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Cool Careers in Accounting Ep. 27 - Thriving Through Change: Building Tomorrow’s Accounting Profession with Mark Koziel
363 Plays8 days ago
Mark Koziel, president and CEO of the AICPA, joins host Mike Potenza to break down the state of the profession, including alternate pathways to licensure, the RISE 2040 vision, and how AI will reshape work while creating assurance and controls opportunities. They tackle offshoring, ESG’s evolving rules, CPA mobility and title usage, talent and inclusion, and career advice for students—from critical thinking to owning your path. Join us for practical, candid insights into where accounting is headed and how to get ready.
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Transcript
Introduction and Background of Mark Koziel
00:00:09
Speaker
Hey, everyone, it's Mike Potenza from Becker Accounting Podcast, and we're here for another super interesting podcast, and we have an amazing guest today. You all probably know him. If you don't, then you're not working in the world of public accounting.
00:00:22
Speaker
His name is Mark Koziel, and he is the new, and i really shouldn't say new because he's been there for a while now, but president and CEO of the AICPA, and we have so many interesting things to talk about. So I just want to welcome Mark. Mark, thank you so much for being here today.
00:00:39
Speaker
Hey, Mike. Thanks for having me. I look forward to the discussion. We have a lot of stuff we wanna talk about. I mean, right now we wanna talk about the state of the accounting profession and so many things related to what is going on in the industry. But before we do that, because we haven't had you on the podcast before as a guest, Mark, if you don't mind, I just wanna kind of take a step back, look at your early career, talk about how you got to the role where you are, and then we can dive into some of the more interesting and relevant topics related to industry today. So let me ask you this.
00:01:14
Speaker
First off, you have this title, President and CEO of the Association of International Certified Professional Accountants and American Institute of CPAs. It sounds to me like you are basically the you godfather of public accounting. So I just want to know, do you ever use the line, you know, I'm going to make him an offer he can't refuse or anything like that when you're, you know, wheeling your power in the world of public accounting?
00:01:38
Speaker
No, you know, you grew up in Buffalo. So, you know, Bill's Mafia, know, you have all of those old acronyms. You know, it's really about the profession. I am I am humbled to to serve in this role. And it really what is with 600,000 members globally.
00:01:53
Speaker
six hundred thousand members globally um You know, it it is a incredible responsibility that I take seriously every day. i love what I do, but it is such an incredible profession. It's it's mine to not mess up at this point.
00:02:10
Speaker
Well, I know you grew up in Buffalo. You don't call Buffalo home anymore. I think you're down a little more um south, like in the Carolina area. But talking about Buffalo for a minute, growing up there, what kind of did you grow up in the city of Buffalo? Was it more rural, suburban? Where'd you grow up inside of Buffalo?
00:02:29
Speaker
It was in the burbs, just outside the city, Cheektowaga area. I grew up, ah went to a high school called Maryvale, just one one suburb off of the city. It's where the airport was. My father worked for the airlines in air freight when i when he started and on the ramp for years. So, yeah, I mean, it's your blue-collar city, right? And I grew up very blue-collar. I like to say lower middle class. It gives you an appreciation for who you are, who your friends are, and and what you stand for. And from there, went to school to try and better my life outside of where I was. And accounting was easy for me in high school. So I said, you know what, I'll i'll take accounting, but I don't want to be an accountant. yeah'll I'll go to school to get in the FBI. And one of my friend's fathers, who's like a father to me,
00:03:23
Speaker
was a Cheektowaga cop. And he said, and all my friends were going to school to be cops. He says, yeah, you go to school to be of the for accounting. We'll get you in the fbi That way, when you show up with to my yo-yo son and all your other yo-yo friends, when you show up to the scene, you say, out of the way, I'm in charge.
00:03:42
Speaker
ah So that was the the reason why, because I didn't know anything about public accounting. But fortunately, I learned differently when I got there. Well, you must have enjoyed growing up there. You're right. You stayed there for college at Canisius University. So you you thoroughly enjoyed your education there and, you know, spending the early part of your life there.
00:04:02
Speaker
I did. Yeah. And I made, you know, I made the the the right school choice for all the wrong reasons. So, you know, I had four offers to play football. They were all Division III schools. Canisius was one of them.
00:04:15
Speaker
That's kind of why i chose it. But turns out I chose the top accounting program. ah in Buffalo, a really good program and great recruiting ah potential out of there. So it really was a great choice.
Challenges and Beginnings in Accounting
00:04:30
Speaker
And it was the right environment for me because it was a smaller school that got me ingrained into the accounting curriculum pretty quickly. So that was helpful.
00:04:41
Speaker
but Did you play football at Canisius? No, You know, and i was I was a small, slow receiver that happened to play on a championship team in high school.
00:04:53
Speaker
So, you know, ah of six of us that signed at Canisius, two ended up into their sophomore year, and they ended up quitting by then. It's just, that you know, it's kind of ah a whole cycle. But I had a shoulder injury, long story. But in any event, yeah.
00:05:09
Speaker
You know, it was again, great school. I appreciate that I was there. So no plans for putting together an AICPA football team at this point? No, no. Those days are long behind me.
00:05:21
Speaker
So, you know, you growing up in Buffalo, now living in your North Carolina, where are your loyalties? You Buffalo Bills, Carolina Panthers, you Buffalo Sabres, Carolina Hurricanes. Where do you stand?
00:05:33
Speaker
Yeah, you have to be Bills. I mean, you're kind of it's ingrained in you spending 30-plus years that I did in the city. It's hard to get away. So we are totally Bills fans. Good, bad, and the ugly somewhere along the way. It's one of those seasons again. But my wife's a big hockey fan, so she's a big Sabres fan.
00:05:52
Speaker
So we we stay in touch on both of them. Well, you know, I do feel for your wife a bit. Sabre not as much fun to root for right now as compared to the hurricanes, but it it is what it is, right? That's right. yeah So you go to Kinesis, you major in accounting, you graduate. Then what happens? you go to the FBI at all, or do you go work in a public firm, or, you know, what happened after college?
