Accounting Profession CRISIS?
Summary
TLDRThe CPA journal has highlighted a crisis in the accounting profession due to an aging workforce and a decline in new accountants and students. With 75% of AICPA members nearing retirement and a significant drop in CPA exam takers, the profession faces a shortage. Reasons cited include the 150-hour requirement, low pay, and a lack of diversity. Proposed solutions involve revising educational requirements, but the discussion also points to broader issues like work-life balance and the increasing use of offshore teams, hinting at an impending revolution in the industry.
Takeaways
- 📈 The accounting profession is facing a crisis with a significant shortage of accountants.
- 👨💼 The AICPA had 428,000 members in 2020, with 75% nearing retirement age, indicating an aging workforce.
- 📉 There was a 34% drop in accounting majors at one private university between 2015 and 2019, reflecting a decline in interest.
- 📊 A 33% reduction in CPA exam takers from 2016 to 2021 suggests fewer new accountants entering the field.
- ⏳ The 150-hour requirement to become a CPA is cited as a potential deterrent for prospective accounting students.
- 💼 The perception of accountants having a lower pay and less exciting work compared to finance or tech industries could be discouraging new talent.
- 🏫 The high cost of college education and the perception that accounting is too specialized may be contributing to the decline in students.
- 🌐 Offshoring is becoming more prevalent in accounting firms, potentially reducing the need for new domestic accountants.
- 💡 The article suggests removing or adjusting the 150-hour requirement as a solution to the accounting crisis.
- 🌟 The speaker proposes that improving pay and quality of life could be more impactful than altering educational requirements.
Q & A
What does the CPA Journal article suggest is the current crisis facing the accounting profession?
-The CPA Journal article suggests that the accounting profession is in crisis due to a severe shortage of accountants, with a dwindling number of current accountants and a decrease in accounting students.
How many members does the AICPA have, and what percentage of them are at retirement age according to the article?
-The AICPA had 428,000 members in 2020, and 75% of those members, which is approximately 321,000, are at retirement age.
What is the significance of the 150-hour requirement to become a CPA, as mentioned in the article?
-The 150-hour requirement is significant because it is one of the reasons cited for the shortage of accounting majors and CPAs, potentially deterring students from pursuing accounting degrees.
What is the impact of the 33% reduction in those taking the CPA exam from 2016 to 2021?
-The 33% reduction in those taking the CPA exam indicates a decline in interest in the accounting profession, which could exacerbate the shortage of accountants.
What are some of the reasons listed by the CPA Journal for the shortage of accounting majors?
-The CPA Journal lists several reasons for the shortage of accounting majors, including the 150-hour requirement to become a CPA, low pay compared to other fields, lack of diversity, specialization, high cost of college, and a general decline in college attendance.
How does the article address the image problem of accountants?
-The article mentions that a previous CPA Journal article pointed to the 'big four tweets' X account as part of the reason for the image problem in the accounting industry.
What solutions does the article propose to address the accounting crisis caused by the 150-hour requirement?
-The article proposes two solutions: one is to remove the 150-hour requirement, and the other is a mixed approach where a 120-hour requirement is suggested if one takes all four parts of the CPA exam, or three parts if one has 150 hours.
What role does the use of offshore teams play in the accounting industry according to the script?
-The script suggests that the use of offshore teams is becoming more prevalent in accounting firms as a cost-effective alternative to local accountants, potentially impacting the demand for new accountants.
What changes does the speaker anticipate for the accounting profession in the future?
-The speaker anticipates a revolution in the accounting profession, with significant changes needed for CPAs to stay relevant, possibly including a shift towards utilizing accountants from other countries.
How does the speaker reflect on their own experience with the 150-hour requirement for CPAs?
-The speaker personally did not find the 150-hour requirement for CPAs to be a deterrent during their college years, but acknowledges that others might view the additional hours as unnecessary.
Outlines
📉 Is the Accounting Profession in Crisis?
The CPA Journal recently published an alarming article claiming the accounting profession is in crisis. The American Institute of CPAs (AICPA) had 428,000 members in 2020, but 75% of them are at retirement age, indicating a looming shortage. Additionally, the number of accounting students and CPA exam takers is drastically declining, with 300,000 accountants leaving the profession between 2019 and 2021. The reasons cited include the 150-hour requirement to become a CPA, low pay compared to other professions, lack of diversity, and the high cost of college. The article criticizes the CPA exam's structure and points to societal issues, like the negative portrayal of the profession on social media, as contributing factors.
💼 Challenges in the Accounting Industry
The narrator reflects on their own experience as a CPA, questioning the impact of the 150-hour requirement and the broader issues affecting the profession, such as pay and quality of life. The article offers two potential solutions to the crisis: reducing the requirement to 120 hours or a mixed approach involving different exam components. The narrator believes that pay and quality of life are more critical factors than the educational requirements. They note the increasing use of offshore teams by accounting firms to reduce costs and the need for significant changes in the industry to maintain relevance.
Mindmap
Keywords
💡Accounting Profession
💡CPA Journal
💡AICPA
💡Retirement Age
💡Accounting Students
💡CPA Exam
💡150-Hour Requirement
💡Quality of Life
💡Offshore Teams
💡Public Accounting Industry
💡Revolution
Highlights
The accounting profession faces a crisis with a significant number of CPAs nearing retirement.
