kenji kuramoto: rules? what rules?

kill the 40-hr work week, online pricing and other archaic accounting conventions. 

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another thing acuity does that’s different from many other firms is they post prices on their website.

why?

interestingly, kuramoto says that is his favorite part of any website because “it depicts how you work and how you value your work.” giving prospects information up front earns credibility when done thoughtfully. it “forces you to be in the shoes of the prospective customer, which is a place that i don’t think we go to often enough as accountants,” kuramoto said. his goal is to make acuity’s website as easy to use as amazon’s, since that is the dominant way people buy today.

kuramoto said the next big step for accountants will be working with client data in real-time so cpas can give clients prospective advice. there’s still a lot of work to fulfill that promise, and the tools to do that are beginning to emerge. instead of coding or categorizing transactions, kuramoto said cpas will use their brains to help clients with forecasting, budgeting and proactive planning.

10 more takeaways from kenji kuramoto

1. the main thing people want today is flexibility in their work. do you really care how many hours your team members work? the 40-hour work week (less than most accountants work) is an archaic and industrial notion.
2. we all need to be pushed to create a better work environment. otherwise, we’ll just model what our previous firm did.
3. invite the conversations about pricing and value. use them as a learning opportunity.
4. our risk-averse nature can serve us well as professionals and as business owners. entrepreneurs need our straight takes. but our risk-averse nature also hamstrings the profession by making it too hard to change when we need to.
5. do you want to grow? a by-product of growth that kenji has experienced is that he no longer knows the majority of the clients at acuity. at a certain size, you cannot know every client and maybe not every team member. is that the kind of firm you want to have? or do you want to have a relationship with all the clients and all your team members?
6. the biggest obstacle to growth today is finding enough talent to handle work demands.
7. curiosity is one of the main attributes acuity looks for in new hires. someone curious is also adaptable to today’s changing profession. successful accountants are curious about technology, their clients’ businesses and the future direction of the profession.
8. technology is the toolset that superpowers accountants. business owners are thankful to find accountants who use the same technology that they do and who are not set in their ways.
9. accountants shouldn’t be overly committed to using quickbooks, xero or any other tech tool. as knowledge workers, we should use good tools for our work. business owners don’t care which tool we use, they want the problem solved. the tools are here to serve us, to make us better, not for us to be beholden to. firms unwilling to look at different tech risk aging and dying.
10. stepping into the shoes of your small business owner clients can help you get unstuck and make the changes that will serve those clients. remember that as a firm owner, you’re also a business owner. get out of the echo chamber of only talking to other accountants and talk to business owners about what’s working and what’s not.

more about kenji kuramoto

kenji kuramoto is the founder and ceo of acuity, which builds and maintains financial functions for innovative entrepreneurs. through acuity, he’s provided thousands of companies with a full range of financial solutions, from high-level strategic financial counsel through its fractional cfo practice all the way to virtualized bookkeeping and tax services. acuity has been named one of accounting today’s top firms for technology and top firms to work for. kuramoto is also the co-founder of acuity invests, which makes seed-level investments in accounting technology, saas, fintech and crypto companies.

transcript

(transcripts are made available as soon as possible. they are not fully edited for grammar or spelling.)

liz farr  00:30
it is i always enjoy talking to you, kenji. so we’ve got a lot to cover. so let’s just jump in. so accounting talent in the us and around the world has been scarce for years. i went back into the journal of accountancy archives, and i found articles going back to 1998, which is as far back as their archives start talking about the the accounting talent crisis in covid, made it worse. now, what are some things that you have done to make it successful to be successful in that?

