Accounting Horizons

Vol. 21, No. 4

December 2007
pp. 411–422

Do Clients Share Preparers’

Self-Assessment of the Extent to Which
They Advocate for Their Clients?
Teresa Stephenson
SYNOPSIS: A conflict between the tax preparation services that tax preparers provide
and the services taxpayers seek is demonstrated in the literature: tax professionals
equate client advocacy with aggressive tax positions while taxpayers hire preparers to
increase accuracy and reduce the probability of tax audit. Although this difference has
been demonstrated at the large firms, more than half of tax preparers are at regional
and local firms. This study examines tax preparers, self-employed or from local and
regional firms, and their clients using an established scale—the recently developed
Mason–Levy Advocacy Scale. This research measures the understanding taxpayers
have of their tax preparers’ self-assessed levels of client advocacy. A practically small
but statistically significant difference is found. Advocacy is found to be equal between
CPAs and non-CPAs—counter to prior research. Also, CPA clients and non-CPA clients
are found to have similar perceptions regarding the aggressiveness of their preparers.
The implications to practice are that more conservative tax preparation may satisfy
clients with less risk and cost. Additionally, less aggressive tax positions will help to
close the tax gap.

INTRODUCTION

P
rior literature shows a mismatch between taxpayers’ and tax preparers’ objectives in
preparing tax returns (Schisler and Galbreath 2000; Hite and Hasseldine 2003). Spe-
cifically, the tax profession and accounting literature understand client advocacy as
tax minimization, whereas research shows that most taxpayers seek accuracy as opposed
to minimization when they hire a preparer (Yankelovich, Skelly, and White, Inc. 1984;
Collins et al. 1990). If tax preparers are more aggressive than clients believe, a hidden cost
of risk of audit (and sanctions) is passed on to taxpayers without their explicit knowledge
or consent.

Teresa Stephenson is an Assistant Professor at the University of Wyoming.

I thank my dissertation chair Cynthia Vines and the rest of my committee—David Hulse, Thomas Pope, Scott
Kelley, and William Rayens—for excellent guidance and immense patience. I also received constructive feedback
from Penne Ainsworth, Julia Brennan, Dennis Chambers, Mary Elizabeth Holbrook, Thomas Howard, Kathy Hurtt,
Do-Jin Jung, Sean Peffer, Mary Phillips, Robert Ramsay, Dan Stone, and Stacy Wade, as well as other participants
at the University of Kentucky’s Von Allmen School of Accountancy and the University of Wyoming’s College of
Business Workshop Series. I appreciate the guidance provided by the editor and anonymous reviewers as well as
the support from the editorial staff. I also acknowledge financial support from the Von Allmen School of Accoun-
tancy, University of Kentucky, and the College of Business, University of Wyoming.
Submitted: September 2006
Accepted: July 2007
Corresponding author: Teresa Stephenson
Email: teresas@uwyo.edu

411
412 Stephenson

This research extends the literature by asking taxpayers how their tax preparers would
answer an advocacy survey. I examine the responses to see if preparers’ tax-minimization
efforts vary in the degree they claim versus what their clients believe they do. The gap
between taxpayers’ perception of their preparers and preparers’ perception of themselves
is important to understand and document for several reasons. First, if preparers are truly
more aggressive than taxpayers want or perceive them to be, then preparers could give less
aggressive advice, which reduces the costs of providing services, the risks to the taxpayers,
and the gap in taxes. Considering that the tax gap in 2001 was about $300 billion, aggressive
stances can significantly affect public finance (Governmental Accounting Office 2005).
Erard (1993) points out that tax practitioners greatly influence their clients’ compliance.
Second, if taxpayers are selecting their tax preparers for other reasons than risk preferences,
this may support the need for more explicit communication about risk preferences, as the
IRS has suggested (See Office of Public Affairs 2003).
I examine the difference in perceptions of client advocacy using a sample of tax pre-
parers at regional and local firms and their clients using the Mason–Levy Client Advocacy
Scale, an instrument recently developed using established scale-development techniques
(Mason and Levy 2001). This research helps corroborate the validity of this scale and
contributes to our knowledge of tax preparers’ attitudes about client advocacy.

