Working in the world of sports may seem like a dream job, but, as we have seen with the coronavirus, it is susceptible to the same difficulties and obstacles as other industries. And like other industries, the sports world understands the immense value of CPAs. In this podcast, we are joined by Darren Heffernan, president of Trintech, to discuss how CPAs contribute to the success of sports teams, how automation is quickly improving their jobs, and how the world of sports operations has been altered by COVID-19.
By: Bill Hayes, Pennsylvania CPA Journal Managing Editor
There are countless career opportunities for those who choose to pursue the CPA designation. One of those opportunities is being a CPA for a professional sports franchise. Today, we talk to Darren Heffernan, president of Trintech, about why CPAs are so valuable in the sports arena, why accounting automation is particularly important in this field, and the effect coronavirus has on a CPA's value in the athletic industry.
Can you tell us a little bit about why CPAs are so important to the financial organizations of professional sports franchise? Obviously, there's a lot of money to be counted there, especially if the sports team is doing particularly well, but what is the greater value?
[Heffernan] I have a true belief that the office of the CFO is the heartbeat of an organization, particularly a sports franchise. They're very unique in the view they have into everything that goes on across the company, across every department. They have a unique view. That unique view, I believe, allows them to transform themselves from just being a traditional, if you like, bean counter into being able to take all the amounts of data that they have, and there's a tremendous amount of it, to turn that into intelligence. No more so than what we've got right now, going through this. Especially for sports franchises, this is a multibillion dollar affair, for whatever industry in sports you're talking about.
They've got very unique challenges, whether it's on deferring revenue, whether it's on cashflow management, whether it's on forecasting, and we've seen in a lot of our customers that people in times of crisis are looking for the office of the CFO to be the leader in these times, to go, how can we get out of this? What can we do differently to make sure that we can survive in a new world that I don't think is just for today, but it could be, it could last after this is over.
How has the value of the CPA been affected by the coronavirus pandemic, which clearly continues to be a challenge for the national sports industry and the global sports industry?
[Heffernan] I think there's already been a trend, a digital trend, that was on the way to automation. You've heard a lot of buzzwords in the past and the recent past, whether it's artificial intelligence or RPA, which is robotic process automation. So these are not new concepts. What I think this pandemic has done is brought it more to the forefront. If you think about it this way, when we close our books every month or every quarter or every year, 75% of what an accountant's job is doing during that process is using Excel systems to be the system of control. And Excel will tell you that they didn't create Excel to be a system of control. They created it to assist in the process, but not to be at the core of it.
And I said it earlier, I just truly believe this has given the catalyst of the finance organization to come to the forefront and be that strategic partner of the business that everybody looks to and how they can drive forward with automation and embrace technology to improve their day-to-day operations and automate their close process and just generally make things more formal. Especially working from home as well. That's a completely different animal.
How would you say that the seasonal nature of sports affects the jobs of CPAs who work in that industry?
[Heffernan] I'm able to attest to this industry. I've been in it for 25 years. I'm not sure if someone told me 25 years ago, "Listen, you're going to work weekends and holidays and late nights," I would have gotten into it. It's no different than it is for an accounting professional that's working in a sports industry. The great thing about working in the sports industry is that it's an energetic, fast-paced environment. It's definitely busier during the season because when you think of the season price, it's no different than it would be in retail at the holiday season.
But at the end of the day, I think we've got to be very careful that the office of the CFO and accounting's job at the end of every period is they need to produce an accurate and timely P & L account and balance sheet, no matter what time of the year it is. If there is 1,000 tasks that need to be done every month to close those books, or 500 or 200 or whatever, those tasks still need to be done every period, albeit it might be higher numbers during every period. That's really important that we've got CPAs who just embrace and look at technology and challenge the processes that they're going through so that they can just make their lives easier.
Now there's a lot of changes going in the sports sphere as we talk here, whether you're talking about declining live viewership due to DVR or e-commerce revenue streams or even the coronavirus pandemic as we've talked about. How would you say that some of those changes are affecting not only the industry, but the CPAs working in it? How are they adjusting to it?
[Heffernan] I think, for CPAs, it's a new world we're living in. I would be pretty confident that I could lay in a bet on this, but nobody has ever said en masse, "I'll tell you what, let's practice doing a financial close process from home. Let's just assume we're going to do it with not even 24 hours’ notice." Literally that's what we put ourselves into right now. That's what's actually happened. What we need to do is figure out how to … I think everybody has gotten over the initial shock of doing that. But what I think, and I firmly believe, is that for business continuity purposes, this is going to be a more new norm. Who knows if there's going to be a second wave of this or something else in the future necessitates us working from home. I think people have embraced this and they're well used to it now.
But the other worrying thing for businesses, especially in the sports industry, thinking about the upcoming season coming up in football, for example, what's the revenue model going to look like? They're very fortunate that TV deals make up a vast amount of the revenue, but you still got game day revenue and you're figuring out, are you going to have people able to watch the game? Are you going to have people who, how are they going to do it? The finance people, because they're at the heart of everything that's going on, I truly believe that they'll be able to help teams out. Figure out how could they add new businesses, new models, new revenue. Streaming is going to become more important, I think, than ever before. And e-commerce is at the heart of everything that … we're delivering food to everybody today. Well, I think you're going to see a lot of delivery, whether it's from merchandising or whether it's from the experience of watching the game, even if you can't attend that at the stadium.