kenji kuramoto  01:16
well, no, not surprised at all, you went back and did their research on this list. and in your right, we’ve always had a very competitive employment field in the accounting profession, because i think it speaks to how valuable people with accounting skills are, have always been. and i think that’s a very good thing about the profession. as an employer, it’s a bit of a tough thing, right? because we are out there competing for that talent always happen. and smaller firms are out there competing with even the likes of the big four, we’re all going to get that talent from somewhere. and i think that we’re seeing, you’re right, we’re seeing some interesting things happen through covid. through just through i think other things more lately, of where it is being more and more difficult to find team members in the accounting space. so i’ll say that we’re by, we’re certainly no expert. that’s not i won’t claim that. but we’ve done a few things a little differently that i think have helped us and maybe it’ll be helpful to other firms. at this point, you know, the remote work thing is here, everyone kind of gets it at this point. we were way ahead of that at acuity, not because we knew to be ahead of it or not, because we had some idea that there’s going to be some global pandemic by any means. but one thing we started experiencing years ago, was just through luck, we happen to find a few team members who, you know, wanted to work kind of on a part time basis. but it also kind of did a little bit of travel, who said, hey, i’d love to work here. i’m not i used to work in public accounting, i used to work in the big four, the big six, but like, i just don’t want to step right back into something that intense. can i find a way to work with you all at acuity. and so we started having to kind of explore that for some team members who wanted more flexibility. and we really came up with more of a concept, again, prior to going to be hearing about like, you know, the remote work thing was, could we come up with a way to let team members work wherever they wanted to, however much they wanted to, and kind of how they wanted to. and it was kind of an interesting notion, because i think the reason we were hearing this is like be able to work anywhere, be able to work whenever and kind of however, that’s their style fit was a very strong reaction to what most accounting professionals experience in the industry. and that is typically always been very regimented, very time sensitive, and very location specific. and so we had lost out on a lot of great team members because we couldn’t afford them due to a bigger firm wanting them, or we didn’t have all the training or all the benefits. and we kind of dawned on us to where i don’t like i’m not sure if i can figure out how to let you work whenever you want to wherever you want or however you want. but like it the closer we got to that it felt like there was a population of accountants who were saying, if you can get me to that, i will i’ll you know, i will look past the, you know, the high compensation i’m getting at deloitte or ny or if i can get a little bit more flexibility in my life, and we started moving that direction. and kind of that’s how we started letting people work wherever they wanted to. we started saying, well wait, why 40 hours, we kind of started thinking about that and most accounts will tell you nobody works 40 hours in the accounting industry. it’s higher than that. but we started thinking about that, like, where does that come from. and honestly, that’s an old industrial era notion of 40 hours, and thought, that’s really archaic. that’s really antiquated. if we can help be an employer, who just listens to like that this is the common complaint of team members of like, hey, i love accounting. i care about the profession. i’ve invested so much time in it, but i can’t step back into it the same way, and just get ground up with all those powers or to this desk or this commutes. and so we just started focusing on how do we compete there. and so i think now people are more successfully thought about remotes. i think you firms if you haven’t yet should very strongly consider this notion of do you really care what the number of hours are the people work? right, i think that has been beneficial for us. i think other people like that. and i think a little bit of the how people work, giving people more say in the way that they do their work, you know, i think that really gives a team members for us, it’s helped out quite a bit on, on figuring out a way to get people to come in and want to choose acuity, because there’s so many choices, right now you’re in a great spot and an accountant and you’re listening to this, you’re in a great, great spot. but you have the ability to be very selective, and many people are looking for a different way to work. so i would really say just listen to what most people in the profession want. and most of them will tell you. it’s flexibility. i’m a most accountants are very thoughtful, they’re very conscientious about their work, many have had to pursue certifications to this up. so they will, accountants will do the work. but what they’ve been missing is flexibility. they don’t need, i don’t think they need nearly as much of the accountability and the micromanagement, accountants just don’t need that. they need they need some support and some opportunity to have a flexible environment. and i think that will free up and bring a little bit more capacity to some firms who are looking for people.

liz farr  07:04
i agree with everything you say. and you know, if i had found come across acuity maybe 2016 2017, when i was getting fed up with the firm, i was out i maybe would have given you guys a holler.

kenji kuramoto  07:22
oh, shoot!  we should have just we should have done better advertising, recruiting. but yeah, that’s yeah, you know, yeah,

liz farr  07:29
you know, but at that time, i wasn’t even really aware that there was even a difference out there. and so every time that one of my former co workers comes to me, and says, hey, i’m really fed up with main street firm xyz, what other firm in albuquerque? should i look at? i say, hey, do not even limit yourself to albuquerque or new mexico. you can work at any firm in the world. and and by the way, i have named dropped acuity several years. but i’m not sure that any of my cohorts have taken you up on that. but

kenji kuramoto  08:21
regardless, regardless, that’s great advice experience you offer. i don’t think a lot of people realize that more probably do now. but a lot of folks have not realized that you can work anywhere the world’s kind of opened up for for opportunities to work with firms that aren’t just somewhere nearby that you can commute to. so i think that’s exciting. yeah,

liz farr  08:41
i think that is really, really exciting. now, and not only can you work at different firms, but you can work in different time zones. and it’s flexible hours. so if you need to take off time to go see your kids basketball game, you can do that or go to the doctor, you can do that. it’s it’s just amazing.

kenji kuramoto  09:09
it is amazing. it’s a great again, this creates competitive competitiveness for us as employers to get those great people. but it’s a good thing. we all need to be pushed, right to think about how to create a better environment. otherwise, we’d be likely to just do exactly whatever, whatever firm we all worked for before, we just probably modeled the same practices, and that doesn’t really bring a whole lot of innovation or change. and so it’s good to have these changing dynamics, because it forces us to think a little more creatively about okay, well, let’s rethink how we’re building our firm.

liz farr  09:42
absolutely. absolutely. and speaking of change, you know, until recently, most accounting firms as we touched on, really use the same kind of business model you build by the hour, your location specific you have the same org chart, you’ve got the partners up at the top, and then you’ve got managers and supervisors and seniors and then staff down at the bottom. but we’re seeing a lot of firms break that model, and you’re one of those firms. so what are some of the things that you’re doing differently?