CLIENT ADVOCACY
The tax literature indicates taxpayer advocacy is the same as tax minimization (for
example, see Ayres et al. 1989; Reckers et al. 1991). Mason and Levy (2001) developed a
scale to measure ‘‘client advocacy,’’ and eight of the nine items on the instrument deal
directly with tax minimization. Hatfield (2000, 112) claims ‘‘advocacy results in finding
positions that maximize the potential tax savings to the client.’’ Archival research shows
professionally prepared returns have a greater refund due or smaller amount owed than
self-prepared returns ceteris paribus (Christian et al. 1994). At the same time, Christensen
(1992, 65) says, ‘‘services the tax preparer gives the client are based on the preparer’s
perceptions of client expectations.’’ Additionally, tax professionals are aware that their cli-
ents face a low chance of detection and audit (Fischer 2002). This knowledge allows them
to take riskier positions than they otherwise would (Kaplan et al. 1988).1 Thus, it seems
reasonable to predict that most tax preparers believe their clients expect tax minimization
efforts.
This seems especially true of experienced tax preparers at the large firms. More ex-
perienced tax managers at one of the (then) Big 6 firms showed greater tax minimization
tendencies than less experienced managers showed (Pei et al. 1992). Tax preparers at the
large firms have also exhibited confirmation bias when searching for tax law or precedent,
which in turn leads to more tax aggressive positions and more confidence in the judicial
success of those positions (Johnson 1993; Cloyd 1995; Cloyd and Spilker 1999; Davis and
Mason 2003). While large firms have been subjected to considerable research, less is known
about the degree of advocacy tax preparers’ exhibit at regional and local firms.
Research using regional and local firms is important because the majority of profes-
sionally prepared tax returns are not done by CPAs and attorneys. A sample of the 1979
Taxpayer Compliance Measurement Program (TCMP) data reveals that less than 20 percent
of returns filed with a paid professional’s signature were prepared by CPAs or attorneys
(Erard 1993). Also, a 1987 IRS survey shows that about half of all professionally prepared

1
This is known as playing the tax audit ‘‘lottery.’’

Accounting Horizons, December 2007

Do Clients Share Preparers’ Self-Assessment 413

returns are done by preparers who are not attorneys, CPAs, or even enrolled agents (Cuccia
1995).
Early research assumed client aggression led to tax preparer aggression; however, when
that hypothesis was first tested, the results showed an inverse relationship between tax
preparer aggression and client aggression (Milliron 1988; Duncan et al. 1989; Helleloid
1989). Subsequently, researchers found that tax preparers increase compliance by resolving
perceived ambiguities in favor of the IRS in straightforward tax items,2 but are tax aggres-
sive where ambiguities exist in the law (Jackson et al. 1988; Klepper and Nagin 1989; Roth
et al. 1989; Klepper et al. 1991; Schisler 1994). Despite the evidence that on average
preparers are more aggressive than their clients, research shows that an important client
can convince a tax preparer to sign a return with a more aggressive stance than the tax
preparer would otherwise take (Reckers et al. 1991).
Research shows what factors tend to increase tax aggression for different types of
preparers. Increasing penalties tend to make CPAs more aggressive, but reduce the aggres-
sion of non-CPAs (Schnee et al. 1987).3 CPAs tend to be more aggressive than nonenrolled
preparers (Ayres et al. 1989). Tax professionals with more (and more successful) experience
with the IRS tend to be more aggressive (Duncan et al. 1989). Cuccia et al. (1995) find
tax professionals exploit ambiguity in standards in favor of their clients, but when the
standards are unambiguous, they assess evidential support in a way that allows them to be
just as aggressive. Spilker et al. (1999) found that tax professionals use ambiguity in tax
law to be aggressive in compliance situations but more conservative in planning situations.
They explicitly assume taxpayers’ primary motivation is tax minimization and, therefore,
advocacy is tax aggressiveness.4
No research exists indicating that tax preparers directly communicate with their cli-
entele about risk preferences (Duncan et al. 1989; Schisler 1994). Indeed, the IRS proposed
changes to Circular 2305 pointing out the need to inform clients of the risks of aggressive
stances (See Office of Public Affairs 2003).
As evidence of this tendency toward aggression, a number of studies have examined
tax liability on professionally prepared returns and self-prepared returns. In general, the
results of this research show that professionally prepared returns have lower tax liabilities
than individually prepared returns (Long and Caudill 1987; Scotchmer 1989; Christian et
al. 1994). Furthermore, some evidence suggests that the lower tax liability was associated
with increased noncompliance (Erard 1993).
In summary, evidence to date suggests that experienced tax preparers and enrolled
professionals take aggressive stances more frequently than do other preparers.6 The litera-
ture does not distinguish between CPAs from different sizes or types of firms. This research
extends the literature by investigating the degree of client advocacy self-reported by CPAs,

