Practice Success Podcast

Lera Kooper on Strategic, Modern Accounting

• Canopy • Season 2 • Episode 1

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In this episode of the Practice Success Podcast, Lera Kooper, co-owner of Accountability Services, discusses transitioning from traditional to strategic accounting, emphasizing proactive planning, advisory services, and innovative business strategies. She shares her journey and insights on building a successful firm focused on long-term client goals.

Chad Saley:

Hello and welcome back to the Practice Success Podcast, uh, hosted by Canopy. Uh, I'm Chad Saley and we're excited to have you join us for season two of the podcast. Uh, this first episode is a special one. We've taken the podcast, uh, And we are actually, uh, live at Accountability Services in Seattle, Washington. And I'm excited to sit down today with, uh, Lera Kooper. She's one of the owners of Accountability Services. And today we're really going to jump into a conversation about, uh, Kind of your, your traditional institutional accounting versus a new strategic forward looking approach. And we're going to talk about hints and tips and the things that accountability services has done to, to improve and to have that forward look. So Lera, thank you for being on with us.

Lera Kooper:

Yes, absolutely. Happy to have you here.

Chad Saley:

Yeah. We're excited to be in your office and uh, to be able to, you know, record the podcast. Thanks. So. First off, let's just talk a little bit about there's this, this, this stereotypes around accounting there. It's these, they're working 80 hours a week. They're all burnt out. They don't want, you know, they don't like their jobs. It's kind of the, just this very, it's very old. Way of thinking about accounting. And I think a lot of people think that's just the way it is. What, what, what's your view? How do, how do you look at kind of that, that stereotype?

Lera Kooper:

I agree that most people think that's the way that it is. Where I disagree is that that's the way that it has to continue to be. Um, Accounting being a CPA, much like with any other industry, there's individuals that are really good at their trade, and so they start a business, and they just end up being a leveraged employee. Essentially, they're working for themselves, paying themselves, but they're not making the time to work on the business, and that, uh, gap right there, that working on the business is where you move from a traditional CPA firm model, that stereotype, to really giving, getting the freedom that you want out of being a business owner. And that of course has a ripple effect to how you work with clients and your staff's work life balance and all these other things. But that's really where the difference is made, from traditional to firm of the future.

Chad Saley:

So, Give me a little bit of your background as far as how did you get to this point? I know you've worked in accounting for a number of years maybe give me a little of your background your experience either working in in both ways and kind of how and we'll get into a Little bit of of the building of accountability services and kind of what you guys are trying to do here But tell me a little let's let's talk a little bit about where you've been.

Lera Kooper:

Okay So I, six months before I finished university, I ended up working for Dave. He's one of our current owners. There's three of us total. And I worked for him for a few years and it was just the two of us. We're working out of a little office and he had the opportunity to invest in one of our clients. So he sold his CPA firm. I went with the sale and I worked for them for several years. And throughout my experience, I learned that they were great. There's so much more value than this reactive approach of reporting on history. It is critical, keeps you from the orange jumpsuit. You have to be compliant. There's value in there, but that's the extent of the value. It's compliance. Uh, most people don't go into business because they want to file an extra tax return. They go into business because they want to make more money, work for themselves, have more freedom, retire early, fill in the blank. And so having this experience year after year. I really just felt kind of stunted in that position, and I thought there has to be, there has to be a better way to help people. I shouldn't have to be waiting for clients to come to me and say, is there more? I should be coming to them based on my experience, what I've seen working with other clients in the industry, and really helping them proactively, not only identify their goals, But then work towards them. And so there was a point in 2020 where I decided I was going to leave that job. And I reached back out to Dave and said, Hey, this is where I'm at. Um, it's really important to me that I enjoy the work that I'm doing. And so until I find something that's in industry, I'm going to go make coffee or be a dog walker. I still joke about it. Um, and. Coincidentally, it was good timing. He was looking at buying a firm locally. And the idea would be to go in as owners working on the business. We wouldn't be diving into billable work. We'd keep the staff, they'd manage the workload, and we'd really be developing it into something that helped business owners be successful. In a better way. And so I took that opportunity partnered with him at the end of 2020 on that firm. We grew it enough in a year that we were bankable to buy a firm three times its size. And that is what accountability services is. Um, we bought that firm, kept the branding, moved everything under that umbrella and then just within the last six months or so emerged in another firm from out of state. So it's it's contagious.

Chad Saley:

Yeah, no, that's incredible. How? So you went into this with this idea of we're going to build the business, not do accounting. How scary is that? Do you think for a lot of accountants maybe to think about? Man, I'm such an integral part of the doing the work and the client work that I don't have time to work on the business. And I guess, how important do you think it is, at least from an owner's perspective, to separating those two tasks?

