New regulations, accounting, tax standards have made business more complex
SANTA ROSA — Backed by a panoramic window showing rolling grassland flanking a busy Highway 101, Ed Pisenti gestured with a smile to a corner of the conference room at the Santa Rosa office of Pisenti & Brinker.
Perched on sturdy metal legs was an immaculate Burroughs “style No. 3″ adding machine, a hand-cranked mechanical calculator once considered state-of-the-art in the accounting profession.
“The end of its career was when I was just starting,” he said with a laugh.
It wouldn’t be the last fixture to go by the wayside in Mr. Pisenti’s career in accounting, a field where changes in technology and practices have come at an ever-faster pace in recent years. Yet one thing has remained constant as the firm he founded with Lynn Brinker approaches its 50th anniversary:
“All of these products just do something,” said Mr. Pisenti, now retired. “It’s the experience of the people at this firm to interpret those results that makes the difference.”
It was in 1962 that Mr. Pisenti, then working at a San Francisco firm now part of Deloitte Touche Tohmatsu, turned down a promotion in Detroit to open a new practice in Santa Rosa. The three-person firm had doubled in size by 1965, when a partnership with Mr. Brinker launched the firm known today as Pisenti & Brinker.
Sonoma County was a very different place at that time, just stepping toward today’s reputation as a hub for premium wine and decades from the boom years of “Telecom Valley.” Yet the region was no stranger to small business and professional-services firms, and many lacked the sophisticated approaches in structuring business entities and perks like retirement and benefit plans, Mr. Pisenti said.
“Coming from a national firm background, I had some assumptions,” said Mr. Pisenti. He found quickly that “the concept of a corporation or a limited partnership didn’t exist.”
Helping owners to modernize those plans was a major source of business for Pisenti & Brinker in its early years years, one that its owners said had an enduring positive effect for the region’s business community.
As that economy grew, so too did the firm’s area’s of service.
“We were one of the first firms in the North Bay to have an employee-benefits and wealth-management practice,” said James Perez, partner.
Pisenti & Brinker added a Petaluma office through acquisition in 1991, the same year the firm opened an office in Napa. Its Santa Rosa office, launched in a small location at 897 Third St. in 1962, now occupies nearly an entire floor in a new office building at the city’s northeast Fountaingrove business district.
The firm today has more than 40 employees.
Pace of change accelerates
It was in the 1990s that the demands on the accounting profession were intensifying rapidly, driven in part by customer demand for services that crossed international boundaries and the acceleration of regulatory and technological change. The North Bay economy itself was also going in new directions, influenced by the larger regional economy that includes San Francisco and Silicon Valley.
The environment seemed ripe for merging with a larger firm, but William Robotham, a partner since 1966, said the sentiment at Pisenti & Brinker was to keep it independent. Instead, the firm in 1994 entered into a relationship with national accounting firm McGladrey — it was a novel arrangement at the time — that allowed Pisenti & Brinker to keep its autonomy while utilizing the larger firm’s resources.
“We liked the idea of being our own boss,” Mr. Robotham said. “We have the resources of a national firm, but we’re independent.”
That membership in The McGladrey Alliance continues nearly 20 years later, giving Pisenti & Brinker access to partner accounting services abroad, systems and training.
Yet as the firm itself increased its resources in a field that continued to advance in complexity, its partners also saw that the barriers for entry to the profession were beginning to mount.
“There came a point in time where we recognized that the learning curve for new accountants went vertical,” Mr. Perez said. “The amount of knowledge that you need to have has increased 20-fold since I entered the profession.”
Pisenti & Brinker began to foster a closer relationship with the popular accounting program at Sonoma State University. Mr. Perez himself is a graduate of the school’s accounting program and was volunteer instructor from 2010 through last year. He received the “Most Impactful Professor” award by popular vote among upper-division students in the school of business and economics in 2013.
“It was great to have a professional in practice to bring real-life experiences into the classroom,” said Joe Standridge, an accounting instructor and long-time adviser to the largest academic club on campus, the Accounting Forum. “Although we have lost Jim for a while, Pisenti continues to be a big supporter of our program by participating in recruiting activities, the banquet and hiring full-time and part-time intern students.”
The school, from which Mr. Pisenti also graduated, is one of the major sources for new employees, partners said.
Weathering the recession
Pisenti & Brinker saw its consulting work ramp up during the recent economic downturn, a time that partners said helped forge closer relationships with the firm’s clients.
“An audit is an audit,” Mr. Robotham stressed. “But we recognize the need to be able to provide that service as effectively as possible. Because we’re in the trenches, we can recommend things that may help them do their finances better.”
The firm today has come to focus more closely on areas such as auditing and assurance, tax planning, succession planning, estate planning, business valuation, business entity structuring, forensic accounting and benefit plan consulting. Its clients span the spectrum of North Bay industries, but there is a particular focus on small and middle-market firms with up to $150 million in annual revenue.
“A lot of times, we find we’re working on issues that are not tax or accounting issues,” said Timothy Moratto, partner.
“A lot of the strength in our firm is the diversity,” he added later.
Preparing to grow
The firm is itself making room for growth, having recently expanded into adjacent office space in both Santa Rosa and Napa. Its partners — among whom also is Raymond Pounds — said they were optimistic for the long-term economic potential of the North Bay and accelerating industries like specialty food and beverage.
Those prospects mean plenty of demand for a firm such as Pisenti & Brinker, particularly at a time when new regulations, accounting and tax standards have made day-to-day operations for small- and medium-sized businesses more complex, according to Mr. Pisenti.
“The accountant is going to be right in the middle of all this, because it all involves money,” he said.
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