2
A personal anecdote exemplifies this: many of my clients have believed that if they received less than $600 for
services for which the hiring agent was not required to produce and file a Form 1099, the money received was
not taxable. This perception, of course, is clearly false, but the area is ambiguous to some taxpayers.
3
This study does not examine attorneys.
4
Clients may be better served by matching tax preparation services to the client’s personal risk preferences, not
by assuming that tax minimization is each taxpayer’s primary motivation. However, this research will follow
the convention of equating advocacy with tax minimization.
5
Circular 230 is entitled, ‘‘Regulations Governing the Practice of Attorneys, Certified Public Accountants, En-
rolled Agents, Enrolled Actuaries, and Appraisers before the Internal Revenue Service,’’ and it governs the
actions of those tax preparers that the IRS recognizes as representatives of taxpayers without the need for a
power of attorney.
6
Enrolled agents who are not CPAs or attorneys have passed an exam administered by the IRS; the IRS auto-
matically enrolls CPAs and attorneys.

Accounting Horizons, December 2007

414 Stephenson

enrolled agents, and nonenrolled preparers at local and regional firms or who are self-
employed. It also investigates the difference between the tax preparers’ advocacy scores
and taxpayers’ predictions of those scores.

TAXPAYERS
Who Hires Tax Preparers?
It is important to understand who uses tax preparers. Over 60 percent of returns filed
in 2003 were with the assistance of a paid tax preparer, which is an increase from prior
years even while the market for tax software has increased (Guyton et al. 2005). Economic
theory would suggest that when it costs more in time or money to perform an action yourself
than to hire someone else to do so, you hire help. The empirical findings that follow support
this economic principle.
Prior research shows that the use of paid preparers increases with income, age, self-
employment, return complexity, number of dependents claimed, and marginal tax rate—
and decreases with education and tax knowledge (Slemrod and Sorum 1984; Long and
Caudill 1987; Klepper et al. 1991; Christian et al. 1993; Arena et al. 2002). Other factors
affecting the use of and type of paid preparers include marital status (Long and Caudill
1987), complexity, and audit (Dubin et al. 1992).

What Do Taxpayers Want?

Studies show that taxpayers want their tax returns to be accurate (Yankelovich, Skelly,
and White, Inc. 1984; Collins et al. 1990). Hite and McGill (1992) found that tax profes-
sionals are more aggressive than their clients want them to be, and that clients who disagree
with aggressive advice are more likely to change service providers than are clients who
disagree with conservative advice. Sakurai and Braithwaite (2001) found that most taxpay-
ers wanted the ‘‘low risk, no fuss’’ preparer who was honest and risk averse.
To summarize, taxpayers with higher incomes or returns that are more complex are
more likely to seek out paid tax preparation services than are other taxpayers. Research
does not reveal how those taxpayers find their tax preparers or what criteria they use;
however, evidence suggests that over half of those seeking paid preparers have accuracy as
their main goal and view that their tax preparer has failed if they are the subject of a tax
audit.