kenji kuramoto  10:24
was a lot and there’s there’s probably not enough time to go through all the really weird things we’re doing. but you know, you highlighted one of them, liz, and you talked about the billable hour. this is not unique. this is a this is a topic that accountants love to kind of debate about. but i’ll share that. i think there’s opportunity, again, for some change, and for some growth and some differentiation. and historically, the accounting profession was all hourly rates. that’s what we’ve learned. and, you know, now you’re seeing more and more firms go to more fixed price models. and i think one of the ways i like to look at this, we did this, and we found it very beneficial. and a few things came out of this, that may not be apparent immediately, mostly, accountants simply want to figure out well, how do i do that? how do i, how do i go and create a fixed price model. and there’s a lot of ways to do that. but there’s some interesting takeaways, once you go and create a different type of model that i think are interesting, we found one thing, we started saying, you know, what we’re gonna make some estimates. and we’re just going to put up on the website, some prices for common accounting services that we sell bookkeeping, or bill payment, or whatever it might be. in some interesting things happen, one of the ones, one thing that happened there was, we were able to start thinking about the way that we sell differently. because typically, in a lot of accounting, sales cycles, you’re having to kind of go and listen to the client and talk and make an estimate of their hours, whatever it might be. and by being much more forward thinking about, you know, what, we’re going to start using, not just ours, we’re going to take the risk and put an estimate to that maybe but a fixed price up. suddenly, clients are kind of getting their question answered already, like online on your website. oh, i see that acuity charges, you know, x $100 per month for this service. okay, cool. interesting, right? and so, it really helps we found shorten the sales cycle, those who go, whoa, that’s way too expensive for me. they don’t waste our time on sales calls others who go, oh, wow, this seems really fair and interesting. they do they move further along in the sales cycle, we’re not going back and forth about estimates proposals. so it really, it really helped our sales process. by putting those prices up there, it’s, i think most people will tell you that they’re monitoring your way, if you’ve managed your website, outside of the homepage, you’ve always found, the number one spot people go to is our pricing page, they want to go look at how things are priced. and i have a bit of a belief, liz that that’s my favorite. that’s my favorite page of any website today. i think it depicts how it fits how you work and how you value your work. right? there’s so much on our website that have a lot of fluff and like this, and that, let me tell you a story. and those are important. but when you’re trying to cut to the chase on what somebody does, and what the value is going to be to me as a customer, there’s no better place to go to the pricing page. if you’re, i think if you’ve been thoughtful, and have tried to give them that information as transparently as possible up front, you earn credibility from that prospect. you’re just streamlining a bunch of other processes and it’s a good mechanism for the firm yourself to go. i’ve got to go think about these things before i put them up online. so i i’m a huge fan of trying to figure out as many ways as possible to whether you want to productize the word make it fixed prices a bunch of other good benefits that people aren’t probably considering i think that it just forces you to be in the shoes of the prospective customer which is a place that i don’t think we go to often enough as accountants we love to talk about if more perspective here’s my accounting so important let me tell you all about it. you know, mr. mr. prospect and being in their shoes as i think about that, stepping in a prospect shoes, i have to think of cable if i’m buying something. what’s the most comfortable way for me to buy something today? and the answer for me as and probably many, many people is, well, it should look like amazon.com right? that’s how right should it so there’s a question should acuities website our pricing page look like? amazon.com should all of our services and solutions be up there where i can just scroll through very easily i can search it i can look at i can i can figure out that price point immediately. how soon when will it be till i get that delivered? can i return it? are there reviews on the sites? can i get up to images and doing all this kind of saying, can you really do that? i don’t know, maybe not. but i don’t think that’s a bad concept to hold in our heads as practitioners saying, that is the dominant way that people buy today, people are most comfortable saying, you know, years ago, i would not have bought a shirt online or shoes. everybody does it. now my parents do grocery shopping, we do it. and so if someone ever gets to where they felt the accounting, your amazon for accounting good for them, i don’t know that we’ll fully get there. but i think the more that we lean toward that, in a way from the past of, you know, click here, and we’ll schedule a call, you know, we’re not going to tell you that our pricing services are going to kind of sound mysterious. that’s just not a buying experience people look for so i think that changing things like a price point. people feel it’s risky, right? but what if i priced it wrong? what if i scope it wrong. but i think the upside benefits are vast that i think there’ll be so much more growth, i think you’re forced to think in terms of how someone buys or is forced to put your service is in plain english in a way that speaks to someone who’s not accountants. so i’m a big fan of modifying pricing, because i think it’s hard. i think there’s some good cues out there, what i would recommend that firms do is you take a look at our website, or there’s others who do a good job with it. but get creative and think outside the accounting industry to how would you if you were forced to do a pricing model, using your existing services today, and make it look like an amazon or somewhere else that you you know, that people can go and shop and build trust with just the click of a mouse versus having to go through a long drawn out sales process and back and forth proposal process.

