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[Podcast] Client Accounting Services Best Practices with Lisa DeVaughn Foley of Baldwin CPAs

Posted by The AI in Accounting Podcast on Jan 13, 2021 7:30:00 AM
The AI in Accounting Podcast

In this episode of the AI in Accounting Podcast, you will meet Lisa DeVaughn Foley, a member and leader of the Client Accounting Services (CAS) Team at Baldwin CPAs, PLLC, based in Richmond, Kentucky.

Baldwin CPAs, PLLC provides accounting and tax services to foreign corporations and individuals who do business within the United States, as well as companies and individuals with activities abroad, in countries such as Japan, Canada, France, China, the United Kingdom, Germany, and Mexico.

In this episode, Lisa offers her insight on where to place your focus when you are starting fresh with a new client:

Lisa	DeVaughn Foley, Member and Leader, Client Accounting Services (CAS) of Baldwin CPAs

“I always tell our staff as we’re starting things that we are here to help our clients and our business owners spin less plates. … If you’re a busy business owner, you are just spinning so many plates, and … you need to design your services offerings around … how to make their life easier, because that’s all the client cares about. … They want the information at their fingertips … they just want their life made easier, and I think you have to … treat their resources as your own.”

Lisa also stresses the importance of having defined processes that the entire team can follow to ensure that everyone is on the same page:

“Internally, you’ve got to develop processes. You have to figure out a way to make things scalable and to add on multiple staff to help you grow. You’ve got to have defined written processes that someone can follow. You’ve just got to have everything laid out to get everybody on the same page and pulling in the same direction.”

Additionally, Lisa offers her advice on how to re-center yourself and your team if your practice has gotten off-course:

“You just have to center yourself back to your strategic plan. What are your one-year, three-year, five-year goals, and, if you’ve gotten off-course, how can you get back on that? Don’t be afraid to try new things. You just have to be willing to pivot and not be afraid of change and … not afraid to try new software, new apps, new things, and just spend the time on that to get yourself … more efficient and headed in the right direction.”

Listen to the episode in full to learn more about the importance of:

  • Designing your service offerings to better suit your clients and make their lives easier
  • Treating your clients’ resources as if they were your own so that you can better empathize with their needs
  • Developing defined, written internal processes to keep your whole team consistently on the same page
  • Continually checking in with yourself and your team to keep your process future-minded and planning ahead
  • Not fearing change and learning how to pivot to keep up with current trends and technologies

All this and more is discussed in detail in this AI in Accounting Podcast episode. To learn more about Lisa and contact her with any questions about client accounting services, you can check out her LinkedIn profile and visit her bio page.

Watch the Podcast Interview


Watch on YouTube: Lisa DeVaughn Foley of Baldwin CPAs Explains Client Accounting Services Best Practices


Listen to the Podcast Interview


Listen to Apple Podcasts: Lisa DeVaughn Foley of Baldwin CPAs Explains Client Accounting Services Best Practices


A lightly-edited transcript follows below:


Joshua Feinberg (00:01):

Hi, it's Joshua Feinberg from the AI in Accounting Podcast, and I'm being joined today by a very special guest. I have with me today Lisa DeVaughn Foley from Baldwin CPAs in Richmond, Kentucky. Lisa is a member and leader of the firm's client accounting services (CAS) team. Lisa, thanks so much for joining me today.

Lisa DeVaughn Foley (00:22):

Thanks for having me, Josh. Looking forward to it.

Client Accounting Services Journey

Joshua Feinberg (00:26):

We really appreciate it. The first place I always like to start with these interviews is to understand how you got to where you are in your career or your accounting journey. Did you always want to be an accountant? And what led you along this path?

Lisa DeVaughn Foley (00:40):

Sure. I actually knew early on. I took an accounting class in high school, and I just enjoyed it. I knew a couple of adults that were friends of my parents that were accountants. So, it always intrigued me, and when I took the class in high school, it just clicked, and I knew from that moment on that's what I wanted to do. I think probably early on, I thought it was more about math than it ended up being. It's more about people and problem-solving, but I knew early on that's what I wanted to do and stay on the path.