HYPOTHESIS DEVELOPMENT
Christensen (1992) found an expectation gap between clients and their tax preparers
from the top accounting firms. Using clients and preparers from three large international
accounting firms as survey participants, she sent surveys to 441 clients and their corre-
sponding 31 tax preparers and received a 54 and 100 percent response rate, respectively.
She found that differences between client expectations and preparers’ perceptions of those
expectations had a direct impact on satisfaction. Overall, she found that clients expect more
tax planning advice and strategies, and they perceive that their tax preparers poorly under-
stand their desires. The two largest differences she found were in the clients’ greater desires
to avoid audits than the tax preparers perceived and in the taxpayers’ complaints that tax
preparers lack communication skills.
In this paper, I examine the difference between the self-perceived level of client ad-
vocacy of tax preparers from local and regional firms and their clients’ perceptions of that
advocacy. The first hypothesis tests whether tax preparers from regional and local firms
tend toward client advocacy to the same extent that tax preparers from the largest firms do.

Accounting Horizons, December 2007

Do Clients Share Preparers’ Self-Assessment 415

H1: Tax preparers will exhibit a greater degree of client advocacy than clients predict.

Research has shown that CPAs are more tax aggressive than non-CPAs (Ayres et al.
1989; Erard 1993; Cuccia 1995). This leads to the next hypothesis, which suggests that the
client-advocacy score for CPAs should be higher than for other types of tax preparers.

H2: CPAs’ client-advocacy scores are greater than non-CPAs’ client-advocacy scores.

Jackson et al. (1988) suggest that volume tax preparers attract a clientele who desire
‘‘safe’’ returns, whereas CPA firms attract more aggressive clients. Looking only at the
taxpayer data, the clients of CPA firms should believe that their tax preparers exhibit a
greater degree of advocacy.

H3: CPA clients’ predicted client-advocacy scores are greater than non-CPA clients’
predicted client-advocacy scores.

DATA COLLECTION
The names and contact information of the tax preparers surveyed were obtained from
a large southeastern university’s Income Tax School mailing list, acquired through that
university’s School of Agricultural Economics. The survey was originally posted online,
and tax preparers from the list were solicited by email where possible or by the U.S. Postal
Service. Responding between June and November of 2005 were 545 tax preparers, an
overall 18.9 percent response rate, which is good for surveys that have no follow-up mail-
ing7 (Dillman 1978). Of those responding, 35 failed to answer every question in the ad-
vocacy section, reducing the usable responses to 510 tax preparers (17.7 percent).
The survey sent to the tax preparers included the Mason–Levy Client Advocacy Scale,
demographic questions about the preparer’s practice and experience, and a request to survey
the preparer’s clients. The Mason–Levy Client Advocacy Scale items are shown in Figure
1. The scale comprises nine items, eight of which are directly related to tax minimization
efforts. Only one item is reverse scored. The scale was presented in a Likert-type format
on a scale from one to seven with endpoints of strongly agree and strongly disagree
respectively.
Just over half the tax preparers that responded were CPAs, but 20 percent had no degree
or certification at all. The sample is heavily weighted toward those with much experience,
probably because of the mailing list—long-time preparers stay listed but acquiring new
ones for the list is more problematic.
At the end of the survey, the tax preparers who were surveyed were asked for permis-
sion to survey their clients. A total of 21 (3.8 percent) granted permission.8 Compared with
the full sample population of respondent tax preparers, more of the preparers who granted
permission have four-year degrees (chi-sq ⫽ 3.231) and are Enrolled Agents (chi-sq
⫽ 12.704).
The tax preparers who permitted their clients to be surveyed had varying client rolls,
ranging from 8 to 2,600. Those clients were sampled between August and December 2005;

7
A follow-up mailing, a recommended technique to increase response rates, was not done because of the expense.
8
Twenty-one preparers allowed a survey of their clients. In one case, three preparers did not distinguish between
their clients; thus, their average was used to compare the clients. In another case, a husband / wife team had
separate clients, so these were treated separately.