00:06:15
Speaker
No, you know, it was interesting, because I yeah i really... Didn't know anything about public accounting. Then I got introduced to it with with the accounting classes and started to to meet some folks. Didn't have any mentors of my own, nobody in my family or or anyone to really kind of lean on about public accounting. So learned a lot of that as I was in school talking to you know ah students other students that were there.
00:06:41
Speaker
so I really kind of started to look at that. And you know business did interest me. So I never did pursue the FBI. And I did the kind of traditional route for a lot of folks that going into public accounting. I graduated in 1991. 1990 was the year of the the savings and disasters that happened. We had three banks that went down in Buffalo out of business. And there were a lot of accountants on the street in 1990. We heard about it on campus.
00:07:13
Speaker
I remember going down to the career center. going to date myself. i don't even know how they do it on campus anymore. But they used to have like a list by firm of the people who were being interviewed on campus for recruiting.
00:07:26
Speaker
And that list was half the year that I graduated than it was the year before. A lot of accountants on the street. And, ah you know, I was fortunate. I had six first interviews. like I got called back on five of the six.
00:07:40
Speaker
The one firm that didn't call me back for a second interview was a firm that I spent the most time in in public accounting. I went to work for them three years later. And the reason they were looking for somebody three years later is they didn't hire anybody the year that I graduated.
00:07:55
Speaker
And so, you know, I say all the time that these pipeline issues that started in the mid-90s that we're still suffering from today, some of that was self-inflicted by the profession. If you want a manager, you have to hire an associate so that they can get there.
Journey to AICPA and Leadership
00:08:12
Speaker
Yeah, I totally understand that. And I can relate because although I look like I'm 50 years older than you, I also graduated in 91 and i i had i couldn't get a job either. And I had to stay for my masters. I didn't want to. I was like ready to go to work. I want to make some money. I was so excited. And they're like, yeah, thanks, but no thanks. So, um you know, stayed for the masters and i was able to get some work after that. But it's a tough time, right? When you graduate in recessions and, you know, we're going to talk about AI and what's going on in the world now in just a few minutes. but it's a little bit scary. But, you know, we we persevere, right? We make our way through it. And that's what's so great about but about accounting.
00:08:48
Speaker
Now, it gave me an appreciation though, Mike, you know, is looking back on it that I don't want any kid to have to suffer through that. I had friends who did not get jobs in that in that year. And I don't want to see anybody go through that. I've charged the team.
00:09:03
Speaker
Anytime something happens from a market adjustment standpoint, it's happened over the last 30 years since i've since you and I have entered into the profession, ah i want ah to find ways to help. when When Doge happened earlier this year and there were cuts at the IRS, those were CPAs. Those were members of the AICPA Being cut during that time, whether you were for against what Doge was doing is irrelevant.
00:09:31
Speaker
Those were our members. And so we actually put a program together to help them get placed out. and it Same at the entry entry level. We are constantly looking at it. I have the team constantly giving me feedback.
00:09:43
Speaker
Are these kids getting getting jobs? And right now they are, but we we're constantly looking at that. no And that's that's an amazing program, what you would put together. And that's why it's so important to be a member of the AICPA and understand all the resources that they have available to you. So, you know, it's so good to hear. And as as you are going through that, you know, I just kind of wanted to salute for, you know, helping out those fellow accountants.
00:10:07
Speaker
Now, let me ask you this question. So you go through the graduation, you get the job at the public firm and you're doing that work. How long do you stay in public accounting before you transition into a role at the AICPA? Is it over a long course of time? Did that happen pretty quickly? Can you walk me through that?
00:10:26
Speaker
Yeah, you know, it's funny. And I think part of it is, and and this is where, you know, it's it's taking beyond, like, the life doesn't just come to you. You have to go and grab it at times, right? So the the the the firm I went to work for, i actually met a couple of the partners at a business dinner the the night before I was going to interview with their firm on campus. And that, because I went out and i reached out to them and found them, I didn't know anything about the firm. We didn't have an internet back then, Mike, right? So everything was brochure based on how you were going to find out about the firm.
00:11:00
Speaker
And it was those two partners that gave me the shot at that firm. And it was because of that night before. and they've said that time and again, and I i attribute a lot to the the to them getting me my start in in my career.
00:11:15
Speaker
So I spent three years at that firm. I left to go work for ah another firm in the in the Buffalo market. Spent nine years there. So I had 12 years total in public accounting. ah at the I had a client of mine in political and public affairs media that was after me for about a year to join the organization, not as CFO, but as to run their time by division. So buying time for the campaigns that we're doing, I had no experience in it, but I did a lot of strategic advisory with that, ah with that firm. So they were really on me about trying to go work for them. They wanted me to eventually run their, their DC office. So
00:11:57
Speaker
I ended up making the decision, caught me on the right day. We talked about it. We made the decision and I spent three years doing that. In three years, found out you know pretty quickly that politicians aren't always the best client to have in the world.
00:12:11
Speaker
But it was a lot of fun, taught me a lot about the political aspects, and more importantly, public affairs. ah And so experience that, I wasn't sure what I was ever going to do with, but I had it. And then I got the call about AICPA. It was 2005, late I was good friends with Jim Metzler. I was active in the Buffalo chapter CPAs. I was past president at that point.
00:12:42
Speaker
And ah so just created my own little network, right, in Buffalo, which I think is important for anybody to do. Jim Metzler, a little older than I am, and he was a partner in a firm, left that firm to start an advisory practice, left that practice to work for the AICPA as their first ever founder VP of small firms. And so he had that role. And once a quarter, he and I would get together have lunch just to stay connected.
00:13:10
Speaker
And, you know, it was, so it was in 2005, get the announcement as an AICPA member sitting in the political firm that the AICPA was moving its operations center from Jersey City, New Jersey to Durham, North Carolina. So I sent Jim an email and I said, Hey, I see AICPA is moving.
00:13:29
Speaker
Are you moving to to North Carolina? he emailed me back within about five minutes and he said, no, but you are call me. You're on my list. They had 400 jobs of which only 5% 10% were actually going to make the move.
00:13:46
Speaker
So they had to recruit for like over 300 people for the move down to North Carolina. He had the job picked out for me, and i have loved every second of it. I was a senior manager then, made it all the way up into executive VP role when i before I left in 2020.
