The Change Your Mindset Podcast

Welcome to the Change Your Mindset podcast, hosted by Peter Margaritis, CPA, AKA The Accidental Accountant. Peter is a speaker, expert in applied improvisation and author of the book 'Improv Is No Joke, Using Improvization to Create Positive Results in Leadership and Life'. Peter's new book, Taking the Numb Our of Numbers: Explaining & Presenting Financial Information with Confidence and Clarity will be published in June 2018.

S2E22 – Bill Sheridan | Becoming Future-Proof

Bill Sheridan is the Chief Communications Officer at the Maryland Association of CPAs and the host of Future-Proof, a podcast in which Bill has interviewed a wide variety of leading thought leaders in the accounting profession and in corporate America.


We discuss whether the profession is moving in the direction of becoming more future-proof, or future-ready, through the lens of the conversations he’s been having with his guests for nearly a year.


So, let’s get right to it: is the profession future-proof?


The short answer is no, we’re not future-proof or future-ready yet – but we’re getting there. However, we might be getting there a little slower than Bill and the other folks over at the MACPA hoped.


“It seems like they’re starting to realize that this stuff is real. It’s not going away. In fact, it’s starting to impact them right now, and they need to pay attention to it. So, that’s encouraging that they are starting to pay attention,” Bill says.


And in a way, this seeming reluctant to look forward makes sense for the accounting and finance profession. “When you think about the profession itself, accounting and finance will spend their entire careers looking behind them. By definition, they’re accounting for things that have happened in the past.


“So, turning around, and looking through the windshield, and noticing what’s coming at you, isn’t a muscle that they’ve spent a lot of time building. And so, they’re just starting to do that now. And the more they do it, the better they’ll get at it.” Becoming future-ready starts with being aware of what’s going on.


It comes back to the idea of the anticipatory organization, an idea championed by MACPA President and CEO Tom Hood. In this sense, anticipation a three-step process: aware, predict, and adapt.


So, first step, being aware of change. That involves asking questions and start to understanding it. Next is predicting what will happen. So, now that I’m aware of it, what kind of impact is this going to have on me and the people that I work with? And then, finally, adapting. What can we actually do about it?


For example, here’s a question for accounting and finance pros out there: how can you take advantage of 5G in a way that will benefit the people that you work with?


“That’s the muscle that we have to start building. We know this is coming, and in very short order. So, what are the opportunities embedded in something like that? And we need to start thinking about that now before it hits mainstream and evolves into something else.” So becoming anticipatory is the practice of building that muscle – because change is going to happen over and over.


“We need to be able to help walk our clients and customers into the future. In order to do that, we need to be there before them,” Bill says.


Now, my question to all of you: do you think you’re future-proof yet?


I’m guessing the answer is “probably not,” so take some time to plot out a path that will help you become ready for the future.


And start today, not tomorrow! You can find 10 minutes out of your busy, busy schedule. And take that time to reflect on what does it mean to be future-proof. And then, each day, take a little bit more time and consider, “How can I become better prepared for the future? What skills do I need to put in my tool box?”


Now, this is not going to happen overnight, but if you take 10 minutes, if you take these baby steps, you’ll end up reaching your goal a lot quicker than you thought – but you have to do it every single day.


Change Your Mindset is now being distributed on C-Suite Radio. You can find Change Your Mindset and many other outstanding business podcasts on C-Suite Radio by going to




Click to download the full Transcript PDF.


Bill Sheridan: [00:00:00] Things have always changed, and we’ve always evolved. People talk about all the jobs that are going to be automated away, and there will be some, but they have those discussions without really realizing that all these new technologies are going to create as many or more jobs as the ones they destroy. And new technology does that.

Peter Margaritis: [00:00:26] Welcome to Change Your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation.

Peter Margaritis: [00:00:46] Your host is Peter Margaritis, CPA, a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers, all the while growing their businesses. So, let’s start the show.

Peter Margaritis: [00:01:12] Welcome, everyone. My name is Peter Margaritis, and I’m your host. Today, my guest is Bill Sheridan, the Chief Communications Officer at the Maryland Association of CPAs and the host of the podcast, Future-Proof. The Maryland Association of CPAs started this podcast on — Wait for it, wait for it — April 15, 2018. And Bill has interviewed a wide variety of leading thought leaders in the accounting profession and in corporate America. I ask Bill to be a guest today and to share with you what he is hearing from those who have influence in our business world. And he’s got some really great stories.

Peter Margaritis: [00:01:50] Just as a teaser, some of his guests that he’s had on his podcast consist of Barry Melanson, the CEO of the AICPA; Samantha Bowling, who’s currently the Chair of the Maryland Association CPAs Executive Board; Tom Hood, who is the CEO of the Maryland Association CPAs; Daniel Hood, who’s the Editor-in-Chief of Accounting Today just to name a few. So, our conversation is around, is the profession moving in the direction to becoming more future-proof, or another way of putting it, are we future-ready?

Peter Margaritis: [00:02:27] Now, I have been exploring that question on my podcast over the last 8, 10, 12 months, maybe even further back. And what Bill is sharing with me is that the conversation in the profession about being future-proof and/or future-ready is starting to move in the right direction but still just a little slower than we hoped. So, before we get to the interview, I want to share with you that Change Your Mindset is now being distributed on C-Suite Radio. You can find Change Your Mindset and many other outstanding business podcasts on C-Suite Radio by going to www,

Advertisement: [00:03:16] This podcast is partnered with C-Suite Radio Network, turning the volume up on business.

Peter Margaritis: [00:03:23] So, with that being said, let’s get to the interview with Bill Sheridan.

Peter Margaritis: [00:03:30] Hey, welcome back, everybody. I am with my favorite Cincinnati Reds fan who lives near St. Louis but works in Maryland, Mr. Bill Sheridan. Welcome, Bill.

Bill Sheridan: [00:03:40] How are you doing, Peter?

Peter Margaritis: [00:03:42] I’m doing great. Like we were just talking before, eight days until Pitchers and Catchers Report.

Bill Sheridan: [00:03:47] Yeah, heaven on earth.

Peter Margaritis: [00:03:47] For me, that was the best part of the Super Bowl. It was knowing that we were less than two weeks away from baseball season, so.

Bill Sheridan: [00:03:55] Yeah, I concur with that.

Peter Margaritis: [00:03:58] It’s right around the corner, and there’s nothing better than spring training because we’ve had kind of a weird winter here, and I’m just ready for it to be warm consistently.

Bill Sheridan: [00:04:08] Yeah. There’s a sense of optimism every spring for us Reds fans that lasts about six weeks, but that feeling, it’s spring training that, hey, we’ve got the same record as everybody else right now. So, I always enjoy that.

Peter Margaritis: [00:04:24] Yeah, we’re still in the running.

Bill Sheridan: [00:04:28] Definitely.

Peter Margaritis: [00:04:28] Bill and the Maryland Association of CPAs, you guys started your podcast called Future-Proof on — go figure — April 15, 2018.

Bill Sheridan: [00:04:39] Yeah.

Peter Margaritis: [00:04:39] And I’m not-

Bill Sheridan: [00:04:40] We chose badly, poorly for a starting date when you’re talking about an accounting podcast. April 15th is probably not the best time to do it, but you can’t change it now.

Peter Margaritis: [00:04:53] No, but it’s kind of apropos. My first book when it was released, that was my goal to have a release on April 15th. Missed it by two days, but that’s just around rounding error. You’ve got 41 episodes. I’ve been an avid listener. Now, I haven’t listened to all of them, but I listened to a vast majority of them. And as I’ve told you, you’ve done a great job on this podcast.

Bill Sheridan: [00:05:16] Well, thank you.

Peter Margaritis: [00:05:16] I love the interviews and what you’re getting out of folks, but I want to interview you about your podcast. I want to know what your audience is telling you. What is the accounting profession telling you about, are we future-proof or we future-ready?

Bill Sheridan: [00:05:34] Right, right. A couple of different answers there. They’re telling me a lot, a lot of different things. And the short answer is, no, we’re not future-proof yet or future-ready, but we’re getting there. We’re, at least, starting to pay attention. So, for a long time, it seemed like Tom and I would be out there beating the drums about paying attention to the trends that were coming at us and things that we were seeing that we thought were important that accounting and finance pros need to be paying attention to. And it seemed, for a while, that the general reaction was, “Oh. Well, that’s interesting, and I’ll get to that when I can.”.

Bill Sheridan: [00:06:13] And, now, it seems like they’re starting to realize that this stuff is real. It’s not going away. In fact, it’s starting to impact them right now, and they need to pay attention to it. So, that’s encouraging that they are starting to pay attention. I mean, it’s — And it’s not surprising that they haven’t at this point. I mean, when you think about the profession itself, accounting and finance will spend their entire careers looking behind them, right? By definition, they’re accounting for things that have happened in the past.

Bill Sheridan: [00:06:47] So, turning around, and looking through the windshield, and noticing what’s coming at you isn’t a muscle that they’ve spent a lot of time building. And and so, they’re just starting to do that now. And the more they do it, the better they’ll get at it. So, that’s our hope is that we’re just presenting things that we think are important that we think they ought to be paying, at least, a little bit of attention to, and just making them aware. I mean, becoming future-ready, it starts with being aware of what’s going on. And so, that’s our goal is just to kind of share with them what we’re seeing in the hopes that it might spark an idea or two about what they can do to better prepare themselves and their clients.

Peter Margaritis: [00:07:34] Well, off of that, I mean, the very first episode that you launched, I mean, you came in strong. You brought in Daniel Burrus, the Anticipatory Organization. Now, I will say that I’ve heard you and Tom talk about Anticipatory Organization, and I kind of had an idea about it, but I needed to pick up some CPE before year end, and I decided to take Anticipatory Online On-Demand Course through MACPA, and I was blown away. Actually, I’ve got all that information, all those materials, and I’m going to start applying that in my business this month and starting to try to trickle that in because it became very apparent to me these hard trends that Daniel talks about. I mean, they’re right in front of us, but we just don’t recognize it as a hard trend.

Bill Sheridan: [00:08:26] Yeah. And that’s the cool thing about what he’s done. So, Daniel Burrus, one of the top futurists in the world, and he’s built kind of this online learning system that he calls the Anticipatory Organization. And then, we, at the MACPA and BLI worked with him to kind of customize that for the accounting and finance world. And we call it Anticipatory Organization Accounting and Finance Edition or AOAF, kind of a mouthful, but we refer to it as AOAF.

Bill Sheridan: [00:08:54] But the cool thing about it is when you talk about that concept of anticipation, it sounds a little out there. It sounds not like — a little nebulous, soft around the edges, but it’s really not. And what he’s done, what Daniel Burrus has done is built this system that actually teaches you how to do it. It’s a skill you can learn. You can learn how to become more anticipatory. And not only that but to actually apply what you’ve learned to your specific job. So, that’s what’s really cool is that he’s got a number of lessons in there that make it really tangible and real world kind of skill that you can actually learn and apply.

Bill Sheridan: [00:09:41] And we’re seeing more of that too. More people are starting to offer the skills that we’ve been told time and time again that accounting and finance pros are going to need to remain relevant going forward, and they’re not the same skills that we’ve been using for generations. They’re — I hate to call soft skills, but that’s the term that everybody uses. They’re really actually hard skills. They’re things like critical thinking, and strategic thinking, and communication, and leadership, and all of that type of stuff. We’ve been told time and time again that’s the stuff that we’re going to need to know how to do in order to remain relevant going forward. And anticipation is one of those skills.

Bill Sheridan: [00:10:24] And so, Daniel Burrus is one of a number of people out there who are starting to offer those skills. So, again, that’s the other great thing is that we no longer are just talking about the skills we’re going to need, there are people out there actually providing them. And so, that’s another great step toward becoming more future-ready is being able to learn how to do the stuff that we know is going to be vitally important going forward.

Peter Margaritis: [00:10:53] Yeah. I’ve always said they call it soft skills, but I might come back to them as, “But would you agree that they’re pretty hard to master?”

Bill Sheridan: [00:10:59] Yeah.

Peter Margaritis: [00:10:59] And get their head shaking, yeah.

Bill Sheridan: [00:11:01] Yeah, yeah. I mean, they sound kind of warm and fuzzy, but they’re critical. What’s interesting is that most of them are, as we we’re sitting here in this age where most people are talking about technology, automation, artificial intelligence, and blockchain, and all this other stuff that’s coming at us, and these high-tech concepts, and the skills that we’re seeing most people say we’re going to need to become a little bit more future ready are actually more human-related skills: collaboration, and leadership, and communication, and things like that. So, interesting that as technology continues to advance and make our lives more chaotic that the skills we’ll need going forward are skills that bring us a little bit closer to one another.

Peter Margaritis: [00:11:53] And, as you were saying, one of those hard trends is technology. This year, I just got the iPhone X, X stuff, I believe.

Bill Sheridan: [00:12:05] X.

Peter Margaritis: [00:12:05] Yeah, but I could’ve gone in and said, “Can I get a flip phone now?” No. And the point was we’re not going to go back to a dumber phone. I think, we use that term. No, technology is going to continue to grow. We can anticipate that. And why would I take this, as you mentioned, artificial intelligence and blockchain? Now, when I first heard of blockchain, I thought I was in Tesla disorder, but I found that there really is for some accountants. It can be. But it seems like AI is impacting the profession more so than blockchain. Blockchain may be three to five years away. But with artificial intelligence — And, I guess, my question is we know that large organizations — and I’ll use McCormick who are using these robotic process automation RPAs. Is that correct?

Bill Sheridan: [00:12:59] Mmhmm (affirmative).

Peter Margaritis: [00:12:59] To reconcile accounts where it would take — It is displacing jobs and-.

Bill Sheridan: [00:13:04] It is.

Peter Margaritis: [00:13:05] It is, but it’s able to do something in such a — almost like a nanosecond. But then, it provides the data to a person and says, “You need to look in these areas and go search this out,” and then be able to communicate that up the line.

Bill Sheridan: [00:13:23] Right, right. So, yeah. I mean, it’s doing incredible things. And you’re right, it is — I mean, the accountants’ worst nightmares are coming true in a way. They said these technologies are going to displace some jobs, yes. But as Ed Kless from Sage says, I interviewed him and Ron Baker for the podcast at one point, and kind of humorously said, “Look, if your job can be automated, your job probably sucks.”

Bill Sheridan: [00:13:59] And so, here’s the point right. I mean, the machines are coming in, and they’re automating away the busy work, the grunt work, the number-crunching stuff that we spend a lot of time learning how to do and spend a lot of time — just, we do that over and over right. But they’re able to do it faster and more accurately than we ever will. So, let them do that, and that frees us up to learn some new skills and add higher-value type stuff. It’s not crunching the numbers anymore. It’s kind of telling the story behind the numbers.

Peter Margaritis: [00:14:35] There’s always a story behind the numbers.

Bill Sheridan: [00:14:38] Oh, yeah. As you know, yeah. But you’re right, it’s here, and it’s happening faster than ever. I mean, Watson, let’s use Watson, IBM Watson as an example. It got its start back in 1997, I think. It was called Deep Blue, at the time, this machine that IBM built, specifically, to see if they could build a machine that could beat a human being at chess, and it did. It beat Garry Kasparov at chess, the world grandmaster.

Bill Sheridan: [00:15:07] And then, you fast forward to 14 years later, 2011. So, Deep Blue had evolved into Watson, at that point. Watson was built specifically to see if they could build a machine to beat a human being at Jeopardy, the game show, Jeopardy, and it did. It beat the two gentlemen with the world record holders for highest winnings in jeopardy. This machine beat them in jeopardy.

Bill Sheridan: [00:15:35] And we all kind of look at those things and thought, “Wow, how cool. Look what the machine could do.” And then, we just kind of ignored it and went right back to doing what we always do. And then, I think, it was 2017 or ’16, I can’t remember which one, but just not too long ago, KPMG announced that they were applying Watson’s technology to its entire suite of professional services, including tax, and audit, and things like that. And, suddenly, it was real. It was impacting the profession. And yet, still, a lot of us weren’t really paying attention because, at that point, only the biggest companies with the deepest pockets could afford to play around with this stuff.

Bill Sheridan: [00:16:18] And then, just 18 months after KPMG announced that, you get something like this. One of my recent guests was Samantha Bowling. In the interest of transparency, she’s the Chair of the MACPA’s Board of Directors, but she is also a partner with a smallish CPA firm here in Maryland. And she started using an artificial intelligence solution called in her firm. And then, suddenly, you’re now talking about a small firm being able to afford to play with this technology. In just 18 months, we went from the biggest firms were the only ones being able to do this stuff; and, now, it’s available to everybody, and it’s giving small firms a key competitive advantage that they didn’t have before.

Bill Sheridan: [00:17:13] So, that’s kind of a long story to say that this stuff is moving faster than ever, and it’s becoming available to more people than ever, and we need to start figuring out how it’s going to benefit us, so that we can use it to benefit our clients and customers. That’s what it’s all about. And that’s going to be happening over, and over, and over again. You mentioned blockchain, and you’re right. There aren’t a whole lot of solid stories or examples that we can point to what blockchain is far as how it’s impacting the profession, but they’re coming. We will see them, and the profession is paying very close attention to it. And given the exponential rate that technology is advancing, it probably won’t be too long into the future before we start to see some really tangible examples of how blockchain is starting to impact the profession.

Bill Sheridan: [00:18:07] So, again, technology, it’s a hard trend, it’s not going anywhere, and this type of stuff is going to happen over, and over, and over again. And we just have to get comfortable with being uncomfortable with new technology because it’s just this is the new normal.

Peter Margaritis: [00:18:24] With blockchain, I’ve heard people say, it’s great right now in supply chain. And looking at — I think it was what Walmart that had a mango issue. And they were able to use blockchain within a matter of seconds to figure out where the source of the bad mangoes were coming from versus the Romaine issue that we had this past year where it took maybe a couple of weeks since they figured it out it was somewhere in California. I want to get some from the supply chain management perspective but from a ledger, three-dimensional type of — I still have a hard time getting my mind around it, but we’ll eventually get there.

Bill Sheridan: [00:19:08] I mean, at some point, it’s going to have an impact on the profession. I mean, there are some wild guesses out there. There was a panel of educators at New York University not too long ago. One of them said he thinks that audit is going to be dead within 10 years, thanks to blockchain. Now, that’s a little out there. And I’m not quite sure that we’re going to get — I mean, blockchain right now, it’s really high on the hype cycle right now. And everyone’s talking about it, and everyone’s trying to figure out how it’s going to impact us. And it’s smart to be paying attention to it.

Bill Sheridan: [00:19:45] The AICPA is working with a number of different organizations to figure out how the profession might have to evolve because of this, and that’s really smart because it may very well have a huge impact on us. We need to start figuring it out now. The point is it’s not having that impact yet. We don’t know exactly what the impact is going to be, but the potential is there. And so, we need to be talking about it and paying attention.

Peter Margaritis: [00:20:15] We both had on our podcast Amy Vetter, who does a lot of work with IT and has a very good understanding and deep knowledge of blockchain and artificial intelligence. And, I think, we’ll go back, and listen to her episode and, converse with her. I think what I’m hearing is, same thing you’re saying, we’re still a little bit out there with it to start to impact it, but we need to understand it now versus what we typically do. “I’m not going to worry about this new revenue recognition thing until it becomes-” And then, we’re still putting it out to, “Oh my god, let’s do now.”.

Peter Margaritis: [00:20:51] And with this anticipatory type of being future-proof and future-ready, we need to start learning blockchain today. It may not impact us for about a year, or two, or three out to gain that knowledge base, so we can explain it to our clients. And I’ll use the term clients broadly in the sense of public accounting, business, and industry, our internal clients, our external clients, and to our community.

Bill Sheridan: [00:21:17] Yeah, yeah, absolutely. I mean, let me give you other examples of we talked about the concept of anticipation and getting ahead of this stuff. So, this whole idea of anticipation is kind of a three-step process. We call it aware, predict, and adapt. So, first step, being aware. What’s going on? Just understanding it. That’s the first step. Predicting is step number two. So, predicting, now that I’m aware of it, what kind of impact is this going to have on me and the people that I work with? And then, adapting, what he actually do about it?

Bill Sheridan: [00:21:50] So, we’ve got a couple of opportunities right now. One of my guests was Rick Richardson who’s a CPA and kind of a tech futurist. And I was just asking him, “What are the what are the big trends that you’re watching that you think are going to have the biggest impact in our lives in the very near future?” So, here’s a great example. One of them, he cited, was 5G. So, the next iteration of WiFi, which it’s not theory anymore. It’s coming. In some places, it’s actually here. And it’s going to allow us to do things. They’re saying the networks are likely going to be 10 times faster with 5G, kind of power everything from driverless cars to the internet of things.

Bill Sheridan: [00:22:32] So, here’s a question for accounting and finance pros out there, how can you take advantage of 5G in a way that will benefit your clients and customers, the people that you work with? That’s the muscle that we have to start building. We know this is coming and in very short order. So, what are the opportunities embedded in something like that? And we need to start thinking about that now before it hits mainstream and evolves into something else. So, that’s this idea of anticipation. It’s building that muscle, just spotting something that we know is going to happen and figuring out how it’s going to impact us and what we can do about it. And that’s going to happen over and over.

Bill Sheridan: [00:23:16] Voice search is another one. I mean, Alexa is not just this cool toy that we’re playing around with. Voice search is going to evolve and become more and more powerful. How can we take advantage of that? That the kind of discipline that we have to start building as we go forward because we’re just going to see more and more of this type of stuff as time goes on.

Peter Margaritis: [00:23:40] And I don’t remember if it was CBS Sunday Morning or 60 Minutes, but they did a piece on 5G to explain how that impact and how powerful it is because it doesn’t work from cell towers, it works from nodes. And there’s all these nodes. But what are the challenges with that is urban areas – St. Louis, Columbus, Baltimore – will have access to 5G, but those who are in the rural areas, it may not reach to them, and there’s going to be a big disparity in the ability to use the internet and cloud if you’re out in those roll areas. So, think about anticipating, if you’ve got clients in these areas, when you move to 5G, how is that going to impact those clients or your location maybe?

Peter Margaritis: [00:24:26] Last month, I was in Endicott, Nebraska, which is about an hour and a half southwest of Lincoln, 127 people in the whole city. There’s a manufacturing plant called Endicott Clay Products. They make brick. They make brick, but they make brick that they use at like Lucas Oil Stadium. And it’s really cool thin brick, but you can hardly get cell service out there, more or less internet service. I’m thinking, how are you guys going to be able to keep up because you’ve got a lot of clients around the country who will be on 5G? Have you guys thought about that? And their answer was, “We haven’t thought about that.” So, let’s start thinking about.

Bill Sheridan: [00:25:15] Yeah, exactly. Yeah. And that’s not uncommon, especially in our profession, but you’re starting to see more and more people in our profession starting to pay attention to stuff like this. They’re starting to realize that it’s like this is just the way things are going to be from now on, and this new stuff is going to continue to have impacts. We need to start figuring out what we need to do about it. So, there’s still — It’s baby steps, but I think they’re starting to move in the right direction, which is encouraging.

Peter Margaritis: [00:25:45] And you mentioned Alexa. So, I remember National Speakers Association. I will say that Daniel Burrus is also a member of the National Speakers Association. He is a certified speaking professional, and he’s in the Speaker Hall of Fame, which is pretty cool. He’s kind of one of those high-profile guys. But in this month’s magazine, they talked about, how can we use Alexa when we’re on stage? And I go, “Interesting.” But there’s a way that — And I actually tested this out. There’s a way that you can go in and, actually, program Alexa to respond to certain commands that you create, not that Amazon creates. And I went, “Oh, that’s kind of cool.” So, I’m in the process now of trying to figure out how I can bring Alexa with me to interact with the audience in a way that, obviously, people stay away, but Alexis able to communicate.

Bill Sheridan: [00:26:42] That would be really cool. It would be cool.

Peter Margaritis: [00:26:44] And so, if I get it done, I’ll have it recorded, but how can we, as accounting professionals, use Alexa in that manner? Let’s talk about Jody Padar. And she’s now — Is it a joint venture, partnership with?

Bill Sheridan: [00:27:03] Botkeeper, right?

Peter Margaritis: [00:27:03] Botkeeper, yeah. And Botkeeper is — You can probably say it better than I can.

Bill Sheridan: [00:27:11] I’m still fuzzy on the whole bot type of thing, but it’s — Again, these kind of robotic assistants that do things for you. And, again, it’s just another example of technology that’s going to be impacting our profession and making things a little different, a little chaotic. And in typical fashion, Jody saying — She’s one of the outliers in our profession, always trying to figure this stuff out before anybody else. So, she sees something new that she thinks is going to have an impact, and she dives right in, and she’s done that time and time again. And this is just another example.

Bill Sheridan: [00:27:47] But she’s actually — I mean, yes, as you said, working closely with them. That’s how much potential she believes that the bots have. That’s how much impact she thinks they’re going to have on this profession. So, you wanted to be right there at the forefront of it. And it’s really going to be interesting to see how all that shakes out.

Peter Margaritis: [00:28:08] Yeah. I remember when I interviewed her about a year or so ago, she was talking about bots. And I pulled out the baby boomer card. I go, “What is that? What’s a bot?” And she pulled out the millennial cards and she started — And I still couldn’t get my mind around it. But, lately, I’ve been able to have a better understanding and even talking with her. She said, “We could create a bot that you could do all of your accounting within your business, have everything reconciled, done, tied up, and you just give the information out to your CPA to do the taxes versus I had them do my reconciliations and make sure that my checking accounts all-”

Bill Sheridan: [00:28:48] Sure, sure.

Peter Margaritis: [00:28:48] Yeah. So, it’s-

Bill Sheridan: [00:28:48] Well, it’s a great — I mean, it’s a great service for small businesses, this whole idea of automated bookkeeping. And the story that she told me was the Botkeeper folks said that they were working with a small business in the area. They actually named their bots apparently, like human names. And there is one client who came in at one point and said, “You know what, I came in to-” I don’t know what name they have given him, but like let’s just call him Leon. “I came in to meet Leon.” And then, they had to explain to this guy that, “Leon’s not an actual person. He’s just the name that we give this machine over here.” But that’s kind of blurring the lines between people and machines. And that’s what technology is doing nowadays though. But interesting stuff. Yeah, we’re paying attention to how that’s moving as well where we’re real interested to see where for all that goes.

Peter Margaritis: [00:29:50] Let’s go to the top of the accounting profession. Back in August of last year, you released an episode where you interviewed Barry Melanson.

Bill Sheridan: [00:29:58] Yeah.

Peter Margaritis: [00:29:59] And it was titled, “We won’t Recognize the Accounting and Finance Profession in 10 Years.”

Bill Sheridan: [00:30:05] Yeah. Barry’s kind of famous for saying that, and he qualified. I heard him speak at a conference not too long ago, and he actually qualified that. He said, “I tend to say 10 years. It’s really more like five, but I just don’t want to scare people.”.

Peter Margaritis: [00:30:23] So, I’m glad you said that because I’ve always felt it’s more five than 10.

Bill Sheridan: [00:30:27] Yeah, yeah, but yeah. I mean, that’s the type of impact that these trends are having. And it’s not just technology trends either. I mean, we talked about things like demographics, and the fact that baby boomers are going to continue to retire at a rate of about 10,000 a day. And who’s going to step in and fill that kind of experience gap? The next generation in line are my folks the Gen-Xers who there’s not nearly enough of us around to take over those, to fill that gap. It’s just a numbers game. I mean, that’s another hard trend. So, that’s having an impact as well on the whole demographic shakeup.

Bill Sheridan: [00:31:08] But, yeah, between technology, and demographics, and legislation, regulation, the profession is changing. So, going back to blockchain. I mean, one of the things that they’re looking at is — And as I said, the impact on audit and various working with a number of groups to say, “Okay. Well, if audit is evolving, how might auditors have to evolve as well? What’s the changing role for auditors going forward?” So, they’re looking at what the auditor of the future actually looks like, and they may end up doing very different things from what they’re doing today.

Bill Sheridan: [00:31:46] So, I think, that’s what he means in a certain sense. It is, it’s changing, but things have always changed. In a certain way, none of this is new. It’s just happening faster now than it ever has. And it’s kind of thrown us for a loop, but things have always changed, and we’ve always evolved. People talk about all the jobs that are going to be automated away, and there will be some, but they have those discussions without really realizing that all these new technologies are going to create as many or more jobs as the ones they destroy. And new technology does that. So, we will evolve as well. And it’s always been that way, and it always will be. We’re just going to have to learn how to do it faster now.

Peter Margaritis: [00:32:28] And I think I’ve heard it explained to me. It’s Tom, or Daniel Burrus, someone. When things changed, it’s kind of a slow kind of a change. And this has kind of crept up on us, and it’s happened. It’s not like a linear line. It’s like a hockey stick. The things that happened, we went from the LP, to the cassette, to the 8-track. And then, all of a sudden — But, obviously, it’s now a hockey stick. It gets to that exponential change. And, boom, it just shoots straight up.

Bill Sheridan: [00:33:01] That’s exponential growth in a nutshell. It’s gradual, almost to the point of you don’t notice it. And then, it’s sudden. Gradual, and then sudden. And we’re halfway up that hockey stick at this point. Things are just changing. We are now in that exponential phase, right. It’s just unbelievable, the things that are happening. And it’s really exciting in a way to be to be living in this time because, my gosh, think about the stuff that we’re going to see in very short order. It’s pretty mind blowing.

Peter Margaritis: [00:33:34] But the one thing, I’ll go old school. Somebody share this with me the other day. Do you remember the time when we had the cassette tape, and we kept it in that plastic container?

Bill Sheridan: [00:33:47] Of course.

Peter Margaritis: [00:33:48] In the north, if you didn’t have a scraper, an ice scraper, that was your ice scraper. And you’ll never be able to experience using a cassette tape as an ice scraper. Go on.

Bill Sheridan: [00:34:00] And I was trying to explain to my daughter too this concept. So, she had just made a playlist on Spotify, and love Spotify, and she’d put together this playlist of some of her favorite songs for a friend. And I was trying to explain to her the concept of making a mixtape and how long that took back in the day. And if you screwed up, you had to go back and erase it. And it’s just a foreign concept to her in an age where you can just go in, and find all your songs, and put them in one spot, and there you go. But, yeah, it’s another example of how quickly things have changed.

