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Just over a year ago, an executive at a tax preparation software company shared an observation about the preparation of tax returns. The Internal Revenue Service, he said, routinely finds more mistakes in CPA-prepared returns than in those signed by non CPAs. "It's because the CPAs do not prepare as many returns as the non CPAs," was the thrust of his remarks.

For obvious reasons, he did to want to be publicly identified expressing this view. It probably would not have helped the company's prospects in selling to CPAs.

But as the season wound down, I reflected on his statement. Over the years, my wife and I have had CPA and non-CPA preparers. And it hit me that the CPAs made more mistakes than the non-CPAs. I attribute this to the fact that the non-CPA firms were much smaller and the owner handled the return while the CPA organizations were larger and handed the work off to staff.

I am not suggesting that the CPA side of the business is riddled with errors. But even before the impact of my own experience hit me, I thought that giving CPAs, Enrolled Agents and tax attorneys a free pass on some of the new preparer regulations enacted by the Internal Revenue Service was not a good idea. There are simply a huge number of these professionals and even if only a very small percentage of those experience problems with quality that means there are many, many mistakes made.

The other observation was that our more accurate preparers were Professional Accountants, a category not allowed in many states or at least bar handing out that credential to new recipients. Maybe it was just that our PAs were older and more experienced than the CPAs we used. But they certainly did their job quite well and there's no evidence that adding a C in front of the designation would have made them any more reliable.

Bob Scott
Bob Scott has provided information to the tax and accounting community since 1991, first as technology editor of Accounting Today, and from 1997 through 2009 as editor of its sister publication, Accounting Technology. He is known throughout the industry for his depth of knowledge and for his high journalistic standards.  Scott has made frequent appearances as a speaker, moderator and panelist and events serving tax and accounting professionals. He  has a strong background in computer journalism as an editor with two former trade publications, Computer+Software News and MIS Week and spent several years with weekly and daily newspapers in Morris County New Jersey prior to that.  A graduate of Indiana University with a degree in journalism, Bob is a native of Madison, Ind
Last modified on Sunday, 02 June 2013
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