Joshua Feinberg (01:21):

Yeah, that was fascinating. I always just think of stories like people that had family members that were in accounting, there was a special professor, a lot of people that started in engineering then ended up moving into accounting, but it's always great to hear the path. I think I took a bookkeeping class in high school, too, pre-Lotus 123, I think it was.

Lisa DeVaughn Foley (01:43):

Yeah. I remember the Lotus days.

Advice for Building a Client Accounting Services Practice

Joshua Feinberg (01:43):

I think it was in college. When we were in freshman year of college, the first time an econ professor got me into keyboard shortcuts, and the original 123 spreadsheets. Easy times. Well, the first area I wanted to ask you about today is when you think about somebody that's just starting up a client accounting services or outsourced accounting practice, what advice would you give them? Maybe you've met them at a conference, or maybe it's someone you went to school with that reached out to get together with you for coffee, or virtual coffee. What advice would you give them on what to expect in the first couple of years of building a practice like this?

Lisa DeVaughn Foley (02:19):

So, I think you need to keep your clients and your team as the most important base of everything, and I always tell our staff as we're starting things that we are here to help our clients and our business owners spin less plates, right? If you're a busy business owner, you are just spinning so many plates, and that is what you need to design your service offerings around is how to make their life easier because that's all the client cares about, right? They just don't want to have to fool with this. They want the information at their fingertips, but they just want their life made easier, and I think you have to take the approach that helping clients manage their accounting, you just have to treat their resources as your own. So, I think that's the side I look at from the client perspective and service perspective, and then I think internally, you've got to develop processes. You have to figure out a way to make things scalable and to add on multiple staff to help you grow. You've got to have defined written processes that someone can follow. Our firm has grown over the last 15 years through a lot of mergers, and so, we've learned that the hard way, that you've just got to have everything laid out to get everybody on the same page and pulling in the same direction.

Joshua Feinberg (03:52):

Yeah, I noticed that a lot, as one of the people in my own company that's responsible for keeping the CRM accurate, I'm constantly seeing, "Hey, I just saw another firm mentioned on LinkedIn, that they just acquired another one," and I don't know whether it's 5%, 10%, 15%, but there always does seem to be a significant amount of acquisition and consolidation.

Lisa DeVaughn Foley (04:15):

Yeah, and we're seeing more of that. So, we were probably $1.5M in revenues 15 years ago, and now we're $10M 15 years later. So, we've grown a ton, and I think I find that we as a member group are being more selective because there are lots of opportunities out there right now, because there's a lot of the Baby Boomer generation that really don't have a plan for their accounting firms. So, their plan is to sell to some of the firms that are still out there and still looking for it. So, when you do that, you've just got to have those processes, and you've got to treat it. We have five locations. So, it's even more important to have the processes documented and treated as a one-firm concept. This is the way we do it, the Baldwin way. So, to keep everybody on the same page.

Joshua Feinberg (05:13):

And it's really forward-thinking, too, now that you look back at that mindset of where we are going into next year. We went from five locations to, there's got to be like dozens of locations now, where you don't have the ability to say, "Hey, Lisa, I'm stuck on this. Can you come over here for a second and show it to me?"

Lisa DeVaughn Foley (05:30):

Yeah. The cloud accounting, we adopted very early. We actually adopted it 15 years ago because we were in two buildings at our first merger, and we were, like, “Why would we get rid of this?” So, we were an early adopter in the cloud side and haven't really looked back, and, as you grow and have more locations, and now with the pandemic, we haven't missed a bit. I have my three monitors at home and can just work here, just like I could at the office, and our staffers are the same way.

