Project management fundamentals for CPA firms


Lately, there’s been a lot of talk within CPA firms around hiring project managers. A project manager (PM) can be an excellent addition to your team, however I’ve found that some people use the term “project management” when also describing an engagement management.

While both roles require the same attention to detail, focus on process, and stellar communication skills, there is a difference between these two roles.

In this article we will cover:

Engagement management vs. project management

An engagement manager oversees client engagements, acting as the communicator between the client and the engagement team. Additionally, they ensure milestones are hit and keep the engagement on task so the rest of the team can focus on their unique abilities. Although every engagement may have unique aspects, there’s typically a common deliverable: a financial statement, a strategic plan, etc.

Projects, on the other hand, are temporary. They are also unique in that they’re not a part of your firm’s routine operations, but a specific set of operations designed to accomplish a singular goal. They have a defined beginning and end, and therefore a defined scope and resources. A project team often includes people who don’t usually work together – sometimes from different organizations and across multiple geographies.

Examples of projects include developing software for an improved business process, constructing a building or bridge, the relief effort after a natural disaster, or the expansion of sales into a new geographic market. All must be expertly managed to deliver on-time, on-budget results.

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Project management fundamentals

Project management is the application of knowledge, skills, tools and techniques to meet the project requirements. Each project goes through five project lifecycle phases, each of which is tailored to fit the project’s needs.

Phase 1 – Concept and initiation

This is the start of the project. The goal of the concept and initiation phase is to define the project at a broad level. This usually begins with a business case and research into whether the project is feasible and whether it should be undertaken.

In this phase, important stakeholders do their due diligence to help decide if the project is a “go.” If it is given the green light, you need to create a project charter or a project initiation document (PID) that outlines the purpose and requirements of the project. The PID includes business needs, stakeholders and the business case.

There are plenty of PID templates that adhere to guidelines established by the Project Management Institute’s A Guide to the Project Management Body of Knowledge (PMBOK® Guide) available online. You can download one to help you get started.

Phase 2 – Defining and planning

The defining and planning phase is key to successful project management and focuses on developing a roadmap for everyone to follow. This phase typically begins with setting goals. Two of the more popular methods for setting goals are S.M.A.R.T. and C.L.E.A.R.

S.M.A.R.T. Goals

The S.M.A.R.T. goal method helps ensure that the goals have been thoroughly vetted. It also provides a way to clearly understand the implications of the goal-setting process.

  • Specific. To set specific goals, answer the following questions: who, what, where, when, which and why.
  • Measurable. Create criteria that you can use to measure the success of a goal.
  • Attainable. Identify the most important goals and what it will take to achieve them.
  • Realistic. You should be willing and able to work toward a particular goal.
  • Timely. Create a timeframe to achieve the goal.

C.L.E.A.R. Goals

The C.L.E.A.R. goal method takes into consideration the environment of today’s fast-paced businesses.

  • Collaborative. The goal should encourage employees to work together.
  • Limited. Goals should be limited in scope and time to keep it manageable.
  • Emotional. Goals should tap into the passion of employees and be something they can form an emotional connection to. This can optimize the quality of work.
  • Appreciable. Break larger goals into smaller tasks that can be quickly achieved.
  • Refineable. As new situations arise, be flexible and refine goals as needed.

Using one of these goal-setting methods, define the scope of the project and develop a project management plan. This involves identifying the cost, quality, available resources and a realistic timetable. It also includes establishing baselines or performance measures. These are generated using the scope, schedule and cost of a project. A baseline is essential to determine if the project is on track.

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Phase 3 – Launch or Execution

The launch or execution phase is the one in which you develop and complete deliverables. This often feels like the meat of the project since a lot is happening during this time, such as status reports and meetings, development updates, and performance reports. A “kick-off” meeting usually marks the start of the Project Execution phase where the teams involved are informed of their responsibilities.

Tasks completed during the Execution Phase include:

  • Develop the team
  • Assign resources
  • Execute project management plans
  • Procurement management if needed
  • PM directs and manages project execution
  • Set up tracking systems
  • Execute task assignments
  • Status meetings
  • Update project schedule
  • Modify project plans as needed

While the project monitoring phase has a different set of requirements, these two phases often occur simultaneously.

Phase 4 – Performance and control

The performance and control phase is all about measuring project progression and performance and ensuring that everything happening aligns with the project management plan. Project managers use key performance indicators (KPIs) to determine if the project is on track.

The PM typically picks two or more of these KPIs to measure project performance:

  • Project Objectives. Measuring if a project is on schedule and budget is an indication of whether the project will meet stakeholder objectives.
  • Quality Deliverables. This determines if specific task deliverables are being met.
  • Effort and Cost Tracking. PMs account for the effort and cost of resources to see if the budget is on track. This type of tracking informs if a project will meet its completion date based on current performance.
  • Project Performance. This monitors changes in the project. It takes into consideration the amount and types of issues that arise and how quickly they are addressed. These can occur from unforeseen hurdles and scope changes.

During this time, the project manager may need to adjust schedules and resources to ensure the project is on track.

Phase 5 – Project Closure

The project closure phase represents the completed project. Contractors hired to work specifically on the project are terminated. PMs recognize team members and may even organize small work events to thank the people who participated in the project for their efforts.

The PM often holds a meeting – sometimes referred to as a “post mortem” – to evaluate what went well in a project and identify project failures. This is especially helpful in understanding lessons learned so that improvements can be made for future projects.

Once the project is complete, the PM still has a few tasks to complete. They will need to create a project punch list of things that didn’t get accomplished during the project and work with team members to complete them. They also need to prepare a final project report and budget. Finally, they need to collect all project documents and deliverables and store them in a single place.

In the end, project management brings together aspects of integration, scope, time, cost, quality, procurement, human resources, communications, risk management and stakeholder management. Of course, all management is concerned with these, but project management brings a unique focus shaped by the goals, resources and schedule of each project. We can see just how valuable that focus is by considering the rapid, worldwide growth of project management as a recognized and strategic organizational competence, as a subject for training and education and as a career path.

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Additional Resources

If you’re looking for additional resources, the Project Management Institute (PMI) is an excellent resource for project management training, standards, tools and templates.

The following Sage Advice articles can also help you master the fundamentals of project management:

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