Peter Margaritis: [00:34:36] The one thing that struck me in Barry’s conversation with you, he mentioned a story. And, obviously, that’s big on my radar all the time, but he talked a lot about, “We need to be better storytellers.” That’s how the profession is evolving, and that’s a skill that doesn’t develop overnight. It develops over time. But I was really happy that he mentioned that because I’ve been talking about that for a while. He goes back to those soft skills, the communication skills, but it’s not a data dump. Numbers don’t move themselves. People move the numbers. Something has to happen to transactions. Something has to happen from a human in order for numbers to move.

Peter Margaritis: [00:35:22] So, our job is to get behind those numbers, find out what it is, and then be able to tell the story to those above. And it’s not a data dump, or it’s more there’s an emotional connection within those numbers. Something had to happen and just finding that. And he talked a little bit about that aspect on how the profession is changing.

Bill Sheridan: [00:35:46] Yeah, yeah. And you’re right. And you know this better than anybody. We have to become better storytellers. I mean, there was a study that came out two or three years ago now. It’s done by the Slate Group actually. They were trying to figure out, what are the top reasons why a client might leave their CPA? And the number one reason they found was that, in essence, my CPA wasn’t future-ready. I think the actual response was, “My CPA provides me with reactive services, instead of proactive advice.”.

Bill Sheridan: [00:36:22] They want us to be more future-ready and help them to become future-ready. And doing that means being able to tell those stories behind the numbers. They don’t just want you to crunch out another tax return forum. They want you to help them understand how their business is evolving and what they need to do about it. And that requires us to be better storytellers. So, yeah, that’s another skill that we need to learn.

Peter Margaritis: [00:36:47] I wish my accountant would be more along those lines. I know I have some challenges in my business, also, small business owners do. But the ability for them to stop for a moment to say, “Hey, Pete, look at this. Have you ever thought about this, or maybe you need to do that, or maybe this would be a better product or line that could help you keep some.” But I don’t get that type of advice. But I think no matter how large or small you are, just by having that conversation also helps retain the business because I have a wandering eye now. My eyes wander. Maybe I need to find another CPA to help me in my business.

Bill Sheridan: [00:37:34] We work very closely with a firm in Maryland that kind of famously told a story one time not too long ago about they were talking with a potential client. And in the process of that kind of getting-to-know-you phase, the firm, the member of the firm, asked that the potential client, “Where do you want to take your business? I mean, what do you see when you look at the future of this business? Where do you eventually want to go with it?” And I think it took a few moments, but they said, the potential new client gave their business that day.

Bill Sheridan: [00:38:12] And they asked him — It was that quick, and the firm said, “Can I ask why?” And they said, “No one has ever asked me that question before. No one has ever asked me kind of a future-focused question about my business. And that tells me that you guys care about where I’m going and want to help me get there.” And those kind of conversations are going to be crucial going forward. I mean, we need to be able to help walk our clients and customers into the future. In order to do that, we need to be there before them. So, yeah.

Peter Margaritis: [00:38:46] I think I may know the firm that you’re talking about. You said a Maryland-based, have about two or about three locations in Maryland.

Bill Sheridan: [00:38:54] Yeah, yeah.

Peter Margaritis: [00:38:56] Right, yeah. And they are very — In a lot of different ways, but they’re very much future-proof and future-ready.

Bill Sheridan: [00:39:02] Yeah. They’re one of the firms. They were one of the first to kind of embrace that Daniel Burrus’ notion of anticipation, and go through that AOAF program, and try to become a little bit more anticipatory themselves. So, they were they were walking the talk there.

Peter Margaritis: [00:39:16] Yeah, exactly. The one episode I do want to talk about because as I was going through, I missed this one, so I haven’t heard it, you interviewed Sally Hogshead.

Bill Sheridan: [00:39:28] Yeah. That was an interesting conversation. So, this was at the CCH User Conference back in October. She was the closing keynote speaker there. So, Sally is a marketing expert and just a terrific speaker. And I’m trying to dig up the actual — Bear with me while I look for it. She put on a great closing keynote at the CCH User Conference in which she talked about how to set yourself apart from the competition. the best way to do that was. And the phrase that she bantered about over and over again was that, “We’re at a point in time where different is better than better.” We have to focus on what makes us different and not necessarily why we might be better than somebody else because chances are we might be better, but when it comes to doing the stuff that we do, there are other people out there who can do what we do pretty well too. So, why we do it or what makes us different from them is really going to be the differentiator.

Bill Sheridan: [00:40:38] So, she’s actually come up with this kind of matrix of sorts that she calls the Fascination Advantage, where you can find your sweet spot and really get to the heart of what makes you different than everybody else out there. And it was a great conversation. That was fun conversation to have.

Peter Margaritis: [00:40:55] She’s up in the Speaker Hall of Fame. I’ve heard her name ever since the day I walked in the National Speakers Association. I’ve never met her. So, I was scrolling through here, I went, “Wow.” And you were talking about that matrix. I think, I looked in your show notes. I think you can find it at

Bill Sheridan: [00:41:19] That’s right. And she actually created a code that people who listen to the podcast can use to take the assessment for free at the website if they’re interested. It’s, again, And if you go there, and you enter the code FutureProof, all one word, capital F, capital P, you’ll be able to take Sally’s assessment.

Bill Sheridan: [00:41:47] And, again, it’s just — She looks at seven characteristics. She calls them innovation, passion, power, prestige, trust, mystique, and alert. And somewhere in the intersection of those seven things is your sweet spot, what really defines you and makes you different from everybody else out there. And it sounds a little touchy-feely, but it’s not. I mean, she had everybody in the audience take the assessment before the keynote. And it’s pretty eye-opening stuff. So, I mean, yeah, I’d go there and just play around with it because it could help you find one or two things that you can focus on that sets you apart from everybody else out there.

Bill Sheridan: [00:42:29] I do a lot of work with EOS and helping folks implement this business operating system. And one of the things we talk about when we talk about marketing is your uniques, your three uniques. What sets you apart? And that becomes part of the message that you deliver to the world. So, it was a really powerful message that Sally offered. And she was very gracious to take the time and sit down with me after the keynote and, actually, have a one-on-one conversation. So, that was a fun interview to do.

Peter Margaritis: [00:43:01] So, if I ever meet her, I’m going to drop your name and say, “Bill interviewed you on his podcast. Can I get some time on my podcast and interview you?

Bill Sheridan: [00:43:12] There you go, yeah. She’s very gracious. And I have to thank the folks at CCH for setting that one up too. They’ve been really helpful over the years. That’s where I met Daniel Burrus for the first time, as matter of fact. He was a keynote speaker at the CCH User Conference four or five years ago. And I just asked the folks at CCH, would I be able to get five or 10 minutes with him either before or after his talk? And they said, “Sure, we’ll make that happen.” And it doesn’t hurt to ask. They can only say no. That’s the worst that can happen. And on the other side, if they say yes, you get to talk to some pretty cool people, so.

Peter Margaritis: [00:43:51] Yeah. So, we’ll go full circle here with Daniel Burrus now. He is the co-chair for our Annual Convention for National Speakers Association. And the annual convention, the theme of it is Transformation.

Bill Sheridan: [00:44:08] There you go.

Peter Margaritis: [00:44:09] And he talks a lot about but we’re past the time of change. We’re in that when the area of transformation. So, I’m looking forward to going to Denver and seeing what they lay out as it relates to transformation for our profession, and take some of that, and say, “Well, how does that also equate to the transformation of the accounting profession?”

Bill Sheridan: [00:44:30] Right, right. Yeah. No. And he’s kind of famous for saying, when it comes to transformation, I mean, there’s a couple of really powerful examples out there. I mean, Uber, for one. We always talk about Uber, but it’s a great example of a new service that came from outside the industry it was impacting, and completely turned it on its head. I mean, Airbnb is another one. So, you know. I mean, hotels probably weren’t really paying attention to what they were doing outside the profession not so long ago. But all of a sudden, in swoops Airbnb and completely turns it upside down.

Bill Sheridan: [00:45:09] So, that’s what worries me a little bit about our profession is that there’s somebody out there somewhere working on something that may very well end up transforming what we do. So, we need to learn how to start looking for stuff like that early. That’s what anticipation is all about.

Peter Margaritis: [00:45:32] And the key there, well, L has to be greater than C squared.

Bill Sheridan: [00:45:38] Yeah, that’s Tom Hood’s kind of personal formula for keeping yourself relevant. The L is the pace at which you learn. C squared is the pace of change and the pace at which your competition is changing. So, change in competition. So, it basically just means you got to continuously learn nowadays. Just always be learning new stuff, always be upskilling. That’s kind of the catch phrase of the day is continually making yourself better.

Bill Sheridan: [00:46:12] The quote I always love comes from Robert Safian, who’s the editor of Fast Company. A couple years ago, he wrote an article in which he said that we’re living in a time where the most important skill any of us can have is the ability to learn new skills, and that’s never going to change. Tom, again, is kind of famous for saying that things will never be as slow as they are right now.

Peter Margaritis: [00:46:35] Yeah, exactly.

Bill Sheridan: [00:46:36] They’re just going to continually speed up. And the only way we can hope to kind of write that out is just free ourselves up to become lifelong learners.

Peter Margaritis: [00:46:43] And invest in yourself. Don’t look at it as a cost. Look at it as an investment. And this has nothing to do with compliance and our licensing. It’s way beyond that learning aspect.

Bill Sheridan: [00:46:54] Yeah.

Peter Margaritis: [00:46:54] So, before we wrap up, do you always — You’re an avid consumer of books. You read a lot of books. So, we’ve got some that similar. What’s the book that you’ve read recently that has just blown you away?

Bill Sheridan: [00:47:09] Oh my gosh, there’s been a number of them. The Culture Code is one. That was a good one. I want to look up the author to make sure that I get it right, but it was — Okay. So, The Culture Code: The Secrets of Highly Successful Groups, and it’s by Daniel Coyle. That was a really great book.

Bill Sheridan: [00:47:30] Daniel Pink’s latest book, it’s not brand new, but it came out last year. It’s called When. And the whole premise was that, how you do what you do is important but equally important is when you do what you do. The Science of Secret of Perfect Timing, I think, was the subtitle. But he makes the point that when we decide to do something, often, has as much impact as how we do it, which was a really cool concept, but it was a great book.

Bill Sheridan: [00:47:58] Tom Peters’ latest book is fantastic. It’s called The Excellence Dividend. He’s always great, but those three really stick out among books that I read last year.

Peter Margaritis: [00:48:09] What do you read now?

Bill Sheridan: [00:48:09] Right now, I am reading — Hold on. It’s right here. I’ve got three of them in order. There’s the One Minute Manager Meets the Monkey, which I haven’t read, but I’ve heard it’s great. It’s by Kenneth Blanchard. So, the monkey story kind of goes like this. It’s this idea of leadership and management. People come into your office with their problems, their issues. You look at those problems and issues as monkeys sitting on their shoulders. And what they what those people are trying to do is give you their monkey. Get this thing off my shoulder here. And at the end of the day, what happens is you’ve got an office full of monkeys, and you can’t get anything done. Your goal has to be to send them out with their monkey still attached to their shoulder. So, that’s kind of the concept. I’m really looking forward to reading that one.

Bill Sheridan: [00:49:10] The Art of Gathering by Priya Parker. And I’ve heard a number of different people recommend this one. I don’t know a whole lot about it, but it comes highly recommended by all the people that I turn to when I’m looking for new books to read. I say, “Okay, what are the best new books?” and this one was at the top of the list. So, The Art of Gathering that I’m looking forward to reading right now.

Bill Sheridan: [00:49:34] But the one that I’m reading right now is — Okay. So, it’s kind of weird. I have become certified as a personal trainer in my spare time.

Peter Margaritis: [00:49:45] Wait, wait, wait, wait. You have spare time?

Bill Sheridan: [00:49:47] No, no, not really.

Peter Margaritis: [00:49:48] Don’t say that out loud. Tom will put more stuff on your plate, man.

Bill Sheridan: [00:49:53] No, it’s my trip into the Bizarro world. Actually, find the time to do stuff like that. So, I got certified as a personal trainer. Personal trainers have a certain amount of continuing education every couple of years to keep their licenses. So, right now, I’m becoming specialized in fitness nutrition. So, I’m reading a nutrition textbook, a little dry. I wouldn’t recommend it for everybody, but it’s very interesting and eye opening in a lot of ways. I’ll let you know how that one comes out.

Peter Margaritis: [00:50:25] That’s cool. Congratulations on being certified as a personal trainer. That’s awesome.

Bill Sheridan: [00:50:29] Yeah, thanks. I don’t know. It’s just something that — I mean, I spend a lot time in the gym, and I just enjoy it, and I just thought this might be a way that I can help people in my later years. So, we’ll see. It’s been a lot of fun though.

Peter Margaritis: [00:50:43] Oh cool. Well, Bill, I can’t thank you enough for taking time. I always enjoy our conversations. Congratulations on the podcast. Keep doing you do it because, man, I love it. It’s strong, and it’s just not because it’s you and MACPA, but you really do a great job on, and I commend you for that. And thanks for all that you and MACPA is doing to help the accounting profession evolve.

Bill Sheridan: [00:51:06] My pleasure. Thanks for the kind words. Always, always fun to talk to you, Peter. Thank you for having me.

Peter Margaritis: [00:51:14] All right, bud.

Peter Margaritis: [00:51:14] Now that you’ve listened to this episode, my question to you, are you future-proof? The answer is probably not. So, take some time, plot out a path to help you become ready for the future. By the way, start today, not tomorrow. Start today. You can find 10 minutes out of your busy, busy schedule. And take that time to reflect on what does it mean to be future-proof. And then, each day, add on another 10 minutes and say, “How can I become better prepared for the future? What skills do I need to put in my tool box?” Now, this is not going to happen overnight, but if you take 10 minutes, if you take these baby steps, you’ll end up breaching your goal a lot quicker than you thought, but you have to do it every single day.

Peter Margaritis: [00:52:10] So, thank you for listening. And if you enjoyed the podcast, please subscribe and share this episode with a friend.

Advertisement: [00:52:21] Like what you just heard? Because it’s C-Suite Radio, turning the volume up on business.



S2E21 – Gary Zeune | The Pros & The Cons: Why White Collar Crime Happens (& How to Prevent It)

We would like your feedback on today’s podcast by answering this quick two-minute survey: Thank you so much for your support.


My guest today is a gentleman who knows more about fraud than just about anyone else in the accounting and finance profession: Gary Zeune, CPA, Managing Director of The Pros & The Cons.


The Pros & The Cons is the only speaker bureau in the country specializing in white-collar criminals. His 40 plus ex-con speakers tell the stories of how and why they embezzled, took kickbacks, and cooked the books to the tune of up to $2.7 billion. His speakers include Mark Morse, a former CFO at ZZZZ Best; Paul Allen, an ex-bank CEO; and Dunlap Cannon, the largest real estate closing attorney in Memphis.


But regardless of what kind of entity they worked at, regardless of the dollar amount, there are several really common elements between everyone who commits fraud – the biggest one being that they don’t think they’re going to get caught. To put it simply, ego gets in the way.


So, why would someone be so stupid to think they aren’t going to get caught?


Well, consider this: have you ever broken the speed limit while driving? Everybody, including me and Gary, have done. It’s illegal, so why do we do it? We do it because we think we’re going to get away with it – just the same as somebody cheating on their expense report or cooking the books at the bank for $2.7 billion.


People say, “Well, I’d never let that happen to me.” Well, when you get in your car and you go on the freeway, most of us start going the speed limit. Then, you go two miles over. Then, you’re three miles over. Then, five. After you’re driving for an hour, you might be going 10, 15 miles over the speed limit. What happens is when your brain is bombarded by constant stimuli, the same stimuli, your brain becomes desensitized.


That’s why frauds always start little and get bigger, and bigger, and bigger.


Most people think that there is a bright line on ethical behavior, but that’s not the way it works. Ethics is not absolute. Ethics is situational.


So you might think going just five or 10 miles over the speed limit isn’t so bad, but would you break the law by driving 30 or 40 miles over the speed limit? Most of us the answer is no, most of the time, but what about when you have a medical emergency and you’re taking your child to the hospital? Your child’s health and well-being is more important than you staying five miles over the speed limit, so you change your behavior and break the law even more because there’s something more important to you in this situation than the speed limit.


So, if you don’t do something about fraud, it’s just going to grow – which also means you need to know how fraud works so that you can identify it.


You may get an expense report for $1000, including a $12 fake cab. If you don’t bust someone over it, assuming you catch it, and then make the punishment worse than the crime, they’re going to do it again. “And it will get bigger, and bigger, and bigger. That’s where it always starts.”


Gary shares a number of great fraud stories in the episode, and you can learn even more by reading some of the following articles he wrote or contributed to:



Download this Episode MP3.



Click to download the full Transcript PDF.

Gary Zeune: [00:00:00] Every fraud that we talk about is a situation where really smart people to do really stupid stuff.

Peter Margaritis: [00:00:17] Welcome to Change Your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation.

Peter Margaritis: [00:00:37] Your host is Peter Margaritis, CPA, a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers, all the while growing their businesses. So, let’s start the show.

Peter Margaritis: [00:01:04] Welcome to Episode 21. My guest today is Gary Zeune, CPA. And his consulting practice provide CPAs, attorneys, and executives with hands-on experience in fraud, auditing, and corporate strategy performance improvement. Prior to forming his consulting practice, Gary was an Assistant Vice President of Corporate Finance at the Ohio Company, a Columbus, Ohio investment banking firm.

Peter Margaritis: [00:01:30] He also spent more than five years in treasury and Finance at Wendy’s International where he was responsible for mergers and acquisitions, financial and SEC reporting, and corporate finance. Gary has the only speaker bureau in the country specializing in white-collar criminals, The Pros and The Cons. His 40 plus ex-con speakers tell their stories of how and why they embezzled, took kickbacks, and cooked the books to the tune of $2.7 billion. His speakers include Mark Morse who’s a former CFO at ZZZZ Best, Paul Allen who’s an ex-bank CEO, and Dunlap Cannon, who is the largest real estate closing attorney in Memphis just to name a few. Our conversation centers around fraud, and why people decide to cross the ethical line. As Gary points out, a large majority of fraud start out very very small but then spiral out of control.

Peter Margaritis: [00:02:35] Before we get to the interview, I want to share with you some exciting news. In the coming weeks, this podcast will be part of the C-Suite Radio library. C-Suite Radio is the home of the top business podcasts for leaders in the C-Suite and those who aspire to be. C-Suite Radio is a library of weekly online radio shows that explore the challenges, successes, and failures of guests, who are successful entrepreneurs, C-Suite leaders, thought leaders, and innovators. I’m very excited to be part of the C-Suite library. We’ll let you know when the podcast can be found there. So, without further ado, let’s get to the interview with Gary Zeune.

Peter Margaritis: [00:03:22] Hey. Welcome back, everybody. Today, I’ve got the man, the myth, the legend. The gentleman who knows more about fraud than most people. I tell you who my guest is, Mr. Gary Zeune. And Gary, thank you so very much for taking time to be on my podcast today.

Gary Zeune: [00:03:40] Hey, Pete. It’s great to talk to you again. Looking forward to it.

Peter Margaritis: [00:03:44] Now, as you guys heard his voice, man, he’s got a radio voice. I need that voice, but he doesn’t do radio. He owns a company called Pros and Cons, and he talks about fraud, and he hires ex-cons to go out and teach fraud, teach ethics to the CPA community. Would that be a correct statement?

Gary Zeune: [00:04:06] That is right. And it’s a really interesting process. I’ve been doing this 25 years since 1995. And you’re right, one of our philosophies or one of our business model is if you don’t know how to commit fraud, how are you going to catch it? Because everybody I’ve ever talked to that’s gone to prison for fraud, they didn’t know how until they figured it out. So, it’s not like a magic skill that you’re born with. It’s a learned skill.

Gary Zeune: [00:04:43] And we very often — or not we because I’ve not done it. I haven’t gotten caught yet. It’s something that you just kind of — It starts small, and it gets bigger, and bigger, and bigger. In fact, I wrote an article for The New Jersey CPA Society a few years ago called Fraud and Theft Start Small. And if you look at the pattern because, most people, the only thing they ever see when they read about a fraud case or hear about it, “Oh, Bernie Madoff blew up $165 million” or “The bookkeeper stole $2 million.” Well, they never start at the amounts you read about in the paper. They always start small. And then, it gets bigger, and bigger, and bigger.

Gary Zeune: [00:05:25] Just like your 15-year-old, a curfew on Friday night is 11:00, and they come home at 11:30, and you don’t do anything about it. The following weekend, your 15-year-old is going to come home or the following Friday, your 15-year-old is going to come home at 12:00 because by coming home at 11:30, what they’re doing is they’re testing the control. What’s the control? You’re the parent, you’re the control. And employees, and clients, and staff, and bosses, do exactly the same thing. Why? Because it’s human nature.

Gary Zeune: [00:06:02] And so, you’re right that all of this stuff we’re going to talk about in the podcast, everybody has seen all of this stuff. So, basically, what we’re going to do, Pete, is we’re going to take the same information, and we’re going to re-frame it, so people can relate to it.

Peter Margaritis: [00:06:17] So, my big question, I don’t think I’ve ever asked this. I mean, I’ve known you for a number of years, but I don’t think I’ve ever asked this question. How did you get into this business? How did how did Pros and Cons start?

Gary Zeune: [00:06:28] I got lost on vacation.

Peter Margaritis: [00:06:31] (Laughs).

Gary Zeune: [00:06:31] That’s everybody’s reaction. No, I did not say it. I don’t know if you ever seen the data, but 80% of all the most profitable products and services started by accident. And, usually, it’s when a customer figures out how to use the product or service for something that the company that sold it to him didn’t anticipate.

Gary Zeune: [00:06:58] So what happened was — And by the way, that’s a great profitability strategy is if you want to know how to make more money, talk to your customers and find out how they’re using your product or your service. And they’ll tell you what they’re doing, things you would never think of in a thousand years. It’s that very few things that are really profitable is somebody sitting in a corner thinking it up because you got to do it. You got use it to think of.

Gary Zeune: [00:07:24] So, what happened with me was by accident, which is also one of the primary ways the fraud gets caught. That’s how these two things are related. What happened was I was in Washington DC, I was teaching there, and my sister and his husband lived in DC at the time. So, I would always teach during the summer. I would take my daughter who, at this point, was 13 years old. And she was just starting to really get into clothes and things like that. So, she wanted to go down to the Potomac Mills outlet mall in Northern Virginia. And she’s always been a really frugal shopper like I am.

Gary Zeune: [00:08:02] Well, we’d flown over from Columbus, Ohio. And I borrowed my sister’s car. We’re going down I-95. And I can’t remember what exit the mall was on. I didn’t have enough sense to ask my sister. I thought, of course, being a guy, I knew where it was, so I didn’t have to. I couldn’t remember. It’s been years since I’ve been there. And so, I stopped at a gas station. I get off the freeway. I’m just pulling off on the first gas station off on the side street there, get the directions. I walked out, I looked across the street, and here’s an old Hechinger Hardware store.

Gary Zeune: [00:08:34] Now, Hechinger Clothes, oh, it’s got to be 20 or 25 years ago. And the easiest way to think about Hechinger is it was like a half-size Lowe’s. So, think of a typical Lowe’s store. And they’ve taken the sign up, the Hechinger sign off the front, and they put up a big banner that says, “Giant Book Sale.” I love to read. So, I pulled across, I get out of the car. The automatic doors opened up, and I walked in. And the only book standing up on edge on the — Now, imagine walking into a half-sized Lowe’s. Let me set the stage for you, the visual here. Imagine walking into a half-sized Lowe’s, all the floor-to-ceiling shelving is gone, and it’s full of folding tables with books, a foot or a foot and a half feet. So, it was like a sea of books.

Gary Zeune: [00:09:27] So, this is what’s called a remainder bookstore. What they do is they buy overstock and slightly damaged. And they don’t even know what they’re getting. They’re literally buying by the truck load, semi-truck load, and they’d buy by the pound, about 10 cents a pound. I didn’t know what they’re going to get. So, imagine a sea of books, and the only book standing up on the edge like this, so you could see it, on the very first table. So, automatic doors opened, imagine this. Automatic doors opened. First table right in front of me, the only book on that table standing up on edge, all the others were laid down flat like this.

Peter Margaritis: [00:10:07] I got it. I got it.

Gary Zeune: [00:10:08] This will be on the edge was a book on fraud. I paid $2 for it, and that’s how the whole thing started. So, it took me about — Oh, the book was Faking It In America by a guy by the name of Daniel Akst, A-K-S-T. Akst was a reporter, business reporter at The LA Times back then. This is 1994. I’m sorry. It’s was ’87 when he was at the Times. So, he writes this book about this guy by the name of Barry Minkow. And Barry Minkow, M-I-N-K-O-W, committed probably the most outrageous fraud of the ’90s. I mean, it’s a classic story. This is so outrageous. The Security and Exchange Commission even changed the rules because of what this guy did. This happened in 1987.

Gary Zeune: [00:11:06] So, I paid $2 for the book. I take two or three nights to read through it. I realized when I get to the end, because he wrote it from a business reporter’s perspective, so I realized when I get through it, I need to write my own book for CPAs on fraud, and I’ll use this as a classic case. So, why use ZZZZ Best as a classic case? The answer is because Barry started the company when he was 16 years old, and he’d never gone to college. And by the time he was 21 years old, he’d stolen $100 million.

Peter Margaritis: [00:11:41] Wow.

Gary Zeune: [00:11:41] And he had five auditors over — I’m sorry. He’s had three auditors over a five-year period of time. He fooled a sole practitioner for two years. He fooled a small Southern California firm for two years. And then, finally, they were going to take the company public. And, now, think about this, never been in college. He fools three accounting firms. So, if you remember the big junk bond investment banking firm, Drexel Burnham-

Peter Margaritis: [00:12:12] Yeah.

Gary Zeune: [00:12:12] … and Michael Milken created the entire junk bond market based on his Master’s thesis in college that if you made a wide enough dispersed investment in junk bonds, you’d end up with a premium yield without a lot of additional risk because you diversified. That’s how I tell Drexel Burnham got to be a world powerhouse investment banking firm, and steal Milken’s idea. And so, Milken was in Hollywood, at this point, by Beverly Hills at this point. And Milken and his team were getting ready to do a $600 million public offering for ZZZZ Best. And Milken said — I should say Drexel said, “We don’t do offerings on IPOs with anything other than Big 8 accounts, Big 8 firms.”

Gary Zeune: [00:13:08] And I used to be an investment banker and did IPOs in private places. And so, the issue from an investment banking perspective, it has nothing to do with [inaudible]. It’s a marketing issue because what happens is the way human brain works, among others, is that if we recognize what we’re looking at, we tend not to evaluate it. We assume the new information from that same well-known source has the same level of quality and credibility as what we’re used to. We don’t independently vouch it.

Gary Zeune: [00:13:44] So, the marketing issue is if an investor is going through a prospective, “No, I think I’ll buy $10 million.” You may see an accounting firm that says, “The financial statements are fairly stated blah, blah, blah. Signed Joe Snard & Associates. Well, who the hell is Joe Snard & Associates?” And so, it creates this little voice in the back of their mind, I wonder if I can rely on the financial statements versus if they see any big-name firm, “Oh, I know them,” and they’ll go right on by.

Gary Zeune: [00:14:10] So, the reason to require a Big 8 firm is to avoid the creation of doubt in the investor’s mind. So, at this point, Barry is using a local CPA firm in the Los Angeles area where the company was based. And here’s an interesting point, remember I said they fooled a sole practitioner for two years?

Peter Margaritis: [00:14:34] Right, right.

Gary Zeune: [00:14:37] The sole practitioner was in New Jersey. It’s a California firm. So, why? Because they’re not going get on a plane every time. Then, they’d look at an invoice and come out. It’s easier. So, Barry and his CFO, Mark Morse, who’s one of my top speakers, Mark was the CFO, they go out and interview all the Big 8 firms. Now, this is late ’84, early ’85. And so, we still had Big 8 at that point. They interviewed all the Big 8 firms, and they picked Ernst. It could have been anybody. I mean, it just happened to be Ernst. This is all public information. So, I’m not telling stories out of school here.

Gary Zeune: [00:15:21] So, the question is if they interviewed all the 8 firms, why did they take Ernst? And Barry and Mark had both said that, “The reason we picked Ernst was because Ernst had a small satellite office not far from ZZZZ Best. And if we went with Ernst, we would be audited out of that office, and we would be a big fish in a small pond; whereas, if we went with any of the other firms, they didn’t have a satellite office, we’d be audited out of the main office downtown, and we’d be a little fish in a great big pond, and we couldn’t push them around like we could somebody who’s local or a big part of their business.” So, that was one reason.

Gary Zeune: [00:16:04] The second reason they have both said — Well, I don’t know if this was true. I don’t know. It’s just what they’ve said. Of course, they’ve both been to prison, so they’re typically bad. And so, they have both said that the reason that they picked the Ernst folks is after interviewing all of the people that it was clear to Mark and Barry that the folks from Ernst in this old satellite office knew the least about the industry. And if you know the least about the industry, you’ll be the easiest to fool.

Peter Margaritis: [00:16:40] So, before you go any further, what industry was this because I don’t think you clarified that?

Gary Zeune: [00:16:46] Right. And so, the name of the company, if you all look it up with four Zs, ZZZZ Best Carpet Cleaning Construction. So, Barry starts this carpet cleaning company when he’s 16 years old literally in his parents’ garage. And the reason he started carpet cleaning was his mother was a telemarketer for a Southern California carpet cleaning company, and Barry used to help her. And so, he knew some about the business.

Gary Zeune: [00:17:12] And he started the carpet cleaning company when he’s working out at the gym one day and he bumps into the guy on the treadmill next to him, who, by complete coincidence, happens to be a salesman for a carpet cleaning supply company. And so, he would sell the soap and shampoo, and would rent the self-steam cleaning machines, and things like that. But, of course, he’s 16 and didn’t have any money. And the guy takes a liking to him and agrees to lease Barry the machines. And that’s how he got started at the age of 16.

Gary Zeune: [00:17:51] Over the time Barry was 21, just to give you a frame reference, he had 1300 employees. Their advertisements and their TV ads were so good, and they are hysterical, by the way. There are a few of them. I’ve got a few of them posted on our website. The TV ads were so good they won Clio Awards.

Peter Margaritis: [00:18:11] Wow.

