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Legally Speaking

 

Issue: April, 2005
Author: Mary Angell

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Practicing Law vs. Preparing Tax Returns: A Calculated Decision

Several attorneys who could be CPAs spoke with the Wyoming Lawyer recently. While they find their backgrounds helpful in their law practices, they agreed they’re happy not to be crunching numbers today.

“A lot of accounting practice is just doing a lot of returns, and I didn’t find that particularly exciting,” said Cheyenne attorney Scott Meier. “Now I do mostly estate planning and business planning. No day is ever the same. There’s always something new.”

Meier, with Hickey & Mackey, was a CPA for 12 years. He worked for Coopers and Lybrand (now Price Waterhouse Coopers), a large accounting firm based in Denver, Colorado, and Dallas, Texas, before deciding in 1993 to attend the University of Wyoming College of Law.

While he is still a member of the Wyoming Society of CPAs, his status is inactive.

“I don’t hold myself out to the public as a CPA who does audits or tax returns,” he said. “I have a few select clients I do tax planning for, but I don’t do the tax crunch.”

Although John Masters, now an attorney with the Cheyenne firm of Hathaway & Kunz, was once a CPA, now he doesn’t even do his own taxes.

“There’s a misconception that because you have gone through accounting school you know tax code, that you read it every night before you go to bed or something,” Masters said. “That’s not true. Accountants more frequently deal with business.”

“Fifty years ago, it was fairly common for attorneys to do tax returns for their clients because fewer people needed to file a return,” he said. “And those who did consulted their family lawyers.”

“A lot of older attorneys regret having lost that element of business,” said Masters. “I don’t. Taxes are very complex. Unless you’re going to spend a lot of time doing taxes or doing one small area of tax law, it’s very tough.”

Masters graduated with honors from UW with an accounting degree in 1975 and passed the CPA exam the same year. He worked for McGladrey, Hansen and Dunn in Casper for less than three years.

“It was a large regional firm and a good group of people,” he said. “I spent the years doing taxes during tax season, and the rest of the year bookkeeping or auditing. It convinced me I wanted to go to law school.”

“Accounting wasn’t a challenge,” Masters said. “I didn’t like it enough to do it for the rest of my life.”

He also didn’t want to make the same mistake his dad did.

“My father was a CPA all his life,” he said. “He always wanted to go to law school.”

A 1979 law school graduate, Master said his accounting background serves him well in the legal profession.

“Clients can come to me and ask me questions about a balance sheet, and as an attorney with an accounting background, I can talk to them about that,” he said. “Maybe not everybody is able to do that. Most of us with accounting backgrounds tend to do a lot of transactional work, estate planning. I’ve found it very helpful in litigation—analyzing information produced throughout discovery. Quite often attorneys ask for information that is financial in nature and they don’t understand what they’re looking at.”

“Figuring damage or economic loss to a plaintiff in tort litigation is easier for someone accustomed to working with numbers,” he added.

Mark Gifford knew all along he wanted to be in the legal profession.

“Before I went to college, I had a pretty good idea I would go on to law school, so I talked to Casper lawyers to see what they would suggest for an undergraduate degree,” said Mark Gifford. “They all said they wished they had more accounting.”

Gifford obtained his accounting degree and passed the CPA exam in 1978. He worked the following summer in an Arthur Anderson firm in Denver, where he continued part-time while attending law school at Stanford. After his graduation in 1981, he went to work for Brown, Drew and Massey in Casper.

“Over the years, I’ve done almost exclusively litigation, but a lot has been business-related,” he said. “Knowing how to read a financial statement and talk the language of business, understanding journal entries, what debits and credits are, understanding how financial transactions flow have been a real advantage for me.”

Now, Gifford handles more mitigation than litigation, but knowing the language of business still comes in handy, he said.

“It has never been anything I was cut out to do for a living, but it’s been a great background,” he said of accounting.

Gifford doesn’t do any tax work—not even his own—but he does do his own books for his private practice.

Wheatland attorney Eric Jones has two sisters who are CPAs—one of them does the books for the firm—but he too concluded it wasn’t the career for him.

After earning his undergraduate degree in accounting from the University of Arizona, he worked as a CPA for Ernst and Young, an accounting firm in Denver, Colorado, for a few years before attending law school.

“I think I use my accounting background quite a bit,” said Jones, a 1997 UW College of Law graduate. “I understand financial statements and am able to reconcile accounts.”

“My dad was an attorney,” he said. “I’m not sure exactly what triggered my decision to go to law school, but the work I was doing at the accounting firm required quite a bit of traveling. There was one period of time--in the month of January--when I never saw the sun five days a week.”

So he pursued a less taxing career—law.


Mary Angell is a freelance writer from Cheyenne, Wyoming.


Copyright © 2005 – Wyoming State Bar

     

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