Handling the stress of busy season is a chore for CPAs under the best of conditions. Amid a pandemic that has resulted in over a year of working from home, the stress can be overwhelming. Small-firm CPAs (and accounting personnel of all stripes) must make sure to monitor their mental well-being at this time. We spoke with Carl Peterson, vice president, small firm interests, public accounting, for the AICPA on this vital topic, touching on resources for employees, what it means to stop focusing on time, and the importance of firm leaders serving as role models.

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By: Bill Hayes, Pennsylvania CPA Journal Managing Editor

Podcast Transcript

In the best of years, CPAs operating in the midst of a hectic tax season are under a lot of stress. When you mix in the fact that they are doing so after a year plus of pandemic-caused quarantine, which has taken a major toll on individuals of all stripes, it is vital that both they and their employers keep a close eye on their mental health. We'll be talking about that topic today with Carl Peterson, vice president, small firm interests, public accounting for the AICPA.

What sort of impact do you think the pandemic has had on the mental health and the well-being of the average employee, or even the average adult in this country?

[Peterson] Well, a huge impact. It's amazing to think about where we've been the last year and a half or so with the pandemic and the state of well-being and everything for all adults.

Actually, my daughter lives in the Chicago area and she happens to suffer from depression already. So, she's dealt with it and handled it over all the years, which has been great. She works in the hospitality industry and she's been with this organization for, gosh, 10-11 years. If you think about hospitality, you know how hard has been impacted. The hotels, the bars, restaurants, all of that stuff.

They eliminated over 10,000 employees, of which she ended up being one of them. So, I have firsthand experience with somebody I know that's very close to me that suffered from depression and, when something like this happens during the pandemics, it has a greater impact on their anxiety and depression and everything else. Fortunately for her, a few months later she did find another position and is super happy about it and all those things. But I was reading, there's a U.S. Census Bureau household pulse survey that they did last year and then also into 2021 this year in January. I thought what was interesting is CPAs are considered essential workers. I think in every state, all finance and CPAs and stuff. So the survey said that essential workers are more likely than nonessential to report symptoms of anxiety or depression during this pandemic. I just think that just highlights how much it's growing, or the issue is growing and the impact it's having, not just on adults around the country, but on essential workers. That's not even pulling out frontline workers. You can imagine frontline workers in the health and medical fields, and the anxiety that they're displaying and depression. I don't think we really know the true underlying impact. I think you read articles and you see things about higher rates of suicide or anxiety and depression. There's some concern about it, but I don't think we're totally aware of it.

In a recent story you wrote for AICPA's Small Firms Solutions, you talked about the stressors that could be affecting teams and how to mitigate them. How important is it for CPA firms, do you think, to recognize the challenges their employees are facing?

[Peterson] It certainly is critical. Client relationships ultimately hinge on that employee interaction. Your staff is interacting with these clients, sometimes on a day-to-day basis, or maybe it's on an annual recurring basis if it's an audit or just simply maybe a tax return, but that relationship that they have, and that interaction is critical. You think about how staff feels, and you think about productivity; productivity is higher when employees are not stressed out. Yeah, during tax season, we focus on getting things done and we're proud that we can get all this work done in that first 14-week period of tax season, or as much as we can. It's high then, but really, if you think about the quality of the productivity and the ability to get things out the door, it's absolutely higher when employees are not stressed out.

One more thing to point out, too, I think is interesting and shows how important this issue is, is that survey that I mentioned before, the US Census Bureau survey. This is what jumped out at me, that over 50% of those respondents in the 18-to-24-year-old category, and almost 50% of those in that 25-to-49-year-old category, report a higher level of anxiety or depression and they may never have reported it before, and they relate that to the pandemic. You think about what's the makeup of our firms today? 18-to-24, 25-to-49.

Then, of course the cost to replace employees is so high, it's so much better to keep them than replace them. I think when you think about how important it is to recognize the challenges employees are facing, it's huge, the challenge of the lockdowns, working from home. Yes, we can do that work from home and we happen to be an industry that probably a lot of firms are ready to do that, or already do it periodically, but day in and day out ... and then you have your kids at home, you have kids trying to do online learning, you have your spouse at home. Yes, we can do it, but we've never had to do it in the environment that our staff has to do it today.

One of the things that you talked about in the piece was the concept of leading with kindness. What do you think it means for a CPA firm, whether it be a small CPA firm or a large CPA firm, to lead with kindness when it comes to their employees?

[Peterson] I guess I think it's tone at the top. That tone at the top impacts culture, impacts brand. In that tone at the top, if you're leading with kindness, I think that it means being aware of the environment the employees are living in. I think ultimately that awareness and that kindness leads to compassion. We just mentioned about all the different, new environmental components, the spouse being at home, kids being at home, all those things. You don't really know what the issues are that that staff person's dealing with, what they're living within the current environment. I don't think you're ever going to know that if you're not leading with kindness, because you're not opening up to that. I think that leading with kindness creates awareness, I think that leads to compassion and, ultimately, that compassion is just naturally, I think, going to result in a supporting culture, a supporting environment for employees, and probably is going to keep many of them from moving to another organization, in search of a better environment. I think I mentioned before too: there's just that cost of replacing somebody that’s so great. It means a lot to a small firm.

When I came to AICPA … before I came … we had a firm of six, five CPAs and one admin person. You lose one person … one CPA, that's 20% of your CPA workforce. It's very important.

