Financial and admin operations

How to manage internal succession

Young talent is at the core of successful internal succession plans. How can firms identify and develop the leaders they need to replace retiring partners? Find out in the eighth installment of the series “CPA Firm Succession: Solidifying the Future.”

Alternative deal structures for succession

Accounting firm partners looking to retire need to either find an internal successor or sell their practice to an external buyer. What types of deals are possible in an external sale? Find out in the seventh installment of the series “CPA Firm Succession: Solidifying the Future.”

How to value a CPA firm for sale

One of the key components of a CPA succession plan is the sale or transfer of the retiring CPA’s ownership interest. How is the value of that interest determined? In most circumstances, the value of an owner’s interest is different when selling to an external buyer than it is in

A two-stage solution to succession procrastination

The 2012 PCPS Succession Survey, a joint project of the AICPA Private Companies Practice Section (PCPS) and Succession Institute LLC, found nearly 80% of CPA firm owners expect succession to become a major issue for their firms in the next 10 years (see “Succession Planning: The Challenge of What’s Next,”

When is a partner "retired"?

When a longtime partner or employee retires from a CPA firm, a sense of loyalty often compels the existing partners to allow the individual to have a symbolic role at the firm. This can include a courtesy title, office space, and invitations to company soirees. While this may seem like

The long goodbye

The best time for an accounting firm to start work on a succession plan is the day the firm is formed. Of course, most firms don’t do that. The question in many cases has become: “How quickly can I put together a succession plan and head into retirement?” The answer

Mergers emerge as dominant trend

Powerful forces are transforming the accounting profession in the United States. The Baby Boomers are heading into their retirement years. Baby Boomer CPAs are in charge of most U.S. accounting firms. And most U.S. accounting firms don’t have a signed succession or practice-continuation plan in place. These realities are rewriting

Is this client the right fit for your firm?

A contentious divorce. Clients who want to file delinquent tax returns. The new client who represented himself as an upstanding businessman but has been indicted—for the third time. After malpractice claims are resolved, CPAs often say, “I never should have taken this client.” But there is a way to help

Preparing for disaster

One CPA firm is still recovering from a “superstorm” that damaged nine of its 14 offices. Another has constructed a safe room in its new office, which was built after a tornado destroyed its previous office. A third firm is adjusting to the “new normal” in a city forever changed

Clients: The end is near

Evaluating clients annually is good practice management for a professional services firm. A firm’s strategies, areas of practice, and risk profile change over time. As a result, certain clients may no longer be a desirable fit for the firm. Similarly, some client behaviors become problematic and can harm the staff’s

When parties come knocking for client records

CPA firms either maintain or have access to numerous types of client records and related working papers. Requests for access to copies of such records can arise from multiple sources, including current and former clients, lawyers, civil and criminal investigators, lenders, and others. All requests should be made in writing.

How to drive partner accountability and unity

Partner accountability and unity are essential for accounting firms to maximize their productivity and profits. Unfortunately, partner harmony is hard to find, especially at larger firms. Consider the findings of the most recent CPA Firm Top Issues Survey conducted by the AICPA Private Companies Practice Section. The biennial poll of

2012 MAP Survey: Signs of recovery

Accounting firms aren’t all the way back to where they were before the Great Recession, but they are making progress. That’s one of the many findings of note in the 2012 National Management of an Accounting Practice (MAP) survey, sponsored by the AICPA Private Companies Practice Section in association with

Gaining (from) your clients' trust

For decades, CPAs in public practice have laid a foundation of trust with clients by competently handling confidential financial data and performing core services such as tax preparation. Today, forward-thinking CPAs are building on that foundation, expanding their business offerings, nailing down new revenue streams and cementing a more profitable

Planning and paying for partner retirements

John was one of three founding partners in a firm formed 35 years ago. He oversaw the buyout of the other two founding partners and, as managing partner, groomed three young managers as his successors. However, when the time came for these managers to be admitted as partners, two of

Pricing, billing and collecting fees

CPA firms provide invaluable advice to business clients but often struggle to run their own businesses effectively, particularly in the areas of pricing, billing and collections. Failure to set appropriate fees, deliver bills in a timely fashion and collect payment promptly—or even in full—cuts into a firm’s profitability, hurting the

Bridging compensation gaps in a merger

Accounting-firm mergers must overcome numerous obstacles. One of the most common—and challenging—involves compensation and benefits for partners and staff. Merging firms usually have differences in compensation levels, compensation methods and benefits packages. It’s crucial for staff and partner retention that the merging firms combine the varying systems into one without

Retreat to Move Forward

With the slow economy still making times—and dollars—tight, it might seem counterintuitive for a CPA firm to take its staff to the beach for an annual retreat. But handled correctly, such off-site activities can be effective investments of time and money. Here are some ideas for making the most of

Traps for the Unwary in CPA Firm Mergers and Acquisitions

You can’t hold back the demographic tide. In the U.S., another baby boomer turns 60 every eight seconds. This translates into a leadership change in the near future at many CPA firms. Thousands of partners are at or reaching retirement age now and in the next five years, putting a

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How the skill set for today’s CFO is changing

Scott Simmons, a search expert for large-company CFOs, gives advice for the next generation of finance leaders and more, including which universities are regularly producing future CEOs and CFOs.