Patrick J. Gros, CPA, is president of the eponymously named accounting firm that he and his wife Kimberly founded in 2001 in Covington, Louisiana. The firm provides outsourced accounting services, bankruptcy reporting, tax consulting and preparation, and compilation/review services, and specializes in the restaurant, hospitality, construction, professional services, and healthcare industries.
Before founding the firm, Gros was with Arthur Andersen, where he performed financial audits and technology consulting services. He is a graduate of the University of New Orleans and serves on the school’s Accounting Advisory Board.
Q: What are you passionate about outside the office? When you can get away from work for a while, what do you like to do?
Gros: I like to collect wine. I’ve been collecting wine for about 17 years, so I have a pretty extensive wine collection. Obviously, I like to drink wine, although I collect more than I drink it because I have over 600 bottles of wine. So I obviously don’t drink it as fast as I buy it. It’s a hobby. Wine is very interesting. It’s like food—a winemaker nowadays is like a chef. They create these exquisite wines with technology. They can just do phenomenal things with wine.
I also like autocross. One of the ways I relax is by driving fast—safely on the track. I like wine and cars, but I don’t do both at the same time. We have a track here, NOLA Motorsports Park. I’m in the Porsche Club and also in the NASA Club, which is National Automobile Sports Association. I go on the track, but not to “race” my car—it’s actually called high-performance drivers’ education. They teach you how to drive your car better. You drive with other cars, it’s very controlled and safe. You basically time yourself on the track, how well you can do in laps.
Q: Let’s go back to the wine for a minute. Do you do a lot of traveling to search for wine?
Gros: My wife and I learn about it that way. We’ve been to Napa at least eight to 10 times. We’ve been to Sonoma. We’ve been to the Chianti region. We just went this year to the Oregon Wine Valley (Willamette Valley), and we went to Santa Barbara Wine Country about two months ago. The next place we’d like to go one day is Bordeaux, in France, and maybe one day go to Portugal because that’s where all the ports are made.
We’ve also been to Spain—not per se to their wine country, but we learned how to drink Spanish wines in Barcelona. I say “learn,” meaning what kind, what they’re about, and things like that.
Q: So do you collect domestics and European wines?
Gros: Not so much the Europeans because I don’t know a lot about them. I have to learn more about it. Ninety percent of my wine cellar is domestic, mostly California and mostly red. I have some wines from the ‘80s.
Q: When did you start collecting wine, and how did you become interested in it?
Gros: I’m a very analytical person by nature. In fact, my wife tells me all the time that I overanalyze things—“You’re overanalyzing it. Let it go, let it go.” The guy who got me interested in wine was the managing partner at Arthur Andersen in 2000, Sean Daly, who’s retired now from Ernst & Young. He was really into wine, so he and I would talk about it a lot. He would buy wine and say, “Here’s a bottle; try this,” and I would get some and say, “Try this.”
We had some other friends of ours in Covington, Louisiana, who have a 3,000-bottle wine cellar. They’ve been collecting wine for years, so I learned a lot from them. They were very knowledgeable about it. I realized that there was a lot more to it than just buying a bottle of wine and drinking it. To be a winemaker is an art.
Q: How about the Porsche driving. How did you get started with that?
Gros: I’ve always loved cars. When I was 16, I had a Mazda RX-7. Then I had a Mustang GT, then another Mazda RX-7, and then I had a Toyota Supra. But I always wanted a Porsche 911. Always. The first Porsche I bought was in 2002, when I bought a used Boxster. It was a great little car. Porsches are unique cars—they’re machines. They’re phenomenal.
Then in 2013, I was able to get a 911, and last year I upgraded to a 2017 911. Both 911s are convertibles. I love driving the car—it’s actually fun to drive. It’s luxurious, but the performance is phenomenal. It’s a pleasure to drive that car.
I love cars. There are two of us and four cars.
Q: Some people have spare tires, but you have spare vehicles?
Gros: I have spare vehicles, yes. But we don’t have any children. We have two dogs and a cat. People spend money on tuition and kids. We spend money on wine and cars.
Q: When you’re on the track, what kind of speeds are you driving?
Gros: It’s not a round track. It’s curved, like a NASCAR track. My average speed’s around 82 miles an hour, but my top speed was just two Saturdays ago, 141 miles an hour in the straight section. My best time is two minutes and three seconds around the track, which is a really good time considering my car is not customized. It’s a street car. It’s just the way I bought it. My goal is to buy a Porsche Cayman just to run on the track. That I will modify, and that will be my racecar.
Q: Is it hard to keep your foot off the pedal when you’re on the street now?
Gros: That’s not safe, and tickets cost money. I save all my speed for the track. I see what driving fast on the street does to people, and many times it costs them their lives.
Q: What might people who only know you professionally be most surprised to learn about you?
Gros: The only thing that I can probably tell you is that everybody who knows me knows that I’m always moving. I don’t sit still very long. I might even be considered having attention deficit disorder or hyperactivity. Actually, I like my time to relax and be calm. Other than that, I’m kind of it is what it is, you see what you get. I’m just the same guy who moved from Houma, Louisiana, to New Orleans.
Q: Did you move to New Orleans right out of school?
Gros: I actually moved here to go to the University of New Orleans (UNO). I went to high school in Houma. I went to Nichols State University for two years, and then I moved to New Orleans to go to UNO, which is where I graduated. They had an excellent accounting department, an excellent accounting curriculum. I’m on the Accounting Advisory Board for UNO. It’s still outstanding— a great pass rate on the CPA exam and everything.
Q: How long have you been on the advisory board?
Gros: Probably 10 years.
Q: How did you gravitate into turnaround/restructuring work?