Obviously, these are big issues we're talking about. You talked to us earlier about even the idea of depression that a lot of people deal with at the same time. When we say to offer information on help to your employees, what sort of resources are we talking about there?

[Peterson] You know, it's an interesting question because in a small firm practice, and I think even as you get up to maybe even the larger firms, they provide health insurance, but I'm not sure that smaller firms go beyond that. I know we didn't. We provided health insurance but I think that, looking at it today, firms could really leverage their health insurance providers' resources. You go into your medical center for a physical or whatever, and you're sitting there waiting and there's all kinds of information on resources on healthy eating, there's wellness guidance, they have hotlines to call during times of anxiety or depression. I think that firms should take that extra step to make sure that, while they're providing health insurance, is there a way to leverage more of that other support and services that the existing insurance carrier provides? I think it's a hard topic to address because we've never really dealt with it as a business or a firm owner.

As an owner, we think we're doing good. We're fine, so our employees must be fine. They come in the office, everybody's happy, but it's a little bit different and I think more with a remote environment and I don't think we really necessarily ... well, we probably don't have the background to recognize the signs of mental health. We go based on how we're feeling.

Another very interesting piece when you consider the timing around tax season, from the article that you had written: Stop focusing on time. The concept of not focusing on time … how can CPA firms accomplish that with all that they have to do and what benefits would that have?

[Peterson] I think it's time to at least consider going cold turkey and drop the time sheet. There are firms of all different sizes that have done this, so it's not just small firms here and there that are doing it. I know of a major firm, group firm, that has taken a team or division within their practice – I think it's their client accounting services part of the practice – and just dropped time sheets. I know that in another firm that would fall as our medium-sized category – a firm with only 25 total people – they dropped time sheets years ago and I think their anxiety level because of that ... I don't know if you keep time sheets where you're at, but those of us who've been in practice for years, that time sheet, you're just so focused on realization and utilization. It's like, oh my God, just drop it because you're always worried about it. I think that's the wrong metric. There are other metrics to look at.

I think you have a feel for the capabilities of a CPA or staff person. You could look at number of returns out the door. You could look at the number of clients that they're servicing, that they're taking care of. I think it should all be about productivity because – there are firms that are going to be a little squeamish on this –realization utilization rates to me really don't mean anything if nothing is getting out the door. So what if you've put in all these hours? So what if you have all this billable time in the system? If you look at dropping time sheets and looking at other metrics and looking at the other billing methodologies, realization utilization, you're going to hopefully find, you know what, that really didn't mean a whole lot to me, but getting stuff out the door and happy clients. I got more things going out the door. Life is better. Automatically, I think that relieves some of that anxiety that people are having today.

How can CPA firm leaders serve as good role models when it comes to mental health? How important is it that firm leaders make sure to monitor their own stress at a time like this, because it affects everyone?

[Peterson] Tone at the top is also success starts at the top. If you are dealing with anxiety and your own mental health issues and not addressing them, then that's filtered all the way down to everybody else. I think the firm leaders, the partner, the owner, you got to make sure you're taking care of yourself first, not only leading with kindness and compassion as we talked about earlier, but you can't do that without dealing with your own situation, too. I think you have to be totally aware that you need to watch what you're doing. You need to have exercise, you need to do all these things that are going to relieve the anxiety that you're dealing with, and that also clears your head for leading the firm and understanding what your staff is going through as well. But being that role model is super important.

So often, firm owners are the first one in the office, so staff people see them if they come in, if they're working in the office, they're the last ones to leave oftentimes, they're working on weekends. You can be that role model, take care of yourself, log out of the system. In a remote environment, people know when you're on the system. Basically, you just need to log off so that they're not going, "Oh my gosh, the partner has been there for the last several hours. Every time I go on he's in.”

We've got to be the right example and be the right role model so that staff recognize that you take care of yourself, I can take care of myself, and the firm supports me in that.

CPAs, in general, they can have that red badge of courage approach to being busy. It's part of the expectation, nothing's going to stop them sort of thing. How important do you think it is for them, especially right now, to just take a step back and make sure they're managing the expectations that they have for themselves?

[Peterson] CPAs are competitive in nature. I think that they need to channel that competitiveness, get the work done and out the door, and not really focus on how many hours it's going to take. I remember when I was a young staffer, so my first five years or so I think in practice with a small firm. I was competitive. I think we're all competitive. I remember one tax season, the year before, man, I was the leader in overtime hours. The next year, Cindy, who I was competitive with, she came in same time I did, she was leader. I'll tell you that irritated me, so, it's like, I was going to focus on putting even more time in it. You know what? That is just the wrong approach. Especially when you think about today's environment, the workload compression, what your clients are going through, what you have to deal with, all the things are going on. I think it's just important to step back and I wish I had known that before, right?

Just stay true to who you are as a person. That's why they hired you and that's why they want to keep you because clients like you because of who you are. Not only that you have the capabilities and you've got the CPA credential and you've got the experience to address their needs, but because of who you are as a person is why you're there. It isn't because you're putting in all these extra hours. So, step back and manage your own expectations, as well as managing your clients.

I think you can do it differently. I think you can step back. I think you can set your goals differently and just different things you can do. Maybe consider certain challenges to set for your own self outside of the office. I know I could lose weight, so healthy eating, there's exercise. Then, I think we're learning more and more about sleep, so challenge yourself to increase the amount of hours that you're sleeping, or reducing your heart rate. I mean, all these things, just step back and take inventory of yourself and care for yourself first, because that's who you are and that will support then your clients in the firm.