liz farr  16:52
i love that. and the amazon ification of accounting. there you go. they love it. i love it. and you know, but i know that a lot of people are gonna say, but what if you get it wrong? what if you are vastly out of scope? what do you do? what if you bid something for $500 a month, and just the compensation for the people doing the work is more way more than $500 a month? what do you do,

kenji kuramoto  17:28
i’ll share what we do on that list. and that is a very common one, as i’ve talked to other firms, what we do is, first of all, we are ready to change our pricing regularly. and so you have to i think that’s that’s actually interesting is where this is very infrequently, and maybe ever will you have a very, very static price page, it should change, it should change quite a bit, you should change it there. in your engagement letters. go ahead, which we do go ahead and put in terms that’s will give a notification period or a period where 3060 90 days, we’ll hold that pricing in effect. but if something changes, if we choose to change our pricing, we’ll give you notice up front, and then want to come in and change it right now. a little bit, are you kicking the can to wait to have that hard conversation with the client maybe. but also, the conversation has to happen at some point. and you get you have to kind of build that muscle of saying you know what, we’ve done our best to try to price this, we’ve come back and looked at the situation. and we found that the value we’re giving you doesn’t match with the costs that we’re incurring. and if they choose to say well, too bad get qe i don’t like that i’m gone. you have to be willing to be okay with that. most clients are okay with it, especially if you give them notice upfront. explain what you’re doing. there may be some good discussion. they’re like, wait, why is this taking so long? why is this? why are we able to estimate? it could absolutely could be that acuity we did a bad job estimating. there could be some other underlying issues there too. so invite those conversations, look at those conversations as a learning opportunity to understand more about the services you’re providing. but make changes be ready to make changes pretty quickly. and that’s fine. and it doesn’t mean it’s easy. but again, i think there’s so many other benefits, you’ll find out about it because you’ll get better indications on how long does it take us to do this work? wait, if we did switch our technology stack a little bit? could we get the time and curve cost us as a firm lower? and then it becomes kind of a fun challenge of going gosh, and we do this a lot at acuity is how low can we get that price point? how low can we get it to where it’s just super attractive to where, you know, using it like an add on? a client goes? well, gosh, kenji, that’s a no brainer. just go ahead and add that to my bill. i’ll take that in a second. so i think you have to be willing to change if we’re going to do this, but it’s the bit there’s so many upside benefits if firm owners are willing to do that. that’s how we’ve approached it at least.

liz farr  20:02
that’s that’s a really good approach. and, and i would agree that that must be hard for a lot of accountants to have that conversation. because in my experience, it was, well, here’s your tax return. and then then kind of sneakily, oh, and here’s the bill, here’s the bill. and oh, no, i’m afraid see what you’re gonna say.

kenji kuramoto  20:29
it’s a lot of these areas that are tough for i think accountants come from an area of real strength of the accountants, right, we are conservative in nature. we are a bit risk averse. and those are all trades that really stand to benefits, the profession and small business owners. but sometimes, when we go too far, with those being too conservative, or risk averse, we get into this posture where we’re not changing, we’re not adapting. and i think that’s, that’s when it becomes problematic. it’s okay to be i think it’s i think sometimes business owners are refreshed to be say, i need, oh, you’re my trusted advisor and accountant, i need someone just kind of shooting straight with me and giving a conservative view to this issue. because most entrepreneurs are not conservative, they’re going fast to me and my eyes narrow, and it takes some of the compliment that but we too often get a little too far that direction, i think. and that’s where we kind of get you know, all those strengths, right? when they get flipped become our biggest weakness. and sometimes, if the unwillingness to change that really hamstrings us as a profession.

liz farr  21:34
yeah. yeah, you know, unwillingness to change is really hard.

kenji kuramoto  21:41
very difficult, very difficult,

liz farr  21:42
very difficult. but i can say, you know, you’ve changed, i’ve changed. i’ve talked to a lot of other people who’ve changed. so it is really the coming wave. it really is.

kenji kuramoto  21:56
it really is. it really is.

liz farr  21:58
yeah. now now, what about growth? what are some strategies that you have used at acuity to grow? you know, i know that one way you’ve grown is through acquisitions, correct? yeah. but what are some other ways that you would suggest firm owners to grow?

