copilot PCs, that will have the ability to roll back or replay the AI conversations over the last few days. That’s kind of a big breakthrough. And, you know, in a nother context, we’d probably talk more about the Microsoft Surface copilot. But we also tried to differentiate the various models, the Microsoft, copilot 365, versus Chad GPT versus club three, versus Jim and I. And I think the group consensus really did land that for CPA firms right now the safest landing zone is copilot 365, because of the indemnity and integration with the applications in use. But even that had a bit of a caveat to it, because we agreed that it’s not the most advanced model right now. But it is a safe model to play with, and Microsoft would continue to evolve it. And that in the big picture of things, these products are leapfrogging each other on a regular basis. So you know, the force that you’re on today may have the lead, but may fall back a few places, and then may get the lead again, over a period of time. So that that bit of insight was interesting. But there were people who were adamant about certain features in chat GPT, or certain features in Gemini or certain features in these various platforms.

Brian F. Tankersley, CPA.CITP, CGMA  07:53

But you know, the thing, the thing I would just respond to that, and just say is that, I think in general, the accountants have to be the adults in the room so many times with so many different things. And we have to do the unpleasant side, we have to be Dr. Know, on so many things, because of regulatory compliance or IRS compliance or legal issues or other things like that. We’re the ones that really lead a lot of the thinking in that area in those areas. And you know, it gets us it gets us a bad rap sometimes. But what you know, when I, you know, the thing, the thing that I think about here is that without that indemnification, there is too much that we don’t know, to, you know, to use these other tools, especially with sensitive data, you know, where they can even touch sensitive data, or, you know, from the accounting firm survey that you and I do we have north of 90% of the folks are using Microsoft 365. And so since that’s the platform of choice, I just think it’s very difficult to go outside of that ecosystem. I mean, you could use Google Apps and some folks do. But the problem there, you know, and that would, of course, lead you to use Gemini. The problem, of course there is that that’s not as compatible with most of the applications we have to use.

Randy Johnston  09:16

But another really interesting observation, like you said, these practitioners are on the front line. I was amazed at some of the texts slash as specialty practices that were using the Google workspace and they thought it was too much effort to try to convert into the Microsoft ecosystem. So they were going to stay the course with their Google workspace. Therefore, for them, Gemini seemed like a natural fit. And you know, we’ve talked about stacks in other technology podcasts here. And, you know, there’s more than one right way to do things and that was interesting. Now, you and I have written reviews on lots of products. cuz including reporting tools, more so you than me. But as it turns out, one of the products that we’d looked at in the past was a product called Future Li. And future Li was acquired by Sage. And we did get to see a very interesting presentation on future leads. Now, it’d been about a year since I’d see that last. So the insights were good enough that I, I think it merits a new podcast on that product alone, which we’ll, we’ll do another time. But what are the key things that our listeners should know about sage future really? Well,

Brian F. Tankersley, CPA.CITP, CGMA  10:37

that product, that product really is a budgeting forecasting tool. It It is designed for primarily small businesses, but it’s designed to help do advisory. I thought that the demo was exceptionally good. There were still a few things, you know, there are a few spellings center and other things like that. That still hadn’t been, you know, we’re still Australian, as opposed to as opposed to American eyes. But, you know, I thought generally it was a, it was a very good demo. And it’s it’s a very interesting product. You know, I think that as we morph into advisory, I think the the financial planning and analysis or the F PNA that gets done inside big companies is one of the functions that we’re going to have to do as part of our advisory. And so tools like futurelawyer, how we’re going to get that done.

Randy Johnston  11:27

Yeah, and the presenter there. And I’ll say his name incorrectly. David chia, cine, you know, he did a beautiful job, as you said, but most important, is the product works with QuickBooks and Xero and other platforms, and gives you, you know, core financials, but you can customize dashboards quickly. There was a lot that was well thought through and improved, notably. And I frankly, told David that directly, in a comment, because I was impressed at how far the products had come along. Over the past year to two years, and again, I’ve been following for quite a little while. Well, I

Brian F. Tankersley, CPA.CITP, CGMA  12:10

was I was very impressed by you know, there were some questions from the audience. And so many times when you watch a demo, if if they’ve not demonstrated, they’ve not worked out the major kinks. There’ll be there’ll be some stammering and other things like that when they respond to things. David had answers, David had features that were already working. Okay, he was, he had a very, the demo went very well, I thought. The other thing is that he’s actually if I understand it, right, one of the founders of bright Pearl, which is another product that we need to talk about, that is a retail operating system that’s designed to run the operational side of retail, and then integrate back with your accounting software. And that’s also by Sage. So, you know, the the person missing, of course, from this was Ed class, who has traditionally been the face of sage to the accounting profession for many years, and is now doing independent consulting. And, you know, it’s actually running some, some events, I think, coming up in a month or so, in Dallas. So he, there’s, you know, it’s, it’s, it’s kind of a changing of the guard, I guess, as we as we look at that, by the way, future really is a fully cloud cloud based application. It’s not on premises in any way, shape, or form.

