mergers & acquisitions

2019: m&a boom gone bust

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putney
putney

this is no time to sell for local firms. instead, it’s time to re-tool.

by rick telberg
the rosenberg national map survey

it has been said that when you buy a nice, old, colonial house, you’re buying somebody else’s problem.

more from the map survey: 2019: more focused training | 2019: expect more alliances | 2019 trends: client service changes | 2019: shifts in hiring & office space | 2019: firms grapple with change | staff policies improve, but not mentoring
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the same can be said for buying a cpa firm with no succession plan.

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14 partner agreement issues in mergers

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two businessmen holding giant puzzle pieces in silhouette against a sunrisemake sure you’re looking at the big picture.

by marc rosenberg

this post applies only to transactions that are true mergers, which require the sellers to sign the buyer’s partner agreement.

more: partner agreement issues affecting women | mandatory retirement: pros and cons (and is it legal?) | deciding how to allocate partner income | making partner: today’s 15 essential skills and traits | how to specify managing partner duties | when votes must be taken, what are the options? | a crash course in partner retirement/buyout plans | protect your business with a solid partner agreement

in a sale, the owner(s) of the seller don’t sign the buyer’s partner agreement because they won’t become owners of the buyers.
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valuing an accounting firm for sale

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plus: a powerful equation.

by joel sinkin
transition advisors

when i teach a cpe class on how to value an accounting firm, the first question people ask is what is the multiple? as you likely know, an accounting firm is traditionally sold on a multiple of revenues.

the multiple is just one part of the equation and not a place to end – let alone start – the valuation process. the overall terms must include factors such as how much money if any up front, how profitable is the acquisition, how long is the retention period that impacts the seller’s balance due based on client retention and how long is the payout period? read more →

the 4 c’s of m&a success for accounting firms

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start planning years, not months, ahead.

by joel sinkin
transition advisors

every week we hear about another merger or acquisition.

there are many reasons firms consider merging.

the most common objectives follow:

  1. talent is in short supply in today’s marketplace. many firms are using mergers to add talent for growth and/or a tool to build an internal succession team for the long-term security of the firm.
  2. cross-selling niche services: we are seeing firms entertain mergers that create strong cross-selling opportunities.
  3. growth from having a larger platform of services, increased capacity and through the addition of the clients a merger brings.
  4. marketplace refers to mergers that provide the successor firm a flag in a new harbor.
  5. succession: a strong percentage of accounting firm owners are seeking to reduce their time commitment to their firm so succession remains the number one driving force of most small firm mergers. read more →

what’s in a (firm) name?

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post with two signs, "same" and "change"there are reasons to change, but don’t do it without reflection.

by marc rosenberg

this will be short because this area is cut and dried. let’s focus on how a firm’s name affects the way it is managed.

more: a crash course in partner retirement/buyout plans | 5 key reasons to have a partner agreement | protect your business with a solid partner agreement
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there are two primary scenarios to examine.
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dean quiambao: ‘if you’re not disrupting, you’re not doing it right’

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portrait of dean quiambao
quiambao

tip you can use: an integration team for mergers.

by kayleigh padar
the radical cpa guide

dean quiambao, a cpa and business development partner at armanino llp, a top 25 firm, works hard to incubate revolutionary ideas within his firm to help it grow and modernize as the world around him changes.

more on radicalism: karbon builds a practice management platform on steroids | firm product management is the way to the future | 10 steps to start innovating | the value of new ideas | the radical road to (business) transformation | the radical cpa: always changing
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“do your activity, because activity breeds activity,” said quiambao. “and i say this all the time, you keep hitting singles and the next thing you know you’re going to pop a triple out of nowhere. you’re going to make your own luck, you’re going to make something happen because you’re constantly doing something.”
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the top 11 reasons cpa firm mergers fail

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four businesspeople, left handshakeplus: four questions to self-assess your due-diligence efforts.

by domenick j. esposito
8 steps to great

even as mergers and acquisitions among cpa firms are moving at a hectic pace, many, if not most, are falling short of expectations.

more: new year’s resolution: solve the partner comp problem | 21 questions to help unlock accelerated growth | m&a candidates: valuations and vetting | ai likely to accelerate merger mania | get your money’s worth from non-billable time | stay independent but keep looking upward
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some are even winding up in divorce, with costly breakup costs as morale drops, go-to-market opportunities fail to materialize, and key partners and potential partners leave for other opportunities.

for every transaction that actually does happen, it is also apparent that handfuls of potential deals die at the altar.

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the three laws of physics in accounting firm mergers

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pendulum desk toywhat led to the succession crisis? inertia.

by r. peter fontaine

sir isaac newton was truly a genius for the ages. he lived 85 years, worked his way through cambridge, invented calculus, had a seat in parliament, was knighted by queen mary and now rests quietly in a prominent westminster abbey crypt.

more: a lawyer’s guide for spring cleaning your accounting firm | 6 types of due diligence procedures | cultural optimization: making mergers successful | why due diligence is done | what to ponder before issuing a letter of intent | the four ways ‘non-competes’ #fail in the social media age
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

while best known for the unsubstantiated tale about a falling apple that led to his theory of gravity, newton’s three laws of motion have withstood the test of time. these principles are remarkably applicable to modern-day accounting firm mergers.
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7 steps to take as your firm grows

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a bigger firm needs bigger thinking.

by steven e. sacks

there has been talk about consolidation within the accounting profession for the last several years. will the big 4 become the big 2, or will there be the big one (from a non-nuclear perspective, of course)?

more: today’s workplace challenge: communicating across generations, cultures, and diversity | the damocles sword of staff retention | does your board know its role? | five powerpoint rules to live by | your firm’s biggest assets walk out the door every day | can we please refer to accounting as a profession?
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or, on the other hand, will there be a combination of regional firms whose size will be in the neighborhood of the top 10 or top 15 firms that are considered super-regional firms – and who may consider themselves direct competitors to the big 4?
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m&a candidates: valuations and vetting

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overhead view of people solving a large jigsaw puzzleplus consultant fee structures and integration committees.

by domenick j. esposito
8 steps to great

last year alone, over 200 firms merged up and this year is tracking the same. at this pace, a very large percentage of the approximately 14,000 multi-partner cpa firms (about 90 percent of which are under $10 million in revenue) will be looking at an upward merger in the next few years.

more on strategic planning: m&a: sometimes bigger is better | use compensation to shape partner behavior | the importance of m&a culture due diligence | are you attracting the new breed of equity partners? | quality work, quality service not the same thing | who will be the next category killer? | why is strategy execution so difficult?
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

so let’s take a deep dive into what you need to know about merger combinations, which are as much about the addition of talent as they are about the addition of clients.
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