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Sep 15, 2021

Lessons Learned from a Life in Accounting

Ulmer_Steven_90x90By Steven Ulmer, CPA (inactive), CISA, CIRM


As I reflect on my career in accounting, there are a few situations that stick out as lessons learned. Perhaps more accurately in my case, lessons needing to be revisited periodically. These situations involved something either dramatic, funny, or ironic, which I guess is why they’ve stuck with me. As I write this, I realize there may be other lessons readers will take away from this blog post, and you may even disagree with some of my conclusions. There is plenty of room for differences of opinion. For those in the early stages of their careers, I hope you will find something you can use in your practice. Sometimes revisiting the basics can result in significant benefit.

Management Reports

Back in the early days of personal computers, our finance unit would put together a monthly management book with a page for each of our roughly 120 oilfield supply stores. Each page contained the results by month for roughly eight to 10 different financial measurements. Composing this book took several people, counting preparers and reviewers, over a week to complete and did not get distributed until the end of the second week of the month. A copy was sent to all the top managers in the division.

One person handing over stack of documents to anotherOne day I was asked to deliver a copy to Ted, our vice president of operations. When I took the book to Ted, he said, “Steve, do you want me to show you what I do with this book?” I smiled, not knowing exactly what was coming, and indicated for him to go ahead. He opened a desk drawer, took the book from last month and tossed it in the garbage can, and then threw the new book in the desk drawer and slammed it shut. Was he trying to be malicious? I do not think so. I looked at it as an experienced senior manager nonverbally sharing his insight with a young person. The drama and humor made it memorable.

How many reports, PowerPoints, and Excel spreadsheets do we or our client companies send out that are not timely or useful for making business decisions? Has it gotten better or worse over time? Do we need more Teds in our organizations?

Signatures

I understand the argument that a signature on a document is a way to hold people accountable (among other things, of course). Early in my career in internal audit, however, I found relying on a signature (manual or electronic) as evidence of performance should carry a warning caveat internum diligit auditoris animus (internal auditor beware). How many times have you seen at least one of these events during your audit career?

  • A plant floor supervisor gives his ID/password to a clerk to approve time reports.
  • To clear out a backlog of purchase requisitions sitting in her queue, a senior manager gives her ID/password to the administrative assistant to do the approvals.
  • A purchase requisition requires five or more approvals, but you get the sense most of the approvers never read the supporting detail.
  • A capital appropriate request (CAR) is routed to multiple approvers. After being approved by the appropriate person in finance, the other approvals take place one right after the other in a short period of time.

Even with all the emphasis on security and training over the decades, people are still sharing passwords. And it is not uncommon.

I sat in a meeting years ago where a group of people were discussing a capital project that went south. I know the CFO was trying to put the best spin on events, but something he said still makes me laugh. He told the group, “We do not even know who approved this project.” I can tell you with certainty that his signature and those of at least two other people in the room were on the CAR. The extent of the review performed before signing the CAR may have been a better subject of conversation. Did they want a post-completion audit to identify opportunities for improvements on future projects? I think you may know that answer: like the Chinese proverb says, “Success has a 1,000 fathers and failure is an orphan.”

Rebuke

With all due respect to King Solomon, I am not sure it works this way: “Whoever rebukes a man will afterward find more favor than he who flatters with his tongue” (Proverbs 28:23).

Our chief audit executive wanted all in-charge auditors to get practice doing performance evaluations. At the end of every audit, the in-charge had to do a formal evaluation of each team member. I remember doing an evaluation for Andrea (not her real name). Andrea would not accept any criticisms without overwhelming support. She wanted specific examples from the audit at a level of detail that I never had to provide before or since, which is why it sticks in my memory. General observations were unacceptable. She also challenged me about why the feedback was not provided until three to four weeks after the fieldwork was completed.

I certainly did not find more favor as Proverbs said I would. In fact, it was quite stressful. Honestly, I think flattery would have worked just fine. Was she overly sensitive? Perhaps. Was she wrong in what she was asking for? Not really. Aren’t most of us sensitive to what we perceive as criticism, even if the intent is constructive feedback? It impressed upon me the need to know something about the person who will be receiving the feedback as well as the importance of the how, when, and whether to provide feedback.


Steven Ulmer, CPA (inactive), CISA, CIRM, is a part-time adjunct associate professor of accounting at the University of Maryland Global Campus. He can be reached at sulmer13@gmail.com.


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3 comments

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  • Jo Anna Crago | Sep 16, 2021
    Great insight Steve!! I really enjoyed the read, thank you for taking the time to prepare it. We can all learn something from examples like this!
  • Katie Lonsway Ciccone | Sep 16, 2021
    Having worked 45+ years as an admin support person, I had to laugh at some of Steve's examples... they sure resonated with me... the tediously created monthly management book, and especially the sharing of ID/passwords!  Thanks, Steve, for your insight, ponderings, and putting a smile on my face today!
  • Andrew De Silva | Sep 15, 2021
    fantastic read!  As a relatively new business owner and someone that is always concerned with time management everything that Steve says is true.  How do we solve these issues I dont exactly know, but all the points are right on point!

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    Statements of fact and opinion are the authors’ responsibility alone and do not imply an opinion on the part of PICPA officers or members. The information contained in herein does not constitute accounting, legal, or professional advice. For professional advice, please engage or consult a qualified professional.