00:14:04
Speaker
So the one question I didn't ask along that path as you're going from public accounting into the AICPA, at what point did you actually get your CPA and pass the exam and get your experience? Did you do that early on, like right after graduation? Absolutely. Or are one of the people that were delayed? I'm sorry? but yeah Yeah, absolutely. Knock it out of the way, right? I made the mistake ah the first time sitting for the exam. I could do this piece of cake.
00:14:29
Speaker
I'm just going to review a bunch of old questions on my own and it'll be easy. And then, you know, flunked four. 69 on two of them at the time. I don't even know if they still do that anymore. I guess I should know the answer to that. But you know how that goes, right? Two 69s and a couple others.
00:14:45
Speaker
And then the the next time I took a review course, pass two, pass one, pass one. So it was still within a two-year timeframe that I had the the exam done.
00:14:57
Speaker
I got licensed right at the time that I could get licensed within two years of of working. Yeah, home run. And thats that's one of the things that we always preach to people. You know, you graduate, that's when you're at your academic peak and you're attaining information, studying, understanding. So we will always want to do it sooner rather than later. So that's some of the best advice we can absolutely give to the young folk listening for sure. ye So now you stay with the AICPA, you leave for a bit, and then you come back. What did you do in the interim?
00:15:25
Speaker
I went to run an international association of firms for five years. Many of the firms that are there, if they're big four, they're all networks, right? They're network firms. And then there's other large networks of the the next tier firms and then firms who are smaller firms, maybe, ah but you know definitely have some level of wanting to be connected to other their firms, especially at the international level.
00:15:49
Speaker
I ran one of those. We had 270 firms globally. We're the second largest association. Now the first largest after I left. ah But yeah, great experience for me. And again, get got me ready for what I'm doing now.
00:16:03
Speaker
That's great. So so now you come back as CEO, president, CEO of the AICPA, and you're stepping into the shoes that are vacated by Barry Melanson. And we know Barry did amazing work for the profession, 30 plus years, you know, in his role there to me, you know,
00:16:23
Speaker
That's kind of a daunting task, right? It's like yeah Derek Jeter steps down as a shortstop of the New York Yankees. Like, who's the next guy that's going to fill the role for him? Those are big shoes to fill. You've been doing, you know, absolute great work from day one since you've been in there. But let me ask you personally, like, how did that feel to you as far as, oh, my God, Barry's leaving. I'm the next guy. How do I handle that situation? What was your thought process?
00:16:48
Speaker
Yeah, you know, Barry and I are two very different people. And I appreciate all the experiences I had with Barry over all the years. So he was mentor of mine as well. Still is.
00:16:58
Speaker
Right. And so I stay in touch with Barry and i learned a lot from, you know, his experiences. And I've taken some of what i appreciated forward with me. And, you know, we all have, ah you know, blind spots along the way. I try to improve on that. His blind spots are different than mine. And We'll come at that differently. But you know i every point of what I've done in my career prepared me for where I'm at today.
Initiatives and Future Planning in Accounting
00:17:26
Speaker
And I never would have, it's not like I planned for it, never would have expected it. But the fact that I spent 12 years in public accounting and really understood that business
00:17:36
Speaker
three years in business and industry going to work for a client in public affairs, which we do a ton of advocacy at AICPA and understanding that world. And then the AICPA experience and 14 years of it you know I don't know anyone else who could have stepped into this role without having any of those prior experiences in a major way. So it kind of was the the the right formula. I put together the right recipe to be prepared for this, which I needed to be. you know Those 14 years, yeah i hit the ground running when I came in.
00:18:12
Speaker
and a lot of that was due to the fact that Barry and I have a great relationship. We did a lot of transition discussion. In the early months before I started, he's always available to me, you know, a cell phone away.
00:18:25
Speaker
ah But all, you know, you think about the alternative pathway was introduced in December before I started, signed into law January 9th. Boom, another of the states are going to introduce it.
00:18:37
Speaker
You know, trains left the station. it's the The debate is over. This is happening. Now, how do we make this the best we can possibly be for the profession inside of mobility and making sure that we have consistent rules state by state to make life easier as we go along? And then there are just a whole other facets. The big, beautiful bill now turned into H.R. 1 and advocacy around that and deregulation risks that are happening in various states. And now the Department of Education, their rules on who they're calling a professional and not, and, you know, they they just keep coming. But it it's, I could hit the ground running when I started based on having that prior experience.
00:19:20
Speaker
Yeah. And, ah you know, i was fortunate enough um when you first stepped into the role to hear you speak at a few different conferences. And, you know, another you know major asset that you have is, like you said, it's just this kind of blue collar mentality in that you're very approachable. You're just kind of talking to people the way we're talking right now. very informally, but you're getting your message across and such great information that you're sharing. and And I think that's a major asset that you have that not many people could step in the role and follow Barry and be so comfortable in the shoes that you're wearing. And it really is going to be extremely important for our profession, the fact that you can do that. And now one of the things that you just mentioned, and we'll start to dive into some of these topics right now,
00:19:59
Speaker
Alternate pathways, right? We know that there's been a talent pipeline issue for a number of years. We've seen that the numbers were decreasing in the industry. We know that there are a certain number of people that are going be retiring soon. So we have to figure out as a profession, how do we address that? So tell me about alternate pathway to licensure. What do you think the effects of this are? 120 versus 150 or just having a bachelor degree versus having a master's degree? Do you see this really making an impact or what are your thoughts with respect to um alternate pathways?
00:20:30
Speaker
Yeah, you know, it's it's been ah it's been debated for so long, right? And it took us ah forever, it seems, to get to 150 hours when it was finally done.
00:20:41
Speaker
I said, I graduated a bachelor's kid, right? And this is how we're gonna start talking to each other. Are you bachelor's kid or a 150 kid based on when you graduated? Yeah. So I do think we all ah ah approach life differently. And some people are going to be better in the classroom versus others who are more experiential learning. So it's equivalent, whether you're talking 150 hours or a master's plus one year of experience or a bachelor's plus two years of experience, all of which...
00:21:11
Speaker
the get you prepared for the exam, which you also have to pass, right? The three E's, education, exam and experience. Having that balance is important. And having that option, I think now is important too. And so I do hope that it opens up the market a bit for us. I don't know that it's a silver bullet. There's a lot of other things that we have to get right.