Accounting Horizons, December 2007

416 Stephenson

FIGURE 1
Mason–Levy Client Advocacy Scale

1. When examining a tax return, I tend to point out to taxpayers reasonable positions
they could have taken which would have contributed to minimizing their tax
liability.
2. The taxpayer has the right to structure transactions in ways that yield the best tax
result, even if the law is unclear in an area.
3. It is important to use trends in the law by trying to establish a pattern of more
favorable treatment for the taxpayer and then extending this pattern to the tax-
payer’s position.
4. I always interpret unclear/ambiguous laws in favor of the taxpayers.
5. Where no judicial authority exists with respect to an issue, I feel that the taxpayer
is entitled to take the most favorable tax treatment.
6. I feel I should apply ambiguous tax law to the taxpayer’s benefit.
7. Generally speaking, my loyalties are first to the tax system, then to the taxpayer.a
8. I believe it is important that I encourage taxpayers to pay the least amount of taxes
possible.
9. In an instance where no judicial authority exists with respect to an issue and where
the Code and Regulations are ambiguous, I feel that the taxpayer is entitled to take
the most favorable tax treatment.
All items were asked on a seven-point Likert-type scale with endpoints of strongly agree
to strongly disagree.
a
This item is reverse-coded.

the goal was 10 percent of the clients: a minimum of 100 (or 100 percent) and a maximum
of 250. The response rate for each preparer varied as well, ranging from 100 percent to
17.7 percent. The overall number of respondents was 512 (30.9 percent). Of those that
responded, 86 did not answer every question in the Mason–Levy survey, resulting in 440
usable responses (26.6 percent).
The taxpayers and tax practitioners were sent the same survey (shown in Figure 1), but
the taxpayers were asked to answer as they thought their tax preparers would answer. The
taxpayers were also asked about their tax preparers’ qualifications and about personal dem-
ographics that were then compared with national statistics.9 The sample tends toward tax-
payers who have higher income, who file ‘‘married filing joint,’’ and who are Caucasian,
45 to 64 years old, and college-educated. Because the sample was only of taxpayers that
use tax preparers, these demographics are not surprising. Prior research shows the use of
paid preparers increases with income, age, self-employment, return complexity, number
of dependents claimed, and marginal tax rate, and it decreases with education and tax
knowledge (Slemrod and Sorum 1984; Long and Caudill 1987; Klepper et al. 1991;
Christian et al. 1993; Arena et al. 2002). Participants were encouraged to complete the
entire survey by allowing those who did so to vote on a charity. The three charities with
the most votes received contributions.10

9
Statistics of Income and U.S. Census Bureau data were used for national demographic figures.
10
American Red Cross received the most votes and was sent $100. Cancer Research Institute and the Humane
Society of the United States were the second and third most popular charities and were sent $50 each.

Accounting Horizons, December 2007

Do Clients Share Preparers’ Self-Assessment 417

The Mason–Levy Client Advocacy scale was used in this survey. Eight of the nine
items on the scale dealt directly with tax minimization. Analysis of the data suggested that
the one item that did not deal with tax minimization actually measured a different construct
than client advocacy and should be dropped from the Mason–Levy Client Advocacy scale.11
The analysis shown in this paper will use the eight remaining items; however, the results
were substantially similar when all nine scale items were used.
The first hypothesis examines in two ways the difference between tax preparers’ self-
assessment of their client advocacy and taxpayers’ expectation of that rating. First, all
taxpayers’ responses are compared with all tax preparers responses to see whether a dif-
ference exists in the services provided at regional and local firms. Second, taxpayers are
matched directly to their tax preparer—after all, it is possible that a gap exists overall, but
that taxpayers seek out tax preparers that meet their criteria fairly closely. The Client
Advocacy score (CA) is measured by taking the average score on the eight remaining items
that make up the construct. The summary statistics for the overall CA scores are shown in
Table 1.
A two-sample t-test was run to see if the overall means between all the tax preparers
and the taxpayers differ. The t-test supports the hypothesis that an overall difference exists
between tax preparers’ self-assessed client advocacy and taxpayers’ predictions of that
score. There are 510 tax preparers with a mean score of 3.45 (Std. Dev. ⫽ 1.147) and 440
taxpayers with a mean score of 3.99 (Std. Dev. ⫽ 1.325). The difference between the two
is ⫺0.54, which is significant (p ⫽ .000). The lower score indicates more emphasis on
advocacy, and thus the difference is in the expected direction—tax preparers show higher
levels of self-assessed advocacy than their clients predict they will. Additionally, the scores