kenji kuramoto  22:21
well, i’m gonna throw something out there. this is not exactly you’re asking this, but we’ll get into more the tactics. but my my co founder and business partner, matthew may mentioned this last week at his panel at accounting web summit. and i really liked this point, because someone asked a similar question that you’re asking about growth and scale. and what he put back out, there was a really good consideration for firm owners. and it was essentially that, first of all, are you okay growing? or do you want to grow? and we asked that, because we’ve experienced some things that maybe people don’t always consider when you’re growing. so the example i’ll give is, i don’t know who all of our clients are. in fact, i don’t know who the majority of our clients are. and i can remember liz, when probably the was the first time someone came up to me in some social setting and said, oh, you’re kenji with acuity. hey, i’m so and so. and this is my company. and you’ve you’ve done our accounting for the past year. and liz, i was horrified. i didn’t know who the person was. i didn’t even know the company. and i just i was just so i was so embarrassed, right? i’m so embarrassed, because we’re taught to be quiet, focused. and, and. and i had to say that i had to say, i’m so sorry, i didn’t realize i didn’t know you were now they said, oh, that’s okay. your team is doing a fantastic job. i love acuity. just wanted to say hello to you. that made me feel much better. but there are i think any accounting professional or many of them are going to feel that same way i did have were going there is a there is a size you get to you cannot know every client, you just can’t know him. and that’s an you have to think about that. is that is that the kind of firm you want to have? are you going to be okay with that? were is like, i just don’t want that i want to have a relationship. i hear that all the time. i really love the relationship that i have with all of my clients. and that’s okay. there’s no right or wrong answer there. i think the individual the firm owner does that best. but ask yourself that. because then this also got brought up and people kind of nodded their head. this was in the session last week and said, oh, that makes sense. they said yeah, but you know, all your employees and team members. and matthew had to look at each other and be honest for the room and said, we don’t we have 150 team members today. there’s just a point to where you can’t know everybody and the same thing. you run across someone to go oh my gosh, they’ve worked for six months, i don’t know them yet, right? that can feel very uncomfortable. and i would just say that as you think about growth, there’s a lot of strategies to growing, really absorb that and think about whether that’s something you as a firm owner want. now, for us, we’re very excited, like we had this big, crazy audacious goal where we want to help 5000 highly innovative entrepreneurs, we want to serve them, you know, by the year 2030. and so that actually, for us makes it okay to not know everybody because our bigger broader role of serving is, is what drives us. but day to day, it’s a little uncomfortable, and you don’t get to know every client, you don’t get to know your team members as well as you’d like. now. so once you’ve kind of answered that question, there’s a lot of strategies there is acquisition, we’ve done a couple of acquisitions. that’s one mean to growing, we’ve always been a very focused sales and marketing based or organization, we’ve had a sales team for almost a decade now, who are doing all kinds of outbound sales and cold outreach things that again, accountants are not comfortable with of cold emailing or cold calling people we at acuity have done that we’ve done that for a long, long time. and there’s some things about that, that are uncomfortable. people say no, and a very high rate. you know, you have to be okay with it’s there’s a lot, a lot of things there. i think what i hear most firms i talked to recently, saying their biggest obstacle to growth right now, it’s kind of back to your first question is on talent is there’s not enough supply of team members, there’s more work than they can deal with the demand is there. it’s just finding enough team members to be able to help, you know, get to that, that growth, but lots of ways to grow. we’ve have tried or keep trying many of them all the time, we’re a very growth minded firm. and so certainly, i would recommend anyone who want to talk through the strategies or length, i’d be happy to share your experiences, the good, the bad, the ugly that come with acquisitions, and sales and marketing teams and outbound emails and inbound marketing, you know, seo and all the fun things out there. i find those fascinating, some people kind of go, ooh, yuck, that’s kind of sounds yucky. so i don’t want to talk people’s head out there. but if people ever wanted to reach out, those are fun topics for me to dig into.

liz farr  27:25
yeah, i could bend your ear about seo some time.

kenji kuramoto  27:29
i know. a lot of you too.

liz farr  27:33
well, you know, what i’ve learned from seo is that it’s probably more beneficial to people to produce content that has meaning and some oomph to it, rather than just being a vehicle for containing keywords. that is, you, you know, cuz i have read the same articles over and over and over, that maybe have a few different phrases, you know, but it’s really, it’s really hard to find anything that is different. yeah. but if you can put that little bit of difference and your firm’s personality into it, then i think that goes a long ways towards getting the right people interested in your firm.

kenji kuramoto  28:32
absolutely, absolutely.

liz farr  28:35
yeah. now, we’ve talked about how accounting is changing. you know, it used to be, you know, back in the dark ages, you had to keep the irs code or the fasb regs in your head. and you definitely had to be really good with the 10 key. but technology is taken care of a lot of that. what are some of the skills that you think accountants need to be successful today and in the future?