00:21:33
Speaker
ah But I think it's it's at least a starting point and the the debate is over. So now it's a matter of getting all the states up to speed as quickly as possible. Some states are calling it a bachelor's plus two. Others are saying 120 hours plus two.
00:21:50
Speaker
We need to try and get keep that language as consistent as possible. We say, and out of the Uniform Accountancy Act, our preferred is bachelor's plus two years experience plus exam passing.
00:22:02
Speaker
That is the additional pathway that we want included in all state law. Right. So, you know, before the 150, like you said, it was 120. Now we're kind of going back there.
00:22:14
Speaker
Well, you know, I don't think that it can hurt the pipeline, right? It can only open up to new people to come in that maybe could not afford a fifth year of school or had to start working right away. So that's that's a positive, I think, for the profession. Now, the the um detractors will say, well, what if people are not experienced enough? And you know I think you made the right point. Well, that's why we're requiring the extra year of experience. It works in the past. It should be able to work now. So with taking that all into consideration and thinking forward, I know you're coming up with a vision, a plan for the future, and I believe you call it Horizons 2040, right? What's the profession going to look like 15 years from now? Can you tell me how Alternate Pathways ties into this and what your initiative is through Horizons 2040?
00:23:01
Speaker
Yeah, it's so RISE 2040. RISE 2025. And just a little history. I think this is one of the things that the profession has done very well. And again, under Barry's leadership, started in the late 90s with the Vision Project.
00:23:15
Speaker
So back then in the late 90s, they said, where is the profession going to be 15 years out? And what do we need to do to prepare our our members and students to get to that point?
00:23:26
Speaker
So that expired in 2011. And in 2011, I was at AICPA. Paul Stalin was chair of AICPA at the time. And Paul wanted to update that. We called it CPA Horizons 2025. that became then the next years vision.
00:23:45
Speaker
And so here we are 2025 and Horizons is expiring, hence why ah we're creating the new name of Rise 2040. As part of that, how right to was CPA Horizons 2025? What did we get right?
00:24:02
Speaker
What was missing? And there was about 80 to 85% accuracy or things that came to fruition. So what we're doing right now is Rise 2040. We're out in the market. We started at our council meetings in May in AICPA, council meeting for SEMA in June in the UK.
00:24:19
Speaker
And this is now going to be a global initiative. be it We have both organizations under the association. We can really go global with what we're doing. Rise 2040 is what are the hard trends and the soft trends of the the profession we need to understand? How is that going to affect our business? And what does it look like 15 years out from now?
00:24:40
Speaker
People say, well, 15 years, that sounds like it's too long. We we we can't predict that far out. but we really want to stretch our thinking because five years out is probably too short to really try and be visionary around what it is. So, you know, you would ask me what my vision is. My vision is, it doesn't matter. It is this vision of the profession that I am just here as a conduit to carry it out.
Impact of Technology and Globalization on Accounting
00:25:03
Speaker
Obviously, I have my own opinions and ah I've voiced those during these sessions as a fellow member of the of the profession, but
00:25:14
Speaker
It really is a great opportunity for us hearing from our members where we think it's going and accumulating all that information and helping our members to strategically vision for themselves individually and for their organizations where the profession is headed and the things they need to do to prepare for that.
00:25:35
Speaker
So that's 15 years out. And Barry served for 30 years. So assuming you have to serve for 30 years also before they let you go, that only gets you halfway through your career. then you could parlay it to another 15 years into 2055, right?
00:25:48
Speaker
Yeah, well, yeah, funny funny enough, when yeah that's what I said to Barry, of course, he did 15 years, because that gave him the two terms that he was looking for for 30. I already said I was at digital CPA in December, they brought me on stage last year, they introduced me as a new CEO.
00:26:04
Speaker
I thanked Barry for his 30 years. And I said to the audience, then I said, I can guarantee you that i absolutely will not be here 30 years from now and i don't think anybody wants me to so uh you know i i i will serve for as long as the professional have me or as long as my body will put up with me doing this and the travel that it takes to to make it happen but um you know it's it's such a great profession i think we're we're on a pathway right now of some really exciting things
00:26:38
Speaker
Absolutely. I could not agree more. And with respect to the rise 2040 and what we're going to look like in 15 years, you know, one of the hard trends you must be looking at is technology and AI, because it's even today, right? We talked about earlier, you know, young people coming out of school nervous. Am I going to be able to get an entry level job or is AI going to take that away from me?
00:26:59
Speaker
So, you know, what can you say in your role where you oversee the realm of public accounting and you see what's happening with AI? How would you um you kind of put to rest the fact that you're coming out of a great accounting program, going to get your CPA, that you're going to lose a job to AI? What are you seeing happening in the industry right now?
00:27:20
Speaker
There's so many things. First and foremost, you know, when we look at Rise 2040 and the three hard trends that have been around really since the late 90s in the Vision Project. It was confirmed in 2011 with the Horizons 2025. So in 2011, we said the three hard trends are simple, regulation, talent, and technology.
00:27:44
Speaker
right And so when you look at regulation, we're talking HR1, just newly implemented, huge opportunity for the profession and regulation will constantly be evolving for us. ESG, it's in, it's out, it's you know all these different things. How does the market drive that? Technology in the rise ah horizons 2025, back in 2011, we talked about technology, we were talking about the cloud.
00:28:13
Speaker
And over the last 15 years, we have advanced the profession through cloud, through open APIs, tech stacks, new companies coming into the marketplace.
00:28:23
Speaker
So that was the technology then. The technology we're talking about today is maybe very quickly replaced with quantum computing. So we don't know what the technology requirements are going to be 15 years from now.
00:28:38
Speaker
But you know what? I mean, i don't know, Mike, what we did to society. that every time there is some type of a technology or innovation that takes place, it's going to put the accountant out of business.
00:28:51
Speaker
You know I've shown a timeline of innovation to the profession going back to 1933. 1933 was the advent of the 10 key calculator, the electronic calculator.
