Hidden Asset

M A N A G E M E N T

prac t ice management

Recruiting the Disabled: Hidden AssetsBy Joanie Sompayruc. John Fulmer,and Richard A. Turpin

According to the LJ.S. Census, almost50 million Americans over the ageof 5 have at least one disability—thatis nearly one out of every five

Americans. Over 33 million of those areworking-age men or women. Furthennore,an estimated 35 million people ai-e consid-ered severely disabled, and of those betweenthe ages of 21 and 64, about 46% remainemployed, according to author TimothyMoore (ezinearticles.com/7How-Many-Disabled-Americans-Are-There?&id= 1918829). Recent decades have seen sig-nificant legislation to ensuis that those work-ers have acces.s—access to public build-ings, access to employment, and access tojustice. One of the most important pieces oflegislation that has attempted to enablesuch access is the Americans withDisabilities Act (ADA) of 1990.

In the yeais following enactment of theADA, the literature was rife witli doom imdgloom over how costly this law wasgoing to be for businesses in general.Articles geared to employers in theaccounting profession warned firms thatcompliance with the ADA could be com-plicated and expensive, advised them toreview job descriptions and personnel poli-cies, and suggested ways to improvefacilities to avoid lawsuits for noncompli-ance with the ADA. These articles showthat accounting firms were wringing theirhands over the impending flood of litiga-tion that was going to follow if they didnot get their houses in order.

The ADA RealityTwenty-one years after President George

H.W. Bush signed the ADA into law. thislegislation appears to have changed howsociety accommodates individuals with dis-abilities. Public buildings regularly havewheelchair ramps and parking spaces, vir-

tually all curbs at intersections allow forwheelchair users, many elevators haveBraille number buttons and audio cues, andoffice design companies offer plans thataccommodate a wide range of disabilities.Studies show that employer eftbrts to com-ply with the ADA have generally beensimple and inexpensive in most cases. Astudy funded by the U.S. Department ofLabor and undertaken by the JobAccommodation Network found that in the1990s, the typical cost of an accommoda-tion for a qualifying disability under theADA was less than $500 ("What Is theReal Cost of ADA Compliance," by DanWoog, hrpeople.monster.com/news/articles/1073-what-is-the-real-cost-of-ada-compli-

ance). Moreover, the necessary accom-modations were often quite easy: raisingor lowering a desk, installing a ramp,allowing orthopedic shoes in modificationof the company dress cixle, allowing a flex-ible schedule, increasing volume on a tele-phone receiver, installing a large-screencomputer monitor, or using an ergonomiechair with extra padding.

There are several reasons why compa-nies, especially accounting firms, .shouldmake efforts to recruit and retain capableworkers with qualifying disabilities andmake reasonable accommodations forthem. This aiticle discus.ses those reasons.Among the many benefits of hiring the dis-abled are tax incentives, increasing diver-

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sity and access to talent, benefitting fromthe experience of seasoned accountantswho may have become disabled over time,attracting clients, and recognizing the man-dates of the recently updated ADA laws.In addition to discussing the benefits toFirms, this article discusses the role ofaccounting professors in working with stu-dents with disabilities.

Tax IncentivesThe Tax Code offers tax incentives to

some businesses that make expendituresspecifically to accommodate disabledemployees or patrons. One incentive cre-ated in 1990 is a tax credit availableunder IRC section 44. Expenditures toProvide Access to Disabled Individuals.This credit was designed to help small busi-nesses cover ADA-related access expendi-tures. A business can take advantage of tliiscredit if its revenues in the previous taxyear were equal to or less than $1 millionor if it had fewer than 30 employees.Eligible expenditures include—• provision of qualified readers, tapedtexts, and other effective methods ofmaking visually delivered materials avail-able to individuals with visual impaimients;• provision of qualified interpreters orother effective methods of making aurallydelivered materials available to individualswith hearing impairments;• purchase of adaptive equipment;• production of accessible formats ofprinted materials (i.e.. Braille, large print,audio tape, computer discs);• removal of architectural barriers infacilities or vehicles (alterations must com-ply with applicable accessibility standards);and• fees for consulting services (under cer-tain circum.stances).

This tax credit can only be used to mod-ify existing facilities for compliance withADA; it cannot be used to finance newconstruction. The amount of the tax cred-it is equal to 50% of the eligible accessexpenditures in a year, up to maximumexpenditures of $10,250. There is nocredit for the first $250 of expenditures.Therefore, the maximum credit availableis $5,0(X) ([$10,250 - $250 fioor] x 50%= $5,(X)0). Furthermore, the expenditurethat created the credit cannot be used toincrease the basis in the property.

