IRS rules, stepped-up audits and complex tax regulations are increasing the demand for qualified CPAs, leading OC accounting firms say.
They are still adjusting to post-pandemic conditions and a constantly shifting economic outlook.
Manuel Ramirez, chairman and partner in RJI CPAs, cited a report of a “significant shortage of CPAs at a time when demand for their expertise is surging.”
The Irvine-based firm moved up to No. 23 on the Business Journal’s list of largest local accounting firms by total headcount, as the number of Orange County employees rose 32% to 91 over the last year. Of those, the number of CPAs increased to 31 last month from 28 a year ago.
Ramirez told the Business Journal that many of the firm’s CPAs and consultants “hold advanced degrees and have experience with Big Four accounting firms.”
Interesting Times
Of the 47 accounting firms surveyed by the Business Journal, the number of OC employees rose nearly 3% to 6,727 last month from the year earlier, while the number of local CPAs increased less than 1% to 2,003. Local accounting firms showed a third year of growth.
Deloitte, a Big Four stalwart, kept its usual No. 1 ranking though the number of employees in its Costa Mesa office dipped slightly to 1,081 from 1,097 a year ago. The CPA ranks increased 7% to 238.
“This past year has been an incredibly interesting time to be in the professional services industry within Orange County,” said Marshall Solomon, the Deloitte OC managing partner.
Global giant Ernst & Young in Irvine held on to second place by local headcount while PwC moved one notch to No. 3.
The largest OC-based accounting firm was Irvine’s Omega Accounting Solutions, whose headcount stayed steady at an estimated 187.
IRS Increasing Audits
The IRS is stepping up audits of corporations and individuals with incomes over $10 million.
Another target of the federal tax authorities is a pandemic-era credit program to support businesses that has grown in importance.
“Many Orange County businesses are frustrated with the slow processing of Employee Retention Credit (ERC) refunds,” said Theresa Fraser, corporate tax partner in the Irvine office of Baker Tilly.
“Processing has slowed on account of the misleading marketing campaigns that lured taxpayers into claiming the ERC when they are not eligible for it,” she told the Business Journal. Her Chicago-based firm came in at No. 7, with 51 local CPAs.
Gabriel Sermeno, state and local tax director at Moss Adams said “there is some uncertainty among businesses right now. OC businesses are still adjusting to a post-pandemic market, fallout from state and local initiatives, opportunities through federal programs, and an impending election.”
Moss Adams in Irvine grew 7% to 303 OC employees as of last month, good for the No. 6 spot. The number of local CPAs was up 11% to 128.
Notables
• “Powered by our 2030 Global Strategy, RSM has worked collaboratively as a global organization more than ever before to innovate and better serve clients across borders,” said market development manager Dawn Sanders of RSM US LLP.
The firm’s local employee headcount grew 14% to 308, claiming the No. 5 slot, though the number of local CPAs dropped 14% to 67.
• “Expanding our focus in the federal government and healthcare sectors has allowed us to not only meet but exceed our strategic goals, setting new benchmarks for our compliance practice,” said Matthew Conrad, managing partner of Conrad LLP, which ranked No. 29 as the number of OC employees increased from 47 to 67.
• Among the other leading accounting firms in OC, Grant Thornton LLP in Newport Beach was ranked No. 11 with 170 OC employees and 63 CPAs, while Withum in Irvine moved one notch to No. 20.
• Haskell & White in Irvine increased its headcount 14% to 90 for the No. 24 spot.