Lera Kooper:

Yeah, I think generally delegating is scary because when you start a business, it's typically just you, you're wearing all of the hats. And so to start to take those off and trust someone else to To wear the hat, but a different way. It's scary. But then once you realize someone else might be better at this than me, you start realizing I got to give more stuff away. Like this is what I'm good at. And this is what I need the rest of my team for. And so yes, change is scary, but the alternative to me is scarier staying the same and really just getting commoditized.

Chad Saley:

Yeah. So let's, let's maybe jump into a little bit of how you then made that jump. You've, you've, you've started the firm. You're not doing the act, you know, like you're not in the weeds doing the accounting, but you're, you're, you're trying to build this business and talk a little bit more about this, uh, future versus the past and how you come up with that, you came up with that strategic approach of focusing on the future.

Lera Kooper:

Um,

Chad Saley:

Instead of living in the past.

Lera Kooper:

Yeah. Um, the past is obviously necessary. And so when we first stepped into it, we're really just taking inventory of what's here, what's the client base, what are the opportunities within the client base and for any new clients that are coming in, let's use that opportunity to engage the right way from the very beginning, because. Anyone that's gone through this process will tell you figuring out how to handle my legacy client base was the most challenging thing ever because they know a different world. They know a different relationship with you. And so now to adjust it, it's a longer process than just getting a new client and saying, this is how we do things. And so we worked with the existing client base really, I mean, logistically rated it on a. You know, ABC scale in terms of who needs this advisory or who needs this support right now. Not in order of importance, but in order of who is going to receive the greatest impact immediately. And so we started creating a lot of just processes, documenting what is What's the scope of this specific service? What's the process for identifying the right client persona? How do we onboard them successfully? So they're receiving that A plus client experience. They're getting all those touch points throughout the process, which of course are helpful to them. But also having the open line of communication lends to having conversations that lead to proactive planning, because they actually think to pick up the phone and call us on a date besides April 14th. And so it's, it just is a lot of inventory. And we found about six months later, a shortcut in, uh, practice forward is a methodology that Thomson Reuters had, and that was an Excellent shortcut for the first year where it packaged. Here's some great pricing tools. Here's some service descriptions. Here's how to teach your startup clients year one, the best practices of being a business owner. And that really just Let us dig our heels into it and then start considering, okay, what's your two, what's your three, what's your four? Because not every business that we work with is a startup. Some of them are experienced and they've been in business for decades. And so they need something a little bit more advanced.

Chad Saley:

So when you think about being able to kind of offer that more advanced work to your clients, how, um, whether it's old, I guess, or, and where it might be tougher, but even if, if they're new. Are you going in and selling them on the proactivity and on, like, this is how we want to work with you. And you're looking for those types of clients that embrace that. And that's what they want.

Lera Kooper:

Absolutely. We're, we're looking for the clients that have the entrepreneurial spirit. We're not selling services. We're selling solutions. And so that's why our discovery process is so time consuming, really right up front from the intake form. We're asking clients or prospects. What is your short term goal for the next 12 months, two years, five years, 10 years? Do you, have you considered an exit plan? Because for better or worse, everyone is exiting. Um, COVID is a great example of that. And so it helps to be planning ahead. And so even from the answers that people provide in those forms, it gives us an indication of how. involved are they going to be with our team as we engage with them? Because of course counting tax all those things are, the good information is critical to decision making, but A planning conversation requires the business owner to be there. So we, we really try to search for those clients that'll take advantage of our team.

Chad Saley:

So, I mean, really it like kind of this, this proactive approach and it's really moving into more like obviously of an advisory role than just looking at the past. And I like how you've talked about, um, that, you know, instead of looking to the past and like, here's what's happened and here's why, But instead focusing on the future and deciding, well, what, what do I want my, you know, where do I want to be like, let me proactively make my future instead of just reflect on what's happened. How does a firm take the steps from moving from kind of that very focused on the past, just handling taxes, just handling the, you know, like what they're asked to by their clients as compared to making that step into, hey, we can do that. We can do all that stuff for you. But let's talk about where you want to be, like, what tips would you give somebody who's on the cusp of this? Um, that hasn't quite figured out how to do it. I

Lera Kooper:

think the hardest part is just taking the leap. We all know how to have a conversation with our clients about their goals. We have to follow up on it, we have to document it, we have to coach our team on almost that, almost that desk side manner of how to ask the right leading questions to Really get them to open up, because in a basic tax, you know, if you're reviewing a tax return with a client, you could stick to the basics, but you could also just ask them, Are you looking to buy a house? Are you looking to invest in properties? And it just gets the ball rolling. That's a very simple example, but even the tax return tells a story. So if you just look at it, Give your client a call, casually ask them about their goals and then start thinking, okay, what education do I have? What experience do I have that would help them through this? And then that's where the productization comes in because we all know how quickly scope creeps on us. And so having very clear scope descriptions. Is what saves you. Um, all, I think I can speak for all accountants and that we want to help people and that's why we are such yes men, but imagine going to Starbucks with your own espresso machine. It's ridiculous. They say, no, we're making it for you with our espresso machine. Here's how much it costs. And so you really have to have the espresso machines, the products, the descriptions, and say, these are the hows to get you to this result. And so I think that's a great place to start.

