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Team Welter

Jun 19
0

Finding and Supporting the Next Generation of Accountants

By | Accounting, Nonprofit | No Comments
accountant at laptop computer

We’ve written about the anticipated shortage of accountants many times. Fewer college students are graduating with accounting degrees, and among those who are, fewer still become CPAs. There are ways to mitigate against the possible shortage of accounting talent, such as embracing automation, technology, and AI efficiencies, but no amount of tech will substitute for the skills of a good accountant or CPA.

That’s why we celebrated the recent steps that the AICPA has taken to address the possible shortage of accounting talent. Here are all the things they’re doing to help prepare the profession for the future.

The AICPA Pipeline Acceleration Plan

The AICPA Pipeline Acceleration Plan addresses the ongoing talent shortage in the accounting profession by implementing targeted initiatives at various stages of the CPA pipeline. The plan focuses on increasing awareness, improving perceptions of accounting careers, enhancing education and training, and fostering diversity and inclusion.

Highlights of the plan include:

  • Career paths in accounting: CPAs share their career journeys with students, highlighting the daily challenges they face and encouraging them to explore various career paths.
  • Addressing stereotypes: Books, movies, and television often portray CPAs as nerdy and unattractive. By directly confronting these stereotypes, CPAs can offer students a realistic view of the CPA profession that challenges and dispels stereotypes.
  • Interactive sessions: Another way in which CPAs are encouraging students to consider accounting careers is through direct interactive sessions. Career days or classroom visits within their local community can encourage students to ask questions and to consider accounting careers.

Experience, Learn & Earn (ELE) Program

Launched in 2023, this program provides students with paid work experience while earning affordable college credit hours. It is designed to help candidates meet the 150-hour CPA licensure requirement without excessive financial burden. The program goal is to increase both access to and the affordability of the CPA license requirement.

STEM Recognition for Accounting

STEM fields encompass science, technology, engineering, and mathematics. The AICPA is advocating for accounting to be classified as a STEM field, which would allow K-12 STEM grant funding to support accounting education and improve access for underrepresented students. The organization is actively seeking bipartisan support to allow K-12 STEM grant funding for accounting education, as well as adding six accounting degrees to the government’s list of STEM degrees.

Accounting Opportunities Experience

CPAs are also stepping into the classroom to share their experience with students. Part of the AICPA outreach includes the “Accounting Opportunity Experience,” in which CPAs participate in career awareness events at local high schools. Through direct, personal community outreach, these CPAs are introducing a new generation to the profession.

Firm Culture & Business Models

The plan encourages firms to offer competitive salaries, career advancement opportunities, and flexible work environments to attract and retain talent.

The AICPA is working with stakeholders, including state CPA societies, academia, and accounting firms, to implement these strategies and strengthen the profession’s talent pipeline.

What You Can Do

While the AICPA is doing its part, you can do yours as well. Encourage the young people in your life to consider a career in accounting. Teens often view accounting as boring. Help them explore the many ways in which accounting contributes to society and business, including specialties such as nonprofit accounting, forensic accounting, tax accounting, and more. Students often form an impression of a career from television or movies, and there’s so much more to any field than what is depicted in their favorite shows.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact us for more information.

Jun 17
0

Imagining the Unimaginable: Recovery from a Personal Data Breach

By | cyber security, Data, Nonprofit | No Comments
"data breach" with locks over data pieces

Can you imagine losing $43 billion? It’s hard to imagine losing $43, let alone $43 billion, but that’s what AARP claims American adults lose to identity theft and fraud each year. That’s a staggering number. And it doesn’t matter whether this information is lost by an organization that failed to protect customer data or an individual who fell for a phishing scam—the results are the same. Lost time, lost reputation, and yes, often blame and shame.

Cybercriminals continue to grow increasingly sophisticated in using both technology and psychology to trick victims into disclosing sensitive personal or financial information that can lead to theft and fraud. If you’ve fallen victim, please don’t blame yourself. Instead, act now to recover from the situation.

An Ounce of Prevention

The old saying “an ounce of prevention is worth a pound of cure” is very apt when it comes to identity theft. Many organizations, including the IRS, have published information to help people whose identities were stolen as part of a tax fraud scam. But did you know that there are 20 types of identity theft? Credit and debit card theft, stealing mail to gain access to confidential information, and other types of theft are common ways in which criminals gain access to personal information.

Many credit card companies now have safeguards against such theft by locking cards and contacting the cardholder when card activity suddenly increases past the cardholder’s typical activities. Still, it’s not foolproof. Consumers should monitor their credit cards, bank accounts, and credit scores frequently and guard against phishing emails or phone calls designed to trick the unwary into revealing sensitive information through a sense of urgency or familiarity.

