financialplanning

BY LEONARD WRIGHT , CPA / PFS , CFP , CLU , CHFC

CPAs can transform their clients ’ lives . My experience shows that the obvious often stares us in the face — we just don ’ t see it . When I was a COO and CFO of one of America ’ s leading jewelers and a leading health care company , I always looked at how I could expand the business . What I discovered repeatedly was that I was always closer than most imagined to adding services , shifting product mix or some way to make our product more accessible to acquire by just making some small changes .

The same is true for CPAs , who are likely performing financial planning without realizing that these activities are subsets of financial planning .

How Close is a Typical CPA to Financial Planning ? We ’ ll break down a few of the services from Figure 1 that integrate elements of financial planning and examine what CPAs already do in a typical accounting practice and their complementary skills . Most may realize that creating transformative client relationships often only requires a little more work .

What CPAs Do : Tax-related Financial Planning Financial planning has one common thread : Taxation . Tax compliance impacts every aspect of financial planning and tax expertise is a unique feature of the financial planning opportunity for CPAs , as is estate planning expertise .

FIGURE 1

Financial Planning

These features are so important to accountancy that we have robust committees dedicated to them and the related sophisticated personal and business estate and tax planning . What is surprising is that too much weight is given to adding one program that integrates the planning you already perform into a financial plan .

What CPAs Can Add A minor addition in this area to help clients take advantage of a rarely used tax strategy is the tax and estate planning opportunities for retirement plans . Less than half of 1 percent of business owners with employees take advantage of coordinating plans that fundamentally change long-term outcomes for families and business owners .

What CPAs Do : Goal-focused Financial Planning Taxes impact all business decisions to help fulfill client visions and goals . CPAs may counsel clients on their goals and how to execute them ; you help them outline business planning , cash flow and various integrated tax strategies ; you prepare the outcomes reflected on Schedule A , Schedule B : Interest and Dividends , and Schedule D , capital gain recognition ; and you may even counsel on 1031 exchanges with sales of property .

What CPAs Can Add One way CPAs can add support to your client ’ s goals and enhance the their current planning experience is by adding a financial plan and forming deeper relationships with clients around what ’ s important to them . A financial plan integrates the planning you have performed for them and adds modules that allow the client to see the value you deliver . Tying together your client ’ s vision , values and goals will enable you to demonstrate the impact of planning you already do in a way that consistently reminds them of the value your services have delivered . And when you meet those goals and needs , a greater appreciation and trust forms .

14 CALIFORNIA CPA JULY 2024 www . calcpa . org