The AICPA had 428,000 members in 2020, with 75% at retirement age.
There's a shortage of accountants, with 300,000 leaving the profession between 2019 and 2021.
Accounting student numbers are dropping, with a 34% decrease in one private university's majors between 2015 and 2019.
The number of CPA exam takers has seen a 33% reduction from 2016 to 2021.
The 150-hour requirement to become a CPA is cited as a reason for the shortage of accounting majors.
Accounting is perceived as less exciting and lower paying compared to finance and tech careers.
Lack of diversity and specialization in accounting are seen as barriers.
The high cost of college education is a factor in the decline of students pursuing accounting.
The CPA Journal's article suggests that the profession needs to address its image problem.
The article proposes solutions to the crisis, including revising the 150-hour requirement.
The author of the transcript, a CPA, argues that the 150-hour requirement was not a deterrent during their education.
The author questions the economic model of accounting, with low pay and high stress.
The transcript suggests that pay and quality of life have a greater impact than educational requirements.
The use of offshore accounting teams is becoming more prevalent in the industry.
Modern accounting firms prioritize employee well-being and work-life balance.
The accounting profession may be on the brink of a significant change to stay relevant.
The public accounting industry needs transformative changes to remain competitive.
The transcript concludes with a call for the accounting profession to evolve or risk becoming obsolete.
Transcripts
is the accounting profession in crisis
the CPA journal or the self-titled voice
of the profession recently posted a
rather dramatic article on how the
accounting profession is in crisis the
aicpa which is the Professional
Organization for CPA had
428,000 members in 2020 and apparently
75% or 75% time 428,000
321,000 of those members are at
retirement age
I have so many questions why are CPA so
old or are the members of the aicpa just
really old did I bring the average age
down a couple years when I joined back
to the article which starts off by
saying the profession is facing a severe
crisis due to the shortage of
accountants not only is the number of
current accountants dwindling but the
number of accounting students is also
dropping 300,000 accountants left the
profession between 2019 and 2021 one
private University saw a 34% drop in
accounting Majors between 2015 to 2019
less accounting students means the
number of those taking the CPA exam is
dropping in fact there is a 33%
reduction in those taking the CPA exam
from 2016 to 2021 the CPA Journal gives
a list of reasons why there is a
shortage of accounting Majors the
150-hour requirement to become a CPA
we're boring we don't get paid as much
compared to finance Bros or Tech nerds
not diverse accounting is too
specialized college is too expensive
less people are going to college I'd
like to note that in a previous article
from the CPA journal the big four tweets
X account was described as part of the
reason why accountants have an image
problem so an X account that posts memes
about the accounting industry is why
we're in this crisis yeah the post can
be cynical towards the accounting
industry but here's the thing they are
holding up a mirror to the profession
reflecting what's actually happening you
Can't Blame A Storyteller for what's
happening in a story when they are just
sharing the story not writing the story
back to the original article the purpose
of the article was supposedly to talk
about the 150 hour requirement as the
reason for the accounting crisis
specifically the CPA shortage if you
didn't know I'm a CPA I know I know it
looks like I should have been a model
for Calin Klein
[Music]
but instead I got a master's in
accounting that became a
CPA from my experience I never thought
having to have 150 hours of college
credit was dumb while I was going
through the accounting program I was
just happy to be in college and not
being an adult back when I was in
college there weren't people on social
media posting about how the quality of
life of public accountants was terrible
and the pay didn't match the amount of
work they did I'm not not sure if
accountants realized at the time how
they were getting screwed that or no one
seemed to be questioning why it was that
way it wasn't until about 5 years into
my career where I started to question
the economics of it all how are we
getting paid so little compared to all
the work that we do and the stress that
we endure the article proposes two
solutions to help out the accounting
crisis caused by the 150 hour
requirement option one remove the 150
hour requirement with what I'm assuming
is just 120 hour requirement but they
didn't say option two a convoluted mix
of 120 hour requirement if you take all
four parts of the CPA exam or have to
take three parts of the exam if you have
150 hours I know the article wants to
zoom in on the 150 hour requirement but
I think that pay and quality of life has
more of an impact than having to go to
school for another year then again I was
in a master's program to get those extra
30 hours so I thought it was was
valuable to my career but those that are
taking random classes like walking
probably think the extra hours are
pointless what you do see on Reddit a
lot is people are sharing how horrible
the quality of life is so what's going
on
um I probably start crying it's
okay so I am a tax accountant
and I'm sorry okay put a lot of r on me
so busy season they want I had to work
50 60 70 hours a week uh stayed up all
night sometimes 3:4
a.m. I'd like to propose a question does
the decrease in new accountants really
matter we've been talking about us
accountants this whole time a lot of
accounting firms are utilizing offshore
teams because they are cheaper and they
can do just as good as a job as their us
counterparts I've noticed most modern
account accounting firms are using
offshore teams to help with their
accounting and tax work and most modern
firms seem to prioritize not burning out
their employees I think we're on the
cusp of an accounting profession
Revolution something is going to have to
change and change in a big way if CPAs
want to stay relevant and right now the
change looks like using accountants from
other countries I'm 100% Pro CPA but the
public accounting industry needs to
change and I can't wait to see when that
day comes if it ever
does thanks for
watching
cheers
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