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Finding a home in public accounting

For a guy who did not want any part of Rochester or Upstate New York after graduating from college, Thomas Wolf is all but immovable at Mengel, Metzger, Barr & Co. LLP.

Wolf, 48, was hired in 1983 by the locally based CPA firm after getting his degree from Rochester Institute of Technology. He became a partner in 1995 and managing partner on Nov. 1, 2004. If he has his way, Wolf will be with Mengel, Metzger, Barr until he retires.

"I have no intention to do anything other than what I’m doing," he says from the firm’s offices on the 12th floor of HSBC Plaza on Chestnut Street.

"I don’t have a retirement age in mind, but 15 years would put me at 63. I might be working at 63. I might be retired at 63. A lot can happen in 15 years. But I love what I do. I feel blessed, lucky, whatever you want to call it. This is where I want to be till I retire."

The Penfield resident oversees 55 employees at the Rochester office and 25 at an office in Elmira. The company also has a satellite office in Hornell, Steuben County, staffed primarily by Rochester personnel.

"He’s definitely had an opportunity to explore what people may consider to be bigger jobs or more prestigious jobs in other cities," says Paul Swistak, district sales manager with the business solutions division of Office Depot Inc. in Rochester. "But I think he loves doing what he’s doing, loves the people he works with and loves the community he lives in."

Wolf is actively involved with the Heart of Gold Foundation and the Small Business Council of Rochester, an affiliate of the Rochester Business Alliance Inc.

"Not only do I think he’s a tremendous accountant and business adviser, he adds a lot to the community," says Swistak, a long-time friend.

Wolf, a Syracuse native, could not imagine that scenario when he joined the firm 27 years ago.

"I certainly wasn’t going to be living in Rochester, N.Y.," Wolf recalls thinking. "My dream job was anywhere but Rochester.

"Not that I didn’t like Rochester, but I was a young kid, I was single and I sent resumes all over the country. My dream job was to be working at a big company, out of Rochester, and making a pile of money."

Swistak says he often leans on Wolf regarding business matters, even though his company does not work directly with the accounting firm because Office Depot is based in Delray Beach, Fla.

"Tom and I have talked about different things, about advice on different types of things I might be thinking about," Swistak says. "He’s always very quick to provide advice and guidance and expertise."

Wolf was raised by his mother in a single-parent household. His mom was a schoolteacher, and Wolf took a full-time job when he was 16 to help pay the bills. He attended school until noon each weekday, then worked until 9 each weeknight. He also worked his way through college.

Getting a start

After sending out 300 resumes, Wolf learned that a bachelor of science degree in accounting did not guarantee a dream job. He also began to think about working for a public accounting firm.

"Back when I graduated, colleges really weren’t pushing public accounting," Wolf says. "You went to work at a company."

He had not interviewed with any public accounting firms while in college, but after graduating without any definite employment prospects he decided to become a CPA, which takes two years of work experience.

"I found some interviews, and in a matter of two or three weeks had three offers from the national accounting firms," Wolf says. "I had a friend that worked here and she got me an interview here. I went from having no job to having four offers in, like, three weeks."

The national firms wanted Wolf to do auditing and not much else. The offer from Mengel, Metzger, Barr included auditing, tax work and interaction with business owners and controllers.

"This place said ‘We’re a smaller firm,’" Wolf recalls. "’You’re not just going to go and do a big section of an audit at a big company. You’re going to get a chance to roll your sleeves up and get to know a lot of different people and learn different disciplines like tax and audit.’ As a 21-year-old, that seemed more attractive to me."

Two years after his hiring, Wolf knew he had made the right choice.

"I liked the challenge," he says. "Even to this day, it’s still a challenge. Every day’s different. The rules are always changing. Every client situation is different. There are certainly similarities between different situations, but everything’s unique to a client."

And, for a second time, his career path was short-circuited.

"My sole intention when I joined the company was to work here for two years, get my two years of experience requirement, pass the CPA exam and then leave," Wolf says. "I had no intention of being here past two years and a day. I’d go to my big company and leave New York State for whatever big thing that I was going to do."

