The Financier/Accountant Thread

[BIC_BAWS]

Not sure if this is the right thread, but what do you guys think about automation in the accounting/bookkeeping/finance industry? I'm in the bookkeeping/accounting industry, but since I'm not CPA (yet), officially its a public bookkeeping business.

I have a ecommerce (Amazon FBA) client who does about 50K a month. Doing the data entry for their business is a PITA, especially with the variable FBA fees. If I could batch, I would. In an attempt to decrease the amount of allocated resources for that client, I've recommended the client to purchase a SaaS, Entriwise, that will automate the data entry process. This software will decrease their accounting/bookkeeping costs, but in turn will also decrease my billables - or cut me out of a job. Since they're my friends, in this case, I don't mind. Considering I need more time to focus on my larger clients.

What do you guys think? Will automation of mindless tasks (data entry) be better for you (and company) since you can focus on more value added tasks, like financial analysis/reporting?
Or do you think it will it create bigger issues, like lower billables, therefore lower revenue?

[Gerbs]

Pretty cool how your friend started a FBA business. I haven't met anyone locally who clear $50k a month. How much do people normally spend to start it up? <$5k?

[bcrdukes]

I am of the opinion where automation for accounting and bookkeeping can be done given a specific, or rather, minimum set of criteria is met. The bottom line would be a mature/established business with a set level of certainty in order to implement an automated process. While doing so, such software can also spit out reporting / business intelligence reports, so you can kill two birds with one stone.

[chinook79]

I was offered a senior accounting analyst job at my previous work as I am a bit handy when it comes to the automation and had deep knowledge of industry I was in. I had nearly no experience in finances other than budget, labour, expenses, etc that I am required to do as a manager. I ended up turning down the offer as I had no intension to get designates and without it, I didn't see myself moving up much further, at least not outside the company I was in. Reading through this thread, I think I made a good choice back then... I never realized that finance sector was so depressing...

[lowside67]

Originally Posted by chinook79

I never realized that finance sector was so depressing...

Despite there being some overlap, especially in junior roles, there is a world of difference between finance and accounting (which in this context includes roles that may say "finance" in the name such as financial analyst roles). When I refer to finance, I am speaking broadly of banking and investment - everything from business banking to working at a mutual fund. Perhaps the largest difference is what the senior roles look like.

In accounting you are going to be a cost center and a line item literally until you are either a CFO with stock options or a partner at an accounting firm - then you have some upside. You can look forward to roles like "Junior Accountant", "Senior Financial Analyst", "Accounting Manager", "Head of FP&A" and still fundamentally that's how you are paid. Obviously increasingly senior roles at increasingly large companies pay more, but the simple reality is you are earning a salary with likely a small bonus tied to soft factors on performance until you have at least 15 years in the industry (assuming you don't become the "CFO" of a startup with 4 people in your 3rd year)...

The true finance world tends to tie your compensation much more to actual performance - in banking, it's usually a sales job and you are compensated either directly or indirectly on growth of your portfolio; in investment management, you are either contributing in an analytical capacity and being paid a percentage of your contribution to returns, or in a sales capacity generating funds to be invested, and being paid on an going trailer on funds under management. Either of these have basically unlimited upside (with some practical limitations) and most importantly, you can start earning big upside MUCH earlier than in an accounting type role.

I joined a bank in a relationship management capacity ("sales") straight out of my CPA, with a few years of unrelated experience prior to that. They paid me fairly, and certainly better than I would have earned in the comparable financial analyst roles I was looking at, but not by a ton. However, by delivering strong sales results, my overall earnings have dramatically increased year over year - this is why I believe so strongly in these roles, if you perform, your compensation can grow quickly.

I wasn't expecting to like banking as much as I have, but as I ended up here completely by accident, I like to try to bring some information about this space as it's a niche that I don't think a lot of "accountants" think about. It's not for everybody, but if you are an outgoing person who wants some control over their job (ie the opposite of a 9-5 where you don't care), you should think about it.

-Mark

[Gerbs]

Which side of sales in banking are you? Like looking for small business or mainly high net worth individuals?