kenji kuramoto  29:09
well, you’re right, liz, how things have changed, haven’t they? i remember when i first left public accounting, and i got into my first industry role as a controller of a company. and i just stressed my first year out of public, because i used to know all the fasb pronouncements cold, i was just like an expert in them. and then i just kept like, oh, my gosh, i don’t know what the news pronouncements look like anymore and things and then you get to a point and you’re like, i don’t care. you know, i don’t know. yeah, i care. but like i can get that information in a different means. now. it used to be i’ll just go talk to my accounting firm was working for me now because i was on the other side of it. now, it’s a good googling, right. i’ll go listen to a podcast about it. i’ll pick that information up. so the skill sets really have changed quite a bit. i think the one to me need the skill set that is the one that we look for the most at acuity. so i’ll just do this from our point of view of what we look for, of course, we’re looking for someone who has detailed orientation. and someone who is interested in accounting and has a background in that. what we’re looking for mostly is curiosity. we are looking for people who have good analytical skill sets, but are curious. because that’s someone for us who’s adaptable, because this is a changing profession. and i, again, i am such a strong believer that there is so much work in this profession, there’s there’s so much work in the profession, the only firms that aren’t getting work or struggling are the ones who aren’t changing, who aren’t adapting, right, they’re the ones who are not being curious and interested in the future. and i’m a big believer in that, you know, if you’re not curious about it, you’ll never be good at it. and, and so we look for that as a trait to where someone who shows interest in the space and is curious about where it’s going, you don’t get to set in their ways. now, that’s a fairly soft way to put it, there’s absolute strong technical skills that are needed. the tool set today is not greenbar ledger, it’s not attended to if that pen and paper, the new tool set is real technology is different pieces of software. that is the toolset that is needed to really kind of superpower, accountants to give them the skills they need to otherwise you don’t want to compete, i guess a very strong tech savvy accountants or accounting firm. if you’re still stuck there on servers in the office, and needing to do face to face meetings and lots of manual paper, and a lot of manual entry, you’re going to lose out, you’re just going to lose in the profession. and so that curiosity about what to how to make it better is something that i think is so important. and typically, that’s a core value of acuities is curiosity is one of ours. and that’s our way we really talk about technology is you need to be curious, technology’s gonna come and go, you don’t have to be one or the other. but you just need to be thinking about where the skill sets are going. because that’s that’s what it really takes to be ethical accountants relevant in the space and that actually, businesses are attracted to i have. we’ve had so many wins over the years of taking on clients who said, you know, who said, oh, my gosh, i’m just thankful that i have an accountant now, who is using some of the same technology we do? who is not saying their ways? and i think that’s something that i think we have to be thoughtful about how it’s perceived by the clients, to the clients, like their clients, like someone who’s curious about their business, too. oh, tell me more about your business. i want to learn about what tools do you use. so curiosity for me is a big buzzword. so whatever that looks like other people’s firms, look for those team members who are not just walking in the door, saying, well, here’s the way i’ve always done it. here’s the tools i’ve always used. but they’re walking in saying, oh, my gosh, well, i’ve used these before, i’m super interested in learning and growing and developing, those will be good team members, those will be i think, how accountants continue to be successful, i think, also, my biases, how they’re going to be happy in the space like, right, you just mentioned that lens, that change that you and i have both gone through. it’s uncomfortable times. it’s uncomfortable, right. but like, it also makes me happy. it’s what drives us to conferences as drives people like you and i to meet because we’re out there searching for what’s coming. next. is there’s good things that happen when you’re out there. i think being curious about what the profession is going.

liz farr  33:51
yeah. yeah, you know, when i talk to people like you, i’m excited about the profession and contrast to my time in public accounting, where it was like, these people are just stuck. i want to get out of here. oh, yeah. yeah, absolutely. yeah. now, we’ve talked about what accountants should start doing, what are some things that accountants should stop doing immediately?

kenji kuramoto  34:24
stop doing immediately? well, there’s the obvious, right, oh, my gosh, pull off the green eyeshade, and the pocket protector and all those things. you know, i think that’s played out a bit of like, move from desktop to the cloud. i think folks understand that. so i’ll maybe give it a little bit of a different hot take on what things that accountant should stop doing immediately. and i will say, as i just we just talked about how much we care about technology and how technology is important is i would say accountants need to stop immediately being the type into account that only works with one platform. i’m only a quickbooks accountant, i’m only a xero account, i only use this tool set. and again, i’m not sure anyone loves accounting tech more than i do. i love it. i’m very involved with it. i am an investor in many accounting tech companies. i’m a huge fan. but what i’ve seen is too many accountants, almost just so sideling up with like, hey, i’m only this type of accountant that works with these kinds of tools. and i think the danger in that is, i think it devalues who that accountant is and the skills they have, we have to be mindful that our accounting tech partners are wonderful, they’re great. but they are a tool set to us. they’re a tool set to us as accountants, the tools should always, in my mind, make sure that we remain where we have always been, or we should always be in the accounting profession. and that is as knowledge workers, accountants or knowledge workers, we’re not manual laborers, we’re not there to do manual. i mean, thank goodness, we’re not having to go through and do all those manual journal entries, or old school bank reconciliations like before, we are really meant to be and we’re valued to be knowledge workers. and so knowledge workers use good tools. and so i like to think of it in that direction, is that the tools work for us the tools work for us, i get the choice to say, you know, if whatever the tool might be, i, let’s say i’m using bill.com, or expensify. and those tools aren’t cutting it for me, guess what, we got to make a change. and i’m not going to just be, you know, the nonstop forever. gi bill.com is the only tool platform we use. i see a lot of this in the industry where people get, you know, the strong debates about which technology is the best do i like this one or that right? small business owners rarely ever have those. they don’t care, they want to problem solved. we like to profession bicker about, well, this is better, that’s better. and it’s good. we want to we want to find the best tool, but sometimes we just go too far, we’re debating about, well, i like the color green in two, and i don’t like the color blue zero. and you’re like, this is a waste of time, right? this is a waste of time. i think that, you know, the mindset that the tools are there to help make us better, and not being too beholden to them, right? these they have big budgets, they have all kinds of, you know, wonderful things they can bring. but i think it benefits the small businesses, it benefits us, it also benefits our tech partners, if we don’t get too far in their pocket and like, well, i’m only going to ever be part of that, you know, intuit community. that’s just, that’s i think what that’s doing is it’s minimizing to a point, the real value of what we can be as an accounting community, we’re bigger and broader than that these are tools we need to use, we’d be looking all the time at them differently. and so i wish more accountants would just stop saying, well, i only, here’s what i follow. and here’s only what i do. that’s you’re minimizing, i think, your own knowledge set as an accountant by just being totally beholden to one or even a few of those types of tech partners, great tools, keep using those tools. but i think that again, i think people tend to get and this is where i see people get a little bit over time, unwillingness to look at something different, or some newcomer coming out. and this is where people get passed by ultimately, and this is where firms ultimately go to start aging out and dying, because, well, sorry, i’ve only ever been a cch practice forever. and i can’t make a move from that. and we’re unwilling, and this is where firms typically go to start dying.