Gary Zeune: [00:18:10] Now, Clio are like the Oscars and the Academy Awards for TV advertising. They are absolutely hysterical. And you go on YouTube and just type in ZZZZ Best TV commercials, and you’ll get a whole bunch of it. And this is from 30 years ago. And, I mean, still today, you’ll laugh. So, Barry, being 16, he can’t get a checking account in California. You have to be 18. So, he would go clean somebody’s carpets, and he did mostly at homes and really small businesses. So, he’d clean somebody’s home carpets. Usually, it was a wife that was there. And so, she’d hand him a check. He doesn’t have a checking account, he can’t cash it.

Gary Zeune: [00:18:50] So, all the question that I always get is, “Well, how did the fraud start?” Well, Barry can’t cash his checks. So, Rick’s Liquor Store is two blocks away from his house or where his mom lived. He goes down to Rick’s Liquor Store, and he would endorse the checks that these customers had given for 75 bucks to clean the carpets. He endorsed the checks over to Rick. And then, give Rick his bills to pay the lease on the machines, and the soap bill, and things like that.

Gary Zeune: [00:19:20] Well, one day — And by the way, and Rick would then make up money orders for Barry. So, one day, Barry is there doing his money order thing, and Rick gets a telephone call, and goes in the back of the store, and take it. Well, Barry is short that week, so Barry just reaches into the back of the money order box, takes one out, puts it in the machine. Punch, punch, punch, ka-ching, the entire $100 million fraud started with a $200 store money order.

Peter Margaritis: [00:19:50] Wow.

Gary Zeune: [00:19:51] Yeah. And then, five years later, ended up $100 million. So, more of the story is that just like when your teenager comes home half an hour late, and you don’t do anything about it, he goes, “It’s immaterial. It’s a small amount of being late,” then what’s going on? They’re testing the system. And so, frauds, if you don’t do something about fraud, or somebody just doing something like cheating on their expense. So, the expense report might be $1000, and it turned in $12 fake tab. If you don’t bust the over it, that’s assuming you catch it, you’re not going to catch all of this stuff, but when you do catch them, if you don’t do something about it, and make the punishment worse than the crime, they’re going to do it again. And it will get bigger, and bigger, and bigger. That’s where it always starts.

Peter Margaritis: [00:20:39] So, again, your business gets started by buying a book in this bookstore about fraud, learned about ZZZZ Best, and you said that the CFO, Mark Morse, is one of your speakers who goes out. So, your business model is you hire ex-cons to go out and present, basically, what they’ve done to teach accountants the aspect of fraud, so they can be better at detecting it. We’re not teaching the accountants to conduct fraud. We’re teaching them how to look for it, correct?

Gary Zeune: [00:21:14] Correct. Well, people say — Well, in fact, I’ll give you an example. One day, there was a really interesting article. We’ve been profiled in The Wall Street Journal probably 4, or 5, or maybe 6 times, New York Times. And the first time, there was an article about a small California company. It’s a bit like in the late 1990s, didn’t have very much internet back then. And I went to contact this small California company, and I couldn’t find them. Brand new startup.

Gary Zeune: [00:21:43] So, I know a bunch of reporters at The Wall Street. So, called him up — His name was Joshua Harris Prager — and said, “Hi. My name’s Gary. And I really liked your article that you wrote yesterday. And could you give me — I’d like to talk to the folks at the company you wrote about yesterday.” So, he was really nice, and gave me a name and a phone number. And he says, “Well, Gary, what do you do for a living?” And I said, “I like to teach people how to commit fraud.” So, it was like getting tabs on the other end of the phone. And 10 seconds later, he says, “Isn’t that illegal?” This is before 911, and so you wouldn’t joke about this stuff. And I said, “No, it’s not illegal, It’s just like bombs. It’s not illegal to design a bomb. It’s only illegal to actually do it and explode it. But having the knowledge how to do it is perfectly legal.”.

Gary Zeune: [00:22:42] So, we used to get a lot — As we talked about earlier, we used to get a lot, but we used to get some push-back. You’re using ex-cons. And my response always is, “Well, if that weren’t okay or if it’s not okay, then why does the FBI do it?” Because the FBI has a lot of crooks come in and teach agents at Quantico. We taught at Quantico years ago. But if you don’t understand, why do you think the FBI has profiles? Why do you think they have crooks or, hopefully, former crooks teaching the agents? Because it’s a whole different mindset. And it’s like this, “Well, where’s the serial rapist or where’s the bank robber going to hit next?” because everybody has patterns and use those patterns as part of the control process.

Gary Zeune: [00:23:38] And so, we used to have a lot of pushback. And so, my response would always be, “Yeah. I understand why you don’t like it but let me ask you a question. If it’s not okay, why is the FBI doing it? And so, if the FBI can learn from people that have done wrong, why are we too good to learn? So, we used to get a fair amount of pushback 20 to 25 years ago. Rarely getting it nailed because it’s much more calm. Back when I first started 25 years ago, nobody ever brought an actual white-collar criminal at a class to teach. And so, I’m the buffer between my clients, and CPA societies, and banks, and et cetera, et cetera, and my ex-con. So, if anything ever goes wrong, then it’s on me.

Peter Margaritis: [00:24:30] So, can you, at least, name some of the ex-cons that you have in your stables that go out and teach for you?

Gary Zeune: [00:24:38] Yeah. Well, probably, my most requested speaker — Well, actually, I got two. One as Mark Mores, as I mentioned. And Mark was the Chief Financial Officer of ZZZZ Best. Mark did four and a half years in federal prison. And when I first started this up and created my speakers bureau for white-collar criminals, we have 45 speakers now, half are white-collar criminals, and they range from Teri Lyn Norwood, who was a bookkeeper, stole $18,000 to one of my newer speakers, Paul Allen, who had a PhD in Finance, was a finance professor, and long story short, did 44 months in Federal Prison for $2.7 billion with a B, $2.7 billion bank fraud and everything in between.

Gary Zeune: [00:25:31] And so, we’ve got theft. We’ve got cooking. By the way, never stole a dime. It’s all cooking the books, keep the bank afloat. That’s another hour-long story. But regardless of what kind of entity that they worked at, whether it was government, nonprofit, public company, private company, or the dollar amount, whether it was $18,000 or $2.7 billion, there are several really common elements. One is they don’t think they’re going to get caught.

Peter Margaritis: [00:26:01] So, ego gets in the way.

Gary Zeune: [00:26:03] Ego gets in the way. And, well, I read about a case, and I won’t be that stupid. No, but you’ll do something else stupid that will get you caught. And they just don’t think about that. So, why would they be so stupid to think they aren’t going to get caught? Well, let me ask you a question. Anybody ever break the speed limit when you drive your car?

Peter Margaritis: [00:26:21] Everybody.

Gary Zeune: [00:26:21] Everybody, including me. And so, why do we do it, it’s illegal? Because we think we’re going to get away with it. Just the same as somebody cheating on their expense report or cooking the books at the bank for $2.7 billion. And so, one is Paul Allen and Mark Mores is probably one of my two most-requested speakers. The other most requested speaker is Sam Antar who committed the Crazy Eddie Fraud.

Peter Margaritis: [00:26:52] I like that.

Gary Zeune: [00:26:55] Crazy Eddie, that was a retail electronics dealer in New York and had some stores in New Jersey, world famous case. And because both of those cases, by the way, are in every accounting textbook. And so, we do a lot of university presentations. And I, typically, will do it when I’m traveling and teaching. I’ll go to a local university of UNC or USC out in California. And then, I’ll Skype one of my speakers in. And the students and even the faculty, they’ve been teaching this stuff for years, they’ve never actually talked to a real white-collar criminal. So, it makes it real. And the student and the faculty just love it.

Peter Margaritis: [00:27:35] Oh, yeah. If I was a student or just even a CPA to hear from the one who perpetrated the fraud, and how they did it, that would be much more intriguing than — Don’t get me wrong, Gary — if you were up there basically telling their story, it’s not that authentic. But there is a question I have. And you had told me when you approached Mark or anybody, in order for them to be a speaker in your stable, they have to answer a question.

Gary Zeune: [00:28:08] Yeah. Not many people know this, but every federal prison subscribes to the Wall Street Journal, at least, the last time I checked a few years ago. And so, we’ve been profiled four or five times. So, every prison, the white-collar criminals tear those articles out and keep them. So, I get a lot, and they’re passed down from one generation of white-collar criminals to the next. And so, I get two or three letters a month that are handwritten saying, “Hi. My name is Joe Smith. And I’m going to be out of prison in six months. Can I be a speaker?” And the majority of them think I’m going to give them a platform to stand up and say, “I didn’t do anything wrong.” I’m sorry, that’s not the way it works. So, there are two questions and two things they have to do. The one requirement is they have to be out of prison. That always helps.

Peter Margaritis: [00:29:05] Yeah, that always helps.

Gary Zeune: [00:29:06] That always helps. And the second is that they had to admit what they did, take responsibility for it, and they have to answer any question that somebody will put to them because it’s part of the crime. The only exception, we do a lot of media interviews, and so I’m always on the line moderating. And so, I tell the reporter, “You can ask him any question you want, except the only thing that’s off limits is their personal sex life unless it’s got something to do with the crime.” Like you stole money while having an extramarital affair, then it’s fair game because it’s part of the crime, but you’re not going to go down that trail just to be sensational. And I’m going to tell you right out, and if you won’t commit to not talking about that, we’re not going to do the interview. And if you commit to not talking about that, and you do it anyway, we’ll never talk to you again. So, you’re in charge of this interview.

Gary Zeune: [00:30:04] So, probably 9 out of 10 letters that I get from prison. They think they’re going to be able to stand up and say, “Hi. I didn’t do it.” Always, I tell everyone of my speaker, “If you ever do that, and you may well be innocent and didn’t do anything wrong, that’s not what the jury said.” So, we have to go with what the jury said. And so, if you stand up and protest, “I didn’t do anything wrong, I was wrongly convicted,” one, nobody is going to believe you. You will have a really bad hair day at work because you’ve got 600 people in the audience that don’t believe a thing you’re saying.

Gary Zeune: [00:30:38] I’ve only got one speaker where that actually fits and it’s the right thing. It was a guy I’ve known for 25 years who’s an attorney and was convicted of 107 counts of security fraud. And long story. Boy, well, I mean, that’s another hour story. And he spent his entire life savings, something like $6 or $7 million, brought it all the way to the State Supreme Court and got every single conviction overturned.

Peter Margaritis: [00:31:09] Wow.

Gary Zeune: [00:31:10] Yeah. It’s the only time I’ve ever seen it.

Peter Margaritis: [00:31:14] Wow.

Gary Zeune: [00:31:14] Only time I’ve ever seen it. So, those are — Mark and Sam are probably the two most-requested speakers. In fact, Sam is speaking at Auburn University this year. And the other speaker is Paul Allen, the bank CEO I mentioned. And then, we’ve got the four smaller entities. We’ve got some bookkeepers, we got some government folks, we got a couple of former CPA. Sam Antar from Crazy Eddie. As I said, famous case. Every student studies that case in college. And Sam was a CPA and lost his license. And he does a lot of presentations, a lot for law enforcement, FBI training, and local law enforcement.

Gary Zeune: [00:32:10] And so, it’s really — people, once they start to listen and say, “Oh my god, I didn’t know that’s the way they think.” And so, listening to white-collar criminals, what it does, it gives you the ability to pick up on very small, subtle, verbal variances and visuals like how people move their hands or how they sit in their chair, stuff that most people, it wouldn’t even occur to them that there is a nefarious reason that they changed how they cross their legs. And so, it’s like interviewing techniques but from the people who tried to make it work but failed because they ended up going to prison.

Peter Margaritis: [00:32:59] So, there’s one I want to talk about. And actually this person is, I don’t believe is a part of your stable, but you interviewed him for CPE. I don’t know how long it was. It was a live interview with Scott London.

Gary Zeune: [00:33:18] Correct.

Peter Margaritis: [00:33:20] And that was what, about 18 months ago?

Gary Zeune: [00:33:24] Oh, how time flies. Yeah. That was June 25th and 27th, 2014.

Peter Margaritis: [00:33:34] ’14?

Gary Zeune: [00:33:35] Yeah.

Peter Margaritis: [00:33:35] Wow.

Gary Zeune: [00:33:36] Yeah, we did.

Peter Margaritis: [00:33:37] So-

Gary Zeune: [00:33:38] Yeah, go ahead. Go ahead.

Peter Margaritis: [00:33:38] I’m going to say. So, Scott London was a former partner of-

Gary Zeune: [00:33:43] KPMG.

Peter Margaritis: [00:33:44] KPMG out in LA.

Gary Zeune: [00:33:45] Right.

Peter Margaritis: [00:33:46] Share that story with the audience.

Gary Zeune: [00:33:49] Yeah, yeah. There’s a degree of, “How could you be so stupid?” with a degree of, “Geez, that’s really sad that you did that.” And just before people think I’m feeling sorry for them, I don’t feel sorry for them because they chose to do it. They got what they deserved. And kind of as a global comment, the people that this is the hardest on is the family because there’s a real famous saying in the criminal justice system or environment, “It’s not just the person that goes to jail that does time. The whole family does time,” because it changes entire family dynamic. People end up on welfare.

Gary Zeune: [00:34:35] So, that one occasion with Scott] by the way. So, Scott was — Just to give you a little background, so what he did will make some sense. And when we teach, it’s really helpful to give the lay of the land because you just say, “Well, I was a CPA, I was a CFO, whatever. I was a comptroller. I was a bookkeeper. Here’s what I did.” Everybody will say. “Well, that was really stupid. I’d never do that.” Oh, yes, you would. So, that’s where the background comes in because nobody just wakes up one day and says, “I think I’m going to commit fraud.” I mean, you get to the point almost.

Gary Zeune: [00:35:10] And so, there’s usually an environment where a growing sense of dread or something in their environment, like the children are sick, and you can’t afford the doctor, or one spouse lost their job, and the house was going into foreclosure. So, there’s always a back story. They’re all different, but the common element is there was always something going on that caused the change in behavior because we don’t do lifelong bank robbers. We do people — My speakers are people that were the typical honest — other breaking the speed limit when we drive — the typical honest business people of all different ethnicities, and backgrounds, and types of entities, and sizes of entities they worked at. And the common element, whether it was $18,000 or $2.7 billion, the common element is what was going on that caused them when they got to an ethical decision point to turn left instead of turning right.

Gary Zeune: [00:36:14] And so, just to give you a thumbnail sketch of Scott — And, again, every speaker has a story. They’re all different, but they all had these back stories. So, what was going on with Scott was that he was the regional audit partner for — And, again, this is all public information. Regional audit partner for KPMG in Los Angeles. He had 500 people reporting to him. There was 50 other partners, early mid 50, 53, 54, something like that. And it was during the recession, the mortgage meltdown, so ’08, ’09, ’10, that era. And so, he had a friend that, as I recall — And I’ll probably screw some of this up, so don’t hold me to 100% here, but the general will be okay.

Gary Zeune: [00:37:09] As I recall his story is that he had a friend that had really started from their country club. It really started when the wives met because, I think, their kids went to the same school, or in the same class, or something like that. So, Scott and this guy get to be friendly, and they play some golf or start playing golf. And this guy owned a wholesale, I think, wholesale jewelry store and were in the recession. Well, one of the easiest purchases to pull off when we were in a recession are discretionary items like jewelry.

Gary Zeune: [00:37:52] So, this guy was also a day trader. So, he starts asking Scott for information because he knows Scott’s an auditor, and he’s a regional partner, he’s got lots of clients, and both that he personally is an — He’s the engagement partner and also oversees as a regional partner of other engagement partners. And so, initially, Scott wouldn’t tell him anything, even information that was publicly available.

Gary Zeune: [00:38:28] And so, as things go on, this guy talks to Scott, and Scott letting. OK. So, it’s a two-way street here. This guy asked and Scott started telling this guy things about companies that was public information. Now, if it’s public information, even if you’re the auditor, it is not illegal securities law violation to share the information. It’s in the public domain already. The person you’re talking to may not have not known it, but it’s still publicly available information that’s available. So, that’s not a problem. So, the problem is that starts the slippery slope.

Peter Margaritis: [00:39:09] Slope.

Gary Zeune: [00:39:10] Right. And people say, “Well, I’d never let that happen to me.” Yes, that’s why when you get in your car, and you go on the freeway, you up to the speed limit. Then, you go two miles over. Then, you’re three miles over. Then, you go five. You’re driving for an hour. And then, you’re going 10 miles over the speed limit. What happens is when your brain is bombarded by constant stimuli, the same stimuli, your brain desensitizes. So, that’s why you’d be going 85 miles an hour on the freeway of 80 and not even know it because as you drive for an hour, your brain becomes desensitized how fast the environment is going by.

Gary Zeune: [00:39:45] And same thing with fraud. That’s why frauds always start little and get bigger, and bigger, and bigger. So, then, that evolves into telling the guy that information that’s already public. Long story short, — This was a four-hour webinar, ethics webinar, so I’ll condense it here. And so, that, finally, evolved into Scott calling this guy, and reading him the quarterly and annual earnings press release 24 or 48 hours before it hit the wire service. So, this guy was able to trade on inside information. And what they did — Oh, yeah, it gets better.

Peter Margaritis: [00:40:24] Yeah, yeah.

Gary Zeune: [00:40:24] So, what they didn’t know apparently was that the SEC has a fairly sophisticated algorithmic system like Google does, and they look not only at the dollar amount of trade, but they look for aberrant patterns in the trades. So, a real common one is whenever a major M&A deal is announced, they look for aberrant trading in the shares in the two, three, four, or five days before the announcement. And if there’s aberrant trading, there’s probably an information leak, and there’s a good chance somebody is trading illegally.

Gary Zeune: [00:41:02] And so, the FBI confronts this jeweler because he’s the one that’s trading. The SEC has access of all the trades. And they confront this guy. Long story short, they flipped him, and he wears a wire. And in the classes I teach that has that case in it, I have a picture that was on the front page of either the The Wall Street Journal, or The New York Times, or LA Times, or one of those three of Scott accepting a brown paper envelope with $10,000 in the parking lot. I think, it was outside the jewelry store. That picture was taken from the inside an FBI van with blacked out windows.

Peter Margaritis: [00:41:45] Yeah, I’ve seen that picture. Yeah.

Gary Zeune: [00:41:46] Yeah. And so, I’ve got video clips that were on the Los Angeles TV stations. And so, every fraud that we talk about is a situation where really smart people do really stupid stuff.

Peter Margaritis: [00:42:03] And that was my whole thing. I mean, he knows better. I think, he was making $800,000 in LA, which is about $25,000 here in Columbus, Ohio equated, and a family, and everything. And he felt bad for his friend, so much so that he went to jail.

Gary Zeune: [00:42:21] He didn’t go to jail for feeling bad for his friend. He went to jail for what he did, not that he felt bad for his friend. So, you can feel bad for your friend. So, you can’t control your emotions — You’re sad, you’re happy — but you can control your actions. That’s where people get into trouble. And one of the explanations you hear all the time when people are being sentenced or trying to explain themselves in court, “Well, I was trying to help Sally out.” Yeah, but you broke the law, and you knew better.

Gary Zeune: [00:42:51] And Scott talks in his presentation. Scott readily and willingly talks about, “I signed the firm’s ethics agreement for 30 years. I knew better, but it was-” And he talks about how he’s going through a lot of therapy to understand why being an ethical person, he did such an unethical thing. And so, moral of the story is that most people think that there is a bright line on ethical behavior. No, that’s not the way it works. Ethics is not absolute. Ethics is situational.

Gary Zeune: [00:43:33] And so, here’s a really easy way to understand it is we all — like you, and I, and everybody listening — we all drive five miles over the speed limit. Why? Because it’s socially acceptable. That’s our rationalization. Remember the triangle fraud?

Peter Margaritis: [00:43:49] Right, exactly, rationalization.

Gary Zeune: [00:43:50] So, it’s rationalization. I’m just keeping up with the flow of traffic. That’s our rationalization. Well, it’s illegal. That doesn’t make it — Is there such a word as unillegal? It doesn’t make it legally okay, but it’s socially. And somebody will always say in class, they’ll say, “Well, if you’re only going five miles over the speed limit, the cops will pass you.” Well, they’re breaking the law too.

Peter Margaritis: [00:44:13] Right.

Gary Zeune: [00:44:16] But would we — Have you ever driven 40 miles over the speed limit?

Peter Margaritis: [00:44:20] No.

Gary Zeune: [00:44:20] I have. Fastest I’ve run when I’m on my motorcycle was 105. That was really stupid. So, it’s dangerous. So, I stopped that and started skydiving.

Peter Margaritis: [00:44:28] Yeah, much safer.

Gary Zeune: [00:44:30] Yes, it’s safer. Remember, it’s not the fall that kills. It’s the sudden stop. So, understand that behavior is not absolute. It’s relative, and it’s situational. So, when would you break the law driving 30 or 40 miles over the speed limit? When you have a medical emergency, and you’re taking your child to the hospital. So, your child, your child’s health and well-being is more important than you staying five miles over the speed limit. You change your behavior and break the law even more because there’s something more important to you in this situation than the speed limit.

Gary Zeune: [00:45:14] And that’s why bank CEOs cook the books for $2.7 billion. That’s why Scott gave this guy illegal inside information, got like $70,000. And Scott was making over mid-six figures, and he lost his CPA license over $70,000. So, let’s say he’s making 500 or 600 a year. You multiply that times 10, or 15, or 20 years, that’s a pretty good-sized number, and he lost it over $70,000. So, I thought $70,000 over $5 million was immaterial.

Peter Margaritis: [00:45:52] Yeah. It’s a-

Gary Zeune: [00:45:54] It’s immaterial why did he lose his license.

Peter Margaritis: [00:45:56] Right. I have read up on this. And the part that, I think, because we don’t think we’re going to get caught, but when we do — And please correct me if I’m wrong. And once it was known and he was — EY, at the time, put out an email to everybody in the company with the indictment, with that picture, and basically said, “Nobody should have contact again with Scott London.”

Gary Zeune: [00:46:25] Yeah. First of all, it was KPMG, not EY.

Peter Margaritis: [00:46:26] Okay. thank you.

Gary Zeune: [00:46:28] I mean, if you want to talk about EY, I’ve got plenty of those cases too. Give me a big-name firm, and you got lots of people, you know what, it’s going to happen because it’s human behavior.

Peter Margaritis: [00:46:37] Right.

Gary Zeune: [00:46:38] Yes, the firm did put out, in my recollection, so I can’t swear to this, but my recollection is — Because I look at so many of these cases, and they have a lot of common elements. It’s kind of like forgetting where you parked your car.

Peter Margaritis: [00:46:50] Yeah, all the time.

Gary Zeune: [00:46:52] And, yes, my recollection is that the firm did put out an email. And I don’t remember all the content though to that level that you just mentioned but told staff. “We’re not going have any contact with Scott.” So, it’s kind of like being banished from the tribe, or the group, or something like that.

Peter Margaritis: [00:47:12] Yeah. And, I mean, literally, if you think that it happened, literally, overnight. So, he was fine one day. Next day, he’s in a worse situation, and the firm that he’s been with has completely cut him off. “You’re dead to me, Scott.” As the firm would say, “You’re dead to me.” And then, everything that happens with his family, everything leading up to this. And I read some stuff that he said is, “I never meant to hurt anybody.” All the kind of remorseful things that one would expect, but, still, why did you think about that? And you’ve talked about the behavioral aspects. We probably do, at some point, but it’s that slippery slope. It’s just I’m getting a little bit — I mean, that’s how Barry Madoff started small, right?

Gary Zeune: [00:47:57] Yeah. Barry Minkow?

Peter Margaritis: [00:47:59] No, Bernie Madoff. I’m sorry.

Gary Zeune: [00:48:02] Bernie, Bernie, yes. Madoff, which was absolutely astounding it went on. That Ponzi scheme went on for 30 years. I think, the average for Ponzi scheme just like the 18 months or two years. So, Madoff was just extraordinary. And, yes, they all start small. Now, small is relative. For example, I’ll give you a real example, WorldCom has the largest financial reporting fraud in the United States’ history, $11 billion. And the whole WorldCom fraud started with a $10 million journal entry and ended up with $11 billion. So, yeah. So, $10 million out of $11 billion would be like the bookkeeper in a little nonprofit stealing $5000 in a $5 million nonprofit. So, the number can be different in terms of that. So, $5000 versus $10 million, but, relatively speaking, they usually are about the same size.

Peter Margaritis: [00:48:59] So. two comments there. One, shouldn’t we have known about Bernie just by his last name, “Made off”?

Gary Zeune: [00:49:03] I “made off” with the money?

Peter Margaritis: [00:49:06] “Made off” with the money. And two, I have 600 shares of WorldCom. Would you like to buy them from me? Yeah, because the auditor signed off on the financial statements. I’ve got 600 shares. I actually tried to get the certificates. I got to hang it in my office from WorldCom. So, as we begin to wrap up with this, can you give the audience — What advice do you give the audience when you talk about this to keep them from perpetrating fraud, or is there any advice?

Gary Zeune: [00:49:40] Well, yeah. There’s a couple of things to think about. And one is understand if the situation is right, if the stresses, whether it’s a sick child, or house payment, or a really in and private businesses is getting the bank loan renewed. And so, one of the things I always say, look at what the requirements are. And private businesses, it’s generally the bank loan will have covenants for working capital ratio, and debt ratio, and restrictions on dividends and blah, blah, blah. Every one of those is a fraud risk because if the company doesn’t meet those benchmarks, then that’s when you renegotiate the bank loan. The interest rate is going to go up, compensating balances go up, covenants get tougher.

Gary Zeune: [00:50:29] So, moral of the story is that every contract that the entity is — And I’ll just say company generically. It could be a nonprofit government entity but just company generically. Every contract, every legal obligation that requires something from the company, some level of performance, or some prohibition of activity is a fraud risk. Every one of them. And every one of those things better be in the audit program. And so, simply knowing what the tipping points — I steal that term from Malcolm Gladwell — knowing what the tipping point are.

Gary Zeune: [00:51:08] And so, think about this, the reason WorldCom made the $10 million journal entry — I mean, WorldCom, at the time, was a $30 billion company. So, why would they do a $10 million journal entry to cook the books? Because they needed to round up over half a penny, to round up to the next whole penny, to make the Wall Street consensus earnings per share rather than if they didn’t do the $10 million journal entry, it would round down, and they would miss the Wall Street expectations by a penny. So, it was like 75 cents or something. So, I thought if you move it from — if the journal entry moved from 74.4 to 74.6, so it would round up to 75, I thought two-tenths of a penny out of 75 was immaterial. Well, if it wasn’t material, they wouldn’t do it. By definition, when they cooked the books, regardless of the amount, when they cooked the books, or the most common one with most clients is a small business owner running personal expenses. If it weren’t material to them, they wouldn’t do it.

Peter Margaritis: [00:52:19] Yeah. I’ve got a story on that one myself.

Gary Zeune: [00:52:21] I’ve got 500 stories.

Peter Margaritis: [00:52:23] Yeah, yeah.

Gary Zeune: [00:52:26] And doing what I do. And we can share all those in future podcasts, but the big picture is two things. One is understand materiality is not just about the size of the number. It’s the result of the size of a number because the audit standards say if a user would make a different decision, then the number is material. And here’s a way to think about that is there are over, on average, 112,000 commercial airline flights every day in the United States. So, if just one of them crashes, why is it on the news? It’s immaterial.

Peter Margaritis: [00:53:12] Yeah.

Gary Zeune: [00:53:12] Right?

Peter Margaritis: [00:53:14] Right.

Gary Zeune: [00:53:14] Yeah. So, really simple examples that we all see in everyday life, if you use those to talk about what we do, it reframes what we think about materiality. If the two-tenths of a penny to round up to 75 instead of down to 74, if that wasn’t material, they wouldn’t have done it. Don’t ever believe that just because the number is small, it’s automatically immaterial. Just flat not true. So, that’s one thing is understanding materiality because, remember, why was two-tenths immaterial? Because it’s human behavior, because the market will react. If the market didn’t react, they wouldn’t have done the $10 million and moved it too again.

Gary Zeune: [00:53:57] So, the second thing is stop doing the same damn thing all time. That’s how we let people fool us. Whether you’re a controller, CFO, or an auditor, it’s not the work itself. It’s not checking the invoices and adding up the column numbers. It’s doing it the same way all the time because you just taught people where not to put the fraud because they know where you’re going to look.

Peter Margaritis: [00:54:21] That’s great advice, and human behavior. So, why did they move? Why did WorldCom do that? Why did they book those expenses and capitalize on them? So, they increased the profitability. It goes to bonuses. It goes to the stock price. It goes to all of this stuff. Basically, an emotion is your wallet, and the size of the wallet can create a lot of emotion.

Gary Zeune: [00:54:43] Yeah. If that weren’t true, salespeople would be paid hourly.

Peter Margaritis: [00:54:47] Exactly. And you’re right, Gary, we could talk hours on this. And maybe we do something and create a series of this because you are the fraud guy, I mean, not in that sense, but you know more about fraud than the most, especially in this profession, and can talk to real-world situations that have occurred to help us become better at detecting fraud. So, once again, I want to thank you for your time. This has been — We just touched the tip of the iceberg because there’s so many other ones that come to mind that I would love to learn more about because I didn’t realize was [inaudible], and London, and a few things that I didn’t know. But thank you again. Great guest, great information. Tell people how they can find you.

Gary Zeune: [00:55:39] If they simply Google my name, according to Google, I’m the only person in the world of my name, and you get three pages of hits. You’ll find the Wall Street Journal profiles and The New York Times. Just click any of those. They almost all contain our contact information, how to get me. And one of the things that will pop up, we’ve got 60 some articles on our website. Those will pop up. So, just Google my name. That’s the easiest way to find us. And when we do the — If we do the next one, then we can talk about my visit interview with Barry Minkow at Lompoc Federal Prison and how the whole thing started.

Gary Zeune: [00:56:20] So, what I’d like to know from the folks that are listening, if you like this, and you like to dig deeper into some of these cases — now, I’ve got over 5000 slides on fraud cases — click the like button, send us an email, and kind of tell us what you think. And if you would like to have some more, Pete and I will put the other for you.

Peter Margaritis: [00:56:41] Yeah, that’s a great idea. So, one thing, I will put a number of his articles in the show notes for everybody, as well as you’ll get to see Gary. And if this is something you think that you’d like to see more of, you can email me at You can go to any one of my social media sites and make a comment about, “Love the episode on fraud. I’d love to hear more about that.” Any feedback that you can give us, that would be great and greatly appreciated. So, for now, Gary, thank you very much again. Thanks a lot.

Gary Zeune: [00:57:15] Thanks for having me on. Hope to see you soon.