00:29:03
Speaker
Oh, my God, that's going to put accountants out of business. Because before that, they had almost like a cash machine thing with the ticker tape and all that that they had to use manually before that. And yet we survived that and thrived and created new jobs because of it.
00:29:19
Speaker
And then you look at when you and I came out of school. So in 1991, was heavy into VisiCalc. Excel wasn't even necessarily around. Maybe it was, but nobody was using it.
00:29:30
Speaker
VisiCalc that quickly morphed into using Lotus 1-2-3. Lotus 1-2-3 was absolutely the spreadsheet of choice in the business community for years, right? And you think about the fact that ah spreadsheets are going to put the accountant out of business.
00:29:47
Speaker
I remember some of the audit function that we had. I literally, i was told by partners, I had to verify that Lotus calculated the the the column correctly.
00:30:00
Speaker
So, and I said, but the formula is right. And they said, doesn't matter. How do you know that Lotus and the formula is actually adding it up correctly? You need to add it up on your 10 key.
00:30:12
Speaker
Now we take that for granted, right? And even before that, just as I came in is when personal computers were really coming around and firms started to do the tax returns in-house rather than sending them out to a service. Remember that?
00:30:25
Speaker
Oh, yeah. And and now, you know again, booming. So is ai going to change how we do things? Absolutely. Is it going to reduce the mundane and the routine? Incredibly so.
00:30:38
Speaker
but it's going to offer us new opportunities. And I think our training is going to have to change on this, that you know we may not have this this big fat pyramid at the at the bottom of the the pyramid scheme of a firm.
00:30:51
Speaker
It may be a little narrower at the associate, but you're going to be able to travel up into the into the next tier very quickly because you're gonna have to. You're gonna have to hit manager level way faster than it ever was back in ah in our days as you did it. yeah We don't have time for five years before you can make a manager. It's gonna have to be within a year or two because you are already being asked to review and to provide critical thinking skill to what you're doing because everything else has been automated.
00:31:23
Speaker
but AI also going to increase the amount of work that we're gonna get as a profession. Someone has to provide some level of assurance over AI controls that companies put in place.
00:31:36
Speaker
The finance function, I would envision, will implement the controls over AI inside of their organizations. Everything is wrapped around financial data. How do they know that their data is secure and the way that AI is is pulling the data that is, in fact, reliable?
00:31:54
Speaker
inside the organizations we own the control space internal controls is an accounting function we will continue to own that we need to own ai controls we need to then provide assurance over ai controls as part of the public accounting process so again i see greater opportunities around it getting rid of some of the mundane that was there before i said the accounts receivable New associates are going to be asked to provide an opinion on fairness of accounts receivable. And did our testing get us to a point to give it help us make a decision that is fairly stated?
00:32:32
Speaker
They are being asked to that right out of the gate. When you and I graduated, my level of success on the accounts receivable was how fast I could make copies of stuff envelopes for confirmations. Right.
00:32:44
Speaker
right We are in a very different place today. Exciting, i think. But we're going to need that critical thinking. And there's going to be some semblance of of ah simulation training that we're going to have to do to give everybody the nuts and bolts, probably in a six-month, nine-month time frame versus the experiential learning that we relied on for so many years prior to this.
00:33:09
Speaker
Yeah, I mean, i think you hit on so many important and relevant points there. And again, that's what I tell, you know, obviously I deal with a lot of young students still in college, just getting ready to take the exam and they're nervous. And, you know, we really say exactly what you just said, you know, they're not going to be replacing you, but your job is going to be different. How you think, what you do, critical thinking, how to vet all of the data from the AI, just different ways we do it. Again, and I think you said it too, you said, you know what happened to society that the moment something new comes out, we think that it's going to get rid of an and hot entire industry. like I talk to my wife all the time, you know we put on the news in the morning and it looks like there's going to be a snowstorm and every snowstorm is like the end of the world, so to speak. Don't leave your house. And then I get like a little dusting. I'm like, what's going on here? yeah So it's that sensationalized society that we live in right now. But the good news for accounting and for the young people, like we tell them, it's just going to be a different type of work. And it's really exciting what you're going to be doing. But that'll that'll lead me into my next question then. So one of the fears is And we can dispel that for sure. The other one is offshoring. you know What's happening internationally? and You know, this is a question I'm getting more from in the United States, domestic students. They say, am I going to lose my job to, you know, another country where all the jobs are going to move and the jobs aren't going to be here? So how do you answer that type of question?
00:34:38
Speaker
Well, I mean, offshore is not new, been around a long time, right? And there are tens of thousands, if not approaching maybe over 100,000 ah offshore employees for public accounting firms here in the U.S., U.K., Australia, Germany. You know, it is not we are not exclusive in this this theory.
00:35:02
Speaker
ah But all of it was due to capacity and trying to maintain ah the ability for these firms to grow at a time that they had limited capacity in people to get it done.
Career Development and Professional Growth
00:35:16
Speaker
And so, you know, we have yet to see, knock on wood, and hopefully we never do, the a relation that the more I hire in India, the less I'm going to hire in the U.S., right? ah Or to the point where, because remember, as you said, the numbers went down inside the U.S. And as that, the firm still needed to get stuff done.
00:35:40
Speaker
And so based on where the hiring needs are of the firm, That is how it's going to be relative to what happens in the offshoring environment and what the needs are in the offshoring environment. So firms know full well, they need to keep that pipeline flowing so they can move people upstream.
00:35:59
Speaker
Now, there's been rumors in the marketplace now. And, you know, again, anytime there's any type of a rumored layoff is always unfortunate. But You know, the the the bigger issue, when you look at the actual numbers and you break it down as far as what has happened inside of of the marketplace, we are still not seeing any level of significance or cause for concern inside of layoffs. Anyone who was laid off It's unfortunate, but what we have seen is that the the percentage of turnover has gone down and it was stabilized and gone down and has been consistent.