liz farr  38:53
i agree with that, you know, that. these are software tools. you know, in, you know, as an analogy in my writing, i use word sometimes i use google docs sometimes. when i first got my mac, i use pages and then add to convert to word. yeah, they’re just tools.

kenji kuramoto  39:18
they’re just tools. that just, i think i think if you were to ask yourself, which is the good practice for us to accountants, if you were to ask yourself, okay, liz, do your readers care which tool you now? now they don’t write in? it’s the same thing we as accountants ask ourselves? do the business owners really care which tool we use? do they do they really care? they want us to use the best tool. they want us to get a job done, but it’s just a means for getting the job done. i think we have to be a little careful of not getting in there and bickering about that too much. and that’s that’s one that i don’t know that accounts will ever stop doing immediately. but i’ll just that was my little heartache for you. i’m like, okay, this is probably one that most people won’t say. but i do think it’s interesting. and it’s a good reminder for us not to get too stuck, you know, thinking about why now?

liz farr  40:03
yeah, you know, i see the arguments on twitter about quickbooks desktop versus qbo. and like, you know, it’s just a tool.

kenji kuramoto  40:16
yeah, they’re kind of fun to go on there and give your opinions and their fun on a panel or maybe on a podcast, right. but at the end of the day, we have to think to ourselves, does this serve the small business? and i think that’s where that’s probably where the stop needs to happen is, okay, what’s just that point? and we’re no longer doing it just for a fun kind of debate over drinks or whatever it might be. that’s where we need to stop the conversation to kind of move on.

liz farr  40:39
yeah. yeah. now speaking of moving on, what do you think are some of the blocks to change? what keeps accountants stuck?

kenji kuramoto  40:54
i think that’s a few things, keep them stuck. we talked a little bit about people’s willingness to be adaptable. but one thing that’s i’ll say, one thing that’s helped me, i think change is, every time i get closer to our customer, the small business owner, and i’m in their shoes. i feel like i get unstuck. i feel like i can change easier. for some reason. if i’m just in my own head, if i’m just thinking like an accountant’s. it’s just, i’ve been trained up for so long, to follow a process to follow the way that the standards, which is what our industry is all about, and are very important, right. but that’s also the same thing that makes me a little hesitant to change. because, you know, when i look back at my career, and i’ve worked at arthur andersen, a great global public accounting firm. in many regards, i could have said, well, i can’t ever create a firm, as huge or successful as that i’m just gonna follow exactly what they do. and maybe i could have been successful on that. but i wouldn’t have changed very much. no, every time i’m with, for me, closer to my customers, and the small business owner. and the benefit here also with us being firm owners is technically we forget sometimes that we’re business owners, we’re small business owners, right. and so when i put that hat on, it tends to help me deal with change better, because i’m looking for something better. i’m usually saying, gosh, i had a bad experience last year with my tax team. i was not in cash, i got my returns late, they didn’t help me plan. i’m just making this up here. but like, and, you know, if i’m really in that posture, with the small business owner, it’s easier for me to say, we got to make change. if i’m hearing that, or i’m feeling that, like we have to make a change the way we deliver tax services, or the way that bookkeeping is done. and i don’t know if that’s helpful for everybody. for me, it’s very helpful. because there is something very, very echo chamber, like sometimes within the accounting profession, we tend that, like, i go to these conferences, i talk to all my friends, and we kind of go through the same issues. and i’m always surprised by how often i forget to talk to the customers what’s working, what’s not working, they don’t want to hear about all the new tools that you know, they don’t want to hear about all the new pronouncements. they just want to solve an issue solved it. so when that becomes going, oh, i care more now about solving the issue and helping them then suddenly, for me, it helps me change a lot. and so i think all of us are fearful at times of change. i think we’re in a profession, many of us were attracted to this profession, because we liked the consistency, the risk averse nature to it. the standard, the practicality service does not come easy to accountants, right. but i think you give a you give an accountant, a problem to solve. and i will tell you from all the accountants, i know, these are good, good people who care about clients. and so just don’t forget about that. i think if they spend more time going, oh, i can’t get too lost in the accounting jargon of this, i’m going to go spend time talking to customers, i think that change will become more inevitable. i think that’ll help them more and more say, well, we’re going to make a change to our services to our tech stack to the way we do things. but if you’re only going to sit there and when you think about from the side, the tables and accountants it’s going to be hard to change. and so that’s that’s maybe a point i will say that helps me all the time that might help some other fellow accountants to once i put a client base on it. change becomes much much easier for me.