Joshua Feinberg (06:05):

Yeah, no, that's great. So, that's excellent advice on what to do when you're first starting a CAS practice. I love the analogy with the spinning plates. I often hear the “wearing lots of hats” being used most of the time, but the plates spinning is actually a lot more realistic. If somebody is walking down the street, and a big gust of wind blows away their ball cap, yes, they may be upset if they lose it, but it doesn't have quite the impact of hearing a plate falling on the floor and cracking into a million pieces.

Lisa DeVaughn Foley (06:34):

Yeah. So, I always use the spinning plates, and I had one client respond back to me. We do a biz diagnostic survey when we take on a new client, and one of the things was when we had that meeting, after they had taken the survey, it was like, “Well, we do a lot of breaking of plates, and that's why we're here to have some conversations.” So, yeah, I think busy business owners, that really resonates with them.

Getting Client Accounting Services Back on Track

Joshua Feinberg (07:03):

So, thinking about someone now, that's been running an outsourced accounting or client accounting practice for a number of years—maybe they're five or 10 years into this, and things haven't been going that well this year; they've had a lot of client attrition; maybe they've had a significant staff turnover, or they're feeling a little bit of sense of burnout—what advice would you give them on how to recharge their batteries, regroup, and get back on track?

Lisa DeVaughn Foley (07:28):

Yeah, I think every year, one thing I've always said, we've been very connected to the tax side, as well, of our business, and we always talk about tax seasons. Every season's different, right? This year, we had PPP. Every year is different. So, you're always going to have bumps in the road, and I think you just have to center yourself back to your strategic plan. What are your one-year, three-year, five-year goals? And if you've gotten off-course, how can you get back on that? And don't be afraid to try new things. I know one of the things we've had to do as a department is PPP. We decided as a firm that this was a very important part of our clients’ businesses to be able to apply for the PPP loans, and we were like, “Okay, we're going to create a service. We're going to hold webinars and podcasts to talk about PPP and educate everybody.” And that was rewarding. It hasn't been tiresome because you have some people that aren't working as much this year, and we've been lucky enough to create it. We would be down in some revenues had we not pivoted, right? You've got to always pivot, and we see an opportunity, first and foremost, just to help our clients, but it also has generated revenues for us. So, I think you just have to be willing to pivot and not be afraid of change, and I think one of the other things is just making sure you're not afraid to try new software, new apps, new things, and just spend the time on that to get yourself back and more efficient and headed in the right direction.

Joshua Feinberg (09:15):

I feel like I'm actually hearing that often enough that at some point, it's going to have to filter down into what an undergraduate or MBA in accounting looks like, because it's not just a matter of that, yeah, they need to be better prepared to deal with technology today, but it's the skills of whatever you think you know now, in 12, 18, 24 months will probably be supplanted by something else, and the ability to continually learn and improve, pivot, be really agile.

Lisa DeVaughn Foley (09:42):

I can't remember; I heard a term the other day; it's no longer called “change management”; I can't remember what it was, and it may come to me, but it's true, you cannot be afraid of change, and sometimes I think you have to look at your team, right? Do you have some cynics on your team? Because if you have cynics on the team, they're going to slow your pace of being able to change down. So, I think finding people that are part of your team that can self-manage and then are not afraid of change, are key skills that you have to look for as you're hiring and putting people in place in your team now.

Joshua Feinberg (10:26):

Do the CPA requirements help with that a little bit? Or do you think there are certain people that are just checking the box on that?

Lisa DeVaughn Foley (10:35):

I think the CPA certificate gives you a good well-rounded knowledge base, and I sat on Eastern Kentucky's College of Business Board, and we focus continually on soft skills. It doesn't matter if you're an accountant, it's still you've got to focus on your skills and sales, right? It doesn't matter what position you're in; you're always either selling an idea to your teammates, or your boss, or a client. You've got to focus on people because I think cloud accounting of the past was so transactional-based, and now it is completely advisory-consultant-based. You've got to hear your clients and respond to the issues they're having. So, I think the CPA gives you a great knowledge base, but I think what makes a CAS practice work the best is relationship-building with your clients, and the people skills and the transactional step just backs it up.