How Do You Know If Your Data Is Compromised?

When personal data is compromised, it can lead to serious consequences, including financial loss, identity theft, and ongoing security risks. Consumers may notice unauthorized transactions, unfamiliar login attempts, or receive password reset emails they didn’t request—all potential signs of a breach. Additionally, a surge in spam calls or phishing emails could indicate that personal information has been leaked to third parties. In some cases, unexplained changes to security settings, such as modifications to two-factor authentication, may suggest that an account has been accessed without permission.

To identify whether personal data has been exposed, individuals can closely monitor their financial accounts, review credit reports for unusual activity, and utilize online tools designed to detect breaches. Many organizations offer data breach notification services that alert users if their information appears in leaked databases. If suspicious activity is detected, immediate action is necessary—this includes updating passwords, enabling additional security measures, and reporting the incident to the relevant financial institutions or authorities.

Recovering from a personal data breach requires a proactive approach. Establishing strong security habits, such as using unique passwords for each account and enabling multi-factor authentication, can help mitigate future risks. Consumers should also remain vigilant against phishing attempts and fraudulent communications, as cybercriminals often exploit compromised data to launch further attacks.

Recovering from a Data Breach

Although there is a lot of information published online to help individuals recover from a data breach, it can feel overwhelming to sort through it all. One helpful tool provided by the Federal Trade Commission is an interactive website, Identity Theft, which can help you create a personalized recovery plan.

If you suspect your personal data has been compromised, acting quickly can help minimize potential damage. Here are the key steps to take:

  1. Confirm the breach: Check for unusual activity in your accounts, such as unauthorized transactions, password reset emails you didn’t request, or unfamiliar logins. If a company notifies you of a breach, verify the details through their official website.
  2. Secure your accounts: Change passwords for affected accounts. Don’t reuse passwords across multiple sites. Mult-factor authentication also adds another layer of protection.
  3. Monitor financial activity: Review your bank and credit card statements for suspicious transactions. You can also place a fraud alert on your accounts or freeze your credit.
  4. Watch for phishing attempts: Scammers often use leaked data to send convincing emails or texts asking for personal information. Don’t click links in emails. Instead, close the email and navigate to a new browser tab before logging in and checking to see if the email is legitimate.
  5. Check for identity theft: If sensitive information, such as your Social Security number, has been exposed, monitor your credit reports and consider enrolling in an identity theft protection service.
  6. Report the breach: Notify your bank, credit card issuer, or relevant authorities if you detect fraudulent activity. If the breach involves your workplace or a service provider, follow their recommended security steps.
  7. Stay informed: Keep an eye on updates from the breached company and cybersecurity experts. They may provide additional guidance or offer free credit monitoring services.

Taking these steps can help protect your personal information and reduce the risk of further harm.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact us for more information.

Jun 13
0

Important Tax Changes Coming to Washington State

By | Nonprofit, Tax | No Comments
"tax changes" on ticker tape

The Washington State legislature passed a new budget on April 27, 2025. The new budget updated several notable tax policies, some of which may affect you or your organization. These changes impact nonprofits, including colleges and universities, as well as nonprofits that host conferences and live events. We’ve summarized key points below and included links to the actual bills for your reference. The Washington Society of CPAs has also provided a more in-depth look and additional resources you may wish to review.

Engrossed Substitute House Bill 2081

Engrossed Substitute House Bill 2081 made changes to the state’s business and occupancy (B&O) tax. Rates have changed for service providers earning more than $5 million annually. The new rate is 2.1%. Previously, the rate was applied to businesses in this sector earning more than $1 million.

Additionally, the bill clarifies tax treatment for investments in response to the Antio, LLC vs. Department of Revenue court case. It formally defines “incidental investments” and establishes a 5% threshold for classification; a stricter limit compared to the Department of Revenue’s previous 5% safe harbor standard. While this change provides a clearer framework, some ambiguity remains regarding the definition of a business’s main purpose and how the 5% threshold should be applied across different reporting periods. To address outstanding tax questions, the Department of Revenue will issue additional guidance to further clarify tax policies and compliance expectations.

A key point in this bill affects nonprofits. Washington State’s Engrossed Substitute House Bill 2081 introduces tax exemptions for mutual funds and most nonprofit organizations, aiming to address concerns raised by the Antio, LLC vs. Dept. of Revenue case. This change benefits foundations, private colleges, and nonprofits by preventing their endowment funds and investments from being taxed under new B&O provisions. However, the exemption won’t take effect until January 1, 2026, as the Department of Revenue (DOR) indicated it needs time to implement the necessary administrative processes. Until then, nonprofits and other affected entities remain uncertain about their tax liabilities for the current and previous years. To provide additional clarity, the DOR will issue further guidance on how these exemptions will be applied under Washington’s evolving tax rules.

