Hartford Business Journal

www.HartfordBusiness.com • January 7, 2019 • Hartford Business Journal 11 FOCUS sons for companies to maintain their S-status, especially if the business will qualify for the new 20 percent Qualified Business Income (QBI) de- duction. And let us not forget there is the reality that C-corp owners will likely have to pay two layers of taxes, namely if they are paying wages or paying dividend distributions to themselves. Also a concern, if the owner plans to sell the company within the next few years, it could make sense to remain a pass-through entity (assuming the QSBS Exclusion will not apply). For businesses dealing with losses, owners should keep in mind that in a C-corp, those losses stay within the business, whereas with an S-corp the losses could be used to offset other personal income. With C-corpora- tions, no such benefit exists. Finally, there is the potential burden of unintended consequences, particularly if the business has ac- cumulated a significant amount of cash and/or invested that cash. In that case, the owner of a C-corp could have to pay extra taxes that an S-corp owner would not, specifically the Accumulated Earnings Tax and the Personal Holding Company Tax. So again, careful examination is re- quired before rushing into anything. What is clear about the implementa- tion of the Tax and Jobs Act is the "one- size-fits-all" approach we saw in 1986 has evolved into "one size fits one." And it takes much more than a simple surface examination to determine if changing from an S- corporation to a C-corporation is the right move. As is customary in the business world, companies that take a complete look at the pros and cons will be the ones that ultimately come out ahead. Corey Veneziano is a tax partner with West Hartford-based blumshapiro, the largest regional business advisory firm based in New England. aged to see schools like UConn offer a data analytics degree, and Mar- cum's Scavuzzo said he often meets with educational institutions about their curriculum, including data analytics and artificial intelligence classes, to talk about the future of the accounting industry. But it's not just the added pressure to prepare the next generation of ac- countants that automated solutions have thrust upon the accounting sec- tor, but also increased pressure from larger firms whose technology-based services make it more cost-effective to compete in smaller markets. "The extent to which the larger [Big Four] accounting firms use data analytics, robotic automation and artificial intelligence, has the capacity to rewrite the landscape of the accounting industry," said Robert Hilbert, managing partner of CohnReznick's assurance practice. "But a smaller [mid-sized] firm that takes off using these technologies and can scale them, could grow rapidly as well." Hilbert points to an AI pro- gram that his firm, which does a lot of commercial real estate busi- ness, uses to analyze key provisions of 200-page commercial leases. "It can identify all the key provi- sions of a lease and provide predic- tive calculations," he said. Scavuzzo said the impact of tech- nology on the accounting sector — and its employees — will depend on how firms decide to best leverage the benefits of automation services. "Does a firm use [automation] to create bigger margins given the increase in efficiencies?" Scavuzzo asked rhetorically. "Or does a firm use it to knock out [smaller firms] below?" Ways in which firms are using new technologies vary. For example, West Hartford accounting firm blumsha- piro developed a program that uses machine learning to analyze historical data and other variables to help man- ufacturing clients more accurately forecast their parts-inventory needs in real time, so that they don't leave excess capital sitting on a storeroom shelf, but also don't run out. Glastonbury accounting firm MahoneySabol is using technology to minimize the need for time-consuming data entry, including completely auto- mating its finan- cial-statement preparation. Marcum's Sca- vuzzo said firms that fail to inno- vate and invest in automation now will struggle to compete in the next three to five years. "I think [technology] will continue to create more mar- ket disruption and will drive more consolidation," Scavuzzo said. "But I think clients across the board stand to benefit as they gain more value from their accounting firms." Drew Andrews, Managing Partner and CEO, Whittlesey Robert Hilbert, Managing Partner of Assurance, CohnReznick Movers & Shakers Richard C. Boggs has been elected to the board of directors of the National Council of Structural Engineers Associations (NCSEA). Boggs is senior project manager at Manchester civil and environmental engineering consulting firm Fuss & O'Neill Inc. At NCSEA, he will join committees and give voice to the needs of this region. Katherine Farrington has joined KeyBank as its relationship manager for the Connecticut and Western Massachusetts markets. In her new role, Farrington will help business banking and middle-market clients guide their employees toward achieving financial wellness. John-Paul Clarke was hired at United Technologies Corp. as vice president of strategic technologies. Clarke previously worked as a dean at the Georgia Institute of Technology's College of Engineering. At United Technologies, he will curate the company's strategic technology focus area roadmaps. Derek Ezovski was elected president of the Real Estate Finance Association of Connecticut. Ezovski, president of West Hartford-based Outsourced Risk Management Solutions LLC, has spent his professional career helping companies create best practices to manage their risks. His previous experience includes management positions with Marsh USA, FleetBoston and Travelers. H. Frederick Sweitzer has been appointed provost of the University of Hartford. Sweitzer was appointed interim provost by prior President Walter Harrison in 2016, but was appointed to the permanent position by current President Gregory Woodward. As an interim provost, he led the process of hiring four deans at the university, and helped develop and launch several new academic programs. The Rev. Erica A. Thompson was named senior minister at the Asylum Hill Congregational Church of Hartford. Thompson is a graduate of Princeton Theological Seminary, and is currently pursuing her doctoral degree at Hartford Seminary. She is the first female senior minister in the church's 150-year history. Chris Van Gorder was appointed to the board of directors at Z-Medica LLC, a Wallingford-based medtech company. Van Gorder is president and chief executive of Scripps Health. He has about 40 years experience in health care, 30 of which he served in executive positions. Rob Michalik has joined Construction Resources Inc. (CORE), a Plainville-based construction management and general contracting firm, as director of business development. Michalik previously worked for the Connecticut Department of Economic and Community Development as director of government affairs. Bethany Zemba has been appointed vice president and chief of staff at Quinnipiac University. Zemba will serve as a senior adviser, working closely with the senior- management team to direct the formulation and execution of the university's strategic plan; coordinate institutional research; oversee community relations; and serve as the primary liaison to the board of trustees. Accounting firm KPMG hired Ronald Williams as a managing director in its risk analytics-actuarial practice in the company's Hartford office. Prior to joining KPMG, Williams served as the leader of the group benefits insurance consulting practice at Willis Towers Watson. At KPMG, he will serve health insurance and healthcare/life sciences clients. Richard C. Boggs Chris Van Gorder Rob Michalik Bethany Zemba Derek Ezovski Rev. Erica A. Thompson Katherine Farrington John-Paul Clarke

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