liz farr  44:49
that’s a really good point. now i do a lot of work with l anderson who’s trying to move the audit profession into the future. one thing that he stresses is relevance. you’ve got to be relevant to your clients, you’ve got to provide relevant services, you’ve got to ask relevant questions. if what you’re doing isn’t relevant to what they’re trying to do, then they’re not going to be sticky to your firm.

kenji kuramoto  45:2
yeah, absolutely. that’s absolutely right. he makes a very good point.

liz farr  45:27
yeah. now, what do you think will be the next big thing in accounting? right now? it’s client accounting services, client advisory services, where do you want to call it? what do you think is going to be the next big thing?

kenji kuramoto  45:45
interesting? boy, i wish i knew. but but, you know, i’ll say just following the changes that i’ve seen, and using mentioned lists, new casts or client accounting services are really hot right now. they were not many years ago, when we first started a cast practice, they were not at all. and one of the things i think that has made them hot or popular is a cast practice allows firms to be much more engaged with their clients on a much more regular basis. i remember as a as a recovering auditor or a former auditor. i’d hear that said from our advisory practices back to that saying, oh, audits are really good thing we have because it’s a recurring, it’s an annual recurring engagements, we get to go back to that client every year. well, i knew as an auditor, we were only going out there like, you know, once a year, maybe a couple times for site visits or things throughout the year, prelim work. and it was still very reactive. it was like, oh, are the books the year closed out? we’ll come out a few months later and do the audit work. and i felt like accountants are always looking for ways to stay more engaged with clients, so they can audit many years ago seemed to be the thing that kind of kept you engaged on a regular basis. now kaz does even a better job, you’re even more engaged with clients on a regular basis. so i tend to think of it as an evolution of what’s even more engagement look like? how does, how does that i think that’s the direction we’re gonna want to go. and i see that as again, people may say it’s just more advisory, but i think of it very much still as forward looking work. most cast today, in my experience is still we’re there to help someone outsource their accounting function, i don’t have them right keeping or ap team or controller will help you with that. most of that work is still i call it rearview mirror work transactions that happened yesterday, we’re trying to categorize and put in shape into meaningful information. and then some of those kind of we’re gonna build some processes today to make life a little easier for us. we’re still i think, really missing and this is from someone who built as a start acuity cfo, was a acuity was known as qt. cfo, we were a cfo advisory practice. 18 years later, we are still trying to get cfo out there to where i think of cfo as not the rearview mirror. all funny off cfo work to me should always be prospective, and should always be forward looking. and we’re still not doing enough of that yet. now. so i think the evolution is going to be the next big thing is going to be when if cars can use takes hold. so now we’re almost really dealing with almost real time data with clients. we’re not waiting once a year for the client to send us the old pvcs. and here’s the stuff for the audit. we are in there with their data real time. the next step that’s got to be how do we start taking that and projecting that going forward? how do we really start, you know, helping them on planning for the future, and not just, hey, here’s your monthly clothes, giving them more real time data and more forward looking data? and people may say, well, that’s what advisory is supposed to have been for years? well, yes, and no, it hasn’t fulfilled on that promise. yet, there’s still a lot of work to do to fulfill on that to where, you know, we can really be helping a client look forward. and tools are starting to emerge for that now. but most of the tools in the space have not been really forecasting or forward looking tools more than have been coming the past few years, which is exciting. and i hope those enable accountants to do more spend more of their time i’ll get back to beating my drum on knowledge based work is to be in that position of where we can do more forward forecasting, budgeting, using that brain of ours as accountants, not just coding or categorizing transactions, i think that’s where things are going to go in the future. it’s going to be exciting when we get there, but the building blocks via kaz are really starting to take hold this would not have been possible years ago, without no has getting in place for accounting firms. how are we supposed to do forecasting we use don’t need to wait for the your client to send you finance, right? it could be a couple months late, and who cares? now we’ve actually got the data. but now it’s time to start looking forward. yeah.

liz farr  50:09
i think that’s that’s a really good perspective. and that’s when accounting really becomes valuable when it’s not just looking at the past, but helping the small business owners look forward and make decisions and see, what would possibly happen if they chose a and what would happen if they chose b. and instead of just flying blind all the time, like they they do right now.

kenji kuramoto  50:43
can you imagine? i mean, it’s just such a, i think it’s just such an exciting place to be that that is when you’re really advising and helping a small business owner, you are really helping them think through different scenarios, right. and that is the proactive planning, the trust you build there is just excited, it’s going to happen. it’s going to happen. i’m hoping sooner than later. but it’s still coming. i’ve been waiting for it. i’ve been trying to make it happen for almost 20 years as a cfo in the space. and, again, we’ve had bits and pieces of it. but i think there’s still a long way to go. and i’m excited for it to come.

 

posted on january 27, 2023