Another tax incentive that some busi-nesses may u.se is a tax deduction. IRC sec-tion 190, Expenditures to RemoveArchitectural and Transportation Barriersto the Handicapped and Elderly, allows adeduction of up to $15,000 per year fromnet income for qualified architectural andtransportation barrier removal expenses.These expanses cannot be chargeable tocapital account.

Small businesses can combine the taxincentives under IRC sections 44 and190. For example, if a firni spends $20,000in qualifying expendiaires for removal ofan architectural banier and modification ofoffice design to accommodate an employ-ee covered by the ADA, the businesswould be able to take the $5,000 taxcredit as well as the $15,000 tax deduction.The reason is that the deduction is equalto the difference between the totalamount of the expenditures and the amount

of the tax credit claimed. For more infor-mation on these tax incentives, go towww.irs.gov and view Form 8826,Disabled Access Credit, and the relatedinstructions for the disabled access credit.In addition, it is helpful to review 1RSPublication 334, Tax Guide for SmallBusiness, and 1RS Publication 535,Business Expenses.

Employers can now earn up to $2,4(XJper year for each qualifying hire underthe Work Opportunity Tax Credit, whichincludes certain disabled employees(www.esd.wa.gov/hireanemployee/re.sources/taxcredits/index.php). This same pro-gram allows employers to earn up to$4,8(X) for each qualifying disabled vet-eran hired (www.doleta.gov/business/incentives/opptax/PDF/WOTC_Fact_Sheet.pdf). There is no limit on thenumber of new hires who can qualify forthis tax credit.

SUCCESS STORY 1

"Many potential employers failed to see his abilities because they were unableto see past his disabilities."

Sam is a financial analyst with a large regional accounting firm based inTennessee. Looking at his credentials, one might tbink that Sam wouldhave no trouble getting a job at a firm like the one where he works. He

graduated magna cum laude from a prestigious private university with a bache-lor's degree in accounting and is a CPA as well as an Accredited BusinessValuation professional. Sam, however, has a form of autism known as Asperger'ssyndrome, and does not relate to the world as most people do. Nevertheless,Sam has not only managed to carve out a career for himself in the corporatefinance division of tbis large firm (where be has worked for the past 13 years),but be has also helped the firm generate substantial revenues.

His boss and mentor, Greg, stresses that Sam is on the payroll because hisunique skills and abilities have enabled the firm to secure clients through his cut-ting-edge business valuation approaches. Greg notes that wbile at times Sam'sdisability can require "some management," Sam bas enabled the firm to find atreasure in someone that many other firms, frankly, overlooked. Greg says that"many potential employers failed to see Sam's abilities because they wereunable to see past bis disabilities." After all, some of Sam's health issues make itimpossible for Sam to drive a car. Also, Greg has bad to help Sam develop cer-tain business etiquette skills. Greg admits tbat "managing" Sam requires moreattention than it would if Sam were like other employees; however, as Greg seesit, Sam is no charity case because be clearly helps the firm's bottom line.

Sam recently won the Southeast Tennessee Placement Consortium's DisabledEmployee of the Year Award. At that time, he said, "I hope this helps peopleunderstand it is okay to hire disabled people in the workplace. Just because youare classified as disabled does not mean you don't have value."

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Recruiting for the AccountingProfession

Hiring individuals with disabilities canprovide several benefits for accountingfirms and the accounting profession. First,in many areas of the United States,accounting finns still l(X)k very homoge-neous. Providing reasonable accomm(xia-tions that enable recmiting and retainingtalented workers with qualifying disabili-ties not only can help a finn secure a capa-ble workforce, but also can send a positivemessage to potential employees about afirm" s culture.

Second, the accounting professionshould avoid excluding any of the best can-didates, and not hiring disabled individualsmay be doing just that. Remembering thatalmost one out of every five Americanshas some type of di.sability, some of thebrightest minds may be in bodies that havedisabilities.

Third, individuals with disabilities canserve as models for others and assist inattracting individuals to the accounting pro-fession. Imagine the impact on students,those with and those without a disability,as well as those from a protected class (e.g..

SUCCESS STORY 2

"I want to be productive and give back."