Gros: I’ve been a CPA for 21 years. I used to work for Arthur Andersen, an international accounting firm. I left Arthur Andersen in December 2001 and started my own practice in January 2002.
I was hired by debtors, mainly in Chapter 11s, to help them report to the court. I helped them to report their monthly operating reports, do projections, and basically helped them get out of Chapter 11, keep their companies intact, and continue to operate and be viable, keep people employed, and keep the economy rolling. That’s what we do—just keep the economy rolling.
In my practice I also do a lot of contract CFO work. Companies that are smaller—I’d say generally under $6 million in revenue, but I do have one company that does about $50 million in revenue—don’t necessarily need to hire a full-time CFO and pay those salaries. A lot of them can’t afford it.
I started doing accounting for them and taking on a CFO role, basically to help them analyze their financials. In general, I help them make more money. So that’s outside of the bankruptcy world. I help them to never get to bankruptcy so they don’t have to worry about that.
But in the bankruptcy world, I help companies to come out of Chapter 11 and be profitable. I have several clients for whom I was hired in their bankruptcies, and I still work for them today. At one company, I was hired in November 2004 and they’re still my client today, 13 years later, because we were successful in getting them out of bankruptcy.
That’s how I got into the turnaround management world. Now when I get involved with bankruptcies, I apply the contract CFO skill set that I use with companies that are not in bankruptcy. So not only do I report their numbers to the court and do projections that will help them get out of Chapter 11 by demonstrating why the judge should approve and confirm the bankruptcy plan, but I also help them, in a more hands-on way, like a CFO, figure how they can make more money and be more successful and how they can continue to operate without making the same mistakes that put them in Chapter 11 to begin with.
I got involved with the Turnaround Management Association through one of the members. I had been doing the work for 10 years and didn’t even know about the organization. He asked me if I wanted to join and told me a little about it. I went to a couple of meetings. Now my firm sponsors each year, and I work for a lot of the attorneys in the organization, so it’s been a really good organization for me to belong to.
It’s very interesting work, and it’s also very gratifying when you can help somebody keep their company intact, keep their employees employed, keep themselves employed, and continue to do business.
Q: What have been some of your favorite or most gratifying engagements along the way?
Gros: A lot of times, one of the first things that falls apart, which is probably the reason they end up in bankruptcy, is their accounting function because people leave. They see the company’s going under or the company’s having trouble, and the employees get other jobs. So in a lot of the bankruptcies I work in, not only do I do all the reporting, but many times I also take over the whole accounting function and report to either the CFO of the company or the owner so we can get good financials. Without good financials, I can’t do anything.
Two big ones I worked on for almost three years were New Orleans Paddlewheels and New Orleans Tours, two big companies that had to file Chapter 11 after Hurricane Katrina because we had no tourism. They’re both still in business today. We were successful in getting them both out of bankruptcy.
Q: I imagine those were tricky. Tourism disappeared for, what, 1½ or two years?
Gros: Yes, it was gone for a while. I think the only reason people came to visit us in 2006 was because they felt sorry for us.
I also worked for a restaurant called Stanley in the French Quarter. They grew their infrastructure faster than their revenue grew. They got overloaded on overhead and costs that put them into bankruptcy. But the chef is a brilliant chef. He and his wife run the company. They’re really good people—they just got ahead of themselves. They built up this big infrastructure without the growth of the company keeping up with it. The infrastructure costs passed up the profits and put them in a financial bind.
I see that all the time. I have two clients right now that are doing that, and I’m telling them, “You need to slow down.” One of them is slowing down, and the other one isn’t. And the other one, I’ll end up working for in bankruptcy.
Q: Some people just insist on learning the hard way, don’t they?
Gros: They just want to do it their way, and that’s fine because it’s not my company, it’s theirs. All I can do is what they pay me to do, which is to advise them.
Q: What role has your TMA membership played in your career?
Gros: I’ve learned a lot about the other roles that turnaround management involves—some of the consultants and attorneys and what they do. I’ve learned a lot about bankruptcy in particular. When they have the bankruptcy judges’ panel every year, my firm is one of the sponsors. I guess I’ve gotten information out of it that I wasn’t aware of, what was happening out there or just technical knowledge.
Q: What advice would you have for someone who was new to the industry or was thinking about getting into the industry?
Gros: I would say to join the Turnaround Management Association because it’s a great networking organization. The people who are in it are the people that you will do business with. You can send them business, and they can send you business. A lot of the people I know in TMA are very knowledgeable, very sharp professionals. They know their professions well, and I have gotten good bankruptcy cases, one in particular with a major firm, because of a TMA meeting I went to. Now I work with that firm regularly.
Q: This business is pretty much a relationship business. Is that what you’ve found?
Gros: Oh, absolutely. It’s all about the network that you establish with people like me and the other professionals. I work for about eight law firms that send me cases, various kinds of cases. I also do forensic cases, and I also do work in divorce when there are property settlements or child support calculations that need to be done.
Q: If you could start your career over, would you do anything differently?
Gros: I really don’t think I would. I worked for an awesome firm that taught me a tremendous amount. When I left it, my wife and I started our own practice. She’s also an accountant. It’s gone well. My firm is solid—I have 16 excellent employees who have been with me for a long time. I just continue to help clients stay in business, be profitable, and pay less tax. Those are the three things I have to do. That’s what they want me to do.
When you provide value to a client, they don’t mind paying for it. They see the outcome, which hopefully is peace of mind or handling things they don’t want to handle or, obviously, financial gain. My goal is always to pay for myself times two or three or five or whatever I can, and that’s what really makes my job fun. I work a lot of hours and I work hard, but I have a great staff to help me and I really enjoy what I do, even now, 21 years later. It truly is fun.