TABLE 1
Client Advocacy (CA) Scores

Minimum-Maximum
n Mean Std. Dev. (Median)
440 3.99 1.325 1.0–6.4 (3.0)
Taxpayers Onlya
All Tax Preparersb 510 3.45 1.147 1.0–5.9 (2.5)
Tax Preparers That Allowed 21 2.25 0.878 1.0–3.8 (2.1)
Client Survey
Difference between Taxpayers ⫺0.54 (0.000)
and All Preparers (p-value)
a
The number of taxpayers differs from the total 526 taxpayers that returned the survey because 86 taxpayers
did not answer every question in the CA section.
b
The number of tax preparers differs from the total 545 tax preparers that returned the survey because 35 did
not answer every question in the CA section.
The scores are the average of the eight items that make up the Mason–Levy Client Advocacy Scale (the full
nine, less the one thrown out in this paper). All items were asked on a seven-point Likert-type scale ranging
from a low of strongly agree to a high of strongly disagree; therefore, a lower number means relatively more
importance was placed on advocacy.
The difference was examined using a two-sample t-test and the p-values are two-tailed with no assumption of
equal variances.

11
At this point, it may be better entitled the Mason–Levy Tax Aggressiveness Scale—but either way it is a proven,
valid scale that measures a single construct consistently.

Accounting Horizons, December 2007

418 Stephenson

for only the tax preparers that allowed a client survey are shown with a mean score of 2.25
(Std. Dev. ⫽ 0.878). Thus, a greater difference exists between the taxpayers and their
specific preparers than between taxpayers and tax preparers in general. This shows that tax
preparers tend to exhibit more client advocacy, or tax aggression, than taxpayers believe
they do.
It is important to note that although this difference is statistically significant, from a
practical perspective it is a small difference; however, notice that the difference between
taxpayers and their specific tax preparers is larger. One possible explanation for the differ-
ence between tax preparers in general and the subset of the 21 tax preparers that allowed
client surveys is that the higher degree of client advocacy claimed by these tax preparers
is what led them to allow the survey. As a reward for allowing the survey, these tax prepar-
ers received an analysis of the results of the client survey. The desire to receive this kind
of feedback, or information about one’s clients, may be correlated with higher levels of
advocacy. The result of testing each of the constructs again with the 19 sets of matched
data shows similar results.
The second hypothesis suggests that CPAs and non-CPAs have different attitudes to-
ward client advocacy. The results of this two-sample t-test show 252 non-CPAs with a mean
score of 2.79 (Std. Dev. ⫽ 0.814) and 286 CPAs with a mean score of 2.79 (Std. Dev.
⫽ 0.756). The difference between the two is 0.00, which is not significant (p ⫽ 0.92).
Thus, this hypothesis is not supported by the data as shown in Table 2. This is contrary to
prior research that has found CPAs to be more aggressive than non-CPAs (Ayres et al.
1989). This discrepancy points to the possibility, as suggested in previous studies, that CPAs
from the Big 4 may differ from CPAs from regional and local firms. More research is
needed to distinguish which differences arise from type of firm as opposed to certification.
Additionally, more research is needed to see if the CPAs from the Big 4 have changed over
time as regulation changes have tightened professional standards.
The third hypothesis predicts that the clients of CPAs have higher CA scores than other
taxpayers. This is examined in two ways. First, the taxpayers of tax practitioners who
actually are CPAs are tested against the other taxpayers. Next, the taxpayers who believe
they are the clients of CPAs are tested against taxpayers who believe they are not. It is
interesting to note that a large number of taxpayers believe they are having their taxes
prepared by CPAs, when in reality they are not. In this data, 180 participants incorrectly
believe they are the clients of CPAs; this exceeds the actual 148 CPA clients in the sample.12
It is unknown whether these taxpayers have been misled by their tax preparers; however,

TABLE 2
Client Advocacy Scores of CPAs versus Non-CPAs

Certification n Mean CA Score Std. Deviation Std. Error Mean

Non-CPA 252 2.79 .814 .051
CPA 286 2.79 .756 .045
Difference (Sig. two-tailed) 0.00 (0.92)
This table compares the mean Client Advocacy (CA) score of CPAs and non-CPAs from the full sample of tax
preparers. A lower mean score means greater importance is placed on the construct.

12
Only seven CPA clients answered that their practitioner was not a CPA, although quite a few participants left
the question blank.