Mistakes to Avoid With New Accounting Clients

Joshua Feinberg (11:45):

That's great. Lisa, when you take over a new client that either has been handling accounting internally or maybe they're coming over from another firm, what's the single biggest mistake when you're inheriting a new client that you ended up having to deal with? What's something big that you see that you wish that people would do differently to make it easier and eliminate all that trouble?

Lisa DeVaughn Foley (12:16):

We try to be very advanced technology, and so, it's just really figuring out a game plan. I think planning is the biggest thing that you have to make sure you do, and if the client is, let's say, they're not progressive, and there hasn't been technology, you've got to figure out a way to make the transition easier for them, and you've got to turn it around pretty quick. I think the sense of urgency, keeping that in your team and getting the client onboarded and comfortable, makes that easier. But as far as technical things that you see coming in that are wrong, it’s not one thing or the other; I think that's very client-specific, and I think you just have to hear what the client says their pains were, and then make sure they get addressed coming in because everyone is very different because the pain points on one client are just very different and figuring out how to solve those and match your services to their problems.

Joshua Feinberg (13:35):

Do you see variances among industries, and commonalities among industries, or even among, like, five different medical clients, or five different law clients, or five different manufacturing clients, because they still have vastly different issues?

Lisa DeVaughn Foley (13:48):

Yes. So, yes, there definitely are differences. One of our main niches is the construction industry. So, when we take on a construction client, one of the things we do see a struggle with coming from that side is job costing and understanding over-and-under billings on contracts. They normally have not addressed that well internally, or their prior accountant hasn't, either. So, that is one niche area that I can think about that there's always something different, and then medical. I think what we see is a lack of looking at KPIs and seeing how they stack up to the industry. A lot of clients we get; they've not had that kind of service where you say, "Hey, you know, your rent expense is really high, compared to industry averages," and if you can tell them that and compare it to something concrete, like, they listen, and so, I think that's one of the things. If you can add that to your service, it is really beneficial and helps them be more successful if they know they're measuring against things.

Future of Client Accounting Services

Joshua Feinberg (15:04):

Yeah. I imagine the motivation of knowing how they're doing against their peers is pretty powerful. Way more powerful than just a recommendation. I think that trusted advisor + the peer + the social proof element definitely should resonate. The final area I wanted to talk with you about, at least, is to get your thoughts on where the business of client accounting services is headed. Where is outsourced accounting headed? Is there something that you see going on right now that we're going to look back in 12, 18, 24 months from now, and, like, “Wow, that was the big pivot; that was the big change; that was the big evolution in where the industry was going”?

Lisa DeVaughn Foley (15:43):

Yeah, I put it in three buckets, really. I think continued automation, just finding ways that zero data entry, right? Can we get to a place where everything, the bank statement, and everything, is just talking together and putting the numbers where they need to be if we set up the right parameters, and the right AI products to help us get there? I think you've got to get to that point. That is not where the value of CAS practices are anymore; the value is in switching to an advisory role. So, the key-in checks and stuff, that's the days of old, and that's what we always made our money off of that is a given now. So, that has to happen, and so, if we can do it more efficiently, we can run a better practice and provide our clients with better service. So, I think you're going to see continued improvements in automation. I think you're going to see a switch to more of a consultant and advisor role, which has already been happening, but I hope within two years that has even changed more, and maybe even stretching that two years, I'd like to see a lot of the CAS practices go to a subscription fee model, instead of billing by the hour, or a flat monthly failing. Let's call it a “subscription base”, right? That's how software does it; that's how QuickBooks does it. You just got to go to a subscription-based approach with your clients, and it's nice; it evens out your income for the year, and you don't have this, “Oh, we make more money January through April.” The CAS practice lets you spread that out and really hopefully improves the quality of life for your team, right? “If we can spread the work and work evenly throughout the year versus working 80, 90 hours every month, every week in January through April, like, everybody will be happier,” is how we look at it.

