Updated July 1, 2015
When I first went into this business, there were 225 full service small business Chicago Illinois Accounting Firms. Now, there are only about 80 left that are any good, and we all know each other. I can tell by who completed a return, whether it is right or wrong. Chicago is still our nation’s capitol for the Accounting Business. The best schools are here; those being The University of Illinois and Depaul. The headquarters for all of the big firms are all still in Downtown Chicago. Why the change in the number of Chicago Accountants that specialize in small business accounting?
Sarbanes – Oxley 2002
The Sarbanes – Oxley Act of 2002 radically changed the accounting world. It was supposed to overhaul the Audit world and solve the problems that led to scandals such as The Enron Nightmare. The main thing that it did was double the amount of work necessary to complete a full opinion audit. This also doubled the fees. The large firms that handle these audits can offer graduates coming out of accounting schools such inflated salaries and benefits that none of the kids even consider going into small business accounting.
An Overly Complicated Income Tax Code
The IRS Tax Code is 17.5 inches thick if you lay it on one side, and it grows thicker each year. The CPA Examination only has about ninety minutes of taxation questions on the two day exam. It is a commonly held disbelief that CPA’s are taxation specialists. Being a CPA means that you know how to do an Audit, not a tax return. It takes twenty years of hands on practice to be able to be a small business taxation professional. Most people just aren’t willing to put in that amount of time to perfect our profession.
A Dying Breed
We are required annually to do professional education hours in order to maintain our licenses. When I started attending these classes, there would normally be at least six or seven hundred of us in class. Last year I counted less than two hundred. Worse than that is the fact that only fifteen percent of the people in the room looked younger than me. And just in case you can’t tell, I’m not in my twenties any more. Most of the guys that attend are twenty years older than me. Who is going to be left to protect Chicago’s small business owners when we are gone?
Who benefits from this obvious lack of accounting talent? The taxation agencies are having a field day. They constantly audit returns completed by lesser firms than mine, and they make money. I cannot over-emphasize this point. Who does your business returns has everything to do with whether or not you may have a problem. The service has a grading system for income tax returns. If your return isn’t done incorrectly, it will receive a higher grade. And you have a much better chance of being audited, if that grade is high.
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Chris Amundson is the President of Accounting Solutions Ltd., a full service public accounting firm of Certified Public Accountants and Enrolled Agents handling the bookkeeping, accounting, tax preparation, and audit representation needs of Businesses, Estates, Trusts, and Upper Income Individuals.
Updated July 1, 2015