How do you think automation of tasks makes, or would make, life easier for not only sports CPAs, I guess, but CPAs in general?
[Heffernan] Let me give you this example. I think automation makes everything work better, no matter what job you do in life. That includes a sports accountant, includes a CPA that's doing their normal day-to-day job. The one thing that's always fascinated me is that if you take a manufacturing company, they figured this out decades ago. We've been building cars with machines since the thirties and forties. But for the office of the CFO, we've never really embraced the automation that we're capable of doing. And why would you want to do something manually when you can get help through technology to help you do that better, quicker, easier? It will give you more visibility. It will give you more control. It will allow you to adopt a more risk-based approach as you're reviewing your financial cloud process.
There's so many benefits associated with automation, and I'll say RPA, that I feel like it's a no-brainer. Who would want to spend five years studying and then go to a company and then all you're doing is mundane, boring, repetitive tasks? Don't you want to add more value to a company? That's what automation does. It makes the job more exciting when you embrace the use of technology, and just makes it more fun.
Focusing on a couple specific areas, how does automation help sports CPAs with processes like governance, risk, and compliance?
[Heffernan] I think, simply put, it improves your transparency. It gives you the chance to view whatever bottlenecks you've got going on in your process. It allows people to work more efficiently. It gives you ideas of how to identify and manage risks easier. How do I automate my internal controls? There's no question it saves time, especially for sports accounts. When they're getting busy during the season, when it's busier than ever before, when the volume has gone way up, your biggest scarce resource you have during that time period is actually time. Then you've got auditor's coming in all the time. Well, instead of trying to get these manual binders to be able to give to them, why don't just give them access to a system that they can have digital binders and be able to figure that out themselves? You just give them a read-only access.
To me, one of the biggest things as well is you got to be able to attract talent and you’ve got to be able to keep talent. If you don't think of a new way of thinking, with governance and risk and compliance in mind, you're not going to keep people for long periods of time that can add value to your company if you're asking them to do things in a manual basis. And I would say particularly now, when you're thinking about millennials, is that all they do in life is use technology. They do not want to come into an environment and then say, "Oh, what do you mean I’ve got to do this manually and use Excel? No, I need Excel to help me, but I need to use a system of control that will make things more automated."
How does automation affect work life balance in a positive way for CPAs and sports CPAs?
[Heffernan] This is a really big area for me and we spend a lot of time in our company just focused on this. I think because, to be quite honest with you, mistakes in the past of thinking manual was okay. Work-life balance and attracting the talent of today and tomorrow, if you don't have that at the forefront of your strategy, from an HR perspective and a recruiting perspective, you're just not going to be successful. I know it seems like for my own career over the years, missing so many things, whether it was with family, with friends, because I had to do things like the close process, for example, on a weekend with nights. Holidays, missed all those things. Now there's no need for that. You don't need to do that because the automation can help you standardize internal accounting processes. It can streamline balance sheet reconciliations. It can identify bottlenecks in the process.
Why not go to your kids' games, for example, and sit there and watch your your kid's game and if things come in, it's on your phone? It's on your phone, it's on your iPad. You get an alert notice, okay, I’ve got to approve this. I’ve got to just do this quickly, but you're watching the game as you're actually doing it. Shorter cycles … embracing automation and utilizing technology will just ensure that your work-life balance just drastically changes your life. One thing I would add also is even now, for me, working from home, it's got its pluses. I no longer have to do these couple of hours commute every day. I can use that to do other things. I view that as literally no different. What helped me do that? Well, I did not have to drive to the office. I got two hours back. Automation will give you that time back to do other things in your life that will make you happier and make the family unit happier as well.
There's probably a small fraction of CPAs in our audience that work in sports. But most likely hearing this, and being sports fans, I'm sure most are, they're going to be intrigued by hearing this. What would you say the rewards are of working in this field?
[Heffernan] I've been in this field for 25 years plus. I've been CFO for Trintech for 10 years previous to taking on my current role in the company. For me, I just have to say it's been a joy to see the evolution of the office of the CFO from where it's come from and where it's gone to on what I can see happening to it in the future. I've worked for very large organizations, like GE, and I've worked at really small ones. And the evolution of coming from that kind of, I would say, not being tied in with the kind of bean counter view, that the job of a CPA is just to count numbers. It's just well and truly gone. It's a myth of the past, and I don't believe it exists anymore because one of the main reasons, I don't think people will tolerate that anymore. Also, because of the value that it can actually bring to an organization.
Companies realize that. This is a treasure trove of information, and we can turn all of this data into intelligence and make our company run much better. No more so than sports. I think of sports over the years and there's a lot of good movies out there of how people analyze data when they're recruiting players. It's no different than thinking of that of the office of the CFO. How can we make our organization just work better? With all the data that we have, and be able to analyze it in the appropriate way to make that happen. The sport, the actual recruitment of sports stars and the performance of sports stars, has been analyzed that way for a long time. And I just think for the rest of us in non-sports world, we can do the exact same thing in the office of the CFO, because we just have access to so much data to help the company perform far better.