Joshua Feinberg (17:53):

Yeah, I've noticed, just in the last two years or so, a really big shift in evolution from it being called “bookkeeping” to being called “outsourced accounting”, and then the shifts for more of the outsourced accounting being called “client accounting services”, and then I see some firms adding an extra A in the mix there, too—client accounting advisory services—and it all seems like the technology is enabling you to stretch your client's budget way farther. So, they're not spending budget on data entry and coding, and you're able to take all of those resources and now be the outsource CFO that you really wanted to be all along and provide them the insight to help them grow.

Lisa DeVaughn Foley (18:31):

Yeah. The CFO platform is something we've really enjoyed, and I've been impressed with how much my team has enjoyed it because they get to do different things, and we have a construction client, and he kind of helped us start the idea three or four years ago, because he's, like, “How I rent a piece of equipment, Lisa, I want to rent you all.” I was, like, “Okay.” I don't know if that's an odd way of saying it, so it's funny because we had a call this week from a fellow construction associate of his in another town, and he was like, “I need to rent a CFO, like this other client,” and I was, like, “Well, maybe we should just name it ‘Rent-A-CFO’ because it seems to stick in the construction industry.”

Joshua Feinberg (19:19):

Yeah, and coming from the IT services world, IT integrators and value-added resellers and consultancies were playing with the whole managed services business model 20 years ago. Marc Benioff is largely credited with getting software-as-a-service going. So, yeah, that makes sense. So, you're going to see more and more of these professional services models, product ties, and just, if nothing else, make it way easier for their clients to spread out the financial commitments over a longer period of time, and then make longer commitments to you, so you can add more value over an extended period of time.

Lisa DeVaughn Foley (19:51):

Yes, I think that is the wave of the future, and you've got to put your toe in and go with it.

Joshua Feinberg (19:58):

Yeah. That makes total sense. Lisa, what's the best way for someone to learn more about your team and the work that you do at Baldwin CPAs? Are you active on LinkedIn? What's a good way for someone to follow or connect with you and learn more about what you’re doing?

Lisa DeVaughn Foley (20:12):

We definitely are on LinkedIn. You can also follow Baldwin CPAs on Facebook; we have a good presence there and share things regularly, and if you'll join us on Facebook, there are also ways to get on a direct email list of when we have certain things come out that we want to share or so. We're also on LinkedIn. Connect with us on our website. So, we are on all of those avenues and getting ready to update our website. So, some big changes coming there that we're looking forward to.

Joshua Feinberg (20:45):

Excellent. Are you active on LinkedIn, also, yourself?

Lisa DeVaughn Foley (20:48):

Yes. LinkedIn (Lisa DeVaughn Foley)

Joshua Feinberg (20:49):

Okay, great. Okay, yeah. I'll make sure to put links to all of those when we run the podcast on our blog, so any of our readers, viewers, watchers, however, they're consuming the content, have another way to reach out to you if they have any questions. But yeah, this has been terrific. I really enjoyed learning more about how you got into the profession, how you've helped the team, how critical the role of process is when you're bringing multiple teams together, so you don't have a spinning plate problem. But yeah, this has all been fascinating. I really appreciate you taking the time to talk with me today.

Lisa DeVaughn Foley (21:22):

Well, I appreciate it, Joshua, and hopefully, it was helpful.

Joshua Feinberg (21:26):

Super helpful, excellent.

What's your favorite Client Accounting Services tip? And what did you find most valuable from Lisa DeVaughn Foley's podcast interview? Let us know in the Comments section below.


Learn even more about client accounting services (CAS) when you download the free report: The State of Client Accounting Services and Outsourced Accounting.


Download your free copy of The State of Client Accounting Services and Outsourced Accounting.


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