Peter Margaritis: [00:57:20] I hope we’ll see each other as soon as well. So, thanks guys.

Peter Margaritis: [00:57:27] I want to thank Gary for taking time out of his schedule to be a guest on my podcast. I have put links to a number of Gary’s articles in the show notes for your reading pleasure. In addition, we would like your feedback on today’s podcast by answering a quick two-minute survey that you can find the link in the show notes. We greatly appreciate your feedback.

Peter Margaritis: [00:57:47] In Episode 22, which airs on February 18th, at the time of this recording, a guest has not been identified, but we’ll have one for that episode. So, thank you for listening. And if you’re enjoying the podcast, please subscribe and share this episode with a friend.



S2E20 – Jennifer Briggs | Indiana’s Competency-Based CPA License Renewal Law, One Year Later

Jennifer Briggs is the CEO of the Indiana CPA Society, and we talked about a year ago about the State of Indiana’s House Bill 1467, which allows competency-based learning through professional development opportunities to qualify accountants for accountant certificate renewal.


Today, we follow up on that conversation to check in on the progress that they have made, learn about any unforeseen challenges that they may have faced, and how they handle these challenges.


To recap, in 2010, the Indiana Society created a board-level task force on knowledge management. Jennifer worked with the task force on competency to examine how things have changed in education and everything snowballed from there.


Then, on July 1, 2017, the State of Indiana signed House Bill 1467 into law.


Following that, the Indiana CPA society created an all-online ethics course. It’s interactive, and you have to actively participate in it by including comments or replying to other people’s comments. Initially, it did count for a waiver of four hours, but if you take that course now, the certificate says you meet the ethics requirement in Indiana.


There’s no test, but, “the part of it that makes it more interactive and kind of tests, if you will, the competency gained is the questions and commentary that the learners have to include.” For example, there might be a case study that you read, and then it would ask what the learner would have done in this particular part of the situation.


So, how’s it going so far?


“We find that it tends to be people just get it right away and really liked the idea, or really people struggle with anything that’s different, which I find so interesting because it has been around a long time,” Jennifer says. “We’re 104 years old, almost, as an organization, but CPE, the credit hours system, is only 40 something years old… Sometimes, I don’t understand that challenge to change.”


I’m so happy the folks in Indiana are working on this because we live in, to some degree, an la carte world. People learn in different ways, and being able to provide the opportunity to learn in the way that fits them best will only make them more successful.


Appropriately, the competency rule in Indiana is an option. It’s not mandatory.


Jennifer also shares a story about her son and his friend that really hits home with me, and explains why this approach will only be more important as our profession moves forward:


Jennifer’s friend visited, and both of their kids were running around the house like maniacs playing hide and seek. At one point, they sat down and Jennifer’s friend said, “Oh, I can count this for her PE class.”


Over the break, there was some incentive for students to be active for four hours per week. It didn’t have to involve going to the gym or working out, it just had to involve being active. “And I just thought, gosh, if we can do that for sixth grade PE, we should be able to figure it out.”


Download this Episode MP3.



Click to download the full Transcript PDF.


Jennifer Briggs: [00:00:00] Serving on a committee would not count toward your renewal. But, for example, if you serve on the Indiana CPA Society Ethics Committee, I guarantee you that you are getting a lot of education about ethics and the profession. That’s one that a lot of people really relate to.

Peter Margaritis: [00:00:31] Welcome to Change Your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation.

Peter Margaritis: [00:00:51] Your host is Peter Margaritis, CPA, a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers, all the while growing their businesses. So, let’s start the show.

Peter Margaritis: [00:01:19] Welcome to Episode 20. And my guest today is Jennifer Briggs, who’s the CEO of the Indiana CPA Society. This is a follow-up interview from our prior conversation on October 30, 2017 around competency-based CPE.

Peter Margaritis: [00:01:34] It’s been a little over a year since our conversation, and I want to check in with Jennifer to see the progress that they have made, and learn about any unforeseen challenges that they may have faced, and how they handle these challenges. As a brief recap, here’s the show notes from that episode.

Peter Margaritis: [00:01:51] On July 1, 2017, the State of Indiana signed House Bill 1467 into law, which allows competency-based learning through professional development opportunities to qualify accountants for accountant certificate renewal. This all began years ago around 2010, when the Indiana Society created a board-level task force on knowledge management. Jennifer worked with the task force on competency to examine how things have changed in education and everything snowballed from there.

Peter Margaritis: [00:02:24] Although the bill is passed, this is just the beginning. Jennifer is now working with a committee to create rules around the law. Nothing is finalized, but the idea is that this new system will be designed around those who actually want to learn, as opposed to those that sit in the back of the classroom just to collect their eight hours of CPE credit. Change is everywhere in our profession – technology, demographics, pricing models – so it’s imperative that education changes too.

Peter Margaritis: [00:02:53] So, there’s a little bit of the background. You can find that episode on my website under Improv is No Joke Podcast or on iTunes if you want to listen to it in entirety.

Peter Margaritis: [00:03:03] But before we get to the interview, I wanted to share with you that my book, Taking the Numb out of Numbers, was number 12 of the Best Books in 2018 for Speakers as ranked by Now, you don’t have to be a professional speaker to gain value from this book. I’m currently working with sales teams, engineers, architects, and financial professionals to help to transform their presentations from data dumping, mind numbing during the headlights conversation, to engaging conversations that spur action.

Peter Margaritis: [00:03:34] Here’s a recent Amazon review of my book by Rob Nance. Title: You Will Not Have a Deer-in-the-Headlights look. “Anyone who ever finds themselves needing to meaningfully engage with an audience, clients, prospects or students, should soak up this book. Gaining new skills and focused insight that will help you provide exceptional customer service is welcome at any time and at any level. And Taking the Numb Out of Numbers delivers on that promise. In an easy-to-read digestible, you will find it thought-provoking, fun, and very worthwhile.

Peter Margaritis: [00:04:10] Rob, I greatly appreciate that review. The book is available on Amazon, in paperback, and in Kindle. So, go buy it today. Don’t hesitate, just go buy it. If you’d like to purchase 10 or more copies, please contact me at for bulk discounts.

Peter Margaritis: [00:04:29] So, without further ado, let’s get to the interview with Jennifer Briggs.

Peter Margaritis: [00:04:37] Welcome back, everybody. Today, I’ve got Jennifer Briggs, who’s the CEO of the Indiana CPA Society with us. And this is a follow up from a conversation that we had back in October 30, 2017 where Indiana had been moving, taking – and she said at the time – baby steps towards competency-based learning within with the membership. And first and foremost, we’re recording this on January 2, 2019. So, Jennifer, welcome and Happy New Year.

Jennifer Briggs: [00:05:12] Thanks, Peter. Happy New Year to you.

Peter Margaritis: [00:05:15] It’s glad to have you back on. And if you could give the audience a little 10,000-15,000 view of this competency-based model, how it developed, I think, it was six to seven years ago, the idea, and how you and Gary Ballinger evolved this over time. And then, we’ll move into where you are today with a little over a year, year and a half later since our conversation.

Jennifer Briggs: [00:05:40] Sure, sure. So, we began talking about future issues for the profession, and what our members need to know, and how they need to define it way back in 2004 or ’05. And then, it evolved into 2009, looking more at kind of those future issues. In 2010, looking at the AICPA– CPA Horizon 2025 document.

Jennifer Briggs: [00:06:10] And so, using that as a basis, we took that core competencies embedded in that document, and worked around them, and came up with this concept that there’s a lot that CPAs need to know, and why are we still so stuck on the hours concept for continuing education, and how can we in this really changing world with all the technology and the ways people do things, how can we focus on competency versus hours, and how can we let our members “count” all the things they do that improve their professional success, that make them better CPAs

Peter Margaritis: [00:06:56] And from that, obviously, a lot of work with the accountancy board, with the membership. I believe in my notes that you guys put together a competency task force. I’m not sure if that’s the right terminology to use, but a committee together to help get this moving in the right direction.

Jennifer Briggs: [00:07:19] We did. We had a task force, the Future Competency Task Force, and wrote a white paper about it. And then, that was about the time we created the CPA Center of Excellence as the hub for these activities. And then, of course, that was in 2014. And then, from there, as you mentioned, in 2017, we were able to pass legislation that allow for competency-based education to renew a license in Indiana.

Peter Margaritis: [00:07:56] And there are some tricky things about — S0, you got competency-based, but we’re still reporting in hours to the accountancy board. And I believe that you started with ethics. And in Indiana, is it four hours needed every three years on ethics or is it more than that?

Jennifer Briggs: [00:08:17] It’s four hours.

Peter Margaritis: [00:08:18] It’s four hours. So, I could take it, and it could take me six hours to do it. You could take it, and it could take you two hours to do it, but we would get, I think, the turnout was a waiver that we completed the ethics course. And in that waiver, there is an hour component there of four?

Jennifer Briggs: [00:08:40] Yes. And, basically, and to clarify and address this correctly, it’s four hours every three years for every renewal. And we did. We created an ethics course. We created a number of courses on different topics like leadership and strategic thinking. And the ethics course was something everyone needs and was kind of easily accessible.

Jennifer Briggs: [00:09:03] And so, we created this course. It’s all online. It’s interactive. You have to actively participate in it by including comments or replying to other people’s comments. And, initially, it did count for a waiver of four hours. But, now, actually, what it says is that if you take that course that meets the ethics requirement in Indiana, if that makes sense.

Jennifer Briggs: [00:09:36] So, it’s moving even more for buying in to competency-based and that we don’t care how long it took you. You did this, and we know it’s relevant. And so, that meets the ethics requirement.

Peter Margaritis: [00:09:50] Oh, okay. Yeah, it has evolved in that direction where no matter how long it takes you, you’ve completed it. And, now, you have met that requirement.

Jennifer Briggs: [00:10:03] Right. Now, our other courses are still on the waiver system. So, you complete a course that’s approximately eight hours. Again, it could take you more less, but you get a waiver of eight hours, and you have a renewal.

Peter Margaritis: [00:10:19] Maybe I’ve asked this question in the past, but in these competency-based courses, well, we all know there’s some online courses that are out there that you can take the course, self-study online, take the course and find ways to have it completed in less time, and get the full credits for it. And not by completing all the information by taking shortcuts or whatever. In your courses in this competency-based model, have those shortcuts been, I don’t know if you could ever say completely eliminated, but much harder to get around?

Jennifer Briggs: [00:10:57] I would say they are practically completely eliminated in our courses, yes, because of the platform we use and the leveling system, you cannot get through it without completing. It will say, if you’re supposed to watch a video, let’s say, you can’t watch that faster than the length of the video. So, it recognizes all of that and has some times — I don’t know how you would say it, but some information about the timing of the whole thing that makes it very, very hard to move to the next part of the course without having completed it.

Peter Margaritis: [00:11:40] So, when you move to the next part of the course, is there a test involved?

Jennifer Briggs: [00:11:45] No, there’s no test.

Peter Margaritis: [00:11:46] No, Okay.

Jennifer Briggs: [00:11:48] Only the part of it that makes it more interactive though and kind of test, if you will, the competency gained is the questions and commentary that the learners have to include. For example, there might be a case study that you read, and then it would ask how the learner would have — what they would have done in this particular part of the situation.

Jennifer Briggs: [00:12:21] And so, there’s a lot of commentary. And people take it very seriously because everyone else taking the course can see it. And so, you can’t just type a quick response without kind of thinking about it. Additionally, we do monitor the responses. I would say we don’t read every one, but we do have a quality control where someone is making sure that all the participants have put some thought into their answers.

Peter Margaritis: [00:12:53] Okay. So, that model, and this — What’s the word I’m looking for? These things, they’ll keep it from people moving ahead. All those bells and whistles are still in there today. Have you enhanced them since the original launch?

Jennifer Briggs: [00:13:12] No. I think, in fact, if anything, they worked too well. So, one thing we’re looking at is breaking the courses down into parts. And I’ll tell you what I mean by that. I think that we found the feedback we receive is that it takes almost everyone more time than the eight hours, let’s say, for the eight-hour class. And so, we are looking.

Jennifer Briggs: [00:13:41] And even though the classes are extra leisure, take them at your own pace, a lot of CPAs, and I’m going to generalize here for a minute, they like to complete something, like a deadline. So, we are finding that it was too long. They just felt like it was hovering over them. Somehow, if we could break them down into shorter parts, they could complete a part, still get some credit, if you will, waiver for that many hours, and then move on to the next part. So, that’s something we’re working on now.

Peter Margaritis: [00:14:25] As you’re saying that, I’m trying to put myself in the attendees’ shoes or in their seats, and if I’m doing eight hours of some type of leadership skill. And, I think, yeah, I could see where that would be a challenge. We want to get to the deadline. We love deadlines. We’re in the deadline business. Yeah. And I’ll do everything I can to get to that deadline, but oh my god, yeah. And so, you break them down into, let’s say, two-hour modules?

Jennifer Briggs: [00:14:53] Yeah.

Peter Margaritis: [00:14:56] Okay.

Jennifer Briggs: [00:14:56] Yeah. And the way we’re looking at it is so that they can be taken independently or as part of the whole. So, if you just do parts one, two and three, you still have a lot of learning there.

Peter Margaritis: [00:15:11] Okay. So, I see you do get some waivers for completing portion of it. You don’t have to complete all of it to receive all that waiver. You could decide, “I don’t want to finish this, but I do have two hours from the module that I did complete.”

Jennifer Briggs: [00:15:27] Right. That’s what we’re looking at.

Peter Margaritis: [00:15:30] So, we talked last year, and I made a comment about you guys doing a great job with this. You didn’t like hit the gun go, and you go sprinting off like you’re in a race. You took baby steps over time, these little baby steps. And I guess my question is a year or so, have these steps grown up a little bit? Are we taking a little bit longer steps? Are we still going down the baby steps just to be sure?

Jennifer Briggs: [00:15:55] That’s a great question. We’re really evaluating everything around this right now, not the concept, not the idea of competency-based education, but I don’t even know whether we’re to teenage steps. I would say pre-teen, which it can sometimes be challenging. let’s say, if you’ve ever had a pre-teen in your house.

Peter Margaritis: [00:16:20] Yes.

Jennifer Briggs: [00:16:22] And so, we have learned a lot along the way. We hear from members. We take that feedback. And frankly, the comfort level is something we did not really acknowledge or, perhaps, maybe it seemed like we weren’t moving that fast to us, but it seemed fast for a lot of our members.

Jennifer Briggs: [00:16:45] There’s something about a waiver of hours that did not feel comfortable to a lot of people. You know how it is. You want to be able to say, “I completed what I needed to complete.” So, that’s something we’ve had to look at, and just overall, what is providing the most value.

Jennifer Briggs: [00:17:03] We passed that legislation in 2017. But, right now, we’re still on the waiver system because it’s taken all of 2018 and more – we’re still working on it – to work on the administrative rules that actually allows CPAs to use this competency-based education. That process has been great and interesting, but also challenging.

Peter Margaritis: [00:17:29] So, are you still working with a subset of the Accountancy Board with this language, and these rules, and stuff as you roll it out that you were doing the last time that we talked?

Jennifer Briggs: [00:17:42] We are. There have been some changes, new board members, and to then there are questions there. Additionally, it’s just challenging sometimes to get it on the agenda. Our board of accountancy, everybody is really busy, and they meet, and they have a lot to cover. So, even getting into this can be hard.

Jennifer Briggs: [00:18:06] And then, once you start talking about it, I mean, the members of the Board of Accountancy are all supportive of the concept, obviously, by allowing the waiver program. It is still a lot. There’s still regulators. And how can we be sure that we are protecting the public, that everyone is getting the education that they need?

Jennifer Briggs: [00:18:26] So, I would say we’ve had a few steps forward, maybe a couple of steps back, but everyone talking and working really hard on it. And I’m encouraged because you see things. I was just looking at an old [one spot] November of last year, our cherished memo from NASPA. And NASPA is talking about evaluating the need for hours, for the experience requirement for licensure, and considering other ways that candidates could meet those hours through internships or life experience. So, I mean, you’re hearing more and more about the idea that we learn in different ways, but actually putting that into practice is harder than we would like.

Peter Margaritis: [00:19:18] Well, yeah. I mean, because we’ve been doing it this way for such a long period of time. Change is difficult. As you alluded in the first interview, we’re dealing with different systems. These systems have been built over time, and to make a change in a system takes integration with other systems, which doesn’t happen overnight.

Jennifer Briggs: [00:19:41] No, no. And, in fact, I am proud to say, honestly, that we have created an advisory board out for the CPA. The excellent side was six professionals from all across the country, well-versed in education, specifically competency-based education, and learning in general. And to a person, everyone tells us that we are way ahead of the game, that this is hard stuff, that we have made a lot of progress, but we just have to be patient.

Jennifer Briggs: [00:20:19] A lot of the advisory board members, they work in higher education. And that’s a huge challenge when you think about higher ed, and the credit system, credit-hour system is set to financial aid and that kind of thing, that we really use that as an example to us of how if higher ed is starting to experiment here, we can do it too because their barriers, I would say, are even higher when you’re talking about the whole financial aid system.

Peter Margaritis: [00:20:55] There appears to be more layers within that higher education system, even to the faculty members who are on tenure, and getting buy-in from that group to agree to something such as a radical change of this competency-based learning. But not to say you guys and the accounting profession, between old school-thought that’s out there, and this is the way we’ve always done it, and kind of changing that all around. I would imagine — Well, let me say, I would imagine that some of the baby boomers are probably much more reluctant to this change versus some who are a lot younger than myself.

Jennifer Briggs: [00:21:39] I don’t know. I don’t have the actual statistics, but I feel like it’s more of personality over age, to be honest. It’s more based on just what you’re comfortable doing. If you just are one of those people, and you like to say, “On this date, there’s this class, and it lasts four hours. I’m going to sit there. I can check it off my list,” then, you’re going to be more comfortable in a traditional setting. So, we’ve had lots of people who really liked it, who, frankly, I would not have anticipated, I think, so.

Peter Margaritis: [00:22:17] Well, yeah. As you were describing that personality type, I wonder if we think about a what a stereotypical accountant CPA, very linear, very precise, loves deadlines, and there’s a lot of them that I know, they go, “I can’t move off the fly. That’s when I go crazy when I don’t have that routine. I just don’t function very well.” And I’m thinking, “Okay. Well, competency-based learning is just the opposite of what that is.”

Jennifer Briggs: [00:22:47] I’m just going to say, we find that it tends to be people just get it right away and really liked the idea, or really people struggle with anything that’s different, which I find so interesting because it has been around a long time, the current system, but not forever. I mean, only half — We’re 104 years old almost an organization, but CPE, the credit hours system is only, I think, 40 something years old. So, I don’t know. Sometimes, I don’t understand that challenge to change.

Jennifer Briggs: [00:23:30] Having said that, you’re talking about CPA license, right. You’re talking about a livelihood. You’re talking about a profession and something that people work really hard for. I understand not wanting to rock the boat and just do what needs to be done. But I also know how our members are learning in so many different ways. And I just wish that could. We just want to move forward.

Jennifer Briggs: [00:23:59] And I think that we are. We’re trying to incorporate competency-based education into everything we’re doing. So, we’re looking at our traditional courses and sort of looking at how we incorporate some competency-based education into it, even though it’s still going to be hours-based, if that makes sense.

Jennifer Briggs: [00:24:22] We have completely changed our leadership program, particularly, for young members. And it now involves a book club where they do work, pre-work reading this book before the meetings. And then, between meetings there’s an online competency-based course. Additionally, we’re using an online tool to assess where they are in certain areas like communication or strategic thinking. So, I think we’re understanding some of the barriers a little bit more and still moving forward, but also trying to make it more palatable by feeding it into other things, if that makes sense.

Peter Margaritis: [00:25:09] Yeah, it does. And as you were describing this, over the past couple of weeks, we’ve had family for the holidays or whatever. And my wife says something, “I need to get the newspaper.” And my son was like, “Mom, why do you read a newspaper? Nobody does that anymore. Just read it on your iPad.” But it also goes different ways of learning.

Peter Margaritis: [00:25:34] And, right now, I’m glad you guys are attacking this because we live in, to some degree, somewhat of a la carte world versus order and just off the menu. And people learn in different ways and to be able to provide that opportunity that they can learn what fits them the best will only make them more successful.

Jennifer Briggs: [00:25:59] That’s what we think. That’s what we believe. So, just kind of… And one example I probably used when we talked before, but I think it’s such a good one, is something like in Indiana, and I think, it’s like this in most places. I mean, serving on a committee would not count toward your renewal. But, for example, if you serve on the Indiana CPA Society Ethics Committee, I guarantee you, you are getting a lot of education about ethics in the profession. That’s one that a lot of people really relate to.

Peter Margaritis: [00:26:38] So, does Indiana now provide continued education for those who serve on a committee?

Jennifer Briggs: [00:26:45] Our committee, we are, yeah. I believe — Now, I’ll say this word catching me out of my lack of detail. So, I believe so. I believe that’s part of the new rule. Unfortunately, I’m not sure, but I think it’s also tied to the new legislation. I think it might be tied to the rules though as far as actually using it.

Peter Margaritis: [00:27:08] But what a great way. I mean, think about it. I remember how much I learned serving on the board in the Ohio Society of CPAs in the role of a chair. Never really thought about getting CPE for it but that would been great. Just from a selfish perspective of being, say, in your shoes as a CEO, what a great way to get membership involved.

Jennifer Briggs: [00:27:31] Right. And, again, yes, your experience in Ohio is a perfect example. You definitely learned along the way, and you spent a lot of hours, I’m guessing, doing it. Do you think that added to your experience as a professional?

Peter Margaritis: [00:27:51] Oh, by far. I walked away. I think Clarke Price, every time I see him, because I’ve never had that opportunity, I would have missed out on a ton.

Jennifer Briggs: [00:28:02] So, it just seems like we should be able to find a way, and that’s what we’re working on, to make that experience a part of your renewal process.

Peter Margaritis: [00:28:14] That’s incredible. I love that idea. And I do wonder, I don’t know if we mentioned this earlier, but the competency rule in Indiana, it’s an option. It’s not mandatory.

Jennifer Briggs: [00:28:27] Thank you so much. Yes, yes. We try to stress that. It is just an option. We know there are people who will always be comfortable with these many hours, and they do those, and they move on. That’s fine. All we’re saying is that it should be an option for people who want to try something different.

Peter Margaritis: [00:28:50] And do you have, now, the — I don’t know if it’s an option. So, you’ve got actually the size of the professional membership within Indiana. Is there percentage that you have of the membership that are attempting to try competency-based learning and has that grown over time?

Jennifer Briggs: [00:29:11] I don’t have the exact numbers here. I can tell you that it kind of has gone up and down, just to be honest. In one area, again, when you can make it very clear. So, our ethics competency-based course does very well. We just released a new course in 2018, and that did very well. It’s a big seller. But most of the other courses that are not as easy to quantify what you need, that didn’t do as well.

Jennifer Briggs: [00:29:40] But, again, that’s where I also try to focus. We have these competency-based courses, and I’m sure there are others out there, but it’s more important to us that everyone understands that this is about what experiences you have that add to your professional expertise and how you can “have those.”

Peter Margaritis: [00:30:08] Yeah. Yes. I’m thinking, are you still the only CPA association in the United States that have gone down this path or if other states began to move in the same direction?

Jennifer Briggs: [00:30:22] I know there are some other states doing some things. In particular, Wisconsin. They did not have a CPE requirement for a license renewal. They were the only state, I believe, that didn’t. And, now, as they have a rule now, they have a requirement now, they have been implementing that, allowing some competency-based education as part of that.

Jennifer Briggs: [00:30:49] I can’t say I’m fully versed on that, but I know our staff have been talking to them about what they’re doing. They’re waiving this to hours or, at least, I believe, credits, so that they can make them a little easier to understand, which is something we talked about as well. It’s just hard, I’m sure, I’m sure other states. I think, things like micro learning, probably, would count in this category to some extent. And I know a lot of people are doing that.

Peter Margaritis: [00:31:24] Yeah, we’re doing that. I know we have that here in Ohio and, I believe, also, in Maryland, but I haven’t heard much about micro learning. I think in the last couple of years, I remember, we’re on the Future of Learning Task Force? And I think it was around that time that I know Ohio had implemented, and I think that Maryland had too, but then there was a halt put on it, and they’re exploring something about it. But I know it’s still there, but I’m not sure if any other states have really jumped on that bandwagon.

Jennifer Briggs: [00:31:59] I’m not sure. That’s something that didn’t work or really interested in, to be honest, for a while. Now, we understand that’s part of it. If you want a 10-minute increment, and it contributed to your competency, by all means, let’s do it. I think we find, and I don’t know about other states, we find that it’s the same idea as our longer courses being kind of hanging over people’s heads. They don’t really like the concept of having to keep track of such small increments of time, even though, obviously, they did that in their day-to-day, a lot of them.

Peter Margaritis: [00:32:38] Yes. You would think they’d be able to track time, they could track CPE as well. But along those lines, but I also think it’s part of the mentality, and maybe it’s a generational one, but I wish I knew the statistics, but I know they weren’t that high. In Ohio, we have our our monthly magazine that you can read, fill in some dots, and then they get an hour’s worth of credit. I’m not sure. Like I said, I don’t know the status, but they weren’t really high on the number of members that attempted it.

Jennifer Briggs: [00:33:15] Really? That’s interesting. I think, what’s so fun about that is we’ve never done that here. I know quite a few states do that, but when I think about it, for us, that would be a great example of, let’s say, you kind of have a plan. Here are some things I want to know more about. And reading that magazine is part of that plan. Just keeping it. So, you count that time, even though you don’t have to submit a test, if you will, or kind of anything like that.

Jennifer Briggs: [00:33:51] And if I can, I’ll say it. I was just talking to a colleague the other day over break, and her daughter is in sixth grade. And she was, and her sister, and my son, were running around my house like maniacs and playing hide and seek. And at one point, sat down on the couch to take a break. And she said, “Oh, I can count this for her PE class.” Over the break, there was some incentive for them. They have to check that activity. And she was trying to get four hours a week. And it didn’t have to be go to the gym or do this many jumping jacks, if people still do jumping jacks, I don’t know. We both said, “Yeah, you’re sweating. You should get credit for this.” And I just thought, “Gosh, if we can do that for sixth grade PE, we should be able to figure it out.”

Peter Margaritis: [00:34:57] Yeah, you’re right. And actually, I had tested something with Maryland where we took the first five podcasts, and made them NASPA-compliant, and we offered it up for SCP. And my thought was, “Well, for those who commute, if you listen to an episode on a daily basis, by the end of the week, you’d get five. And just keep adding that up.”.

Peter Margaritis: [00:35:18] And we tried to market it, and it’s still sitting out there. But I think over the last two years, we’ve sold three maybe. And the only thing that we’ve concluded is one, well, okay, a podcast is still new to a lot. And two, it’s only an hour or even a half of a credit. But is it worth that investment where I could use to go sit in for eight hours. Okay, I’ve got my eight hours. Let’s move to the next.

Peter Margaritis: [00:35:48] I don’t know. I think it’s still part of that mentality. And maybe better understanding the product that’s out there or the opportunity that’s out there. But at the end of the day, it’s all about learning.

Jennifer Briggs: [00:35:59] It is. And I would say, we are in the same boat, honestly, with just people actually participating, again, aside from ethics. And I don’t know. I think it’s just about a comfort level and what’s easy. And I don’t blame anyone. Listen, I don’t want to add one more thing that I need to track. I’m one of those people, like I refuse to wear one at step tracker thing. Like, “No. I don’t need more pressure. I’m good.” But I just think there are just people who want to know how to do it and do it.

Peter Margaritis: [00:36:36] Yeah. I’m one of those who like, I guess. I don’t know if it’s the competition or what, but if I had 10,000 steps yesterday how could I do 10,000 again today to help build that habit up? Sometimes, it works. Sometimes, it doesn’t. The other aspect of it is, and I thought about this one day, whether you’re in business in the industry, whether you’re on public accounting, you really only have about eight months out of the 12 where you can fully learn or go through that learning process. During those peak times, you’re learning, but not in a CPE way. And then, when we’re done with being busy, then we’ve got this. There’s a lot of other plates.

Jennifer Briggs: [00:37:23] There’s a lot. There’s a lot. But again, if you think of it this way, and if you think about it, you’re an industry, and you want to take on a new project that’s something you’ve never done before, so you’re going to have to research it, and talk to people, and make a plan, and implement. I mean, all of that is education. And that’s what we’re talking about. But then, I’ll tell you, we have a lot of people say in response to that, they say, “Well, you should just be doing that anyway.” And CPE is on top of your regular job. So, it is ingrained. It’s ingrained.

Peter Margaritis: [00:38:07] It’s ingrained since kindergarten, I believe. But, yeah, I love that idea. You give me something to do. I go research and work on it. I bring you a memo back. You go, “Okay. You look at this,” spend another couple of hours. We put it in place. And when we’re looking at, “Did we do it right? What did we do wrong,” that all is part of continuing professional education. It doesn’t have to be cheeks in the seat. It doesn’t have to be 50 people’s cheeks in the seat with the lecture person up there. And that’s another piece of that in class that we need to develop is the ability for the person who’s leading the class not to think that they have to lecture, but how do you have a discussion.

Jennifer Briggs: [00:38:53] I’m so glad you said that. That is something. We see a little bit more of that, and more of case study work, and that kind of thing. There needs to be a lot more. I mean, I don’t know. It’s very challenging. I can’t even imagine. I’m just going to be honest. So, I know, I need hours for my credential, but it’s not nearly as rigorous. And I go to conferences, and there’s a different topic every hour, and I still can hardly stand to sit for that long. So, I think about members on one topic for eight hours. That seems hard. But I understand because if you’re gonna take the day to do it, you want to get as many hours then as you can.

Peter Margaritis: [00:39:47] Right, but is it you can’t sit that long because you just don’t like sitting that long, or I can’t sit this long because it’s not interesting or it’s not engaging?

Jennifer Briggs: [00:39:59] Yes, exactly. Yeah. I think that’s part of it. I think part of it is just my personal problem with sitting for a long periods of time, but I guess that is the point. I’m going to say something I maybe shouldn’t, but I really think that we, as state societies, are really dependent on our vendors for education. And, of course, we plan it, and we choose, and that kind of thing.

Jennifer Briggs: [00:40:28] But you know, as well as I, that there’s only so many places to go to find that education because your average CPA is not going to stop what they’re doing to create an eight-hour course, and then go deliver it to people. And so, we’re dependent on these vendors. And I feel like that it’s a slow process to update the education practices.