Accounting Horizons, December 2007

Do Clients Share Preparers’ Self-Assessment 419

the problem of misrepresenting oneself as a CPA is widespread enough that a law was
passed in Michigan on December 19, 2005, which enhances enforcement of penalties
against persons misrepresenting themselves as CPAs.13
The CA scores of the CPA clients versus the non-CPAs clients are summarized in Table
3. There were 148 actual clients of CPAs with a mean CA score of 3.06 (Std. Dev. ⫽ 0.866);
the remaining 319 taxpayers had a mean CA score of 3.15 (Std. Dev. ⫽ 0.920). The
difference between these two scores is 0.09, which is not significant (p ⫽ 0.31). There were
308 taxpayers that believe they are the clients of CPAs. They have a mean score of 3.11
(Std. Dev. ⫽ 0.914). The remaining 114 taxpayers that do not believe themselves to be
CPA clients had a mean score of 3.18 (Std. Dev. ⫽ .909). The difference between the two
scores is 0.07 and not significant (p ⫽ 0.47). Thus, this hypothesis is not supported.

CONCLUSIONS, LIMITATIONS, AND FUTURE RESEARCH

Overall, the results of this research show that tax preparers self-assess a higher level
of advocacy at local and regional firms and a higher level than predicted by taxpayers that
hire this type of tax preparer. This finding is evidenced by the statistically strong (although
practically small) results supporting the first hypothesis. This result supports prior research
showing that tax preparers tend to be more aggressive than taxpayers prefer.
Evidence suggests that the levels of client advocacy do not differ between CPAs and
non-CPAs, as shown in prior literature. However, the participants in this research are from
regional or local CPA firms, local offices of national tax preparation firms, and individual
practitioners, whereas prior research has concentrated on the Big 4 CPA firms. This may
indicate an interaction between certification and type of firm (CPAs that work for the Big
4 are more aggressive than CPAs that work elsewhere). It does not address whether this is
because the Big 4 attract aggressive CPAs, or whether the culture at the Big 4 fosters tax
aggression. Additionally, in measuring the perception of client advocacy, no difference is
seen between the clients of CPAs and non-CPAs. It may be that the difference is found

TABLE 3
Client Advocacy Scores of CPA Clients versus Non-CPA Clients

Certification N Mean CA Score Std. Deviation Std. Error Mean

Panel 1: Actual Certification
Non-CPA Client 319 3.15 .920 .052
CPA Client 148 3.06 .866 .071
Difference (Sig. two-tailed) 0.09 (0.31)

Panel 2: Perceived Certification

Non-CPA Client 114 3.18 .909 .085
CPA Client 308 3.11 .914 .052
Difference (Sig. two-tailed) 0.07 (0.47)
This table compares the mean Client Advocacy (CA) score of the clients of CPAs and non-CPAs. In the first
panel are the actual CPA and non-CPA clients based on the response of the corresponding tax preparer. In the
second panel are the clients’ perceptions based on their answers about their tax preparer. Note that 160 taxpayers
believe they are using the services of a CPA when in fact they are not. A lower mean score means greater
importance is placed on that construct.

13
Michigan State Senate Bill 0723 (2005) Public Act 278 of 2005.

Accounting Horizons, December 2007

420 Stephenson

only at the Big 4 accounting firms. Alternatively, the social environment may have changed
enough over time that tax aggression has declined even at the largest CPA firms.
This research shows that a typical client base may not understand (and perhaps may
not desire) the degree of tax minimization efforts engaged in by professional tax preparers.
In fact, it may be that tax preparers contribute to the tax gap by choosing more aggressive
positions than their clients would prefer. However, this study does not directly test client
preferences but rather their perceptions of the degree of aggression that they believe that
their preparer will exhibit.
Any survey-based research has limitations. Possibly those who chose to respond to the
survey have a self-selection bias. No incentives were offered based on the way the survey
was answered, and therefore the answers may be a result of social-desirability bias or
demand bias. Additionally, by necessity, the sample sizes are smaller than one would like,
and the tax preparer survey was geographically limited. However, the study represents a
small step in the direction of better understanding the taxpayer–tax preparer relationship.

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