00:36:40
Speaker
You know, the it's it's the the the math world of how we created our pyramid scheme of a profession, and we need to rethink it a little bit, I think. But if a firm has 18% turnover year over year over year,
00:36:54
Speaker
and they have two years that show up that their turnover now is only 13%, they're going to do something about it. Sure. Right? Because there's still this pipeline coming in, and you haven't had the turnover of people you expected to leave at that other end, and there is some minor adjustment that happens. It's unfortunate. Not to the degree that you and I saw in the 90s. Not nearly the volume that happened back then. Even in the blip of 2000,
00:37:23
Speaker
and the blip of 2008, we have not hit again the significance in numbers like we had in in the late eighty s early 90s. you know as we As we go through this, and this is where I say, you know what? Then I want us to be responsible to help those of our members who have been displaced and get them placed somewhere else. Because there is a home for each and every one of them.
00:37:45
Speaker
And I want us to help do that. Or our benevolent fund for those who are displaced and may have some financial change those challenges in the short term. Anything we could do to help our member ah be happy in this profession, stay in the profession, and find the home that's right for them.
00:38:02
Speaker
Yeah, absolutely. And so funny you brought up like the 80s because we think about what the level was back then compared to today. And it's so radically different. And I try to explain to even young people that I deal with when they say, oh, my goodness, the mortgage rates just went from 2% or 3% to 7%. I'm like, do you know in the 80s mortgage rates were 14% 15%? mean,
00:38:22
Speaker
percent at fifteen percent i mean So it always seems like you're in the worst of the times when you're in them. But when you step back and you look at the big picture, you realize, hey, man, things aren't as bad as I might think that they are.
00:38:35
Speaker
That's right. That's right. And, you know, I think, again, this greatest profession in the world, I've said this time and again that, you know, for... Your career is only up to you.
00:38:47
Speaker
It's great to have mentors and they can help you to a degree. But at the end of the day, you have to make a decision based on your personal goals and who you are and understand, you know, your strengths and your blind spots at the same time and listen to that and always ask me for feedback.
00:39:04
Speaker
That has been ah how I've gone through life. And I even remember my grandmother, God bless her. She was, you know, when I left my first firm to go to the second firm, she was mad at me.
00:39:18
Speaker
She said, how could you leave that firm? They're the ones who gave you a job coming out of school, right? Because that traditionalist mentality of our grandparents was, you know, you go to work for a company, they gave you the job and opportunity, you're there for life.
00:39:33
Speaker
Now we saw management like middle management, our our parents get forced into early retirement during that time. And so so some of those loyalties have gone away.
00:39:44
Speaker
And I've said to to candidates all the time, you know what, you know, you always public accounting comes in so many shapes and sizes. If you like the work, if you like the clients, you Then if the the firm you're with doesn't feel right, there are other firms. I'm not encouraging everybody to leave. And the firms always yell at me if I ever say that. But that's the reality. i First firm was great. I'm still in touch with them. Good friends there.
00:40:11
Speaker
But I needed to make the change after three years. I did that. ah Second firm was great. Again, for reasons that were were for me, i left that. So always keeping friendly relations with all of them because you never know if they come back. And that's what I just got ah an email from someone who's leaving us.
00:40:31
Speaker
And she you know kind of felt bad about it. I'm like, look. You know what? I left in 2020. Everyone can have a a temporary ah you know the vacation, temporary ah way of of leaving an organization. But then for some, they may actually realize that they had it better than they thought they did at the first organization anyway.
00:40:55
Speaker
Right. How do we say just when you think you're out, they pull you back in. Right. That's what happens. So let me just say then with respect to the rise, 2040, you talked about all the things, regulations and technology and, you know, quantum computing, whatever it's going to be. Where do we fit in, um you know, diversity of talent in there, whether it's ah racially, ethnically, socioeconomically?
00:41:17
Speaker
Is that addressed inside of the 15 year plan? It will be as part of the talent acquisition, right? And I've said this time and again, you know, and I've been... You know, on my first day at AICPA, the diversity team and the people team all reported in to National Commission on Diversity Inclusion.
00:41:38
Speaker
and And so this year, as many know, there's been a lot of debate over D&I programs. And, you know, the federal government has given some direct feedback on that for certain organizations, the university system, obviously, and how they do things.
00:41:55
Speaker
But you know at the at the end of the day, for me, I look at the fact that you know you and I both talked about being blue collar, right? ah That is what's made a really good employee for public accounting and for CPAs.
00:42:10
Speaker
We've grown up with this. I go back to the CPAs of the 70s. All grew up blue collar, probably first generation a college graduate. I was first generation college graduate in my family.
00:42:23
Speaker
you know, continuing to find the the the folks out there who want to better their their lives and their careers by getting something in accounting that ah is is a true profession that really embraces, I think, some of that blue collar mentality as you come into it.
00:42:42
Speaker
ah To me, that was was critical. And I think there's a lot of opportunities for us to continue to expand that. I keep saying time and again, we don't look like the communities in which we serve.
00:42:54
Speaker
And so we need to do a better job of that. Maybe maybe not now we're going to talk less about race, but we can definitely talk about socioeconomic. Look at that based on zip codes and try and make that encouragement.
00:43:06
Speaker
you know I've had so many opportunities to to work with diversity groups and diversity programs along the way to to gain a better understanding.
00:43:17
Speaker
And as a white male, trying to carry the torch and have that constant understanding, whether we're talking about gender or race, making sure I i make it a a mandate. Any room that I walk into, it's not just about a racial thing or a gender thing. Any...
00:43:36
Speaker
room that I walk into, I look around and I look for someone who looks like they feel like they're out of place. Cause i know what that feels like. I didn't know how to dress when I was in college. I had, you know, I went to a university that was a private university, you know, and there was, you know, some of the upper class kids that were there. And I'm in my ripped up jeans as I'm going to class and whatnot.
00:43:59
Speaker
I look for that opportunity for someone who looks like they may what feel out of place and I want to make them feel welcome. And I learned that because first ever in my first stand at AICPA, I was invited to speak at the NABBA Division of Firms. NABBA is the National Association of Black Accountants Division of Firms. I started in July of 06, January of 07.
00:44:23
Speaker
I'm flying to Vegas to speak to this group. The night before I'm going to speak, i walk i they had a reception the night before. I walk into the room, and it was more than evident that I was the guest speaker the the next day because I was the only white guy in the room.
00:44:41
Speaker
And I had one gentleman, George Wiley, comes walking up to me, never met him before. He shook my hand, and introduced himself, said, hi, I'm George Wiley. Let me introduce you to a few people around the room.