Peter Margaritis: [00:41:00] It is. And Chris Jenkins in South Carolina tried something. He contracted myself and another gentleman to come and do a two-and-a-half-day workshop with some folks who are delivering tax and audit at conferences, and try to help them, or teach them how to be more engaging in that classroom. And we’ve done that.

Peter Margaritis: [00:41:25] So, I think we put through about 14 to 15 people. And the last time I had a conversation with him, he goes, “Their style has changed dramatically.” We’re getting more, not saying directly from this. He’s done a lot of other stuff. But, I think, a lot of more members attending conferences.

Peter Margaritis: [00:41:41] I think, a part of that, to some degree, has to do with the ability to teach these folks how to become more engaging in that classroom, how to ask questions, how you get the audience involved because whether you’re sitting there for an hour or eight hours, our attention span, and something that’s as complex that we have to deal with, can’t last that long if it’s just all facts and figures the whole time. There’s just a lot of other things that you can do to make that classroom much more engaging. And I think that also goes in this model that you guys are working with is how do we make learning — A lot of people think about it, but how do you make learning fun?

Jennifer Briggs: [00:42:21] Yeah. I’m so glad you mentioned that South Carolina because I really want to follow up on that because if the presenters are are open to that concept, I think they will really enjoy it, and learn a lot, and make it even better for the participants.

Peter Margaritis: [00:42:40] Yeah. And what he did, he put myself and another gentleman, and our teaching styles are just polar opposites. And the attendees just loved the dichotomy there because, I guess, if you think about their work with a lot of bandwidth where they could figure out where do they fit in this line of this difference — Am I’m closer to his style, or his style, or I’m somewhere in the middle? So, what if I take this and this, and I could build my own style where I can be more engaging?

Jennifer Briggs: [00:43:17] That’s great. It’s a great idea.

Peter Margaritis: [00:43:20] So, looking forward, you’ve taken baby steps, your ethics course is doing well, some of the other courses has still haven’t really gravitated to, but you’re still moving this forward. What do you think ’19’s coming up? If we got together January 2, 2020 – That just scares me – and we’re having this conversation, what’s the one big thing that you would say that you would want to say that this was our biggest success in ’19?

Jennifer Briggs: [00:43:57] Well, that’s a really great question. Well, number one, we want to get these rules done. We want to get them, at least, starting, get the rules written, and starting through the administrative process, which can take a while. And that’s one thing. Certainly, I would love to be able to report we’ve made a lot of progress on it.

Jennifer Briggs: [00:44:21] As for most of everything else, in all honesty, this is a year of review, I mean, internally and also with our board of directors at their retreat in November, and a lot of time talking about this journey that we’ve been on, and all of the different elements involved. You’re talking about the CPA learners themselves having to change and adjust to the concept. You’re talking about the regulatory journey. You’re talking about building the business of it because it costs money to do this stuff. And then, in addition just your basic change management ideas.

Jennifer Briggs: [00:45:04] So, I think we we did a really nice job. Jess Halverson Bowyer on our staff who runs the Center of Excellence did a wonderful job outlining the continuum of the work we’ve done and putting it out there, so we could see, “You know what? We’ve done a lot, but we are not where we thought we would be.” And at what point do you say, “Yeah, the plan is great, but the plan is maybe not working,” for lack of a better word to say it.

Jennifer Briggs: [00:45:42] So, parts of it are. Parts of it are, but where do we need to reboot and be willing to — Everybody — I think a lot of people and associations, in particular, really, any challenge you give them, they just want to work harder, do it better, do more of it, that kind of thing. And you get to the point where you’re like, “We are doing it all. Perhaps, the market is telling us something.” So, long, long answer to your question, but I think that I would love to know what I would say this time next year because I think we’re going to have a lot of deep thinking this year trying to figure out what’s next.

Peter Margaritis: [00:46:33] Yeah. The market will always tell you if you’re successful or not, or if you’re going down the right path, or it might be to the fact of a great idea. You might be ahead of yourself just a little bit. I don’t think you are, but I’m kind of bias with it because I love what you guys are doing.

Jennifer Briggs: [00:46:50] Well, thanks. I didn’t think we were at it. I mean, I’m the first to admit, when we get on board with an idea, we work hard on it, and you can have blinders on to some extent. And now, we’re just taking that step back to say, “Okay, what part?” One thing that came up quickly, and with our advisory board when we met with them — And just so you know, the advisory board includes people like Donny Shimamoto, and Kelly Richmond Pope, and then Tracy King, Jeff Evans who is an expert in this area at Purdue University, and Bernard Bull who I believe has a new position at the University recently but I don’t know.

Jennifer Briggs: [00:47:39] Long story short, when they first met, and were exposed to all that we had done, and were there to give us some feedback, one thing that came out of that, the most important thing that came out of it was the idea that we are trying to start a revolution. Maybe we could have done it more as an evolution.

Peter Margaritis: [00:48:04] Oh.

Jennifer Briggs: [00:48:04] Yeah. And it doesn’t seem revolutionary because we haven’t maybe taken as many steps as we anticipated, but the point was well taken, and that we were asking for a lot of change, a lot of change overnight. We want you to understand competency-based. We want the regulators to understand it. We want you to try new things. We know it’s hard. All of this stuff. And perhaps the things we’re doing now, frankly, trying to tie in to other elements of what we do, the concepts of competency-based education is maybe something we should have spent a little more time on the front end. In hindsight, it’s 20/20, but I think we are trying to learn from that and say, “Where are we not being successful? Where are our challenges in the change management process?”

Peter Margaritis: [00:49:07] Yes. What you just said made me think of Tesla. The story I’m hearing around Tesla is when Elon Musk wanted to create this car company. He didn’t do it Ford and Chrysler that basically think what the customer wanted. He went out, and surveyed the customers, and see what they wanted, and then came back and built it. And maybe that was a little bit that was going on with the aspect of a revolution versus an evolution.

Peter Margaritis: [00:49:39] In hindsight is 20/20, but you’ve learned a lot in that hindsight that moving forward, one, I wish you all the luck possible because I think you guys are really on to something. But I like the thought because I always thought of it as an evolution and a process. But then, hearing those conversations, coming at it as a revolution, yeah, I could see where maybe there had been some, “Oh, I didn’t think about it. Oh, yeah.” Kind of some unexpected — Unexpected situations coming up that we didn’t think that would happen, but you’re still moving in the right direction.

Jennifer Briggs: [00:50:20] I believe we are. And I think that I didn’t think of it as a revolution either, frankly, until they said this. But then, as I started thinking back on other conversations I’ve had over the years, and frankly, how much negativity we heard, maybe we should have an understanding of that.

Jennifer Briggs: [00:50:44] I know one thing. You mentioned the Future of Learning Task Force earlier, and Todd Shapiro, in Illinois, used to say to me when I would talk about this sort of thing during that time that he would say, “You can’t just keep saying the current system isn’t good. You have to acknowledge that it’s the system, and go from there.” And Todd appreciates. We give each other a hard time, but I will give him credit, but I was excited, and I was ready to move forward. And so, with all of our staff, and members , and great, beautiful members, but you have to take into account people’s comfort level and help them along.

Peter Margaritis: [00:51:31] So well said. So well said. Well, Jennifer, thank you so very much. As I’ve said a number of times, I love what you guys are doing in Indiana. I applaud what you’re trying to do for the profession as a whole, and make it better, and leave it behind for those who come behind us in a much better shape than we ever found it.

Peter Margaritis: [00:51:54] I wish you guys all the best, and I will keep my eye on what’s going on in Indiana. And maybe I hope you don’t mind if I just pick up the phone and go, “So, how’s it going today?” And just check in because I am fascinated by this. And the journey that you guys are on, I applaud you. A lot of folks in the profession applaud you guys for what you’re doing. And once again, I wish you guys the best of luck.

Jennifer Briggs: [00:52:23] Thank you so much. You call anytime. I very much appreciate your interest and encouragement. Thank you.

Peter Margaritis: [00:52:33] You’re welcome.

Peter Margaritis: [00:52:36] I want to thank Jennifer for taking time out of her schedule to be a guest on my podcast again. I’ve made a note to check back with Jennifer around year end to get an update on their progress. Congratulations on the progress that you have made. And I wish you all the luck on the progress forthcoming in this current year 2019 and beyond.

Peter Margaritis: [00:52:58] In Episode 21 which airs on February 4th, I interview Bryce Welker CPA, who is the founder of Crush the Exam, Crush Empire, and Crush Offers. You’ll know that Bryce will crush his interview. Thanks again for listening, and please share this episode with a friend.



S2E19 – Allen Lloyd, Boyd Search, & Chris Jenkins | Roundtable Discussion: The Future of the Associations, Technology, & Fellowship

Happy New Year, everyone! As I thought about 2019, I wanted to get off on the right foot – and I wanted to try something a little different. So today, I interview three wonderful guests at the same time. And you know what? It was a blast!


Our guests are Allen Lloyd, CEO of the Montana Society of CPAs; Boyd Search, CEO of the Georgia Society of CPAs; and Chris Jenkins, CEO of the South Carolina Association of CPAs. All three are CEOs who used to work for the Ohio Society and are now running other state societies, so naturally, our discussion centers around the state of the CPA associations and the issues that members are facing in the accounting profession, both current and in the future.


This isn’t a one-size-fits-all solution, which is why this isn’t a one-on-one conversation. These three highlight that each association needs the ability to recognize the idiosyncrasies or uniqueness of their membership and try to tailor their offerings to meet the membership’s needs.


For example, Chris Jenkins and the South Carolina Association of CPAs recently overhauled their membership model to create something completely new: an all-inclusive membership. And this was a pretty radical move!


“It’s about bringing the association back to what it originally was, and the association was a community,” Chris says. “We spend a lot of time talking about CPE, and we spend a lot of time marketing CPE, but there are a lot of CPE vendors out there. What we were trying to do is deliver the maximum value for the minimum price. So, we wanted to roll CPE in as a member benefit.”


That’s right – SCACPA isn’t trying to upsell their members to purchase additional CPE credits anymore! The conversation around CPE is so often competence versus compliance, and when you take the price point out of the CPE, it becomes more of a competency-based system.


The world is changing rapidly, and as the world changes, associations need to change too.


Allen Lloyd and the Montana Association face a very different problem than our other two guests: they’re a state with just a million people that’s three-and-a-half times the size of Ohio. CPE is difficult for them because it’s difficult to get everyone together – then, even when you accomplish that, none of the cities in Montana are that big, and they’re spread out so far from one another, making it difficult to get teaching talent to come.


So the MSCPA got rid of their eight-hour seminars and switched to cluster events. Instead of getting people together for an afternoon, everyone gets together for two or three days. None of the classes are longer than four hours and members can pick and choose what they want to do.


Georgia, on the other hand, is a much more populated state. There are over 21,000 CPAs licensed in the state, and 85% of their members are actually in Metro Atlanta. This creates both opportunity and challenges because, while they are compressed in this space, traffic is terrible and it’s not going to get any better.


So Boyd and the GSCPA have made significant investments in their live stream technology, and they’re doing it all themselves. “We have our own equipment, our own staff, and we do it for ourselves,” Boyd says. “And in an age when a lot of people are partnering with outside companies, or with other states, or whatever, we have moved in the opposite direction where we are entirely reliant on ourselves.”


So the society owns the process, owns the technology, and hires the people beginning to end – and that has paid huge dividends for them financially. Although they have not experienced tremendous growth in their margins, they have offset losses that you can see in other states and other providers.


Change is scary. Change is necessary.


People in associations have a fear, and not an entirely irrational fear, that if they create too much change, the people who have supported the associations for the last 30+ years won’t like them anymore.

“But we also have to recognize that if we don’t change, if we don’t do something different, the people who are going to support us for the next 30 years are not going to find us relevant. They’re not going to find value in us,” Chris says.


So, each association, and really each firm, has to have a method of controlled change, in which you try to balance the needs of both without making either one 100% happy… and no matter what you do, you’re never going to make everyone happy.


But if people can find the value, they will want to be part of your association or work with your firm.


Download this Episode MP3.



Click to download the full Transcript PDF.


Chris Jenkins: [00:00:00] You can have everything in the world, but if people don’t feel like they belong or that they want to belong, they’re not going to be a member. And it’s really about that camaraderie, that fellowship being something larger than yourself and building on that that moves us forward. And you’ve got to have the students engaged, you’ve got to have the older folks engaged, and you just got to deal with the fact not everybody is going to be happy. Everybody is going to find value.

Peter Margaritis: [00:00:32] Welcome to Change your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building stronger communication skills is by embracing the principles of applied improvisation.

Peter Margaritis: [00:00:53] Your host is Peter Margaritis, CPA, a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers, all the while growing their businesses. So, let’s start the show.

Peter Margaritis: [00:01:20] Welcome to Episode 19. And before we get to our guests, I want to wish everyone a Happy New Year, and I hope you all had a safe and festive holiday season. As I thought about 2019, I wanted to get off on the right foot, as well as I wanted to try something different.

Peter Margaritis: [00:01:40] And today, my guests are Allen Lloyd who’s the CEO of the Montana Society of CPAs, Boyd Search who’s the CEO of the Georgia Society of CPAs, and Chris Jenkins who’s the CEO of the South Carolina Association of CPAs. I wanted to interview three people at one time. And I’d tell you what, this was a blast because I’ve known all three of them for many years because they all used to work for the Ohio Society of CPAs. And our discussion centers around the state of the CPA associations and the issues that members are facing in the accounting profession both current and in the future.

Peter Margaritis: [00:02:17] Before we get to the interview, I want to share that my book, Taking the Numb Out of Numbers, was ranked number 12 of the Best Books in 2018 for Speakers as ranked by That blew me away. I was so excited about that rating. And the review they gave the book goes like this, “Peter does an outstanding job demonstrating how to present numbers to a non-number audience. It is useful information that can be used in any presentation. It can help make the presenter a rock star. I highly recommend this book for anyone who presents financial data and wants to make it interesting and relative to their audience, whoever they may be. I’ve already used many of the suggestions in his book.”

Peter Margaritis: [00:03:01] Thank you very much Speakers Hub for that review and being ranked as one of the 12 Best Books for Speakers in 2018. And Taking the Numb Out of Numbers will transform your ability to communicate technical financial information in greater context through analogies, metaphors, and storytelling. Put another way, translate complex financial information into plain English, so your audience will gain a deeper understanding.

Peter Margaritis: [00:03:30] The book is available on, and paperback, and in Kindle. So, buy it as a New Year’s present to yourself. If you like to purchase 10 or more copies, please contact me at for bulk discounts. So, without further ado, let’s get to the interview with Allen, Boyd, and Chris.

Peter Margaritis: [00:03:54] Hey, welcome back everybody. Boy, are you in for a treat this week. Actually, this will be the very first episode of 2019. So, I thought I’d kick it off and try something completely different. I’m with three very special guests: Chris Jenkins, the CEO of the South Carolina Association of CPAs; Allen Lloyd, the CEO of the Montana Society of CPAs; and last but certainly not least, Boyd Search is the CEO of the Georgia Society of CPAs.

Peter Margaritis: [00:04:26] We have all CEOs who originated out of Ohio who are now running the other states. And I thought we could have a conversation on what they’re seeing going on in the profession and give us some of their insights. So, each one of you, we’ll start with Chris. Give everybody a hello, a little bit about yourself, and then we’ll move to Allen, and Boyd will come up in the rear.

Chris Jenkins: [00:04:50] Chris Jenkins here from South Carolina, CEO. I came from Ohio. I was there for 16 years as the CIO. So, my background is primarily technology. Looking forward to talking with everybody today and discussing what’s going on with the profession, want to see what the other smart guys in the room have to say, and we’ll go on from there.

Peter Margaritis: [00:05:08] Okay. Allen, you’re up, bud.

Allen Lloyd: [00:05:08] Yes. So, I am Allen Lloyd from the wonderful state of Montana. Much like Chris, I’m looking forward to hear what others have to say, and I can’t wait to share. This has been kind of a couple of weeks where I’ve been dealing a lot with our students and looking forward to sharing some of the cool things that are happening at Montana schools.

Peter Margaritis: [00:05:30] Great. Boyd.

Boyd Search: [00:05:31] Boyd Search, CEO of the Georgia Society of CPAs. I have known all three of you guys for longer than I probably deserve to. They’re both right, and there is entirely too much noise in the system. And so, my conversations with you guys always actually help bring clarity to that. I know we’ll laugh and make fun of each other a little bit today, but in all sincerity, that’s, I think, not only me but hopefully other people get some of that clarity out of this.

Peter Margaritis: [00:06:01] Yeah. I think before we start, we should probably give a big shout out to Clark, who all three of you guys have had worked with over the years, and I’ve interviewed a number of times on this podcast. And I think a big thank you goes out to him for all of his leadership that he has given all of us over time.

Peter Margaritis: [00:06:20] So, we’ll start with Chris. So, what do you see in South Carolina? I know that you’ve gone through a big overhaul, per se, in your membership model, and you’ve created something completely new and different from the other states. Maybe you could fill us in on how that’s working.

Chris Jenkins: [00:06:38] Well, the model’s about all-inclusive membership, and it’s about bringing the association back to what it originally was. And the association was a community, and the idea of the profession coming together and having that camaraderie. We spend a lot of time talking about CPE, and we spend a lot of time marketing CPE, but there are a lot of CPE vendors out there. What we were trying to do is deliver the maximum value for the minimum price. So, we wanted to roll CPE in as a member benefit.

Chris Jenkins: [00:07:06] And when you look at all of the talks that we’ve had about CPE over the years and what CPE actually is, it’s that competence versus compliance. When you take the price point out of the CPE, it becomes more of a competency-based system. So, what we do in South Carolina, any of our live streams or any of those things, you can take those for free. The only time that you’re going to use any of your bank hours, and those come with membership, is when you’re going to get credit. So, we have a lot of people taking a lot more CPE, and it’s more competency-based, and not worried about the compliance part because they know they’re going to be able to fill that in, but the competency comes at no cost.

Chris Jenkins: [00:07:45] And I think that’s important as we go forward. The world is changing very rapidly. And as that world changes, we want to make sure that we’re delivering everything that we can. But most importantly from our association standpoint, it’s really about delivering that community environment and working for the profession, advocating for the profession, and, again, removing the CPE component, not making that a sales pitch but making it just another member benefit shows our members everything that we do. And we’ve been able to communicate the advocacy, the student pipeline, the communications tools that we have. And CPE kind of fell down on our member value structure. It’s something that CPAs have to have, and we hope that we deliver it well. But it’s by far not the most important thing we do.

Peter Margaritis: [00:08:30] And this was a radical move. And I know because I was down there for a bit while you were going through this process. This took I can’t even imagine how many hours and nights of lost sleep that you went through in order to get this thing rolled out. And I congratulate you on taking that risk and doing something different. And on the surface right now, I know you’re still kind of new with it, but on the surface, it seems like it’s going to be successful and will be sustainable.

Chris Jenkins: [00:09:02] It does look successful. I’m not to the point yet where I want to go, “Yeah, it’s a wild success.” With a change of this magnitude, you’re going to get people who push back, and that actually makes the program better. So, we listen to those people. We made it better. I think some of the proudest moments this year were when the people who were really not happy with the change came back to us said, “You know what, I didn’t like it. I’ve experienced it now, and you’ve actually brought the association back to what it’s meant to be.” And that is community and camaraderie. That’s something that makes me really proud.

Chris Jenkins: [00:09:31] Our conference this year have been higher attendance than we’ve had in the history of SCACPA. And it’s not like record numbers like you might see in a big state. When we get 400 people to an event or 500 people to an event, that’s over 10% of our membership, which means — And they’re working with their peers now, and that interaction is what we drive. That’s the value of the association. It’s member-to-member interaction.

Chris Jenkins: [00:09:55] And I’m proud of where we’re at. Does it mean that it’s perfect? No, it’s not perfect, and it will evolve over time. Does it mean it would work for everybody? Absolutely not. This program was specifically designed around the requirements in South Carolina, and that’s why it works. It’s specifically designed around what South Carolina CPAs need. We’re not the AICPA. We’re not these other organizations. We don’t try to be that. We’re here for South Carolina CPAs. That’s all we focused on. That’s all we did.

Peter Margaritis: [00:10:24] And that’s great in how you’ve been able to get that message out. And we had talked on an earlier podcast about this topic, and the word that you said that really stuck with me, because you summed it up in one word, fellowship. And that’s what you’ve created down in South Carolina. And I think hats off to you, for myself as well, as your other colleagues who were on this podcast with us.

Allen Lloyd: [00:10:47] What Chris has done is really cool. And, I think, when you look at his timeline, being the rookie here in the group, this isn’t something that Chris jumped in, and year two, was doing. He took the time to listen to his members, figure out what the needs were there. And then, this was the answer to those issues.

Allen Lloyd: [00:11:08] Here in Montana, one of the problems we have is we’re a state of a million people that’s three-and-a-half times the size of the State of Ohio. And so, CPE is difficult for us because it’s hard to get here. And then, even once you’re here, our cities, none of them are that big, and they’re spread out so far from one another that it makes it difficult for us to get that teaching talent here.

Allen Lloyd: [00:11:34] And last year, one of the things we changed was we got rid of all of our eight-hour seminars. We switched to these cluster events. So, there are two or three days, and there are no classes longer than four hours, and you get to pick and choose. But what that allowed us to do is bring in a teacher who was teaching a broad topic, and we’d get enough people from that broad topic, but then to have that person there for the afternoon where they could do a deep dive. And then, in the past those deep dives just weren’t happening because we never got enough people here to do it.

Allen Lloyd: [00:12:06] And so, looking at that situation and figuring out what works best for us, it’s not going to work for anybody else. And figuring out those things, I think that’s one of the things that I learned from Clark. Clark always had his thumb on what the members in Ohio needed and how we could provide that to them. And I think that’s one of the biggest strengths that we probably all took away from working with him is understanding that we’re membership organizations. We need to be aware of what our membership needs.

Peter Margaritis: [00:12:35] And each membership has different demographics, and different logistics, and everything to pull. Speaking of logistics, Boyd.

Boyd Search: [00:12:39] Yeah.

Peter Margaritis: [00:12:44] I mean, Georgia is not a small state, and you get a lot of stuff in Atlanta, but I know CPE is delivered throughout the State of Georgia.

Boyd Search: [00:12:51] When you listen to Chris and Allen, I think their stories and differences articulate well some of the challenges we face in the profession and how different our members operate, their varied needs and things, and you see these different ways of trying to adapt and adjust to those needs.

Boyd Search: [00:13:12] We are in Georgia. It’s a larger state. I mean, it’s fairly big geographically. We have a good membership size, over 21,000 CPAs in the state, licensed in the state, but there is an advantage for us in that 85% of our members are in Metro Atlanta. And that creates opportunity and challenges because while we are compressed in this space, traffic is terrible. It’s not going to get any better. The joke is if you want to go anywhere in Atlanta, whether it’s a half a mile down the road or 10 miles down the road, it’s going to take at least a half an hour to just get started.

Boyd Search: [00:13:52] And so, we have made significant investments, as we’ve talked about before, in our live stream technology, and we’re doing it all ourselves. And we have partners on the software side of things, but we have our own equipment, our own staff, and we do it for ourselves. And in an age when a lot of people are partnering with outside companies, or with other states, or whatever, we have moved in the opposite direction where we are entirely reliant on ourselves.

Boyd Search: [00:14:23] And so, we own the process, and own the technology, and hire the people beginning to end. And that has paid huge dividends for us both financially. We have not experienced tremendous growth in our margins, but we have offset losses that we see other states and other providers are having. And it’s created a unique product for us in Georgia where we have firms, and companies, and people utilizing it in different ways. Everything from firms putting all their people in a conference room, and watching a live stream, and they discuss the issues as they’re being talked about. As the presenter brings up an issue, they can talk about client A, B, C and how that impacts them too.

Boyd Search: [00:15:03] The for-hire controller, and I know of this person who works out of her home, and probably I’m not going to say her name because she works at the same time the CPE class is happening. And that’s, to Chris’ point, about competency versus compliance. We’ve found a way to to help you meet those needs.

Peter Margaritis: [00:15:22] Interesting. And what I hear from all three of you is the ability to recognize the idiosyncrasies or the uniqueness of your membership and try to tailor something to meet their needs. The one thing that Chris and I were talking before you guys joined us, he was telling me the uniqueness in South Carolina where — Now, Chris, correct me if I’m wrong — South Carolina Board of Accountancy only will allow or recognize only eight hours of professional development, like leadership, to be counted as CPE.

Chris Jenkins: [00:15:56] That is correct.

Peter Margaritis: [00:15:56] Yeah. And while I was talking about, I researched one time the State of Kentucky because going up there, I’d always want to take — I’d love to teach there, but I found that they don’t allow any personal development to be part of CPE, leadership types of courses.

Chris Jenkins: [00:16:12] That can be good and bad if you think about it, right. You’re already fighting this battle of competency versus compliance. There’s a bad taste in people’s mouth over CPE because people have to do it. And what we see in students or what we hear from the firms is we need our new CPAs to have better writing skills, business development skills, communication skills. So, if you look at that, that’s all personal and professional development.

Chris Jenkins: [00:16:41] One of the best courses I took as a young professional, and it sounds really strange, was Dine Like a Diplomat. I’d never been to a business there. So, I actually took a course through my association, and they taught me that you pull the bread, you don’t bite it. And those tips and tricks in what you do with your sugar packet is you put it under the plate, you don’t leave it laying on the table.

Chris Jenkins: [00:17:02] But it’s easy for us as seasons professionals to think everybody knows this stuff. Everybody knows how to draft a business letter. Everybody knows how to make a sale, how to do business development. These, to me, are very important skills, and people won’t send their staff to CPE because they can’t use that credit.

Chris Jenkins: [00:17:22] So, what if we took it another direction and say this is just part of lifelong learning outside of compliance to try to get people to come to that? And this is where we have to be unique in South Carolina because our firms need their new CPAs know how to do this. We have to find a way to provide it outside of the scope of CPE because of the limitation.

Chris Jenkins: [00:17:41] Another limitation is self-study. In South Carolina, you can only do 20 hours of self-study, and it will carry over from year to year. So, you’ve got that limitation. Again, some of the best CPE is the CPE that you need just in time, right. Oh, I picked up a new timber client. There’s not a lot of timber CPE out there, right?

Peter Margaritis: [00:18:00] Right.

Chris Jenkins: [00:18:00] So, again, from my perspective, that limitation actually limits the CPA’s ability to be competent in that area because they’re not taking that CPE, they’re not going to get that, but when they need it, it’s really important. And that’s where, as an association, because I don’t sell CPE, I don’t have to apply credit to everything. and it makes it better. But we have to fundamentally change how we think about education, how we think about professional learning because the world around us is changing so fast, there’s no way to keep up.

Chris Jenkins: [00:18:31] And we value everything by the hour. So, we bill by the hour, we trace by the hour. It’s the most ridiculous, outdated concept that I can imagine for tracking anything of value. Value has its own measure. Time is not the measurement of value.

Peter Margaritis: [00:18:51] I’m going to give you a big amen on that because I fully agree with that, and the ability to check the box. But CPE, we teach CPE the same way we did 30 years ago. Not much has changed except maybe the delivery of it.

Chris Jenkins: [00:19:07] It’s actually gotten worse. So, I started doing CPE courses 20 years ago, and I was a discussion leader. My job was to walk in a room, and facilitate a discussion, and to be a topic expert in technology. People would come in the room, they would talk about what they were doing and what their problems were, and I would facilitate the discussion to get to a solution. Now, it’s all lecture, and that’s what you’re supposed to do. Now, I’m a presenter. And that’s a problem because you learn more from experiences than I could ever prepare in a lecture.

Peter Margaritis: [00:19:37] Right, exactly.

Allen Lloyd: [00:19:39] And, I think, one of the things that we’re doing right now is our president, my current president is very interested in engaging our young professionals. And so, we are taking our young professionals and having them go through some process to discuss the major topics that we’re facing, the impact of technology, demographic changes. And then, here in Montana, we’ve got a large issue with rural CPAs who are retiring and leaving a void.

Allen Lloyd: [00:20:08] Part of that process, we’re asking this group not only to come together and talk about the issue, but then, at the end of the day, they’re going to be giving presentations at our annual conference next year on what they come up with. And a big part of the reason we did this was to give those people an opportunity to be presenting in front of a group of people, which is something, at their stage in their career, they might not necessarily get a lot of opportunities to do that.

Allen Lloyd: [00:20:33] When we initially started this, it was just a new task force that we were going to put in place. And then, luckily, one of these young professionals asked us, “Hey, are you going to use CPE for this?” And we looked at him, and we’re like, “Oh, that’s what allows technical committees to obtain CPE for their work. This is a technical committee researching technical issues.”

Allen Lloyd: [00:20:52] And so, we’re thinking about how do we leverage this in the future as we learn how the folks in this process are learning. They’re learning technical issues, but they’re also learning some of these soft skills at the same time. How can we do more of that?

Peter Margaritis: [00:21:08] Right. That’s a wonderful idea to have them come and present at your annual meeting. There’ll be some nerves, but they’ll get a ton out of that. They’ll have a lot to walk away with it. That’s great.

Chris Jenkins: [00:21:21] Can I do a pitch here?

Peter Margaritis: [00:21:23] Sure, yeah.

Chris Jenkins: [00:21:24] So, I know this guy. His name is Pete, Pete Margaritis. And he worked with us this year to build a speaker’s training, and we’ve run it twice, and it’s been wildly successful. So, what we’ve done is we brought our members in, and we gave them those tools and that comfort to be able to create materials, how to present, tell stories, actually get in front of a crowd. And again, that was two to two and a half days of CPE, but what we were able to do is build a speaker pool of 15 experts that are now comfortable in speaking as well.

Chris Jenkins: [00:21:53] So, I think there’s a lot to be said about moving away from the status quo, and bringing in those new faces, and actually building the local speakers, the younger speakers, and bringing it back to that discussion.

Peter Margaritis: [00:22:08] Thank you for that. But that, to his point, it was a lot of fun to do it, but they walked away learning a lot of things that they never would have even thought about. And I think the one thing they kept saying is, “It’s not about me. I learned it’s not about me, it’s about the audience. And I have to tailor my conversation to the audience, not just my myself.”.

Peter Margaritis: [00:22:28] And to the point, we really do need the younger CPAs in the discussion leader pool because we’re going to wake up here soon, and all the — As Joan of the AICPA said, a lot of male, pale, and stale will be gone, and we’ve got to be able to backfill that. What about you Boyd in Georgia? As you’re laughing there after my heartfelt comment.