In 1995, 12 years after joining the firm, he became a partner. In 1999, James Barr-who co-founded the firm in 1975 and had been managing partner since-decided to relinquish the position to co-founder Richard Mengel. Wolf was named operations partner, overseeing the firm’s day-to-day activities.

Wolf replaced Mengel in 2004, with Mengel’s blessing and a vote by the firm’s partners, to become its third managing partner.

"He’s done a great job of integrating the old and the new," says James Rahmlow, a partner in the firm’s tax department. "He always has the firm’s interest at heart. That’s No. 1 for him whenever there’s decision-making involved in the process.

"He’s a very likeable guy, well-respected by the staff. He gets right in there and rolls up his sleeves. He doesn’t act like he’s the managing partner and above all these things. That does a lot toward fostering a team effort."

The 15 partners last year voted in favor of Wolf for a third three-year term.

"Everybody says you’re the big cheese," Wolf says. "I don’t look at it that way. I have a role here. Other people have a role here. That’s what Jim and Dick always taught me, that nobody is more important than anyone else. We just have different responsibilities."

Because of his duties as managing partner, Wolf has reduced his client base by 25 percent.

"In a regional public accounting firm, there’s an expectation and a need to continue to stay sharp as far as your technical skills and to still manage a book of business," he says. "I probably spend half of my time running the firm and half of my time still working on clients."

As managing partner, Wolf reasons the firm’s 80 employees have become clients.

"I went from making sure my client base was serviced and helping to bring in new work for the firm to feeling like I had a bigger responsibility to the whole organization," he says. "That encompasses those 80 families and what you need to do to make sure those 80 families have their own success."

Wolf formulates the firm’s growth strategies. That includes size, geographic markets and types of work.

"We’re always looking for expansion opportunities," he says. "It has to be a good fit. We’re not looking to get bigger just for the sake of getting bigger.

"If we were to find a firm that had some niche specialties that we might not have that would complement what we do have, and they were in a different geographic market, we would certainly entertain that. But it’s not something that’s on our radar screen, like we have to be in Buffalo or we have to be in Syracuse or we have to be in Binghamton."

Wolf also is responsible for the firm’s financial matters, including budgeting and forecasting. He heads a five-person management committee. He brings recommendations to the committee for consideration.

"It’s really like having two jobs. It does require a lot of time," he says.

Wolf works 75 to 80 hours each week in the winter and 60 to 65 hours weekly in the summer. He could not do what he does, he says, without the understanding of his wife, Dawn.

"I’ve been doing this for 27 years, and I’ve been with my wife for 21 of those 27 years," he says. "Not once in 21 years with her has she ever given me crap about what I do. There has to be times when she wishes I were home. She keeps our house running. She keeps the kids in line."

Company growth

Wolf will not disclose the firm’s financial details, but he says revenues and profits have grown dramatically in the last eight years because of tighter accounting standards imposed by the Sarbanes-Oxley Act of 2002.

"That had a dramatic impact not only on our practice but on other regional public accounting firms," Wolf says. "A lot of the national accounting firms were telling smaller clients that they weren’t able to service them anymore. That really created huge opportunities for firms like ours."

Growth has slowed over the last two years, Wolf says.

"We’ve been fortunate that, while we’ve been in a recessionary time, our revenues have not decreased," he says. "We’ve seen a slight increase in revenues."

Mengel, Metzger, Barr provides accounting services for clients in manufacturing, distribution, retail and construction, and for service and non-profit organizations.

"Probably the only industry we don’t do an extensive amount of work in is hospitals, and we don’t do governments," he says.

Its 2,500 clients are primarily family-owned or closely held companies with fewer than 10 owners.

"We get into things like succession amongst generations of the family," Wolf says. "You’re dealing with financial issues, but you also have to be a bit of a psychologist and get involved with emotional issues.

"When you’re helping somebody sell their company, they often think it’s worth a lot more than the marketplace may think it’s worth. You have to work with them and temper their feeling of it being their baby, if you will, and try to help them be practical."

The annual revenues of its clients range from $1 million to $100 million. Most are in the Rochester or Elmira areas, with some in New York City.

The company has developed a niche in auditing charter schools, many of them in the New York City area. It entered the charter school arena two years ago, and this year has added 10 charter schools to its portfolio. The segment accounts for some 2 percent of the firm’s revenues, Wolf says.