Chad Saley:

How have your. Uh, clients responded like as you've moved forward with this, obviously you're finding clients with that entrepreneurial spirit. Describe some of your relationships and how this is, has worked out for you.

Lera Kooper:

It's a little bit of a mixed bag. It really depends on where the client is and how much they've worked with business advisors. I think some of them are very well aware that they don't know what they don't know, and it's just so important to them to have a relationship with someone that they trust. Others are Of course, we're skeptical of, okay, here's the price point. What's in this? And that's where the service descriptions come into play. That's where that relationship and trust comes into play to say, yeah, we're going to work through these things. And this is the time that requires we don't bill at an hourly rate, but it is an investment of both our time and the clients to get a result. Change requires change. So you can't expect it. A tax return to give you a business advisor. Of course, the engagement is going to be more because you're getting more. Um, and that has been a challenge, I think, for those entering the advisory space, because we're not only teaching clients that advisory exists, but we're teaching them that it exists in a structured way, not reactive. And then we're saying there's also a price tag. And so that's, that's not a challenge we've overcome either. Some clients are easier than others to have that conversation with because they worked with other professionals before and they just, they understand that's what it takes. Um, but you never questioned an attorney's bill. You just pay it. And so, and I, I think that's where CPAs are different. People question the value a lot more.

Chad Saley:

Do you think that, um, is that because of the stereotype and that they're just, they're kind of putting CPAs in that box and maybe not, Yeah, respecting them is kind of, yeah, they actually have a lot of business knowledge. It's not just the ability to do math and fill out a form. There is a lot of that consultancy and being able to come in. Is it just getting over the stereotypes or do you think is it just, does accounting as an industry need to do a better job of kind of showing like, Hey, we're bigger than just tax day and we do a lot more

Lera Kooper:

for business. I think we've just given it away for free for so long. Um, I don't think anybody's questioning the credibility or the expertise of their CPAs. They're just expecting to continue getting it for free because they may ask a question looking at the story of the tax return, we can rattle off a 30 second answer. But that 30 seconds was only possible because of years of education and experience and coaching from other individuals. And that is where the price tag is missing. Is that shortcut to you. knowledge and application of it. Um, even with AI, anyone can go make a search on chat GPT, but then they'll still have the question. How does this apply to me if it does it all? And so that's where the advisory component becomes very important and where I think CPAs are needed more than ever, because there's so much misinformation out there.

Chad Saley:

Yeah. How, um, How vital or important do you think that this, this kind of this approach and this focus on advisory is to the future of accounting?

Lera Kooper:

Critical. Um, and for accountants and just CPA firms in general, I, my hot take is that tax prep is going to be very commoditized in the near future between offshoring, AI, you just can't charge a premium for the tax return alone anymore. And so it's critical to be able to have a structured. Productized advisory model and not, it's not a one size fits all either. And that's why it takes effort. You have those that are startups or established or they're looking for exit. Those all require a different tool bag of services and education and planning. And I think that's where it's easy to get overwhelmed when you don't have time to work on the business, because there is so much that can be done. And there's so much that you know.

Chad Saley:

Yeah, so what do you recommend when you talk to your peers and others that are kind of faced with these similar types of issues like where do they go? How do they learn about adding whether it's advisory or just switching to a more proactive future approach? Where do you, where do you find information? How do you, how do you, how do you get better?

Lera Kooper:

Yeah, I think. That's the thing, they already have, they already have everything that they need. You have the knowledge to put into a service description. You have the knowledge to coach your clients, whether it's an industry niche that you have, or just your experience in working with those in different phase of business, um, or individuals, those with just multiple income sources. I will say the Thomson Reuters Practice Forward, It was an excellent shortcut if you just don't know where to start. Um, it's an investment. There's lots of sample service descriptions and best practices. Tools, educational tools that you can use with your clients. And so, that's a really excellent starting point if you just don't I just don't have the time for it.

Chad Saley:

Yeah. Um, last question. Yes. What one piece of advice would you give somebody that's looking to do this? So like, what do you think is the, what is the one key most important, uh, thing to kind of changing into this future focused attitude?

Lera Kooper:

Just do it. I, I am relatively comfortable with change, I think, for the industry, and I still look back and think, Man, I should have made that decision faster. I should have done this faster. Um, I think our fear holds us back a lot, but we can, and the writing's on the wall in terms of where the industry is going, and you're really doing a service to yourself. If you Develop the advisory model, really try to kind of separate out the commoditized part of it. And I mean, the amount that you'll get for your exit. Well, thank you.

Chad Saley:

Absolutely. Well, thank you, Lera. I appreciate the time and appreciate, uh, being able to visit you here in this space and, uh, yeah, thanks again.

Lera Kooper:

Absolutely. I loved it.