Boyd Search: [00:22:54] I’m trying to figure out what the question is.

Chris Jenkins: [00:23:02] Because there are no questions, only solutions.

Peter Margaritis: [00:23:04] It’s only solutions, yeah. It started as idiosyncrasies within our state. You can only have eight hours of personal development count as credit in South Carolina. What about Georgia? Do you have ethics requirements? Do you have a reduction of things, of topics that you can use and can’t use?

Boyd Search: [00:23:27] Yeah. I mean, we do not have an ethics requirement; although, they’re getting ready to pass one. So, that’s coming. We’re one of, basically, four states that doesn’t have one. And so, we’re behind, I think, on that in terms of public perception. We have a 16-hour requirement for A&A. So, we report every two years. It’s 80 hours. You have to have, at least, 20 hours in each year. 16 of those 80 hours to be an A&A.

Boyd Search: [00:23:53] You can argue about foundation, and core of being a CPA, and things, but the reality is we have people that are running concrete companies, and they have to take 16 hours of A&A, and it’s of no value to them from a professional development perspective. And so, Chris is absolutely right about what we should value versus what we do value in terms of time and those things.

Boyd Search: [00:24:21] It’s an easy conversation to have or an easy thing to say that. It’s another to be able to find a way that proves out to the public or somebody that understands that you are, as a profession, adhering to a standard that maintains you, that keeps you as a competent professional. I get that the public perception and the reality of things are vastly different, but that’s really, I think, the single greatest hurdle to getting agreement on how can we transform CPE to be something different from a regulatory perspective.

Peter Margaritis: [00:25:01] Right. And I know in Indiana, they begun to move to more of a competency-based model, and they started with ethics, and they were able to get their Board of Accountancy to accept. They still had to have credit. And you have to ask Jennifer Briggs about this, the details of it. But they’ve worked with the Accountancy Board to recognize that some of this stuff is going to competency-based. You got to take a test, pass it in order to say you can move on, but that does qualify for credit. But there’s some fuzziness in that that is escaping me right now, but we tend to be moving in the right direction slowly, but that’s what our profession is very slow. Allen?

Allen Lloyd: [00:25:45] The weird thing in Indiana is that it still converts back to hours.

Peter Margaritis: [00:25:48] Yeah. And I don’t know how it converts though.

Allen Lloyd: [00:25:50] The hours and the explanation I was given is for a new person, it might take them five hours to take this class, but the class is only worth one hour; whereas, you’ve got this person that’s already master to the subject, they can do it in 15-20 minutes, and they still get an hour. But it’s that you’ve proved that you know this thing, and knowledge of that thing is worth X number of hours. So, that’s one where I really like that they’re trying something different, but I’d love to see a lot more of that, so we can figure out what works a little faster.

Peter Margaritis: [00:26:23] Well, I will contact because we’ll probably come up on a year anniversary since I did interview Jennifer on that. I thought I was going to come back in and see where they are. So, I’ll see if I can get her on the podcast to explain what’s happened over the past year.

Peter Margaritis: [00:26:39] But if it takes somebody five hours, I guess, the end result is we are more competent at what we’re doing because we’ve passed it versus I’ve sat there and, now, I can just check a box. So, what do you guys — Allen was talking earlier about the young CPAs. Are you guys engaging any your CPAs in leadership and volunteerism with the organizations?

Boyd Search: [00:27:04] So, we opened the door to that this year. It seems like really late in the day to say you can be a student member, and actually be on a committee, and lead the organization, but it’s something we just hadn’t thought of. And if you want to grow your business in the future, it’s something that’s kind of self-evident, right. You’re building an association for the future, you want to talk to the future professionals are going to be and figure out what they’re going to want as they move forward.

Boyd Search: [00:27:31] One of the most frustrating things for me is I get calls all the time, “I want a three to five-year experienced CPA.” All of the time. And I’m like, “Well, I’ve got a whole bunch of CPAs who are looking to get to three years of experience because they don’t have that. They’ve got two years or a year of experience that was needed to get licensed. Are you willing to look at any of that?” “No, I want three to five years.”.

Boyd Search: [00:27:55] And I get it from a business standpoint, but you’re never going to get three to five-year candidates unless you’re willing to start hiring some. The race for talent, the fight for talent has kind of started to reverse, right. So, now, you see the big firms, the largest of the firms started to come downstream and take employees from the regional firms because we need employees.

Boyd Search: [00:28:18] So, where we used to say, “Oh, the regional firms will get their experienced employees out of the large firms,” that’s going away as more people move to the gig economy. And, again, three to five years experience, how do you calculate that if you have people who are working in this gig economy who are doing random work for different firms?

Boyd Search: [00:28:36] So, if I look at from the student perspective when I go talk to students, I love to tell them about the flexibility of the profession. That, to me, is the big selling point. You can go and do anything as a CPA. At the same time, I do want to get their feedback, and I want their ideas about how they’re going to work, so I could start addressing this at the firm level and say, “Okay. How are we going to change the mentality of the firms who are hiring to say, ‘You can get someone who maybe hasn’t done the traditional three years of experience at the big four, and there’s still quality candidates’?”

Boyd Search: [00:29:08] So, I think, it’s important to bring those students in, start collecting that data now. And I’m actually kind of embarrassed that we were so late to bring them into the fold and say, “Volunteer with us, get some experience here, and tell us what we need to do to move forward.”

Peter Margaritis: [00:29:23] Yeah. Somebody recently said that, “I’m looking for a 30-year-old tax manager.” Well, they’re kind of hard to find. Do you know how long it takes to get a 30-year-old tax manager? 30 years and 9 months.

Boyd Search: [00:29:36] That’s the right answer.

Peter Margaritis: [00:29:37] That’s the right answer, exactly. And the gig economy, soon as you said that, it popped to mind, one of your members, Sean Kenny, who I interviewed who’s building a platform to change public accounting basically find CPAs from around the country that specialize in the areas, and if the firm doesn’t have that talent, they can go to his platform, find that talent, hook themselves up, and the work gets done.

Chris Jenkins: [00:30:03] Right. So,, another pitch there. The website is And it was built by a CPA, four CPAs. First, they get a subscription and find the talent that they need, and individual CPAs can, of course, put their experience up there and look for jobs. So, it is more about that gig economy. When you look at gen-Z and you look at the millennials, this is how they’re working. I mean, this is their expectation.

Chris Jenkins: [00:30:28] Now, again, even on PrepLink, people are looking for people with experience, but they have to get that experience somehow, and this introduces them to different kinds of teams, different kinds of engagements, and build a very wide range of experience, and in a shorter period of time.

Chris Jenkins: [00:30:44] So, I think that that’s going to be something that’s great. We do see, with gen-Z especially, they want to work in an office, they want to have that stability, they want to be part of that team, but they’re also struggling to get there. So, that gig economy is helping them gain those different types of experience, so that when they interview, they can talk about what they’ve learned.

Peter Margaritis: [00:31:03] Boyd, what do you what are you guys doing in Georgia with young CPAs?

Boyd Search: [00:31:07] So, let me start at a more macro level with just the issue of what are you doing with this particular set of people to try and get them engaged, or diversity and inclusion, or young people joining the association and being in leadership. I am right, wrong, or indifferent when we start to talk about, Well, we’re going to put together a young CPA Committee. We’re going to put together our D&I task force or whatever.”

Boyd Search: [00:31:37] I have enough experience and cynicism that I tend to — Unfortunately, my starting place is an eye roll because, largely, what comes of those things is activity that allows us to say we’re doing things that makes us sound smart and makes us be able to make it sound like to other people that we’re doing something that matters and makes progress, when, by and large, we rarely ever are.

Boyd Search: [00:32:03] And so, I think you have to do those things because they create conversations. But beyond that, it requires the leadership from Chris, from Allen, from me, from you as a past chair of the board of the Ohio Society, to function with great intention on things. And I don’t mean quotas for young CPAs or others, but, certainly, in developing your own personal network of people that you know and talking about opportunities to be engaged, or leadership, or whatever.

Boyd Search: [00:32:41] Because if I’m doing that, if Chris is doing that, if my board members are doing that, you tend to see a lot swifter and more productive progress, if you will, than you do by sitting people in a room, and talking about the issue, and saying, “Well, we’re going to budget $2000 next year for our young CPA board, so they can have a beer and broth night at the local ballpark,” which are cool, but it doesn’t put somebody on the board. It doesn’t put them in a position where they suddenly realize, “Holy crap. My opinion matters. And the work I do and the attention I pay matters.”

Boyd Search: [00:33:19] And so, we’ve done many of those things that everybody talks about. But the thing I’m most proud of is that we’ve had leadership that has recognized on all of those fronts. And I’ll say diversity because diversity is not just an ethnic or racial thing. It could be young, generational, or whatever. They have an openness and a willingness to function intentionally when it comes to those things.

Boyd Search: [00:33:48] And as a result, we have a fairly deep bench of diversified talent across. We’ve got roughly what we say about 400 members that are actively engaged. And so, that means they are serving in some form of leadership role, task force committee, counsel, or whatever. And the bench is not as deep as I would like, but from a diversity perspective, again, diversity being all kinds of things, it’s robust, and I’m quite proud of that.

Peter Margaritis: [00:34:21] I hear you, and I have lived through a lot of that frustration as well, but as you were describing this, the thing, we keep talking about leadership within, we need more leadership CPE, we would go soft skills. But a great place to develop all of those soft skills are volunteering and being part of a task force, part of a committee, getting involved. We’re not seeing as much involvement from older, younger, middle of the road, whatever generation, into the association as we once did. And is it because we’re just too busy or is it something else? I don’t know.

Boyd Search: [00:35:02] I think the definition of involved or engaged is what you have to worry about. If you are 65 years old, your definition of engagement is far different than if you’re 25.

Peter Margaritis: [00:35:13] Right.

Boyd Search: [00:35:13] And if you have an expectation, and I’m way over generalizing, but a 25-year-old is going to join the local chapter, serve on a chapter committee, decide to be a chapter officer, be the secretary, be the treasurer, be the vice president, be the social chair, be the president, and then maybe get the chance to share a lot of state committee where they’ve done — And 30 years later, they get to bang the gavel as the chair of the board. That is not — It’s not how it works anymore.

Peter Margaritis: [00:35:47] Right.

Boyd Search: [00:35:48] We have focused on the idea of engagement, making it what the individual wants. And so, you’ll have an individual of two different people, let’s say, I’m making it up, sitting on the same task force that we’ll have. And they will both have vastly different experiences in terms of the time they commit, the depth of their intellectual commitment, but both of them can walk away satisfied because of the way we structure it and the way we have a broader array of expectations or acceptable outcomes for individual volunteers. And that’s hard because, particularly, if people have been around a long time, their expectations for what should be are way different.

Peter Margaritis: [00:36:33] Way different. What do you think about that, Allen?

Allen Lloyd: [00:36:35] As Boyd was talking, one of the things that struck me is on our board, we have two seats that are reserved, one’s for a student, and one’s for a young professional. So, every year, we’ve got one student that sits on our board and one young professional that is there. And that is part of their capacity of being on the board.

Allen Lloyd: [00:36:56] And one of the things that I’ve been really proud of is our group does a great job of making sure that those people are included in every conversation. We don’t ask our students just to talk and be engaged when we’re talking about student issues. We want them talking and engaged on all the issues that the profession and the society is dealing with.

Allen Lloyd: [00:37:21] And that’s where — So many great ideas come from that and questions because the younger folks don’t have all that history. And so, they’re not following this track where they’re like, “Oh, yeah. We’ve seen this problem before. We’ll just do X, Y, and Z.” They come out with a different angle, and it’s amazing what it does to that board dynamic to have those folks in the room engaged and involved in the conversations.

Peter Margaritis: [00:37:45] Yeah, they haven’t developed false biases out there. Actually, I was — Do you have-

Boyd Search: [00:37:49] The kind I’m voted with.

Peter Margaritis: [00:37:51] This guy was saying that he was looking for it. And he went into the open rate. He want to have 100% open rate on this campaign that he was doing. And he had his group together and asked them all, “Well, what should we do?” And this intern goes, “Well, we’ll have this event at the ballpark. Why don’t you get a box, and put a baseball in it, and send it to all the people that you want to invite.”.

Peter Margaritis: [00:38:21] And nobody else came up with that idea. And actually, he ended up having about 100% open rate because when you get a box with something, what do you do? You open it. And then, the baseball and the invitation. So, yeah, that’s a great idea. Back to you, Chris, what do you think?

Chris Jenkins: [00:38:38] So, I will say that Allen’s idea of having reserved seats, I do like that. The concept that you’re aware, and you need to have that representation on the board at that level, and you don’t end up with the path that Boyd pointed out, which is 30 years. And I agree with Boyd. Involvement, the definition of involvement depends on the person, and it depends on their passion. And when you have a volunteer, I think the most important thing that you need to do is you need to understand what they’re passionate about. You just can’t assume that somebody wants to be in a specific group.

Chris Jenkins: [00:39:14] So, we don’t have what you would call a Diversity and Inclusion Committee, right. Diversity and inclusion is in everything that we do. We want to include everybody. We want to make sure that we have the proper thing. So, that’s a charge of everything that we do. Young, startups, candidates, and students, and young professionals should be part of everything that we do. And the more that we realize that, I think the better off we’re going to be.

Chris Jenkins: [00:39:37] And Boyd is absolutely right. Members can be very, very passionate about something, but they have a full-time job. If you really want traction, if you want to move, it’s going to have to be somebody on staff, and they’ve got to go get it. So, I’m out. I go to all the universities. I’m the one that’s leading the student charge, and it’s very successful.

Chris Jenkins: [00:39:57] The other thing is I used to lead it, and I would take digital assets, and be like, “Hey, all of you, students, here are all these cool web assets and things that you can go to, and it works on your phone.” What I found is they’re overlooked. The way that I’ve been able to get the most traction is I take paper applications, and have them fill them out while I’m there.

Chris Jenkins: [00:40:16] So, I think that there’s a lot going on there. I also see that we are starting to get more of the younger generation involved, but it has to do with change. We have a fear, as associations, as we should, that if we create too much change, the people who have supported us for the last 30, 40, 50 years won’t like us anymore. We don’t have that. It was just the change, right?

Peter Margaritis: [00:40:43] Right.

Chris Jenkins: [00:40:43] But we also have to recognize that if we don’t change, if we don’t do something different, the people who are going to support us for the next 30 years are not going to find us relevant. They’re not going to find value in us. So, there has to be this method of controlled change where you try to balance the needs of both without making either one 100% happy.

Chris Jenkins: [00:41:02] And one of the things I was told when I took this job, no matter what you do, somebody is going to be mad at you. If you want everybody to be happy, go sell ice cream. I’m not selling ice cream, right. And even with ice cream, it’s going to melt. At least, my products not melt. But I think it’s really important to, number one, understand your audience, understand you can’t make everybody happy, get everybody to the table, and you’re not going to get consensus. Now, you’re not going to get a unanimous, “Yeah, this is perfect,” but you’re going to get, “This is what it takes to deliver value to me.”

Chris Jenkins: [00:41:36] And if people can find the value, they will want to be part of the association. And that’s because, again, for fellowship, to reinforce that they’re part of something larger than themselves. Boyd and I talked about this. You can have everything in the world, but if people don’t feel like they belong, or that they want to belong, they’re not going to be a member.

Chris Jenkins: [00:41:54] And it’s really about that camaraderie, that fellowship, being something larger than yourself, and building on that. That moves us forward. And you’ve got to have the students engaged. You’ve got to have the older folks engaged. And you’ve just got to deal with the fact not everybody is going to be happy, everybody is going to find value.

Peter Margaritis: [00:42:13] Well put. I mean, we never can make everybody happy. And I guess, it’s important. As long as you’ve got a majority of consensus to what is happening, then you’re moving in the right direction. I guess, when your popularity goes down to below 50, and you have more people against you than with you, that creates the issue, one of the issues.

Chris Jenkins: [00:42:36] I would like to stay at 80/20. That 60/40 is not where I want to be.

Boyd Search: [00:42:42] Did we just start talking about politics or?

Peter Margaritis: [00:42:44] Using that as a metaphor. Yeah, I would assume that 80/20 or 85/15 is the preferred, but where does it get to the point that it becomes concern? At what number?

Chris Jenkins: [00:43:00] A concern for myself, or concern for the association, or concern for the profession?

Peter Margaritis: [00:43:08] The first two, for yourself and for the association.

Chris Jenkins: [00:43:11] I have no idea about for myself, and I hope I’d never find out. And not to mean that we won’t lead and make tough decisions on those things, but I don’t have any perspective on when it would be a danger zone for me personally. I think for an organization, I don’t know that there’s a danger zone in terms of, “Gosh, 70%, 80% disagree with the direction we’re going,” because dissent or agreement implies some measure of engagement, and concern, and/or we’d say awareness. And that’s not always — Usually, for me, that’s a good thing.

Chris Jenkins: [00:43:53] Apathy, I think, if you could measure apathy, that would be the one to measure for me that would give me concern if it reached a certain number. And I think some of the areas where we see that, and this is not a popular thing to say, CPE is an area, and you can talk about why, or who’s to blame, or what’s to blame, the CPE is an area where there is a tremendous amount of apathy, and that can be very dangerous. So, that’s where I would go with it.

Peter Margaritis: [00:44:24] I think I’m going to make that into a bumper sticker because in all honesty, you’re right about the apathy in the CPE world. What do you think, Allen?

Allen Lloyd: [00:44:34] I’m going to go to the opposite side of this issue because when I started, one of the things that I knew was going to be an issue is this whole idea of technology is coming to disrupt us all and-

Peter Margaritis: [00:44:46] Yeah.

Boyd Search: [00:44:48] And kill us, isn’t it?

Allen Lloyd: [00:44:50] It’s coming, right. I mean, things are changing. But at the same point, I knew coming in that I didn’t need to make all my members blockchain experts within a month. But I think coming in, there was clear heads in the sand, and I would say it’s probably 80/20. 80% of people were just ignoring this issue. And I think anytime you’ve got something where people ignore or are dismissing something that we, as a profession and associations, find important that’s something where I go against that.

Allen Lloyd: [00:45:25] And I’ve heard from members that have told me that, “Stop mentioning this damn thing. I’m going to retire before it really impacts me anyway.” and I’m like, “Well, are you retiring tomorrow? Because this is something that even today we’re hearing from other members, members in industry that are actually using this stuff.” And they’re disappointed because the firms that they’re working with don’t understand it enough yet.

Allen Lloyd: [00:45:51] And so, I think, it depends on this issue. If it was something political, and I didn’t have at least, I would say, 70% of my members on board, it’s not something I would go chasing and advocate for the statehouse. But on some of these other fuzzier issues, I think I’m comfortable wherever it happens to be as long as I’m making progress in the right direction.

Peter Margaritis: [00:46:17] Do you remember, IFRS? The IFRS. And I would say I was very involved with it back then. And the acronym we used to say is it’s incentive for retirement soon because I would hear a lot of the same thing. I’m not worried about this because I hope I’m retired by the time it comes into place. And we’re going to-

Boyd Search: [00:46:37] We’re going to look dead.

Peter Margaritis: [00:46:38] Yeah. And then, I look at it. I will go say to that same group and go, “We may not have adopted or converged with it, but if you look at the standards, how fast we have been putting it up for the last two years with redbrick, leasing, elimination of extraordinary items, changing inventory measurement from lower cost to net realizable value.” That was all IFRS-based. That was all IFRS.

Peter Margaritis: [00:47:02] So, when someone says, “I’m glad we didn’t converge because I was going to retire,” well, you should have gone ahead and retired because it’s really here, which you get a lot of that pushback. And with blockchain, I thought it was an intestinal disorder when I first heard of it, but I’ve come to find out that it still is with a lot of people in our profession because it’s hard to get around, put your mind around the process, and it’s upsetting some people in the abdomen area, I believe.

Boyd Search: [00:47:33] I don’t think I want to know what you thought bitcoin was.

Peter Margaritis: [00:47:38] Well, I’ll let that one past for now.

Allen Lloyd: [00:47:45] I think, we joke about blockchain, but I think if you take the time to learn it at a little bit at depth, you start to realize that there’s a lot of opportunity in that for accountants and CPAs. One of the things I brought up with folks is you hear it’s secure because it’s distributed, right?

Peter Margaritis: [00:48:02] Right.

Allen Lloyd: [00:48:02] The same things on a thousand computers. You got to fit. You’ve got to get 501 of them in order to commit fraud. That sounds great. You hear that and you’re like, “This, I can trust this.” Well, what if 700 of those computers are all from the same business and the same IT guy can manipulate them all at the same time? It’s not so secure anymore. And so, that, to me, is one of these places where we might have a role. Maybe part of our role with a blockchain is verifying that it’s legitimately decentralized and is, in fact, protecting the way it says it is.

Peter Margaritis: [00:48:37] Don’t give Jenkins any ideas here, okay? Being the former IT guy that he is, now, he’s going to go basically take control. Well, being the former IT guy, you want to chime in, Chris?

Chris Jenkins: [00:48:49] I would look at artificial intelligence before I look at blockchain. So, robotic process automation and how that’s impacting firms and changing the dynamics of the firm model is far more of a threat than blockchain is right now. Large scale blockchain is not reasonable in the short term. The power consumption that’s required, the fact that everybody is building their own, and they’re not going to integrate well with one another.

Chris Jenkins: [00:49:18] I mean, we see this with iPhone and Android, I mean, on a small scale. Now, try to do a global transactional system and try to get them to play nice with one another. Not to mention the amount of power required to do the encryption and the timestamp on these types of transactions, I mean, we’d have to have another sun to make it work on a large scale. It doesn’t mean the blockchain is dead. No. For small scale implementations, it makes a lot of sense, but it’s not decentralized. And that means it’s less secure.

Chris Jenkins: [00:49:48] So, the first thing that I can tell you about any technology solution is when somebody comes to you and says, “I’ve got a completely secure solution,” they’re lying. Just saying that makes me go, “No, you don’t,” because it’s built by humans. And if it’s built by humans, it’s fallible.

Chris Jenkins: [00:50:06] I look at over two-thirds of my membership, small practitioners, five or fewer firm partners maybe, something like that, they’re working with Main Street businesses. Nobody is going to be implementing this in the next decade. Do I think that our larger industries will? Absolutely. For internal controls, it makes a lot of sense, but wide scale adoption, it’s just not for me.

Chris Jenkins: [00:50:30] Now, on the other side of that, robotic process automation and those types of things, I think there’s a lot of value in firms. I think there’s a lot of value in the audit. When you look at those types of tools in AI, I think that’s really what’s going to make the biggest change in the profession over the next 5 to 10 years.

Peter Margaritis: [00:50:47] I would tend to agree with you there. RPAs, McCormick has two RPAs. McCormick, the spice company. One is called Old Bay. One is called Pepper. And they do vendor reconciliations. Now, some of the people in AP did lose their jobs over, but they’re able to go through and do the reconciliation. You need to look in this area here, and these over here look like to be fine. You might want to sample them.

Peter Margaritis: [00:51:14] And then, there’s another. From artificial intelligence, there’s a company called MindBridge based out of Canada who has taken a Watson type of environment and made it affordable for smaller firms to do audits with it. Download information into their AI, and it goes to a search through, and says, “Okay, here’s some high risk areas based on some parameters that’s out there that firms are using today.”.

Peter Margaritis: [00:51:41] And with the RPAs companies are using today, I think to your point Chris, I think that will continue to grow in the short term with blockchain being underneath that. But I think you’re right about that blockchain, it’s out there, maybe another 5, 10, 15 years.

Chris Jenkins: [00:52:02] But you got to look at the threat that RPA actually has. And I don’t want people to be scared of technologies, but it shows that there is a disruptive force in the profession because if you’re doing billable hours, and everything that you do takes less and less time, and you’re not billing on value, everything gets cheaper. And you’re actually delivering greater value.

Chris Jenkins: [00:52:22] That’s not how products work. That’s not how you build a healthy bottom line. We’ve got to find a way around this billable hour. We have to, again, focus on the value of what we’re doing. When you’re looking at 100% of data rather than sampling, that’s the more valuable audit, and it should be priced accordingly.

Chris Jenkins: [00:52:42] And I think that that’s the threat I see. And then, you look at the HR threats, right. How do you train humans to work with machines and how do you gauge their performance when the machines are doing the work? And from the CPA perspective, robotic process automation is really cool because who audits that the robots are working properly, that they’re doing what they’re supposed to do. I don’t know about you, but my technology tends to fail right when I need it most. And I’ve got the feeling that somebody-

Boyd Search: [00:53:13] When you’re in charge.

Chris Jenkins: [00:53:15] Yeah, when I’m in charge of it. That’s the last one. Thank you, Boyd. But somebody had to be overseeing those types of issues and making sure that year over year, transaction after transaction that these machines that are now becoming self-aware or auto-learning, as you might say, aren’t learning the wrong things and actually themselves committing fraud.

Peter Margaritis: [00:53:39] That’s a good point. That’s an excellent point. I want to change the conversation just a bit because we are touching on it. I want to know, of your members, what is the greatest pain point? What keeps them up at night in their world? And we’ll start with-

Boyd Search: [00:53:58] That is unique.

Peter Margaritis: [00:53:58] Well, we’re going to start with Allen first. Well, him first, and then move from there.

Allen Lloyd: [00:54:03] I think across the board, what we hear from everybody is “I’m too busy. I got too much to do.” We had a small firm roundtable. I think there are 15 people in the room. Of the 15, all 15 were looking to lose clients this year because they didn’t have the capacity to do the work.

Peter Margaritis: [00:54:22] Wow.

Allen Lloyd: [00:54:23] And when we talk about robots and all these things helping us with part of the work, of those 15 people, one was using the function in their tax software that would auto-populate after scanning. And so, to me, there’s this huge disconnect with these folks. I’ve got way too much to do. And they’re hearing, “Oh, hey. Here’s this tool that can help you get more done.” And they’re like, “I really don’t want to learn what that tool can help me do.” And that, to me, is a big frustration points. Hearing folks that have have a problem and a solution that’s right there, it’s right in front of them, but they dismiss it.

Peter Margaritis: [00:55:07] Or they dismiss them because they don’t have time to learn it. So, we know there’s a learning curve when you adopt anything new. And is that the issue?

Allen Lloyd: [00:55:17] This is the crazy thing because the one person that is doing it, and the past two years, the same person has been in our roundtable and made the same comment, it’s as easy as making a phone call. All of the tax software providers have this functionality. They charge you for it. I mean you got to pay a little bit of money for it, but it’s not something that you don’t necessarily have to learn anything. You just have to tell somebody to turn it on. And that’s to be a — Opportunity is right there in your face. Take advantage of it.

Peter Margaritis: [00:55:49] So, is it fear?

Allen Lloyd: [00:55:51] I think it is stuck in the muddedness.

Peter Margaritis: [00:55:54] Stuck in the muddedness.

Allen Lloyd: [00:55:58] I’ve done it this way forever. Why would I change? And if it were working, and they were taking on more business and doing more, I would completely agree. I’d be like, “Yeah, what you’re doing works. But clearly, it’s not working. And when something’s not working, I think you have to open your eyes to different opportunities.”

Peter Margaritis: [00:56:20] Oh. So, now, we’re dealing with word change. And we know that, historically, CPAs aren’t really great at changing or wanting to change.

Allen Lloyd: [00:56:31] And I think from our perspective, one of the side impacts of this is that for the past 10-15 years, we keep hearing how busy everybody is, and that’s led us as associations to professionalize everything. We’re like, “Our members are too busy to do these things. We’ll go ahead and do it for the members. We’ll take them. We’ll get rid of that committee that’s done this work for 20 years because they’re too busy to do this anymore. So, we’ll just do it ourselves.” And what we miss there is that deeper knowledge of the profession that we would have had in the past but, now, is kind of missing.

Peter Margaritis: [00:57:11] Interesting. Chris, do you have your hand up or do you just have an itch over there?

Chris Jenkins: [00:57:15] I was itching, but I’m meant to speak too. So, I’m thinking of everything, yes.

Peter Margaritis: [00:57:22] Chris, what’s keeping your members up at night? What’s a big pain point?

Chris Jenkins: [00:57:26] I’m not going to give you another pain point. I’m going to say the same thing. I think one of the things that’s most interesting to me, it’s always a staffing challenge. right. Everybody is busy. But if you move away from the people you would normally ask, which are the partners, and you start going down the line, and you get it to the younger staff, one of the biggest complaints is, “Well, nobody up the chain wants to change. And I’m, now, a young partner in this firm.”.

Chris Jenkins: [00:57:50] And they’ll say, “Well, I’m going to retire. It’s working good enough. Why would I change? Why would I go through that hassle, that work to learn something new?” when the younger partners are going, “Hey, I have an investment in this now, and this has to go beyond your retirement. We need to change.” So, that rift between the current status, the status quo, and the people who are in the position who need to change the business, I think that’s something that is significant.

Chris Jenkins: [00:58:23] And I think it’s actually turning people away from the firm. So, I think that’s why you’re seeing more people go out on their own because they’re recognizing the need for change. So, they’re going to go out and create their own firm where they control their own destiny because it’s become too difficult to control their destiny inside the firm.

Chris Jenkins: [00:58:39] It’s true. I mean, I can understand both sides of it. Working at the position I’m in, it’s really easy to go, “You know what? This has worked for 100 years. Let’s ride this train,” but also recognizing that if something doesn’t change, eventually, the trains coming off the tracks. I think that’s difficult, especially as the firms grow in size, the more difficult it becomes because you have so many people at different levels in that they want to take advantage of change and full-fighting not to take advantage or change.

Chris Jenkins: [00:59:09] So, again, it comes back to we know we have a staffing problem, we know that we’re busy. I still don’t understand the concept of “I’m really, really busy, but I’m billing by the hour because there’s only 24 hours in the day. If we’re building by value, you will then be able to afford more staff and do more clients.” But that rift between young and old really does worry me, and I’m sure it worries a number of people who have just signed up to be equity partners in firms.

Peter Margaritis: [00:59:39] Yeah I’ve heard that a lot over the last year. So, that same argument, “I’m a young partner. They’re waiting for retirement. We need to change now.” But there is one thing I will correct you on. There are more than 24 hours in a day in a billing process because when I worked at Pricewaterhouse in Cleveland, we had a gentleman. His first name was Joe, I won’t say his last name, who did try to bill a client 25 hours of the 24-hour workday. So, apparently, it can almost be done. It must be-

Chris Jenkins: [01:00:09] How did that work out?

