Gulf Coast FCU's Urgent Need for CU Accountants

Customer Story: Gulf Coast FCU’s Urgent Need for CU-Centric Accountants

January 20, 2022

Our newest customer story tells the saga of one small credit union’s quest to obtain a full-service accounting staffing & training solution. Over the past few years, if you’ve experienced frustration (or maybe even despair?) from a lack of skilled staff in your region, inability to compete with the salary offerings from larger organizations, and high turnover, you are not alone. $50M, Alabama-based Gulf Coast FCU understands exactly how you feel. They have been outsourcing their accounting function to Aux since late 2019. This is the story of how they overcame these challenges.

How does a small credit union find, afford, and retain expert-level, credit union-savvy accountants when pummeled by rising salaries and poaching?

After Gulf Coast FCU lost their primary accountant to another company in late 2019, they hired a replacement, who was unfortunately not nearly as capable. This all-too-common situation created a huge disruption in the credit union’s function and created a frustrating knowledge gap, and it became evident to Gulf Coast FCU President/CEO David LeNoir that he needed a different solution this time around. He started looking immediately.

Introduction

In this case study, we’ll discuss the journey of a full-service accounting relationship, including:

The catalyst for outsourcing
Unexpected benefits
The importance of communication
Letting go of fear and trusting professionals
Succession planning

Before LeNoir entertained the idea of outsourcing his accounting function, he had a traditional setup consisting of an in-house, non-CPA accountant, capable of handling the day-to-day routine and monthly reporting as well as a group who managed individual pieces of the accounting function (like general ledger, accounts payable, income statement, and profitability.) After Gulf Coast lost their primary accountant to another company in late 2019, they hired a replacement, who was unfortunately not nearly as capable. This all-too-common situation created a huge disruption in the credit union’s function and created a frustrating knowledge gap, and it became evident to LeNoir that he needed a different solution this time around. He started looking immediately.

A Single Source Solution

LeNoir went to his league first for suggestions, The League of Southeastern Credit Unions, headquartered in Tallahassee, Florida. He had worked for them for seven years and knew they were a great resource for tough situations and questions. Fed up with the run-around, Gulf Coast desired an alternative to hiring that would make their accounting function more economical, improve centralization of the team, and improve accountability. LeNoir explains: “When I asked the League, they said, ‘Well, we do know of some outsourced accounting firms.’ I called a dozen different ones and told them what I needed: a full-service accounting firm that can take care of everything from soup to nuts. I always got the same response: ‘Well, send us the reports you want us to prepare, and we’ll see what we can do for you.’”

LeNoir was “wholly unsatisfied” with the lack of a robust, turnkey solution. It seemed his only option was an ad-hoc combination of separate bookkeeping services and CPA services. “Our credit union needed a single source for our accounting function, one that understood credit union specific accounting, and one that was not going to rely on our own personnel to augment what those accounting firms did.” LeNoir was relieved after meeting with Diane Parham, CFO of Aux and head of the CUSO’s outsourced accounting services, learning that her team could offer a full, credit union-centric solution, one that works as an extension of his own team. “There was no other singular solution company that offers anything like that,” says LeNoir.

Small Credit Union Staffing Woes

Gulf Coast’s challenges with hiring and retaining staff was not due to lack of trying, that’s for certain. They too were victim to the massive staffing challenges that existed pre-pandemic and are even worse now. After their accountant left, LeNoir said “we cast our hooks far and wide to try and land someone. We advertised, went through a recruiter, looked online… and we found very capable bookkeepers competent at the mechanics of accounting. However, they didn’t have gravitas that an accountant brings in, and the hands-on experience of credit union accounting, which is often unexpectedly complex.” And when it comes to training a new accountant, the amount of time and expertise it takes, especially in a skilled field like credit union accounting, is deeply burdensome to a smaller credit union like Gulf Coast. They don’t have the luxury of cross-training and a team who is capable of training a replacement. Once the accountant leaves, the knowledge goes right with them.

“What happens when you get your new employee trained up and comfortable in credit union accounting and reporting, and then we can’t compete on a pay scale? I hear, ‘I’d love to continue working for you, but I can make much more somewhere else.’” – CEO LeNoir

What’s worse, small credit union staff poaching is a real problem. “We end up as a training ground for people to work at other financial institutions that are able to compensate them better than we can,” laments LeNoir. One can see how appealing outsourced services become after years of running in staffing circles. LeNoir was sold by the cost-benefit alone: for the cost of just FTE accountant, the credit union could have an entire team, from clerks to CFOs!