Leisure time

Golf is Wolf’s passion away from work. He took up golf when he was 11 years old, and played three years for North Syracuse Central School.

"There were 2,500 kids in my high school," he says. "If you wanted to play one of the major sports, you had to be really good. And I wasn’t. But I was a pretty good golfer. I was the best on my team but, candidly, we didn’t have a very good team."

The Wolf family belongs to the Penfield Country Club, and their home is next to the golf course.

"In the summertime, I try to be home by 6 or 6:30, and I’ll just walk out the back door with my wife and play," he says. "I do get to play a couple times a week, and I generally get to play on weekends. My kids play, my wife plays, so it’s a big family event for us."

The couple’s two sons-Patrick, 18, and Jordan, 15-play for the Penfield High School golf team. They also play baseball and soccer.

"Both my kids are very athletic, and most of my time is spent going to a game," Wolf says. "My hobby was being with my kids at their sporting events."

The family likes to travel. Wolf went to Scotland two years ago and twice played the Old Course at St. Andrews Links, the site of this month’s British Open.

"Watching the British Open at St. Andrews was really cool," he says. "Four years ago, I played Pebble Beach, which was a lifelong dream, and the U.S. Open was at Pebble Beach this year."

Swistak, a friend of Wolf for 10 years and also a member of Penfield Country Club, accompanied Wolf on both trips.

"When you travel with somebody, you really get to know them well," Swistak says. "I can’t speak highly enough of Tom. He has a great personality and was always there to provide anything the group needed. He was kind of our planner and organizer."

Wolf has a growing interest in fishing, the result of occasional trips to the Gulf of Mexico.

"In recent years, we’ve been going to Florida a couple times a year, and we went out on a charter with a professional charter captain deep-sea fishing in the Gulf of Mexico," he says.

"We were out in this spot for three hours and caught 150 fish. I thought that was what fishing was. The captain said I’ve been a charter captain for 35 years and I’ve never in one day seen anything like this."

Wolf’s favorite spot locally is Irondequoit Bay, where he and Jordan regularly fish from a rented boat.

"It’s just an excuse to be out there alone with him and talk about stuff," Wolf says. "It’s not about the fishing. It’s relaxing for me, but it’s really our time together because my older son doesn’t care too much about it."

Patrick is, however, following in his father’s professional footsteps. He plans to enroll at SUNY Buffalo and major in accounting.

"Forget the fact that I’m an accountant," Wolf says. "I thought from just a career perspective it was a great opportunity. If you do a good job in college in accounting, you’re not going to have a problem getting a job."

College graduates can find accounting jobs with starting salaries of more than $40,000 a year, Wolf says.

"In Rochester, New York, that’s not a bad gig," he says.

"There is a huge need for accountants. The baby boomers are starting to retire. It’s estimated that in the next 10 years, 65 percent of the partners in public accounting firms are going to retire. There’s a se-vere, almost dangerous, shortage of people coming into the profession."

Although Wolf says he does not know when he will retire, he does expect to hand the reigns of managing partner to a successor at some point.

"I feel strongly that there will come a time, let’s say in the next 10 years, where it will be time to step down, much the way Jim Barr and Dick Mengel made the decision," he says.

"At some firms, the managing partner stays on till they retire. I personally don’t think that’s a good idea. I think it’s a position that needs youth, somebody in their early 40s. And I think it’s good for the organization to have fresh blood in there because it’s a very demanding position."

Thomas Wolf

  • Title: Managing partner, Mengel, Metzger, Barr & Co. LLP
  • Age: 48
  • Home: Penfield
  • Education: B.S. in accounting, Rochester Institute of Technology, 1983
  • Family: Wife, Dawn; sons Patrick, 18, and Jordan, 15
  • Hobbies: Golf, fishing, travel
  • Quote: "Our firm has 80 people, and we have 15 partners. That’s a very high ratio of partners to staff. That’s been the culture of this organization since it started in 1975. Our clients see lots of face-to-face involvement by the partners. It’s a business model that’s worked for us."
     

7/30/10 (c) 2010 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or e-mail rbj@rbj.net.

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