00:44:53
Speaker
And he took me to each person in the room. And he said, hi, I want you to meet Marcozio. He's a good guy. He's one of us. And that taught me more about inclusion and making people feel welcome no matter who they are, no matter what they look like, no matter what they're thinking. Just finding those that may look like they feel out of place and making them feel welcome.
00:45:16
Speaker
That's what inclusion is all about. Yeah, I mean, that is fantastic. You know I attend the NABA annual conferences every year as well. And I've been a speaker at DOF myself. And, you know, what just fantastic organizations, what amazing people. And it's it's really great to see everything they represent and how they are trying to help in this area. So, you know I love the fact that you and your team are making sure that that is something on your list to keep moving that forward.
ESG and CPA Designation Challenges
00:45:43
Speaker
And on that thought, another little item you touched upon, and um we didn't really dive into it but I'll just ask him a question on it. we We hear so much now about what is or is not happening to ESG, environmental, social governance or sustainability, however we want to refer to it. Where do we stand with that in the profession today? And what do you see the future of sustainability with respect to your RISE 2040 plan?
00:46:08
Speaker
Yeah, it's part of it's part of the service offering now, right? And it will continue to evolve, I think. And you know part of that is the regulatory aspect of it. And yes, the SEC has dropped the rule that they were going to implement.
00:46:20
Speaker
There's still a couple of states here in the US that have adopted rules that need to be followed. But then also you had the EU. The EU had really kind of the first detailed level of ESG mandates in the world.
00:46:37
Speaker
And so since then, they have actually pulled back on that a little bit. You know, Chairman Atkins from the SEC, he's been pretty vocal about ESG. He made some comments in Europe that I believe was taken out of context a little bit, but he definitely ah is is saying that we've gone too far on ESG and we need to figure out the right balance of cost benefit of what we're getting out of ESG. And I think that that's an important aspect is to look at that balance.
00:47:06
Speaker
EU is pulling back. Interestingly enough, this year i had the benefit. I met with the FSA and in Japan. That is the SEC equivalent. I met with the the the financial oversight of Hong Kong also over the summer, all of which are talking about ESG. They've adopted their own rules around ESG, and they're like, well, wait a minute. The U.S. has dropped their SEC rule.
00:47:30
Speaker
EU is pulling back on the mandate. We may have the most stringent ESG mandate right now, but we don't want to. So how how do we balance this? And what is it that we have to do? Because they're afraid that it would actually hurt their businesses if they had the bigger mandate around it.
00:47:48
Speaker
I will tell you, i so just this week, Monday, i was on a a video call with, we have an ESG task force, a number of the firms that are involved in this, they're as busy as ever.
00:48:00
Speaker
a lot of it, they are asking for some level of assurance over ESG. They have figured out some of the balance. There has been a little bit of that pullback, but it's still out there, it's still prevalent, and it will continue to grow. The investors are asking for it.
00:48:14
Speaker
Audit committees are asking for it. So I do think it'll be here. Maybe not as deep as what the EU originally stated, but between technology and ah some of these adjustments, it'll still be here, but might be a little easier to to report and track going forward too.
00:48:35
Speaker
Well, that's great information. So kind of wrapping up now, we've covered a lot of information about the profession. We talked about Mark as well, but just you know taking a step back again one more time, you mentioned throughout your career, you've had mentors, whether it was your family friend who got into accounting to join the FBI or the gentleman that had a role for you at the AICPA, or just being able to bounce ideas off Barry, you've had these mentors.
00:49:01
Speaker
And I'm sure there's others that you haven't even mentioned from all of these mentors. If you could kind of think about, hey, what's the best lesson I i learned or the best leadership advice I got from these people? What would be something that we can leave our audience with?
00:49:17
Speaker
Yeah, you know, I think first and foremost, ah you know, being a ah Having a sense of vulnerability, understanding what you know and don't know, ah listening more than speaking, all those pieces are incredibly important. And I've learned different aspects of who I am from all these different mentors. So my friend's father, ah again, like a father to me, then I went to work for a guy in sporting goods who taught taught me how to sell and taught me how to work a room.
00:49:49
Speaker
Right as I was going to college. And then i entered the profession and I had mentors in the different firms that I was with being able to help me along and and understand, you know, the how to navigate inside the firm. And, you know, just the the various things about being a good auditor and being a good client service person, having those to fall back on.
00:50:12
Speaker
And then joining AICPA, Jim Metzler first, and then Barry in those last number of years, always so important to me to have someone to to do that. But, you know, the leadership style is, you know, I can only control what I do. I've been through executive coaching. I have an executive coach now.
00:50:30
Speaker
So he would be, in essence, that mentor relationship for me. ah Very important for me to have and for help me identify my blind spots and to ask open questions of the people that I'm dealing with and not afraid to share in a way that they understand who I am, not that i let people assume who I am along the way.
00:50:53
Speaker
Well, that is great. And thinking about this body of work that you've put together so far from the day you left college to, you know, the day you're sitting where you're sitting right now in the role over the AICPA, you've seen and you've been a part of a lot of professional achievements. If you look over the body of your career or of the profession, is there one moment or one shining light that you could say, hey, I was so proud on this day of this achievement that you can share with the audience?
00:51:24
Speaker
ah probably the day i got my CPA. I said, you know what? They can never take that away from me and unless I screw it up, right? So now it is fully in my control. And I know, and look, you know, Mike, we're working on this right now because it's it's getting more prevalent right now, the use of CPA. And I get it for our young professionals.
00:51:48
Speaker
You work hard, you achieve it, you pass it. And then for the firm to say, Don't tell anybody. You can't put it on your LinkedIn, can't put it on ah your business card.
00:52:00
Speaker
Part of that is we've made the rules so complicated right now. The whole mobility thing, we talked about the additional pathway, that's adding complication. and you have more firms telling their people not to put it on because they're afraid they're going to get tripped up one state to another right now until we fix mobility.
00:52:18
Speaker
you know what, just hang tight. We are going to, and i when I first learned that this has happened early on as I started, i said, look, i you could take those three letters out of my cold dead hands. I am never giving that up.