[lowside67]

Originally Posted by Gerbs

Which side of sales in banking are you? Like looking for small business businesses or mainly high net worth individuals?

I work in the upper end of the business banking space - companies in this space typically have borrowing needs from $10-20 million and revenues from $10-100 million. My role is to be the primary point of accountability for relationships - both existing and new - and be the point person for lending needs.

An entry level role in my exact line of business would be the same job but for smaller companies - those who borrow $1-3 million and have revenues in the $1-10 million space. There would also be one more role between mine and that one which would bridge the gap in terms of sizes.

An entry level job would typically have salaries in the $50s-$60s (though it is possible to get hired in the 70s if you are a desirable candidate that the bank would expect to promote quickly), and on top of that, bonus in the 15-20% range, with top performers getting significant raises and lots of upside beyond that bonus number.

-Mark

[bcrdukes]

I think a good way to summarize what lowside6 is saying is your compensations (and responsibilities) differ significantly when it comes down to the level of spend.

I started off with spends of < $2 mil, and now juggling spend values of up to $1.5 billion. But I'm still a janitor.

[Gerbs]

What would the position be called lowside67? I want to look for qualifications so I can adjust myself towards that role.

[lowside67]

"Commercial Account Manager" or "Commercial Relationship Manager". There isn't anything up at BMO but I did see some at RBC.

-Mark

[iPee]

Lowside are you a CAM at BMO? I used to work in BMO Commercial Banking but in the back office. IIRC my job title was PSO or something along those lines. We did some automating and ended up automating myself out of a job 3 years ago lol.

[lowside67]

Originally Posted by iPee

Lowside are you a CAM at BMO? I used to work in BMO Commercial Banking but in the back office. IIRC my job title was PSO or something along those lines. We did some automating and ended up automating myself out of a job 3 years ago lol.

Yup - mid market CAM, though we have re branded recently. PSOs are now entirely centralized in Toronto. Small world.

-Mark

[Gerbs]

What was your route towards CAM? Did you go through like the traditional banking route of like Teller > FSR > FA > CAM. I don't see too many people in banking hopping into the position without working in banking prior.

[lowside67]

I joined BMO Feb 2015 as a CAM trainee with no prior banking experience. I was in training for about 6 months and then got my portfolio which was a mid-market portfolio. I have not seen another person given a mid-market portfolio at BMO without prior banking experience, so I would not take my path as typical.

Usually people come to us from three places:
1) commercial banking analysts from BMO
2) account managers from other banks, especially credit unions
3) senior personal lenders or branch managers

-Mark

[Gerbs]

I've been approached by a friend who runs a company that wants to report day trading gains on their cryptocurrency. However, I never filed a corporate tax return before. Thus I want to learn. It should not be hard since I think it's just investment income through a corporation.

Specifics:
Started in 2017.
Filing for 2017 in Canada. (They are late)
No financial statements
Recorded accounting on Excel
1 owner corporation. Holding fund holds this business as a subsidiary. (will file taxes for the holding company if it's simple)

How to minimize liability? Is it easy to file?

[tiger_handheld]

Originally Posted by Gerbs

I've been approached by a friend who runs a company that wants to report day trading gains on their cryptocurrency. However, I never filed a corporate tax return before. Thus I want to learn. It should not be hard since I think it's just investment income through a corporation.

Specifics:
Started in 2017.
Filing for 2017 in Canada. (They are late)
No financial statements
Recorded accounting on Excel
1 owner corporation. Holding fund holds this business as a subsidiary. (will file taxes for the holding company if it's simple)

How to minimize liability? Is it easy to file?

step 1- minimize liability by not doing things outside of your expertise - decline this engagement.

step 2- read this: https://www.canada.ca/content/dam/cr.../t4012-17e.pdf

step 3- Go and download turbo tax corporate / small business & play around

step 4- Go and volunteer some time at a accountants office during tax season and do at least 100 T2's under guidance

step 5- keep that knowledge and provide knowledge transfer on a free and friendly basis not to profit.