Samuel T. Owl Jr. would never call himself a numbers guy, even though he’s been a certified public accountant for more than 15 years. “There is an interesting level of theory behind accounting, and I am big on finding the most efficient processes,” says the manager in the business operations and Tribal services practices at CLA (CliftonLarsonAllen), a national professional services firm in the Washington D.C. area. “It’s not all about numbers, numbers, numbers.”
An enrolled member of the Eastern Band of Cherokee Indians, last fall, Owl told Native Business that he was the only CPA from his Tribe under 40 years old. “I got into accounting because Native accountants are so few and far between,” and now, he explains, most of his time is spent serving CLA’s more than 50 Tribes and Tribal enterprises with various financial matters, including financial department assessments, systems implementation, audits, outsourcing and consulting.
Owl offers a wealth of experience in the accounting field, having worked for two of the Big 4 accounting firms ― PwC and Deloitte. He is also the former Chief Financial Officer for the National Congress of American Indians.
Who better to offer the following list of accounting tips and best practices to other Native business owners than this wise, young Owl?
Hire the right people with the right skill set. It’s the No. 1 priority, says Owl. “Make sure you have a qualified staff with the right credentials or ways to access professionals possessing those skills.” If this access is not available, he suggests creating a mentorship program to develop these professionals or tap into other resources, such as telecommuting or outsourcing. “Outsourcing is a big part of the industry right now,” he says. While it is not necessary to have a CPA at every level of your organization, Owl believes that having a CPA at the top is the best practice and will give you time to develop the rest of your staff.
Create lean policies and procedures, ideally separately. While these systems are usually referenced in the same breath, Owl recommends that companies establish policies and procedures separately, as one does not always inform the other. “You don’t want to create bottlenecks or any unnecessary steps that will lead to inefficiencies in your process,” he says of the main goal. Owl adds that companies should revisit policies and procedures on a regular basis, always thinking about the desired outcome and best practice.
Choose the right accounting system. You want something modern that will allow you to connect to other utilities to help create efficiencies, says Owl, who likes working with cloud-based systems. “Automation is a big, big part of our industry and economy right now, as it helps feed more real-time data into your accounting system and gives you access to other professionals.” He suggests selecting a system that fits your industry or organization, one that offers agility and flexibility.
Stay current with changes in accounting guidance and regulation. It is important to always stay ahead of these changes, as you want to know how they will affect your future financials. “For instance, a change in accounting principle could kick you out of compliance with your debt,” Owl explains what is at stake. Many resources are available to accounting professionals to keep them up to date on industry regulations, such as webinars and round-tables hosted by professional service firms. For Native businesses, Owl recommends NAFOA, the Native American Finance Officers Association. “It is a really good source for information. They are constantly monitoring regulation changes.”
Set up a system of internal controls and use internal audit departments. The key is to prevent fraud and misstatements in your financial reporting, and it all starts at the top, says Owl. “The tone at the top will set the organization on the path to having the right internal controls and going through the right practices.” One crucial practice that he recommends is reconciling accounts on a monthly basis. “That way, you are able to identify errors earlier and if there is fraud, you would be able to recognize it right away.”
Identify key performance indicators and dashboard them. Accounting is a numbers game, and by definition, not a very visual medium. But for CPAs, like Owl, visualizing key accounting metrics through “dashboarding” helps summarize a lot of data on one page. “Dashboarding gives you the visual information to make the right decisions with real-time information,” Owl explains why he frequently uses this financial reporting tool that helps aggregate data. Because key performance indicators should be industry-specific, Owl suggests using dashboards throughout an accounting organization, at every management and staff level. “We also set up dashboards for our clients, as well.”
Engage the right consultants and auditors. They are a critical part of any financial team, says Owl, who advises that you choose strategic partners outside your organization who know your industry very well. “Make sure you are engaging with, and have access to, subject matter experts who can grow with you.”
Run background checks on key employees. While this important recommendation applies to nearly every business, it especially holds true for employees who handle sensitive financial affairs for individuals or corporations. “Know who you are hiring. It’s a basic, key practice,” says Owl. Background checks on senior management performed by reputable companies will help you “make certain that you have people of integrity and ethics in your C-level suite.”
Know your audience and stakeholders. Who you report financials to can run the gamut, from a sole proprietor to a small business to a large corporation. Owl says it’s important to really understand who your clients are, as they all have different financial reporting needs. “For instance, there are a lot of small organizations that don’t require an audit. Maybe they go to a bank for a loan or mortgage building or some sort of financing and don’t need a full audit. There’s no use in expending resources on things that are not necessary at that point in time.”
Invest in organizations that hire and support Native financial professionals. “It’s good for Indian Country and it’s good for Native businesses,” says Owl, who believes that Native CPAs are underrepresented in the financial industry. “I think it’s because Natives are not introduced to these careers early on. When you think about protecting Tribal sovereignty, most people think about being a lawyer. They don’t understand that protecting Tribal sovereignty might also mean protecting the financial resources of the Tribe or Tribal enterprises.” Owl says the need is greatest for Tribes in rural areas, as they don’t always have the broadband infrastructure to tap into technologically advanced accounting systems. “We hear from Tribes all the time that they are looking for accounting professionals. It’s definitely a niche with a lot of room to be filled.”