Boyd Search: [01:00:11] It wasn’t Tom Cruise?

Peter Margaritis: [01:00:12] No, no, it was not. Actually, the tax partner said, “We’re not charging 25 hours in a 24 hour day.” That’s the math, whatever, but every time I hear that, I think of my friend, Joe, and trying to do that way back in the day. How about you, Boyd? What keep your members up at night?

Boyd Search: [01:00:33] Similar themes, people and time are the first two that you hear from everybody. Don’t have enough people, don’t have the right people, don’t have enough time to do any and all this stuff. Anecdotally, a theme I am I’m hearing, and I don’t think it’s something that on a survey, people would go check it off and be like, “Oh, yeah, that’s one of my concerns.”

Boyd Search: [01:01:02] But whether you — And this isn’t about politics but whether you want to blame the Trump effect, or other things, or a combination of things, the things we are willing to accept now from leaders that we would not accept years ago, and that’s not just political or government leaders, but any type of leadership position seems to be weighing on people’s minds a little bit. And I don’t mean Steve Jobs wearing jeans and a mock turtleneck. I don’t mean that kind of stuff.

Boyd Search: [01:01:33] I mean, this sort of adherence to crazy in a lot of ways, and our general willingness to just sort of accept crazy when 10 years ago, what defined crazy in our willingness to accept it was nowhere even close to the round that we see now. And so, all of that creates a measure of, I think, uncertainty or instability in people’s lives because they’re just not sure about things anymore. They’re not sure about the markets. They’re not sure about the government. They’re not sure about our international relationships. They’re not sure about it just any of this stuff because so much of it’s just so crazy right now that that occupies more conversations than anything else. But, again, I don’t know that it’s something people would check off on a survey, and say, “Yeah, that’s what’s keeping me up.”

Peter Margaritis: [01:02:27] Maybe we should add it to a survey because I don’t think I’ve seen a survey out there, what’s keeping you up at night, having that as one of the issues of crazy or, I guess, the lack of civility at times, the lack of respect that out there that whether it’s face to face, or through social media, or whatever, there’s so much noise out there that it’s just mind boggling. It kind of becomes overwhelming at times.

Peter Margaritis: [01:02:57] And I guess, if I had owned an organization, had a firm, and I’d be concerned about that as well on my people. What are their perceptions? What do they feel? They’ll bring that into the office. And it would show up in the productivity. Is it becoming overwhelming for them? I tell people you don’t know crazy until crazy shows up. And when crazy shows up, you got to call HR and call the cops because it’s not going to be pretty at that point.

Peter Margaritis: [01:03:30] We’ve been at this now for about an hour. And one, I thank you all for staying awake, being attentive, and being-.

Boyd Search: [01:03:37] We’re not ending, are we? I’ve got all afternoon.

Peter Margaritis: [01:03:41] We can keep going.

Chris Jenkins: [01:03:43] I’m tired of hearing Boyd.

Boyd Search: [01:03:46] Yeah, because I’ve dominated.

Chris Jenkins: [01:03:49] Well, speak up.

Peter Margaritis: [01:03:49] I love it when the family gets together, and it feels like we’re at Thanksgiving dinner or Christmas dinner. The brother-

Chris Jenkins: [01:03:57] How are you not going to talk about the new path the CPA? Come on.

Boyd Search: [01:04:05] I was kind of thinking the same thing.

Chris Jenkins: [01:04:07] How are we not talking about it?

Allen Lloyd: [01:04:09] The evolution. It’s not a pathway anymore. They changed the word. It’s completely different now.

Chris Jenkins: [01:04:15] Cognator.

Boyd Search: [01:04:15] For the record, that was Chris Jenkins. For the record.

Peter Margaritis: [01:04:23] For the record, that was Chris.

Chris Jenkins: [01:04:25] I’m assuming some of that will be edited out.

Peter Margaritis: [01:04:29] I may have to listen to this before it goes out or send it to you guys. No. Let’s talk about the path to the CPA. What is that path? Since you guys want to hang out for a while.

Chris Jenkins: [01:04:44] Well. since I’ve dominated, I would like to defer to one of my counterparts to begin this discussion on the evolution of the CPA.

Allen Lloyd: [01:04:53] I will go first because I can point to something that’s not mine that I really like. And so, we had some students at the University of Montana, and they do a capstone project as grad students. At the end of that, they give a presentation on the topic. But luckily, last year, their professor was my board chair. So, this year, they went out, and they looked at this alternative pathway. We’re lucky here in Montana, I have an AICPA board member and a MSCPA board member who are both here in Montana. For a state this small, that’s really strange.

Peter Margaritis: [01:05:33] Very cool.

Allen Lloyd: [01:05:34] Something we’ve worked hard on, and something that I’m riding coattails on that at this point, and hope to continue in the future. But this group looked at it, and these are students. So, these are people that are actually, they’re going to be more impacted by this than anybody. The rest of us are going to be retired, and they’re still going to be going.

Allen Lloyd: [01:05:54] And what they identified was the fact that we’ve got some new things that are impacting the profession. We need to find a way to make sure that people have the appropriate level of knowledge of that. But at the same time, we don’t have 25 hours in the day. And so, how do we fit this new thing into the existing framework? And something I think that we we all need to start thinking about is, what are those things that have been on the exam forever that maybe have lost some relevance?

Allen Lloyd: [01:06:33] Maybe some of these things that we’ve been teaching and having the students do for decades is not as relevant anymore. And this new technology it’s impacting or new methodologies for doing the work is impacting. How do we make a change so that we can swap those things out?

Allen Lloyd: [01:06:53] And then my other big concern is, what about all these CPAs that are already out there? How do we make sure that as this profession is evolving that the — We started talking about CPE. How do we make sure that that CPE is having the impact that it needs to have, so that everybody, not just the new students coming out, have this knowledge?

Peter Margaritis: [01:07:18] Should there be more than one type of CPA exam tailored to whatever specialty that I want to-

Allen Lloyd: [01:07:30] See, I have — Initially, I really liked that idea of having CPA tax, CPA audit, right. But realistically, CPA, we only have one thing that we’re the only people that — They only have one thing that they’re the only people they can do, that’s attestation. And so, to have it for tax, well, technically, Chris Boyd and I could go open a tax shop today, and there’s nothing to prevent that. So, that, to me, it becomes that regulatory part, where by state regulation, we can do one thing. If we’re going to make that credential, then specialize in something else.

Peter Margaritis: [01:08:13] So, I’m a CPA, and I’ve done a test, and I don’t do taxes, but I still have to do other things to maintain my license that has nothing to do with what I currently do, even though I’m on the other side trying to teach. And then, you look at the tax person in Michigan, you had to get like 15 hours or 8 hours of tax. And I taught a couple of classes up there. I do an A&A stuff, and I was getting like blank stares and stuff. I go, “What’s going on?” And they go, “We’re all tax people. We’re just here just to set because the state requires us to do that to get 8 hours when maybe there’s something more specialized they should be doing. So what kind of discussions are they having at the national level about this?

Allen Lloyd: [01:09:06] I guess, I’m going to chime in. Well, I’m going to start this one too with one more pet peeve. And I’ll stop being the Chris Jenkins. There’s currently a group of 10, okay. You can see 10 people talking about this, okay?

Peter Margaritis: [01:09:21] Yeah.

Allen Lloyd: [01:09:21] That subcommittee is a group of 10 people. None of those 10 people is under the age of 40. None those 10 people work in industry. None of those 10 people work on the consumer side of financial statements. To me, that is a huge issue with that group.

Peter Margaritis: [01:09:46] Well, you don’t have the right group together to do it. I’d say we’re going to have diversity but I just got a bunch of older white guys to talk about it.

Allen Lloyd: [01:09:55] Mmhmm (affirmative).

Peter Margaritis: [01:09:56] Yeah, okay. So, Boyd, you’re up, bud.

Boyd Search: [01:09:57] I am confused by a whole lot of things when we talk about CPA evolution because like the I checked, this profession’s over 100 years old, and it has evolved in all kinds of ways and has been able to do it without fracturing itself at its core or its foundation. And so, it is completely beyond me why the conversation can’t be, “Let’s assess what being a CPA is today, assess what we think it’s going to be tomorrow, and you can measure tomorrow in whatever span of time you want to. And then, talk about the work that has to be done to freaking exam to adapt to those things.” I don’t understand why that’s not the conversation.

Boyd Search: [01:10:53] And one of the responses is that, “Well, it takes five years to change the exam.” So, you’re telling me it’s going to take less than five years to do this fractured other path or this other thing that’s somehow, then, going to have a foundation that can withstand the next hundred years like the current one? None of it makes any sense to me. It’s all in a mad rush. I don’t understand that. And it’s like, “Well, our hair’s on fire, and we’re all going to die, and we have to do it now.” And I don’t buy any of that.

Boyd Search: [01:11:20] I think, are we behind? Yes. Are firms operating, hiring, and practicing in a way that’s different than what the exam largely test to in certain areas of the business? Yes. Okay. Well, then, let’s start changing the exam to address those things. If we want to have a wider pipeline of people into it, then let’s change the requirements that qualify you to sit for the exam.

Boyd Search: [01:11:48] I mean, largely, they’re arbitrary. If you can pass the test, why can’t you be a CPA? I get the whole education thing. I’m good with having to have a degree or 150 hours, which is an entirely different conversation. But if you have a college degree or a master’s degree, and you can pass that exam, tell me why you don’t belong, whether your degrees in tiddlywinks or brain surgery. None of it makes any sense to me. We’re spending so much time on this nonsensical stuff, which let’s have a conversation about changing the exam to meet today’s and tomorrow’s standards. Why is it harder than this? I’m sorry.

Peter Margaritis: [01:12:27] No, no. I’m glad you’re not passionate about this at all.

Boyd Search: [01:12:32] Who’s the Chris Jenkins now?

Peter Margaritis: [01:12:32] So, boy, I’ll ask all three of this question, and then I’ll get Chris, but there was a gentleman here in Ohio who didn’t have an accounting degree, and passed the CPA exam because he met some requirement out there. I don’t — Do you remember the guy’s name?

Chris Jenkins: [01:12:52] I don’t remember the name, but I know that you can. In Ohio, you can get a CPA without having an accounting degree. There’s a backdoor.

Allen Lloyd: [01:12:58] You’ve got to have so many hours in accounting.

Chris Jenkins: [01:13:02] Right.

Allen Lloyd: [01:13:04] You don’t have to have an accounting degree.

Peter Margaritis: [01:13:06] Right, but you have to have so many hours. There was a backdoor for this guy. He’s one of the few in the state to do it through the back door. Chris, your thoughts?

Chris Jenkins: [01:13:14] CPA is the gold standard among financial professionals. It’s a brand. It’s a known brand. There’s a lot of trust around that brand. The concept, like Boyd said, that there needs to be some other thing that happens for the profession to evolve, I have a hard time coming to grips with that simply because I’ve been to a lot of firms, and I don’t see too many advocacies laying around anymore.

Chris Jenkins: [01:13:38] My experience with CPA is when technology is going to make business better, they use it. They’re the trusted business advisors. They normally work well outside of the scope of finance to ensure that they’re advising their clients on the right tools to use to complete the job. It’s most of the time in specific industries, which I think is an incredible asset to the profession.

Chris Jenkins: [01:13:59] Is it true that the world is changing? Absolutely. Does that mean that there has to be a different path? I’ve had a hard time with it. The original proposal where we were going to get technology folks to switch over and get their CPA, as a technology professional, I have a number of credentials. I’m very proud of them. I worked hard to get them. Straight out of college with an IT degree, firms are going to have to really up their pay scale if they think that they’re going to transition somebody from an IT degree to a finance degree. It’s the nature of the beast, right.

Chris Jenkins: [01:14:34] The problem that I have with education, and when we say, “Well, we’ll have a different path of education, and we’ll do something different here,” technology education, it’s not real. What you’re learning at a university is already outdated by the time that you graduate. It changes too quickly. So, to, again, say, “Well, we’ll load it up with education,” that’s silly. It’s cost prohibitive. It makes people not want to go and get the CPA. Technology courses are outdated by the time that you get out.

Chris Jenkins: [01:15:04] So, again, this is where experience comes in, right. It is a three-legged stool: exam, experience, and education. With today’s environment with colleges and with college courses, it’s overly expensive to get to 150 hours. If you’re going to take 150 hours, you want to take it in things that are going to pay you back.

Chris Jenkins: [01:15:21] I think that there has to be a lot of consideration given to that type of roadblock. And is it actually beneficial to a CPA? Are there other ways to achieve that through experience? Is there a bridge, for example, where instead of 150 and a year of experience, can you do two years of experience and 120, and actually gain the skills through doing things?

Chris Jenkins: [01:15:42] There’s got to be a more flexible way, but the idea that we would take the CPA and try to transition it into something that it’s not to devalue that trusted professional, to devalue the gold standard, I think it’s harmful to the profession overall. Do I think that we have to learn new skills, just like Boyd said? Absolutely. Do I think there’s a better way? Absolutely. And I think it starts with the exam. If items on the exam aren’t relevant, change into something that is.

Chris Jenkins: [01:16:12] And if you change the exam, guess what the university is going to do? It’s going to change what they’re teaching. So, you’re going get the education. And then, when you get in the firm, you’re actually going to be prepared to do the work that’s necessary.

Chris Jenkins: [01:16:24] What firms are upset about is they’re getting CPA candidates in, they can’t do the work because they’ve been taught something from 10 years ago. Change the exam, the educators will follow, which will give you the experience that you need, and you’re going to have highly qualified financial professionals, which is what a CPA is, that understand the technology around them just like we’ve had for the past hundred years.

Boyd Search: [01:16:43] I will add to what Chris said a little bit in that, one, anecdotally, we have a few firms, managing partners that kind of rail on this issue is that this notion that when we implemented 150-hour requirement in Georgia, as an example, we actually reduced the experience requirement to then become licensed. And they were against that when it happened, not necessarily against 150 hours, but against the reduction experience requirement.

Boyd Search: [01:17:13] And basically what they said is, “Look, what we’ve done is we have advocated our responsibility to have some type of apprenticeship in here, in this profession to universities, but they’re not actually getting any skills that you develop through an apprenticeship.” And so, there is there is some frustration over that whole concept.

Peter Margaritis: [01:17:35] Well, I will say this about one while you’re a chair in Ohio, one of the things I was trying to tackle is if we’re going to have 150 hours, put some meat on the damn bone. In Ohio, there was no meat on the bone. You could take anything. You can underwater bone pottery. As long as you got college credit for something that went to the 150 hours, which I thought that was a waste.

Peter Margaritis: [01:17:57] And my whole notch is, I think 120, get the accounting degree up to experience level, they still have to take CPE, they still have to do that other stuff, probably create a better CPA than make them take an additional 30 hours in something that’s not relevant, or they’re just trying to get the hours, just so they can sit for the exam. I just think that’s been crazy.

Peter Margaritis: [01:18:21] And from what I understand, a lot of states haven’t put any meat on that bone to say, “You need to take X, Y, and Z because that will make you a better CPA, pass exam.” No. And what they typically test on the exam is what you took in your college-

Allen Lloyd: [01:18:38] Undergrad.

Peter Margaritis: [01:18:38] Undergrad, thank you. You just completed me. Thank you.

Boyd Search: [01:18:43] I also noticed, if you guys noticed, I did join the Glasses Brigade. You were all you’re all there, so I felt the need to-

Chris Jenkins: [01:18:50] You still don’t look smart.

Boyd Search: [01:18:51] When you’re not, it’s kind of hard sometimes.

Peter Margaritis: [01:18:58] Hey, why are you guys all looking to me? Hey, stop that.

Chris Jenkins: [01:19:03] I really question the cost of the education at this point. And I think that’s the difference in the ’90s when it was implemented versus today, and the fact that we are grasping for straws to now say what the education should be, and you have students who are just trying, especially first generation college students, to reduce their costs, to find non-traditional education, to meet a requirement. It is completely arbitrary.

Chris Jenkins: [01:19:28] And if you want to if you want to increase the number of people willing to take the exam, you really do need to look at the cost of that education versus the value it delivers. This was an apprenticeship profession when it began. And I think there’s a lot to be said for the apprenticeship and the experience that comes with that.

Peter Margaritis: [01:19:48] I agree. I agree. Anything else you guys wanna talk about?

Chris Jenkins: [01:19:52] We can talk about why Clark is so great.

Boyd Search: [01:19:56] There is a coaching tree legacy or whatever that’s out there. And I think you recognize the three of us as a part of it at the beginning. But Pete, there’s no question, you’re a part of that as well having served in leadership with him and stuff. And we would be remiss if we didn’t take the opportunity to tell him that we love him, and he’s a brilliant leader, but he’s also totally full of crap.

Peter Margaritis: [01:20:19] So, Clark, you recognize that voice. That was Allen. Yeah, I think you spoke for all of us very well there, Boyd, about our feelings for Clark, and what he has done, and what he has taught all of us, and continues to teach us because I know you guys get together in Tennessee with him at times and I can just — I’d love to be a fly on that wall just to hear what you guys are talking about, what you’re hearing. Being retired, but he’s still connected to what’s going on in the profession very much so. So, a big shout out to-

Boyd Search: [01:21:00] That would be a lovely podcast.

Peter Margaritis: [01:21:06] Thank you, but that’s okay. We do just that one little nugget. Just that one little nugget that you’d be able to pull out and be able to use. Gentlemen, I greatly appreciate you taking time to do this. Always fun to get the three of us, four of us together. Unfortunately-

Chris Jenkins: [01:21:24] [crosstalk].

Peter Margaritis: [01:21:25] Yeah, I can’t. I’m the Accidental Accountant. And I haven’t even started drinking yet. But, unfortunately, we had to get together via Zoom. But, hopefully, all of our paths will be in the same spot at one point in time. And I know how this can happen since I think Boyd could appoint me an at-large member, or Chris, or Allen to the accountancy board. And then, at least twice a year — I mean, to the AICPA Council. And twice a year, we could, at least, get together, and all of us at one spot.

Peter Margaritis: [01:21:58] I’m just throwing out ideas, but I do greatly appreciate you guys taking time to do this. I think your insights and your knowledge is well worth people’s time to sit, and listen to, and formulate opinions, and see how this profession will continue to move forward, and what changes will need to be made.

Peter Margaritis: [01:22:18] So, I will leave you with this. Happy New Year. Tons of prosperity. You guys have done great. And your roles as CEO, you’re making mass changes, and you make great things for this profession into the area that you — to your community. I’m just proud to know the three of you guys.

Chris Jenkins: [01:22:35] Right back at you.

Boyd Search: [01:22:36] Yeah, I’m shaking my head. They can’t hear that, can they? Only Boyd can.

Peter Margaritis: [01:22:39] Only Boyd can do it.

Allen Lloyd: [01:22:43] It’s funny that you say that. We’re talking about Clark. We’re talking about the four of us getting together. I think one of those things that’s always amazed me about Clark and seeing this now, it props me up, but he really did a great job of finding people that he could mold. And I think that looking at all of us, we learned a great deal from him, but that’s because he saw something in us. I’m proud of that as a person that Clark saw something in me and was able to build me into what I am today.

Chris Jenkins: [01:23:17] Some of us, we did challenge him more than others.

Peter Margaritis: [01:23:22] Yeah. Some of them challenge him more than others?

Chris Jenkins: [01:23:24] Yes. I absolutely love Clark Price, and I would not be where I’m at today if he weren’t there guiding me and pushing me. And I could say the same thing about Boyd. I would not be sitting where I’m sitting today because I didn’t always make the best decisions or control my emotions to the best of my ability, but I’ve grown a little bit, just a little bit, but I will always cherish that time.

Chris Jenkins: [01:23:46] And I’ll be honest, in the last month, there’s been a couple of tough spots I’ve been in where I needed to vent, I needed to get some advice, and he always takes my calls, and talks me through it, and tells me when I’m stupid, which is in his own Clark Price kind of way of telling you you’re stupid or giving you that advice on how to move forward. I wouldn’t trade anything for the time that I had with him in Ohio.

Peter Margaritis: [01:24:11] Yeah, those were-

Chris Jenkins: [01:24:13] Now, you Pete, on the other hand, I give that up in a heartbeat.

Peter Margaritis: [01:24:19] Back at you.

Boyd Search: [01:24:20] And yet another reason Pete’s a member in Georgia and not South Carolina, right.

Peter Margaritis: [01:24:30] Oh, god, this one has been way too much fun. So, I do think the next thing that — We should do this again but do it after 5:00. That should produce some additional fodder as well.

Chris Jenkins: [01:24:40] I think we should do the video. I think we should do it video, and weekly, and live broadcast it, and we all have to be drinking while we do it.

Peter Margaritis: [01:24:49] I’m in.

Chris Jenkins: [01:24:50] I might be able to get permission from my board to agree to not fire me over anything I might say in that.

Peter Margaritis: [01:24:58] You know, you might be on to something. Maybe even — I’m not sure how we could do that live, but I’ll look into that. Maybe we’ll do a session live, and see how many people will be in the audience listening to us.

Boyd Search: [01:25:12] I’ll be there for sure.

Peter Margaritis: [01:25:13] And happily as well.

Allen Lloyd: [01:25:16] We need really good bouncers, somebody to control the door, make sure the right people are in there.

Peter Margaritis: [01:25:24] Yeah. And I think Clark might be in the front row. So, guys, I do appreciate you guys a lot. I am privileged to have you guys as colleagues, as friends. And I look forward to, hopefully, spending some time face to face with you guys all in 2019, preferably someplace warm.

Chris Jenkins: [01:25:48] Charleston.

Peter Margaritis: [01:25:48] Works for me.

Chris Jenkins: [01:25:50] Convention is in Charleston and 2019, maybe all of us can get there.

Peter Margaritis: [01:25:56] Hey, I’ll crash it. I’ll crash the party. I’ll crash that day. Oh, that’s your annual convention. I still crash it.

Chris Jenkins: [01:26:06] Exactly.

Peter Margaritis: [01:26:07] Exactly. Cool. Great talk. Great talk for us. And we’ll talk to you in ’19. You guys have a happy holidays and look forward to chatting soon.

Peter Margaritis: [01:26:21] I want to thank Allen, Boyd, and Chris for taking time out of their schedules to be a guests on my podcast. It was so much fun interviewing these guys as you can tell by the laughter during the interview. I’m greatly indebted to all three of them, and I wish all three of them a very prosperous and Happy New Year.

Peter Margaritis: [01:26:38] In Episode 20, which airs on January 21st, I interviewed Jennifer Briggs, who’s the CEO of the Indiana CPA Society. I interviewed Jennifer back in October of 2017, and our discussion centered around competency-based CPE, and how the Indiana CPA Society was utilizing this with their members. Well, it’s been over a year, and I wanted to see how competency-based CPE was evolving in their state. So, thank you again for listening. Happy New Year, and share this episode with a friend.



S2E18 – Karl Ahlrichs | Multitasking is a Myth

We, as humans, are not wired to multitask – but we’re also addicted to it! So today, we’re going to learn about why multitasking doesn’t work and then some strategies we can use to be more productive. I thought this would be a perfect episode to end the year, as the accounting community’s busy season is lingering on the horizon.


We’re joined by third-time guest Karl Ahlrichs, a human capitalist consultant who knows a thing or two about how individuals and teams really get things done.


Why can’t we multitask?


You can think of multitasking as either the ability to perform multiple tasks at one time or switching back and forth from one thing to another – but neither is an effective way to do… well, just about anything.


If you think you can effectively perform multiple tasks at once, I’d like to present exhibit A: “If you’ve eaten at a quick service restaurant like Kentucky Fried Chicken, they will hand you a multitasking eating implement that is with a spoon and a fork – the spork. It fails at both tasks! It’s basically a spoon that can hurt you.”


And if you’re switching between tasks, that has its own costs. There is up to a 40% reduction in productivity from this, when compared to focusing on a task and completing it then turning to another task and completing it. Decision fatigue also sets in, as Karl calls it, and you become less effective as you think.


For example, imagine you’re balancing a spreadsheet and writing a document. If you were to split your brain power between those two, it is not a simple 50/50 split. There is a loss of time to task switching, and every flip takes about 20% of the brain’s total processing power, leaving 80% for the task at hand, not 100%. So, instead of a 50/50 split, it’s a 40/40 split with 20% wasted.


But this isn’t just lowering your productivity. It basically lowers your IQ by about 15 points – the equivalent of staying up all night – and it lowers brain density in areas of the cortex that are responsible for empathy, cognitive, and emotional control.


“So, over time, if you do a bunch of multitasking that is paying off in these short-term ding ding dings, it makes you less cognitive and have poorer emotional control.”


Still don’t believe us? Try it for yourself!


Karl walks us through a simple exercise to demonstrate the impact of multitasking and task switching:


  • Take out a sheet of paper, a writing implement, and something to time yourself with.
  • Write “A B C D E F G H I” on one line and then, underneath it, write “1 2 3 4 5 6 7 8 9.” Time yourself.
  • Now do it again, but don’t write the two lines sequentially. Instead, alternate between letters and numbers (A, 1, B, 2, and so on). Time yourself.


How long did it take you? The first time it took me 11 seconds, but the second time it took me 15 (and I might have messed up once).


How to Put an End to Multitasking


The overall process is pretty simple: identify the tasks at hand, identify and focus on the workflow process that you want to use, decide what needs your full attention, triage, prioritize, reduce distractions, and then just pay attention to one thing at a time.


To make this easier on yourself, do less! Delegate, hand things off to colleagues, or hand things off to technology. Remove the stuff that someone else can do from your plate “so that your precious brain power can be used for the good stuff, for the creative moments.”


If you need some help creating a more effective workflow, Karl suggests trying out the Kanban method. It’s pretty simple: create a to-do list, a doing list, and a complete list on a whiteboard (or something similar), then write all of your tasks onto sticky notes. There shouldn’t be more than a couple things in your “doing” list at any given time, and writing them all out will both help you prioritize and figure out what can be delegated.


If you want to learn more about Kanban, head over to


Another thing that makes a big difference is aerobic exercise. “Overall physical fitness appears to improve the outcome of all tasks, and it improves cognition.”


I hope that gives you some ideas for taking on tax season. If you are looking for some more ideas, feel free to reach out to Karl or myself.


Download this Episode MP3.



Click to download the full Transcript PDF.


Karl Ahlrichs: [00:00:00] The specifics can be debated, but, overall, it’s irrefutable: The human brain is not designed to multitask, and with rare exceptions, gaining efficiency through multitasking is an illusion.

Peter Margaritis: [00:00:21] Welcome to Change Your Mindset Podcast, formerly known as Improv is No Joke, where it’s all about believing that strong communication skills are the best way in delivering your technical accounting knowledge and growing your business. An effective way of building strong communication skills is by embracing the principles of applied improvisation.

Peter Margaritis: [00:00:42] Your host is Peter Margaritis, CPA, a.k.a. The Accidental Accountant. And he will interview financial professionals and business leaders to find their secret in building stronger relationships with their clients, customers, associates, and peers, all the while growing their businesses. So, let’s start the show.

Peter Margaritis: [00:01:08] Happy Holidays. And welcome to Episode 18, the last episode for 2018. And my guest is Karl Ahlrichs, who is now the founding member of the Three Timer Club on Change Your Mindset Podcast. Karl always comes with a wealth of valuable information to help the audience become better and more productive at what they do.

Peter Margaritis: [00:01:32] Today’s topic of discussion is that we, as humans, are not wired to multitask. And Karl gives us some great advice on how to be more productive while not multitasking because multitasking is really a myth. And Karl ties this all together by talking about how our brains are wired and why we can’t multitask.

Peter Margaritis: [00:01:59] You see, I thought this would be a perfect episode to end the year on as the accounting community is moving into the busy time of the year starting in January, and there are a ton of nuggets he leaves behind that you can begin to implement ASAP, so you can become more productive during this time of year.

Peter Margaritis: [00:02:19] Before we get to the interview, I wanted to share that my book, Taking the Numb out of Numbers, was ranked number 12 of the best books in 2018 for speakers, as ranked by, which means you don’t have to be a professional speaker to get value of this book. As long as you present information to non-financial professionals, there is a benefit in reading my book.

Peter Margaritis: [00:02:49] Here’s the review they gave the book. Peter does an outstanding job demonstrating how to present numbers to a non-number audience. It is useful information that can be used in any presentation. It can help make a presenter a rock star. I highly recommend this book for anyone who presents financial data and wants to make it interesting and relative to their audience, whoever they may be. I have already used many of the suggestions in his book.

Peter Margaritis: [00:03:18] Thank you very much for the ranking. And thank you very much for applying some of my concepts to become a better presenter. Taking the Numb Out of Numbers will help you transform your ability to communicate technical knowledge in greater contexts through analogies, metaphors, and storytelling. Putting it another way, translate complex financial information into plain English, so your audience will gain a deeper understanding.

Peter Margaritis: [00:03:46] The book is available at, in paperback, and on Kindle. So, go out and buy it today. If you’d like to purchase 10 or more copies, please contact me at for bulk discounts. So, without further ado, let’s get to their view with Karl Ahlrichs.

Peter Margaritis: [00:04:08] Hey, welcome back, everybody. Today, we’re having a first on the podcast. Today, is a first.

Karl Ahlrichs: [00:04:14] No, it’s not. It’s a third.

Peter Margaritis: [00:04:17] It’s the first time I had one person on for three times. And if you recognize the voice in the background, that is the Karl Ahlrichs, extraordinaire. And we were talking the other day on the phone. Actually, I think it was yesterday, we had this conversation. And you said, you had just delivered a presentation titled-

Karl Ahlrichs: [00:04:37] Multitasking: Myth or Reality.

Peter Margaritis: [00:04:40] And as we were talking, you said, “This would make a really good podcast.” I went, “Exactly,” especially this would be the last podcast for 2018. As we move into 2019, maybe after listening to the wisdom that you professed on everybody that they will take this on as a resolution for 2019 and eliminate multitasking.

Karl Ahlrichs: [00:05:07] Now, let’s spin it more positively that you’ll get better quality work done more efficiently, as opposed to negatives because I’m a positive guy.

Peter Margaritis: [00:05:21] And I try to be positive.

Karl Ahlrichs: [00:05:25] Well, and the interesting thing is everybody has thought that everybody will raise their hand and say they’re good at multitasking.

Peter Margaritis: [00:05:33] Exactly.

Karl Ahlrichs: [00:05:34] And it’s a myth. And it’s, medically, a myth. What made this interesting and the reason I wanted to share it was I uncovered some of the medical reasons. The brain wiring, brain chemistry reasons that it fails, as opposed to just I don’t think it works.