Randy Johnston  13:25

Yep. So that led then into a client accounting services discussion. Again, here, we listen to practitioners with the things that they were doing. But it was clear that the service offerings, and the pricing definitions were still a struggle for many in the room. And these are the more in my mind sophisticated or more advanced thinkers in this area. Of course, you and I will have the opportunity to speak at another conference shortly that has a lot of client accounting services in it. But, you know, the net of this client accounting services environment is the amount of profit and services being generated is up, we’ve seen statistics saying that in some sort firms, this is a major growth area this past year or two, that the platforms involved, Ken to now focus around Xero and QuickBooks Online, which by the way, just had a recent price increase announced. So the QuickBooks Online will go up again, in the latter part of 2024. But then sage intact been in play. And then from there, it was interesting how not too many other players were really named. We know between us that there’s probably seven or eight products that you could use as your client accounting services platform. But the bigger issue is, what are all the wrappers that you put around it the payroll services, the reporting services, the advisory services As the HR services, the accounts payable services and so on. And, you know, you originally created the grid of these stacks, if you will. And I think the way we’re maintaining it right now, we’ve got 16 service lines with four applications each 64 applications. And, you know, if if we did a podcast a week on those applications, we’d have a whole year’s worth of content. So what else did you observe or learn from the casts?

Brian F. Tankersley, CPA.CITP, CGMA  15:31

There was there was one practitioner who I am bound by our agreement to not name his name, we have a the rules for this thing is that unless you have specific authorization from somebody to, to associate their name with the comment, you don’t do that. And so I’m not doing that with this gentleman. But I found it interesting that, that he was his focus in his practice, which has, which has three offices and does primarily Kaz, and tax, his focus is on is on basically going in and, and operationalizing everything, and he’s changing around staffing. So So in his Kaz operation, you deal with a client services manager that is a project manager, and not necessarily a CPA, and, and then you, you have bookkeepers and other folks that you deal with, but you don’t talk to the partner about everything, his goal was to basically set up an operating organization that could work without his involvement at all. So he could, you know, go sail the world, or whatever he chose to do. And I thought that was a, I think that that kind of leads into some of the private equity discussions because the CPA so many times want themselves at the center of everything, and it is a, you know, the the practice is a Me, me, me, me me thing. And instead of being an operating company that can that has processes and rules and can continue on, even if that person disappears. Yeah,

Randy Johnston  17:10

understood? Well, you’re actually segwaying into where we probably need to hit next, because we did close up the day with culture, private equity and security discussions. But we saw one more demonstration by Andrew argue of Corp V, with a platform called instead. And the instead platform is a is a in user facing, document gathering type of tax planning tool. And, uh, you know, I think my learning on the instead demo was that Andrew is on a path where he has figured out what can be gathered from clients effectively, and how it impacts their taxes in a big way. And I think he’s got a vision that he can build a new tax calculation platform. And that was kind of a big step in my listening to him. But what did you learn from the instead demonstration?

Brian F. Tankersley, CPA.CITP, CGMA  18:13

I’m so glad that he’s looking at solving the problem of dialing for documents. You know, in so many cases, we spend so much time chasing down documents, figuring these things out. And I’m, I’m excited about what he’s doing. I hope that they, you know, I hope they have the resources to do it all. Just because there’s, you know, he’s, he’s taking on some big problems. And so, I’m quite excited about what they’re doing. You know, it looked like they’re looked like they’re applying some new some good original thinking to this. And I think that’s really what we need, you know, we have we have too many practice management systems that look like they’re there for pre y2k, because they are and it’s, it’s time to think differently about a lot of these things and get more in line with what’s happening in big companies with the automation and automated workflows and things like that.

Randy Johnston  19:12

Yeah. And you know, the other sponsors, Wolters Kluwer and Avalara did not do presentations, but their teams contributed meaningfully to the conversations which, you know, that I respected that a great deal because so much of the time in today’s culture, we’re surrounded by sales pitches all the time and frankly, inaccurate sales pitches which are really bothersome to me

Brian F. Tankersley, CPA.CITP, CGMA  19:37

and many of the people most of the people from those organizations that were there were more product people as opposed to being as opposed to being again the enterprise sales people that sell into the biggest companies you know, we don’t need we don’t need Joe Cool we need we need somebody that’s that’s you know, gets down and is the super mechanic and can tap the wrench on the machine and make it work in five minutes.