Engrossed Substitute Senate Bill 5814

Engrossed Substitute Senate Bill 5814 modifies the rules around sales tax. It removes a tax exemption for services that rely primarily on human effort, meaning that accounting and other professional services will now be subject to sales tax if they involve the use of digital tools. The bill defines Digitally Automated Services (DAS) as any service transferred electronically using one or more software applications.

Because many CPAs and professional service providers use online portals to communicate with clients, their engagements will likely be taxed. The legislature declined to restore the exemption, so this change will take effect on October 1, 2025. In response, the Washington Society of CPAs (WSCPA) and other professionals have asked Governor Ferguson to veto this section of the bill, arguing that more discussion is needed to assess its broader impact.

Another change is that “live presentations,” such as conferences, will now need to charge sales tax. This includes all professional development conferences. This provision requires further study, as it may also impact schools, colleges, and universities.

Nonprofits Need to Know Tax Law Changes

Having a tax-exempt status does not mean that your organization is entirely exempt from all taxes. As in the examples above, there are certainly situations in which nonprofits could be required to charge taxes, such as sales tax. Nonprofits must keep up to date with tax law changes in their states to ensure they’re in compliance with current regulations.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact us for more information.

May 21
0

Why Your Nonprofit Needs a Financial Risk Assessment

By | Accounting, Accounting Software, Budget, Nonprofit | No Comments
person at desk with notebook, pen, and laptop and graphs showing high/low waves for risk assessment

A financial risk assessment is an annual audit of many areas of your organization’s financial preparedness and stability. Such an assessment looks at many areas of your company, including the overall management, human resources, facilities, finances, accounting, sales, information systems, and more. Here is why a financial risk assessment is vital for a healthy nonprofit.

The Purpose of a Financial Risk Assessment

Everything in life involves risk. That includes running a nonprofit. A financial risk assessment examines the current state of your business and identifies potential risks. It’s only after identifying risks that you can take action to address them.

You can conduct your own financial risk assessment; however, many find that obtaining outside assistance from their CPA, a nonprofit consultant, or another similar professional is helpful. Often, we are too close to our own business to see potential risks clearly. An outside perspective can cut through the familiarity of the everyday and see the gaps that we often miss.

Benefits of a Risk Assessment

A financial risk assessment provides many benefits to nonprofits by enhancing their overall operations and safeguarding their missions. It helps organizations identify potential risks, such as fraud or inefficiencies, ensuring that their funds and resources are managed effectively to achieve their goals. By addressing these vulnerabilities early, nonprofits can streamline their operations and make better use of their resources.

Conducting regular financial risk assessments builds trust among donors, board members, and the community. It demonstrates a commitment to sound financial practices, which can attract and retain long-term supporters. Additionally, these assessments ensure that nonprofits comply with legal and regulatory requirements, minimizing the risk of penalties or reputational damage.

Finally, a financial risk assessment equips nonprofits to navigate uncertainties like economic shifts or changes in funding sources. By preparing for these challenges, organizations can maintain their focus on their mission and continue to deliver meaningful impact.

Costs of Avoiding a Risk Assessment

Perhaps you’re thinking, “This is all well and good, but we’re so busy! We just don’t have time to stop and do a comprehensive assessment.”

Do you have time to address a big risk, like a cyber-attack? What about a trip and fall accident because you haven’t assessed the risk of a worn carpet in your reception area?

It’s like owning a car—do you ignore the knock in the engine until the car breaks down, or do you take it to a mechanic to get it checked out?

The costs of avoiding a financial risk assessment may include:

  • Mistakes in the balance sheet, such as liabilities not properly recorded or other mistakes that can muddy the financial picture, can be time-consuming to fix later.
  • Failing to conduct a physical inventory on a regular basis can lead to adjustments, negative equity, and other problems.
  • Missing or poor internal controls can lead to employee theft or mismanaged funds.

There are many more areas where failing to conduct a risk assessment can lead to problems. As you can see, it’s always better to prevent problems than to spend time later fixing them.

Other Benefits of a Risk Assessment

Other than avoiding scary problems, there are many more benefits derived from conducting a comprehensive risk assessment. The assessment can help you build your strategy, setting the stage for thoughtful decisions about where to invest for risk mitigation and where to step out in growth. It may also uncover untapped potential and lead to productive discussions about how your organization can expand.

Start Now

Don’t wait until the end of the year planning to conduct your assessment. You can start now. Pick one department or area of the company, such as finance or operations, and come up with a list of questions. Ask yourself what is working, what isn’t working, and what may be improved.

This is where working with an outside consultant can help. We’re happy to discuss your plan of action and the next steps for financial risk assessment and management.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact us for more information.