Jonathan made quite an impression on his first day of class in intermediateaccounting. It is not every day that a professor gets a student with noarms in class. Jonathan was in an accident several years ago that result-

ed in the loss of his arms. He had the option of using the financial settlementfrom the accident to avoid pursuing another career, but he says, "I did not wantto sit around and do nothing for the rest of my life. I have been fortunate toreceive kindness from many people, and I want to be productive in some wayand give back."

Jonathan has chosen to pursue a degree in accounting. As with most studentsin accounting, Jonathan recognized the importance of gaining experience work-ing for an accounting firm, so he sought employment with the accountant whohas worked with his family for many years, Jack. Jack says that Jonathan beganworking for him in June 2006 and he has had to make no special accommodationfor him. Jonathan brings his own keyboard and his own mouse. Jack asserts thatJonathan is extremely independent and will go to extraordinary lengths to provethat he can perform tasks himseif.

Jack says his intent in hiring Jonathan has been to let him know what workingin a small accounting firm is really like. His firm is a sole proprietorship that hasbeen operating for 40 years. The personnel in the firm Include Jack, his wife(who functions as an office manager), a bookkeeper who has been with the firm30 years, a receptionist, and now Jonathan. The firm handles work for individualsand small businesses. It does payroll work, general ledger work, and tax compli-ance. Jonathan has enabled Jack's firm to expand its services to include com-puter software installation and programming troubleshooting.

When asked if clients ever comment to him about sending an employee withno arms to help them. Jack says the most frequent comment he receives is, "Wethink we like Jonathan even more than we like you!" Jack does admit that heinitially had a concern that Jonathan would be at a disadvantage because hecan only handle papers with his toes. But his strong work ethic, can-do attitude,professionalism with clients, and expertise with computers has eased any con-cerns Jack had. In fact. Jack, who is a member of the Georgia State Board ofAccountancy Exam Committee and the Georgia CPA Licensing Board, says hehas every confidence that Jonathan will succeed in the accounting profession. Infact, when Jack retires in the next three to five years, he hopes that perhapsJonathan wili enabie his firm to carry on without him at the heim.

race, national origin, age) when they see adisabled individual make a presentation ata Beta Alpha Psi meeting. The idea thatmight (3ccur to many students is, "Gee, thatindividual is successful in the accountingprofession: there must be a role in account-ing for me, too" or "Wow, that individualcan be successful in the accounting pro-fession; so can 1."

Recognizing the Value of ExperienceStatistics show that the likelihood of

having a disability increases with age.Arguably, some of the accounting profes-sion's most experienced and reliable employ-ees will iilso be older workers. Having sea-soned accounting veterans with disabilitieson limi stalls will help develop younger staffmembers, while providing tliem with valu-able life lessons and good examples. Somefirms have even concentrated on recruitingolder accountant.s becuuse tliey rccogni/x; theimmeasurable worth of their experienceand loyalty.

Many of the.se sea.soned accountants—thanks to advances in technology—can nowwork from home. Finns are now recogniz-ing that having disabled employees withextensive experience work from homeenables them to benefit from the depth iuidbreadth of knowledge of these workers,while .saving money on work space and pR)-viding convenience and flexibility to theworkers.

Attracting ClientsAccounting firms should hire employees

based on their ability to pertbnn the work;uid be a part of the team: however, someaccounting Fimis recruit students who canal.so bring in nature business. Tho.se fimis thathave employees with disabilities may havea leg up on other linns when bidding for newclients. It is probable that some potentialclients either have employees with disabili-ties or are run by disabled individuals.When selecting the finn to provide theiraccounting needs, these |X)tential clienLs maylook favorably upon an accounting fimi tliathas invested in recmiting ;uid tiiiiiiing qual-ified disabled employees.

Changes in the ADA LawsIn addition to the benefits to firms for

hiring disabled employees, changes in theADA laws have provided an added incen-tive. The courts have been increasingly

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reluctant to qualify some disabilitiesunder the ADA and, thus, have deniedADA protection to many Americiins whomight otherwise qualify for accommoda-tion under the law. On September 25, 2(X)8,President George W. Bush signed theAmericans with Disabili t ies ActAmendments Act of 2(X)8. According tothe Equal Employment OpportunityCommission, this act "emphasizes thatdie definition of disability should be con-strued in favor of broad coverage of indi-viduals to the maximum extent pennittedby the terms of the ADA and generallyshall not require extensive analysis"(www .eeoc.gov/laws/statu tes/adaaa_notice.cfm). Among the issues this act addressesare that it—

• expands the definition of what consti-tutes "major life activities" to include moreactivities than previous court decisions,• asserts tliat "mitigating other tlian 'ordi-nary eyeglasses or contact lenses' shall notbe considered in assessing whether an indi-vidual has a disability,"• notes that an "impairment that isepisodic or in remission is a disability if itwould substantially limit a major life activ-ity when active," and• provides that individuals covered onlyunder the "regaided as" prong are not enti-tled to reasonable accommodation.