00:52:32
Speaker
Even when I went into business and industry, as I did three years and in working in political media, I kept those three letters because i said, I am never giving that up. I am proud of it it. It gives me such a diverse,
00:52:45
Speaker
opportunity ah out as a career in the so many different things that I could have done that even if that the political thing didn't work out, I could have gone in so many different directions because i kept that CPA.
00:52:59
Speaker
So I just, you know, letting everyone know, hang in there. We are talking to the firms. I get it. Why we are talking to the state boards. We are talking to NASBA. We're talking internally.
00:53:12
Speaker
This is something we need to fix. It's a 20-year-old problem, by the way. ah So people want to say it's PE firms. It's not. It's a 20-year-old plus problem that we need to fix. It's not going to happen overnight.
Balancing Professional and Personal Life
00:53:24
Speaker
But I want everybody to be proud of being able to use CPA. You have some in, in ah you know, there's a couple of states that if you are not in public practice, if you are a CFO in in industry, they say you cannot say that you're a CPA.
00:53:40
Speaker
To me, that's crazy. So if AICPA, if my office was in one of those states, I could not say on my business card that I'm a CPA representing the AICPA.
00:53:52
Speaker
That is outrageous. And so I think we need to really kind of fix these rules So that we are all proud of CPA, that the public's protected, that they understand what a CPA does.
00:54:04
Speaker
In the various roles that are out there, it is not just about public practice. We have a diverse aspect of what we bring to the business community. And so, yes, to you know that is a long-winded answer to your question of what I was most proud of. It was the day I passed i i found out I passed the CPA.
00:54:24
Speaker
All right. I mean, you just touched so many things that we're not going to have time to dive into right now. Unless can you give me um two days for this podcast? if i have two days I can cover just about everything. I mean, you talked about in you know mobility, inbound mobility, outbound mobility. We have private equity. I mean, we used to CPA. I mean, so much stuff. So that's why I need to get you back on here because we have a lot going on and a lot more that we need to talk about. But we're going to. We're going not dive into there because we're just about at the end of the time that we have, I know. And um I really do appreciate what you've been saying here and coming here and sharing all of this with the audience. But I do have one last question that I want to ask you. And I know from speaking to Barry, I mean, I believe he was traveling 240 or 245 days out of the year. Are you traveling as much as Barry is doing all of this? And How are you finding balancing your personal life with the professional life and avoiding burnout, so to speak?
00:55:17
Speaker
Yeah, it's not easy. I am probably traveling as much. And, you know, fortunately, where I am in my stage of life, ah I have a very understanding spouse. Marianne has also traveled with me.
00:55:32
Speaker
We kind of make it a mandate at least ah a week a month or two weeks a month to to have Marianne with me just to keep me sane, too, and kind of keep me under wraps. Otherwise, I'd be up at six, you know, on on calls and going to dinners till 10 every night. If she's there to kind of balance me a bit and keep me from overextending when I'm on these trips.
00:55:58
Speaker
In fact, she you know any American Airlines travelers, she hit executive platinum since April 1, two weeks ago, as you know traveling with me occasionally versus the the million plus points that I hit recently.
00:56:15
Speaker
you know, recently since April myself. So um yes, it is it is a hard balance. I do want the team to travel more. And I keep saying that there's ways that I can do it more virtually in the first year, especially, you know, I'm going to try and reduce that. Although i have more conflicts than I am able to actually make in a lot of these travel things as well. So ah yeah, it's, it's,
00:56:42
Speaker
Travel heavy. Well, you know, from all your answers and everything you've said, it's apparent, you know, how much you love the accounting profession, as do I. And we're, you know, fighting the battle to grow the profession, move it in the right direction. So wrapping this up,
00:56:57
Speaker
What are the words of wisdom you could share with those young people that are still in college and just going in there with respect to why accounting is so great? And would you, Mark, do it again? And what should they think about as they project what their career path is going to be?
00:57:14
Speaker
Yeah, they own their career. And if if if the current role that they're in ah is not what they're looking for, or they want to see things differently, it is up to them to communicate that with their employer.
00:57:30
Speaker
Right. And if they left ah and and they had not had that conversation of what their career trajectory would be or, you know, what they're looking for in an ideal situation and shame on the the candidate.
00:57:45
Speaker
If they've expressed it and the employer wasn't listening, then shame on the employer. But communicate that and give it a shot. I mean, again, I say public accounting, I treasure those 12 years. In fact, one of the first clients I ever brought in, I brought it into my first firm.
00:58:03
Speaker
Ended up bringing it into my second firm a few couple of years later. ah the the The owner just passed away recently. And, ah you know, that was that was hard for me because he was such a great advocate for me and brought all these others along the way. Those relationships.
00:58:21
Speaker
are just so incredible. And to be able to have that, the relationships I have now with people like you and and our members all around the world, ah i treasure. And I think that we are a people business. That public, the PNCPA is very public and it is a people business and I love every minute of it.
00:58:41
Speaker
Well, that is great. And thank you so much for taking the time to come on the podcast and talk to the audience, share all of this great information about the state of the profession. I think there was just such valuable information you shared. And it really is mutual, you know the respect we have for the AICPA and the relationship we have with you and the york organization.
00:59:02
Speaker
And i just feel so positive about the profession and growing it and the direction that you know Barry's taking it and now you taking it over as respect to the leader of public accounting. I just see you know great things ahead in the future and you know with respect to Rise 2040. So thank you for all you do and the personal sacrifice you make for running this massive um you know profession of 600,000 plus people. So thank you again. And I really look forward to having you on a podcast again in the future.
00:59:34
Speaker
Thanks, Mike. Thank you everyone for listening to this podcast with Mark Koziel and thanks again to Mark for taking the time out of his extremely busy schedule as you heard to share all of this extremely valuable information with you. Now, I wanna make sure that everyone listening is aware that you can earn CPE credits just for listening to this podcast.
00:59:55
Speaker
All you need to do is visit the link in the show notes, click on that and get your credit. And even better, if you're a Prime CPE subscriber, you can earn the CPE at no extra cost. All you need to do is log in to finalize your credits.
01:00:10
Speaker
Thanks again, everyone, for tuning in. And we hope to see you again at a future Becker Accounting podcast. See you soon.