Randy Johnston  20:01

Yeah. Well, you know, knowing that our time together here is short to the last three topic areas are all pretty broad, I’m gonna go on a mini rant let you respond to him too. Because in the culture piece, it was clear that the pipeline discussion and remote work were hot topics which we tried to provide. And that by the way, in each of these situations, the thought leaders are trying to work together to come up with solutions, not just chat about it, because another conversation doesn’t solve much, but an idea to solve is pretty good. And I’ve got a list of ideas to solve. Uh, you and I both walked away with quite a list. And I was watching other thought leaders with quite a quite long list also. But in the private equity piece, you know, the transactions that are happening there on both the software companies in the firm’s themselves will continue to change the culture of the profession, I think was the main learning there. So I’ll let you attribute your own saying on that particular area, which I thought was a brilliant saying, so.

Brian F. Tankersley, CPA.CITP, CGMA  21:10

So so the saying really is that, you know, the thing that motivates so many people to work as hard as they do in public accounting, is the autonomy and the, the pot of gold at the end of the rainbow is that we’re? Well, the problem we have, the problem that PE is going to solve is some of the culture problems where these autonomous CPAs suddenly turned to the doc to Dr. Know, to block technology projects and to maintain the status quo. And that’s how we’ve gotten so far behind. But But then, you know, the problem, the bigger problem is what the next generation Lee of leadership looks like, when we take away the pot of gold at the end of the rainbow that is the partnership track, and we put a we put a mop bucket at the end, where there’s just more work to do, and no pot of gold. And so figuring out that compensation model and figuring out how to motivate people and to to make things work, you know, on a on a sustainable basis for decades, as opposed to months, I think is going to be a much bigger challenge, you know, turning that culture, I think it’s going to be very difficult. I’m not saying it’s impossible, but it’s going to be it’s, it’s it’s going to be a beast of a chain, it’s

Randy Johnston  22:23

going to be a tough one. In fact, how this evolves in the next generations of transactions are pretty interesting. But you know, one other observation from the instead demo where you know, tax prep and organization happened, there was concerns about people who had been learning to do tax by doing prep, that it would eliminate a lot of the prep, and then how do we teach tax details, I was a good concern over in the Security Section, which was a hoot. You know, I got to sit in the security group. And, you know, we were just kind of laugh and run having an uproarious time. But it was probably laughters of pain, because we knew that the security piece pieces based on AI based on quantum computing, based on many things, security, futures don’t look very good. And the risks are greater than ever. And we went through all sorts of different security issues, which I know we’ll cover in the future. But, you know, I’ll just say I’m an optimist, and the future is bright. But in security, it’s a pretty great day out there.

Brian F. Tankersley, CPA.CITP, CGMA  23:32

Well, sometimes it’s darkest before the dawn.

Randy Johnston  23:36

Well, other observations from our time in the thought leader think tank, it really was such a good event, I wish you could have heard all of the conversations, because it was absolutely worth the full day commitment to it.

Brian F. Tankersley, CPA.CITP, CGMA  23:49

You know, I thought it was a, that was a great use of time, I thought it was a great time, we had to interact with a lot of people. You know, anytime you get a group of people like that together, and you set up a framework where they can have a discussion, you can really get the, the the number of out of left field insights that I got was was really quite remarkable. And I think that’s the, that’s the goal of those kinds of meetings is to bring all the mines together and to figure out, figuring out what the considerations are so that people can make good decisions going forward. I do think the impact of private equity or the culture and the impact of the impact of setting up operating companies is going to be kind of a goal of the PE folks. And I think we’re going to be looking at a different different profession. You know, one of the one of the unanswered questions was, at the valuations that these practices are being purchased at who’s going to buy him in three to five years when the PE term ends. And, you know, maybe it’s going to be the investment advisory people I don’t know. But it’s it’s going to be a A, you know, I think we’ve got a good chess players think three, four or five moves in advance. And I think we have to, we have to think in our minds about what those chess moves are. So they don’t get we don’t get there in five years. And we’re sitting there and all we have is a mop bucket, and they shut her down.

Randy Johnston  25:17

Understood? Well, you know, I’ve heard you talk about chess club before. And of course, we had a band concert last night. So I’m thinking, are we in the band or in the chess club? Where are we at here? So well, it’s always a pleasure to chat with you about these type of things, Brian, because of insights, and we hope our insights here have been helpful. As we discussed the accounting leaders think tank symposium recently held, it gave you a chance to hear some of the ideas that were in the room. We look forward to talking with you again in a future accounting technology podcast. Good day.

Brian F. Tankersley, CPA.CITP, CGMA  25:54

Thank you for sharing your time with us. We’ll be back next Saturday with a new episode of the technology lab, from CPA practice advisor. Have a great week.

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