Role of a University Accounting ProgramAccounting professors need to be aware

of positions in the accounting professionthat students with different disabilities cansuccessfully undertake. It would be help-ful for the profession to develop and pub-licize a list of examples where individualswith disabilities are successfully employedas accountants. Professors could then usethese examples to offer encouragement andinspiration to disabled students. Manyaccounting success stories are the resultof an accounting professor offering hopeto an aspiring accounting student. (Seethe Sidebars for three accounting-relatedsuccess stories.)

In carrying out their role as sources ofencouragement and inspiration, accountingprofessors should be cognizant of thetotal profession, not just their particular spe-cialization. For example, an auditing pro-fessor might think that a hearing-impairedindividual would not be successful in theaccounting profession given the extensive

interviewing techniques that a skilled audi-tor must possess; however, tliat professoris viewing the profession from the view-point of an auditor, and must realize thatthe hearing-impaired person can play a vitaliind vibrant role in other areas of account-ing where aural skills are not as crucial.

In addition, accounting pnifessors shouldbe cognizant of advances in technology andcommunications as they relate to disabledstudents. For example, a professor mightthink that a student who has limited useof his arms cannot work efl'ectively in theaccounting profession given the amount ofmemorandum writing and data entry thatis required in many accounting positions.He must realize, however, that special com-puter keyboards are available that enable astudent to enter information without usinghis arms.

Importance of RecruitmentThere are many reasons to recruit and

retain capable workers with qualifying

disabilities and to make reasonableaccommodations for them. Certain expen-ditures made to accommodate disabledemployees or patrons qualify for tax cred-its or tax deductions. In addition, moti-vating the best and brightest to join theaccounting profession can only enhanceits ranks. Finally, employing disabledindividuals may assist in attracting clients.Accounting finns should dearly consid-er placing additional emphasis andeffort on the recruitment of those withdisabilities. Ü

Joanie Sompayrac, JD, MAcc, CPA, isthe University of Chattanooga FoundationAs.Kociate Profes.wr of Accounting andJohn Fulmer, PhD, is the First TennesseeProfessor of Finance, both at theUniversity of Tennessee at Chattanooga.Richard A. Tiirpin, PhD, CPA, is an asso-ciate professor of accounting at TroyUniversity, Troy. Ala.

SUCCESS STORY 3

"I want clients to focus on my work, not my inability to hear."

K aren was born deaf, and her parents insisted on making sure sbe grewup fully prepared to function in the bearing world. All of her siblingswere able to hear, so her parents made sure Karen learned to read lips

at an early age. Wbile Karen also knows sign language and uses certain aids toassist the bearing impaired, sbe functions amazingly well in the hearing world.

When Karen went to college in Ohio, many of her classmates were initiallyunaware that she had a bearing impairment; tbey just "thought I talked funny,"she says. As friends and classmates discovered that Karen was deaf, most wereimpressed at her ability to function so well in tbe collegiate environment. Therewere those people, however, who appeared to shout at her and treat ber asthough sbe were handicapped, which Karen admits sbe hated.

When Karen discovered her love of accounting, most of her professorsencouraged ber, but there were those who shared their concerns with ber aboutbow accounting firms would perceive ber ability to deal witb clients because ofber hearing impairment Wbat Karen has discovered is that clients are actuallyincredibly candid with ber—sometimes witbout meaning to be. For instance, shenotes that on some jobs, sbe notices client representatives talking among them-selves about wbat to honestly share witb ber and what to keep to themselves,witbout realizing that sbe reads lips. She finds these little moments more amusingthan anything. Sbe also notes that some of her clients still don't seem to fullyrealize tbat sbe bas a bearing impairment.

Karen has earned a master's degree in accounting and a CPA designation.She has found that ber impairment bas made her somewhat more approachable,and she thinks ber firm is more amenable to biring otber disabled accountantsnow tbat it has realized how seldom her impairment affects her work.

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