Peter Margaritis: [00:05:53] Right. And when I was researching and writing the book, Numb for Numbers, I read this book Brain Rules by John Medina. And this guy is a neuroscience researcher who wrote this book about the brain and put it in a language that we all could understand. And one of the things he talks about is what you’re going to talk about now is our brain can’t multitask.

Karl Ahlrichs: [00:06:13] It technically can’t multitask. And the interesting thing is we can define it a couple of different ways, the ability to perform multiple tasks at one time, or switching back and forth from one thing to another, or a number of tasks in rapid succession, which is different actually. But let’s let’s go to the top of multiple tasks at one time. If you’ve eaten at a quick service restaurant like Kentucky Fried Chicken, they will hand you a multitasking eating implement that is with a spoon and a fork.

Peter Margaritis: [00:06:56] The spork.

Karl Ahlrichs: [00:06:59] The spork. It fails at both tasks. It’s basically a spoon that can hurt you. And it’s not good at stamping stuff, and it’s not good at scooping stuff. So, just stop it.

Peter Margaritis: [00:07:14] I’m going to go on KFC, just so I can get a handful of sporks.

Karl Ahlrichs: [00:07:19] So, there’s a wonderful poster that has — So, this is a visual part of today’s podcast. Imagine a poster labeled “Multitasking” featuring a Giant spork, and the caption is, “The art of doing twice as much as you should, half as well as you could.”

Peter Margaritis: [00:07:45] Is that visual actually out there?

Karl Ahlrichs: [00:07:47] Yeah, it’s out there. I can look for it.

Peter Margaritis: [00:07:48] Okay. Because I think, if not, then we should create that visual.

Karl Ahlrichs: [00:07:53] No, no. It’s copyrighted.

Peter Margaritis: [00:07:54] Okay.

Karl Ahlrichs: [00:07:54] Anyway, but with email, with texting, with phones, just the fact that I’m sitting here with a phone next to me makes me less efficient because my attention is drawn to it, and I’ll switch over and check for messages, and then switch back to our conversation thinking there’s no damage. And, actually, there is damage done. Oh my gosh. Hang on.

Peter Margaritis: [00:08:23] Seriously.

Karl Ahlrichs: [00:08:23] I’ve told you not to call me here. That was Peter Margaritis. Wait a minute. I see what you did. You clever. Anyway, great example. Being bored in a meeting, posting on Facebook, drifting in a conversation, and checking email. I saw a wonderful note from my — My son taught English, and he had a note that, “I know you’re multitasking in my class. Nobody ever looks at their crotch and smiles.”

Karl Ahlrichs: [00:08:58] But answering email, texting, writing a report, trying to complete a spreadsheet, it’s kind of interesting. I’ll bet your listeners are attempting to multitask by doing something while they listen to this podcast. And if I am so gripping, so engaging, so amazingly interesting that they run into a light post while they’re jogging, then I would have proven my point.

Peter Margaritis: [00:09:29] Or they’re listening while they’re walking somewhere, and they run into a light post.

Karl Ahlrichs: [00:09:33] There, that’s better.

Peter Margaritis: [00:09:34] Or run over somebody. Yes, yes.

Karl Ahlrichs: [00:09:36] So, if you’re listening to this, it’s about multitasking. While you’re multitasking, you’re busted. So, let’s go to the summary. Let’s go to the fun fact. The human brain cannot multitask, fact.

Peter Margaritis: [00:09:48] Correct.

Karl Ahlrichs: [00:09:50] So-called multitaskers are just rapidly switching from one activity to another. In fact, there is psychological harm. There is an inability to concentrate and focus on the good stuff. And there is up to a 40% reduction in productivity from this as opposed to focusing on a task and completing it, then turning to another task and completing it. And also, there’s, I would call it decision fatigue sets in. You become less effective as you think.

Peter Margaritis: [00:10:27] Is the original multitask, because we talked about multitasking, with cell phones and all the other aspect, but was the original multitask sitting in the classroom, taking notes while the instructor speaks?

Karl Ahlrichs: [00:10:41] No, because you are learning better by processing what the professor speaks and logging it in written form. It actually increases learning. Multitasking is actually a computer term out of the 1960s, and a multimedia term from the 1990s. It comes from having a single processor and a computer that can, then, when a disk drive is reading something, and it takes time for the disk drive to do its function, the main CPU can cycle over, and maybe run some logarithmic tables out of its memory, and then check. And when the disk drive is done, it can park that, and go back to its original task.

Karl Ahlrichs: [00:11:27] So, the main individual, singular CPU can be busy all the time, but it parses different tasks as it switches from one, to the other, to the other. And this frequent switching is the problem that we have. It’s not a simple split of the difference. Let’s say you have 100% of processing power.

Karl Ahlrichs: [00:11:50] Right now, I am focused 100% on interacting with Peter Margaritis on his fancy computer box thingy where he’s recording me. Okay, great. You can’t split the difference. A 100% to Peter versus, let’s say, I’ve got two tasks, balancing a spreadsheet and writing a document. If I were to split my brainpower between those two, it is not a 50/50 split. There is a loss of time to task switching as the brain flips from one to the other, and then has to get kind of settled on what the other is, and get processing on that. And the numbers I have seen, every flip takes about 20% of the brain’s processing power, leaving 80% for the processing, not a hundred. So, instead of a 50/50 split, it’s a 40/40 split with 20 wasted.

Peter Margaritis: [00:12:52] Interesting.

Karl Ahlrichs: [00:12:52] So, therefore, if — Now, you’re saying, “Wait a minute. Karl. I know people, like, say, a musician who can play music and juggle. Well, if you’ve got muscle memory, and you’ve done it a whole bunch, and you’re very familiar, and you’re not critically learning new material or really having to focus on crafting a paragraph, that’s fine. I mean, if you’re basically reciting a nursery rhyme while you flip pancakes with a skillet, okay, you can get away with that because that’s a lot of familiar territory.

Karl Ahlrichs: [00:13:26] I’m not talking about that. If you’re familiar plus familiar behavior, you’re okay. If it’s a focused thing, and you’re focused on one thing, it’s okay. But if you’ve got familiar in the background, and you’re trying to focus, then it can quickly become not okay.

Peter Margaritis: [00:13:42] That’s why we shouldn’t text and drive.

Karl Ahlrichs: [00:13:44] Exactly. Everybody can tell stories about what happens when you get distracted when you shouldn’t be. So, let’s agree there’s two piles of things. There’s the automatic things that are familiar, and simple, and trained. And there’s controlled things where your brain has to control it, where it’s unfamiliar, where it’s complex, where it’s untrained, where it’s high level.

Karl Ahlrichs: [00:14:05] I don’t want the surgeon doing my knee replacement to have Pink Floyd on his headset and be dreaming of his Italian vacation. No, I want him focused on my knee. Hello, I want you here. How are we doing so far?

Peter Margaritis: [00:14:23] We’re doing good. So, what is it about the brain? What is it that does not allow this parsing? We lose this information.

Karl Ahlrichs: [00:14:33] Well, I’m going to talk to two things. One is outlook. Let me jump to that. First, let’s agree that the brain is a computer, and it’s a computer that, medically, is wired to do processing, but you have a single brain. You don’t have a four-core brain. You have a single brain. It, basically, has your consciousness. Your awareness is a single. There’s people who claim to have multiple personalities, but that’s not today’s topic.

Karl Ahlrichs: [00:15:08] Let’s agree the average American, the average human. I shouldn’t say average American. Listen to outside the United States through the interwebs. The average human has a processing chip that has a single main core. And it has a lot of support brain parts that can shift things in and out of that core. I’m going to talk a little bit about some brain chemistry here.

Karl Ahlrichs: [00:15:39] Okay.

Karl Ahlrichs: [00:15:39] Have you ever heard of the fight or flight reaction of, “Boo. There’s a bear.” And this adrenaline and a stress hormone called cortisol is dumped into the bloodstream. It causes mental fog and scrambled thinking. It also enables you to pick up one corner of your car and lift it out of the ditch. A lot happens in that one thing.

Karl Ahlrichs: [00:16:12] Well, it also creates a dopamine addiction feedback loop by rewarding the brain for losing focus. And then, you’re constantly searching for external stimulation. This is what drives addiction to video games. This is what drives addiction to Facebook, “Oh, how many likes did I get? How many likes did I get? How many likes did I get?”

Karl Ahlrichs: [00:16:42] So, there is a chemical addiction happening with the switching function within the brain. So, the brain wants to switch, and I’m asking you not to. We also have in the prefrontal cortex, novelty bias. It wants something new. It gets hijacked by something new and shiny.

Karl Ahlrichs: [00:17:07] And so, marketers and software programmers know to tweak that novelty-seeking, reward-seeking brain center by offering. You heard my phone ring. The little blue box at the corner of your outlook that, dong, it says new message, email ping, texting ping. It’s a novelty-seeking, reward-seeking. And, now, I’m going to use some big words here. It causes a burst in the genus opioids. This is truly an addicting chemical in your brain.

Karl Ahlrichs: [00:17:47] Think about it. The noise of a slot machine paying off, bom, bom, bom, bom, bom, ding, ding, ding, ding, ding, ding. That is triggering a chemical reaction in the gambler’s brain that they will do anything to get another one of those. Well, if that’s running while you’re trying to balance your spreadsheet or write your article, you’re going to lose focus and get off task. The brain is wanting to get another hit, and wants you to get off target, and go find something fun, instead of this boring spreadsheet.

Karl Ahlrichs: [00:18:32] So, within the brain, we’ve got the nucleus accumbens. It’s a small structure in the limbic system. It regulates dopamine production. It’s the region that lights up when gamblers win a bet. And email and Facebook reward that dumb novelty seeking portion of the brain driving the limb, and it creates this feeling of pleasure, and it says, “Oh my gosh. I want that.” This is not the planning, scheduling, higher-level thought centers in the prefrontal cortex. This is lizard brain level stuff. That’s the part that’s causing us problems.

Karl Ahlrichs: [00:19:08] How is it causing us problems? What’s the outcome in all of this? If I talk about reducing efficiency and performance, there’s medical data that shows that it basically lowers IQ by about 15 points. It’s the equivalent of staying up all night. And it lowers brain density in areas of the cortex that are responsible for empathy, and cognitive, and emotional control.

Karl Ahlrichs: [00:19:34] So, over time, if you do a bunch of multitasking that is paying off in these short term ding, ding, dings, it makes you less cognitive and have poorer emotional control, which actually may explain some people in my family, but it really affects the impact. It impacts learning. Learning information while multitasking fails.

Karl Ahlrichs: [00:20:02] In the brain, there’s basically two memory buckets, long term and short term. There’s the striatum, the brain region that specializes storing new procedures and skills. And there’s the hippocampus, the brain region that specialized for organizing and categorizing facts easier to retrieve. Basically, when you’re multitasking, information is just sent to the short-term bucket, not the long-term bucket. So, it’s just like trying to cram for a test when you haven’t slept, you’re not getting a good take on the world when you’re multitasking.

Peter Margaritis: [00:20:47] So, how do we break this addiction? As you’re talking, I am listening, but I’m-

Karl Ahlrichs: [00:20:55] You’re also distracted by your phone and thinking about the chips and dip up on the counter. I know.

Peter Margaritis: [00:20:59] No. I was thinking about my son, and the way he studies, and the way his friends study. They had to have some other distraction going on when they’re studying.

Karl Ahlrichs: [00:21:10] Well, that’s a different topic. There is some logic to having some audio wallpaper going in the background when you’re trying to focus. For instance, if you have traveled as much as you and I have, you know that occasionally we will get somebody in the next hotel room who’s keeping us awake with erratic noises.

Peter Margaritis: [00:21:38] Yes.

Karl Ahlrichs: [00:21:39] Do you know the bedside radio static trick, the white noise trick?

Peter Margaritis: [00:21:45] About playing white noise?

Karl Ahlrichs: [00:21:48] Yeah. If you turn a radio to a between-station static, that’s pure white noise. Turn that white noise up, and the white noise masks the sounds in the background. Pretty quickly, your brain tunes out the white noise allowing you to sleep. So, that’s not really today’s topic, but the brain can adapt to constant background noises.

Karl Ahlrichs: [00:22:19] If, indeed, they’re focused on their studying, and they’re focused on their material, and in the background is a YouTube video of stupid pet tricks, they’re really not paying attention to the stupid pet tricks. They’re going to be paying attention to one thing at once.

Peter Margaritis: [00:22:36] Because I’ve accused them of trying to multitask while he studies. but, apparently, I am wrong with that accusation to him.

Karl Ahlrichs: [00:22:44] That’s right because if he is — Well, let me step back a second. In general, you’re right, and he shouldn’t have as many stimuli going at once. They had an experiment where they had somebody you’re forced, you’re asked to read a book, and sitting right next to them is a television with a program on, fairly loud.

Karl Ahlrichs: [00:23:12] And after a certain period of time, let’s say, 10 minutes, the subject — So, it’s an observed experiment. The subject is asked how many times did they switch their attention between the book and the television. And the subject, let’s say, the median, they said six times. The research would show that, actually, they had switched 35 times, that you’re not as conscious of it as you are.

Karl Ahlrichs: [00:23:44] To me, from a learning standpoint, this is huge. As a facilitator of a training session, I’ll be pretty firm with my audience that, no, they don’t need to just silence their phones in their pocket, they need to put their phones in their pocket on silent upside down, face down on the table, or they’re not going to feel them vibrate and get distracted. I want you disconnected for the next hour, unless you have someone in your family that’s in surgery, or someone in your family who’s fixing to give birth. The distracted people don’t learn. And with all of our bait out there, the brain distracts very easily.

Peter Margaritis: [00:24:28] So, some have said they use Twitter to take notes, and post them to have a string of information that I can refer back to. Is that technically taking notes, or is that just another distraction masked as taking notes?

Karl Ahlrichs: [00:24:46] No, I think that, actually, it requires — Short answer, I don’t know. That’s splitting hairs. Half of me says, “Yeah, they are taking notes, so that would embed some of the learning.” The other half of me says, “Man, to post to Twitter, you have to be cognitively focused on your @ sign, user name, hashtag. That’s clever, post a post,” as opposed to the tactile having a Dixon number two pencil and a pad of paper where it’s more visceral and less cluttered. I would say physically taking notes is far more effective than a Twitter feed.

Peter Margaritis: [00:25:28] Okay. I’m thinking about what we’ve been told. Let them have their phones, let them tweet. And that’s what the younger generation-

Karl Ahlrichs: [00:25:39] Yeah, right.

Peter Margaritis: [00:25:40] And I have always kind of been, “Uh, not quite.”

Karl Ahlrichs: [00:25:42] Yeah. I vote no on that. Well, and it’s personal experience. I have gone to presentations where I tweeted. And at the end, I was disappointed that I really didn’t get as much out of the presentation because I was living in two worlds: the world of the presenter and the world of Twitter.

Peter Margaritis: [00:26:04] Yeah. And there’s other ways of being engaged in the classroom to help with the memory and help with the engagement of keeping their attention versus the electronic distraction.

Karl Ahlrichs: [00:26:17] That’s right. But, again, what did we learn? We’ve learned that the brain is wired to be addicted to the switching, and it’s difficult to break that. I’m here to tell you it’s medical. There’s a brain chemistry reason that we are drawn to this. It’s not that we want to watch a bunch of clever videos of cats doing cute things, it’s that our brain wants us to switch, and it gets a reward for doing that.

Peter Margaritis: [00:26:47] And that’s the dopamine. And there’s the issue. And it’s really like an alcoholic and obsessive gambler, it’s that trigger, and I want that. I guess the only way to break it is go cold turkey.

Karl Ahlrichs: [00:27:07] Yeah, just like any other addiction. And it can be harmful. I don’t know about the Department of Traffic Safety, and I forget what it’s called, MTA. The — I forget.

Peter Margaritis: [00:27:19] NTSB?

Karl Ahlrichs: [00:27:19] Thank you.

Peter Margaritis: [00:27:21] You’re welcome.

Karl Ahlrichs: [00:27:22] Distracted drivers, four times more likely to have an accident while — four times more likely to have an accident while talking on a cell phone. Oh, texting, 23 times more likely. It’s real.

Peter Margaritis: [00:27:38] I’m laughing, but I’m not really laughing. As I was coming to the house, my wife and I go around 270, and we saw, seriously, almost three accidents. And it had to do with the phone, either talking on the phone or-

Karl Ahlrichs: [00:27:54] Good news. We do have autonomous driving on the horizon and that will help. It will save us from ourselves, in spite of ourselves.

Peter Margaritis: [00:28:04] Yeah. But we could do something in the end. Something has got to be done in the outcome. It’s dangerous out there.

Karl Ahlrichs: [00:28:10] It is. All right. Let’s start moving towards the fixing of this. I want to offer a basic strategy, and then a specific thing you can do in your work space.

Peter Margaritis: [00:28:23] Okay.

Karl Ahlrichs: [00:28:24] Clearly, it’s a focus on the task at hand, identify and focus on the process that you want to have done, decide what needs your full attention, triage, prioritize, and then just pay attention, reduce distraction. I have learned that my office could have no windows and no clue about the outside world. I live and work in a bunker. Excuse me. I work in a bunker when I need to focus, so that I truly am not distracted by birds, and trees, and fluffy clouds.

Karl Ahlrichs: [00:29:02] Second, do less, delegate, hand off to colleagues, hand off to technology. Figure out the stuff that can be handed off, so that your precious brain power can be used for the good stuff, for the creative moments. If there’s rote behaviors, if there’s anything we can automate, as artificial intelligence arrives in our lives, we’ll be able to have the sorting and balancing of a spreadsheet done automatically, and we can think great thoughts for the world instead. So, we can delegate and do less.

Karl Ahlrichs: [00:29:40] Next, one thing at a time. One at a time is more efficient. Focus and prioritize first, then do one thing at a time. One bite at a time. Here’s a great exercise. You happened to have a piece of paper and a pencil?

Peter Margaritis: [00:29:55] Somewhere around here.

Karl Ahlrichs: [00:29:57] Find it. I want you to do something.

Peter Margaritis: [00:29:59] I didn’t know this was going to be a quiz.

Karl Ahlrichs: [00:30:03] I’m going to have write. And everybody in radio land, if you’re not driving, if you’re sitting there with a piece of paper and a pencil, in one line across, write the first nine letters of the alphabet A B C D E F G H I. Okay, that goes across. Right underneath that, let’s write 1, 2, 3, 4, 5, 6, 7, 8, 9.

Peter Margaritis: [00:30:33] All right.

Karl Ahlrichs: [00:30:35] Do that? All right. I’m going to time you on this, Peter. You’re going to tell me when you start and stop. I want you to write that again in the same way that you wrote it when I say go, I want you to start writing A B C D E F G H. when you get to the end of the line, go underneath it, and go 1, 2, 3, 4, 5, 6, 7, 8, 9.

Peter Margaritis: [00:30:58] Okay.

Karl Ahlrichs: [00:30:58] Do you understand the task?

Peter Margaritis: [00:30:59] I believe I do.

Karl Ahlrichs: [00:31:01] All right, three, two, one, start.

Peter Margaritis: [00:31:05] Done.

Karl Ahlrichs: [00:31:15] Okay. 10.5 seconds. Okay. Now, I want you to do this Again, but I want you to not write them sequentially. I want you to alternate between A, 1, B, 2, C, 3, and so on where you’re all alternating between the lines. You are multitasking. You understand that task?

Peter Margaritis: [00:31:36] And I’m going in the same direction?

Karl Ahlrichs: [00:31:39] Correct.

Peter Margaritis: [00:31:39] Okay,

Karl Ahlrichs: [00:31:40] It’s going to end up looking the same. You’re just going to do it splitting your attention between the two. Ready? Tell me, are you ready?

Peter Margaritis: [00:31:48] Ready.

Karl Ahlrichs: [00:31:49] Three, two, one, go.

Peter Margaritis: [00:31:51] Darn it. Okay.

Karl Ahlrichs: [00:32:05] 15 seconds. You see, how did that feel?

Peter Margaritis: [00:32:11] It wasn’t fun.

Karl Ahlrichs: [00:32:15] And, probably, the quality of the work dropped. I heard a curse word.

Peter Margaritis: [00:32:20] Yeah, yeah. I screwed up.

Karl Ahlrichs: [00:32:24] Yeah, yeah.

Peter Margaritis: [00:32:24] Yeah.

Karl Ahlrichs: [00:32:26] Do you see my point?

Peter Margaritis: [00:32:27] I got your point.

Karl Ahlrichs: [00:32:27] Okay. Other things you can do, control your environment. I got rid of my windows, just because it’s me.

Peter Margaritis: [00:32:39] Now, when you say control your environment, something I’ve been doing lately to increase my level of focus is I’ll read email for 10 minutes. When I start my day, I shut email down. I’ll look at it again at noon, shut it down. Look at again later in the afternoon, shut it down. So, I remove that distraction. Is that what you’re talking about?

Karl Ahlrichs: [00:32:57] You are a wise grasshopper.

Peter Margaritis: [00:33:01] Thank you.

Karl Ahlrichs: [00:33:01] Also, by grouping things together, so that you have everything needed for the job means that you can start, finish, and complete a chunk without having to get up from your chair. You can assemble things. It becomes more automatic if everything you need — You cook dinner, right?

Peter Margaritis: [00:33:24] Yes, sir.

Karl Ahlrichs: [00:33:26] Before you start the stove and get the pan hot, right there on the counter, what do you have?

Peter Margaritis: [00:33:34] A glass of bourbon.

Karl Ahlrichs: [00:33:37] Maybe I should ask my question.

Peter Margaritis: [00:33:40] Yeah, I have got a-

Karl Ahlrichs: [00:33:41] The answer I was hoping for was that you would have all the ingredients assembled and ready to go.

Peter Margaritis: [00:33:46] I do, and a glass bourbon.

Karl Ahlrichs: [00:33:47] And a glass of bourbon. Unless you’re cooking with the bourbon, in which case you have to glasses. Another thing that makes a big difference is aerobic exercise. Overall physical fitness appears to improve the outcome of all tasks, and it improves cognition.

Peter Margaritis: [00:34:08] You know why?

Karl Ahlrichs: [00:34:10] No.

Peter Margaritis: [00:34:11] Because it’s doing something with those stress hormone, the cortisol.

Karl Ahlrichs: [00:34:17] Interesting. Okay, that makes sense.

Peter Margaritis: [00:34:18] It’s like you’re flushing toxins out of your body. By exercise, it flushes those stress hormones out of your body versus without exercise, it continued to build up in your system.

Karl Ahlrichs: [00:34:32] Yeah. But you’re exercising your heart. I want you to exercise your brain. You will, by this, become a more balanced human being.

Peter Margaritis: [00:34:45] Yes.

Karl Ahlrichs: [00:34:46] And that will make all the difference. That’s kind of my point in all of this. I mean, the specifics can be debated but, overall, it’s irrefutable. The human brain is not designed to multitask. And with rare exceptions, gaining efficiency through multitasking is an illusion.

Peter Margaritis: [00:35:05] Exactly, it is. And one of the chapters in Brain Rules talks about exercise, how to boost brain power as well.

Karl Ahlrichs: [00:35:13] Yeah. And I saw a coffee cup that said, “Multitasking: the single best way to screw up both jobs.” Let me give you a final tip on fixing it. I work somewhat in lean theory and tactile thinking. And in the work done on factory floors, and in hospitals, et cetera, imagine three columns on a sheet of paper. The first column is labeled to do, middle column is labeled doing, that’s work in progress, and the third column is done.

Karl Ahlrichs: [00:36:00] If you were to have a whiteboard near your work space, a pack of the three-by-three yellow stickies and a sharpie marker in the color of your choice, you could jot a word or two about every to do, and put them in the to-do column. You are only allowed to work on what’s in the doing column that you prioritize. And the doing column should only have a couple three items in it. Too few items in the doing column

Karl Ahlrichs: [00:36:37] And you may not be purely efficient because there’ll be times you hit a stopping point. Somebody has to bring you a report or something. You can, then, pivot and focus on a second topic. That’s different thanq multitask. And then, once things are completed they move into the done pile and can be delivered. And then, by doing that, you free up space for something else to be prioritized in the to-do column, come on over. This simple process, it’s called a Kanban board.

Peter Margaritis: [00:37:09] Kanban board.

Karl Ahlrichs: [00:37:09] Kanban, K-A-N-B-A-N. It’s a Japanese manufacturing term. It’s part of Lean Theory and it’s focused on getting waste, as part of Lean, which is focused on getting waste out of a process, or life, or as far as you doing things. And they have a lot of different things that they do. What I have simply lifted, this one simple planning structure out of the middle of a very complex Lean Theory lecture.

Peter Margaritis: [00:37:40] That makes sense. I mean, it’s a Japanese way, especially Just in Time inventory system.

Karl Ahlrichs: [00:37:47] Or the Almost in Time inventory system.

Peter Margaritis: [00:37:49] Yeah, the almost in time inventory system. It’s prioritization on — what was it I recently heard? Is it urgency and important?

Karl Ahlrichs: [00:37:59] Yeah.

Peter Margaritis: [00:37:59] And the difference between the two. Something maybe urgent but maybe not as important as the important things that we need to get done.

Karl Ahlrichs: [00:38:09] That’s right.

Peter Margaritis: [00:38:10] It’s funny that you talked about multitasking stuff because I’m going through a process right now of trying to refocus again, and employing some things that fell off the wagon, and bringing it back into place. And this shutting the email, and becoming more focused, and prioritizing, putting things in place. And Greg Conderacci, you know our good friend, Greg Condracci.

Karl Ahlrichs: [00:38:32] I do.

Peter Margaritis: [00:38:33] He also prescribes about the best time to use your energy is — Some people are more energized later in the day. Some are more energized earlier in the day. If you get your energy and most creativity in the morning shut, everything down, but use that time to be creative. Eliminate all distractions. And that’s one of the strategies I use to get the book done. So, I write in the morning, first thing, get it out of the way, get it done, most creative, and then move on. Versus if I wait until the afternoon, not getting done. It gets pushed away.

Karl Ahlrichs: [00:39:05] If anyone would like additional resources on the kanban, there’s a website out there There’s plenty there.

Peter Margaritis: [00:39:19] So, you know my audience. You speak to my audience a lot.

Karl Ahlrichs: [00:39:22] I am your audience. You’ve only got two of us.

Peter Margaritis: [00:39:24] Well, my audience who’s listening, our audience that we speak too, the finance and accounting professionals. And we all know, this is the last podcast of the year. We know that once the calendar flips, the worlds flip. And then, as we get closer into February, it becomes faster. More workers being pressed on us. The more opportunity to be distracted and attempt to multitask.

Karl Ahlrichs: [00:39:53] Yeah.

Peter Margaritis: [00:39:54] You’ve given your tips, but what’s your advice in making that achievement? Especially in March when we’re in the throes of everything. Especially end of February, early part of March, whether you’re in public or you’re in industry, we’re in the throes of it. And it’s easier to go back to what we’ve always done before.

Karl Ahlrichs: [00:40:21] That’s a good point. This is a question of workflows. We get used to how things should work. We’ve got a little bit of time here to practice a better way of working. And I just want to challenge people to reflect on what I said, figure out what parts of it — First off, I wanted to scare everybody that it really is medically true. And then, give a couple tools that people might customize into their worlds, so that they get a little more control, and they are doing what they choose in the proper orders.

Karl Ahlrichs: [00:41:05] Just as you have turned off the email ding, and focus on emails in windows, that kind of thinking, I don’t want to lecture on how they should do it. Today’s purpose was just to wave the flag that they ought to consider looking at their workflows and working at their priorities, so that they have a more balanced, fundamentally sound life.

Peter Margaritis: [00:41:33] And being the HR professional that you are.

Karl Ahlrichs: [00:41:38] Yes, I am.

Peter Margaritis: [00:41:39] That is advice that should be written down. I guess, my point is they should make some visual reminder to them.

Karl Ahlrichs: [00:41:48] Yeah, that’s what I like. Well, that’s why I personally like the Kanban board. But you got a to-do list that works. Just a reminder, use it. Prioritize things and only work on a couple things at once. Don’t overwhelm yourself. Don’t fool yourself that you can chip away 10 things at once on the to-do list.

Peter Margaritis: [00:42:08] Well, Karl, you always bring great advice, great knowledge to the podcast. I think this is perfect timing with the new year coming up.

Karl Ahlrichs: [00:42:16] Yeah.

Peter Margaritis: [00:42:16] And I challenge everybody who’s listening, all three of you, to the audience to consciously write something down in your desk, whatever, to remind yourself to stay focused. And I love the Kanban thing. And if you have it in your planner, use the moleskin or whatever. We’ll put that visual reminder out there, so you continue to do it, and you’ll find yourself becoming much more productive.

Karl Ahlrichs: [00:42:47] You just focus better. You just focus better. I want to close with everybody does this. Here’s the situation. You’re driving, you’ve got the radio on, you’re in an unfamiliar neighborhood, you’re moving, it’s dark, and your GPS just doesn’t make sense. What do you turn off to get rid of the multitasking?

Peter Margaritis: [00:43:08] The radio.

Karl Ahlrichs: [00:43:08] And then, pull over and throw it in park. And then, focus and figure it out.

Peter Margaritis: [00:43:17] Yeah, exactly.

Karl Ahlrichs: [00:43:18] With that, may everybody have a pleasant productive 2019. I wish you all the best.

Peter Margaritis: [00:43:24] And we wish you all the best as well. Always great to spend time with you, buddy. I look forward to when our paths cross again. And thanks for taking the time to share this with the audience.

Karl Ahlrichs: [00:43:36] Thanks for having me. Good luck, everybody.

Peter Margaritis: [00:43:40] I can’t thank Karl enough for taking time, for explaining to us why multitasking is a myth, and giving us some real strategies, so we can be more productive.

Peter Margaritis: [00:43:51] In Episode 19 which airs on January 7th, I interview three CEOs of state CPA associations. And they are Allen Lloyd from Montana, Boyd Search from Georgia, and Chris Jenkins from South Carolina. All three used to work at the Ohio Society of CPAs and are great friends. We discuss a lot about State CPA Associations and the issues that members are facing in the accounting profession. And we have a blast doing the interview.

Peter Margaritis: [00:44:20] So I’d like to, one, wish everybody a happy holiday season. Merry Christmas, Happy New Year. I look forward to listening to the podcast in 2019. And thank you for taking time to listen. And please share this episode with a friend.