the partnership

buyout when a partner dies

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older businessman leaning back thinkingis the firm’s life insurance up to date? probably not.

by marc rosenberg

it’s a tough question, but one that must be asked: in the event of a partner’s death, does the firm wish to accelerate the buyout?

more: when votes must be taken, what are the options? | why voting isn’t such a big deal | what’s in a (firm) name? | protect your business with a solid partner agreement
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there are two ways to do so: accelerate vesting or accelerate the payment schedule.
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when votes must be taken, what are the options?

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overhead shot of eight businesspeople meeting around a table5 ways to vote, plus how to set a supermajority.

by marc rosenberg

we’ve established that voting is overrated and that most firms rarely vote.

more: why voting isn’t such a big deal | why and how new partners buy in | a crash course in partner retirement/buyout plans | protect your business with a solid partner agreement
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sometimes, though, it’s necessary. but how?
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why voting isn’t such a big deal

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overhead view of five businesspeople discussing something at a table with an open laptop nearbywhat about non-equity partners?

by marc rosenberg

voting is a highly overrated privilege of being a partner.

more: why and how new partners buy in | ownership percentage and capital accounts | 5 key reasons to have a partner agreement
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when you don’t have a vote, it seems desirous and enviable. it appears to be a very special privilege enjoyed only by the firm’s elite. having a vote is synonymous with ownership, power and prestige.
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why and how new partners buy in

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businessman signing document as another looks on7 key provisions.

by marc rosenberg

let’s start with a very basic, standard concept in the business world: a partner is an owner.

more: why and how new partners buy in | ownership percentage and capital accounts | 5 key reasons to have a partner agreement
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in any business, not just cpa firms, ownership is not free. because partners are owners, they have to purchase a part of a company, for money, to acquire an ownership share.
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ownership percentage and capital accounts

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cut pie chart on plate flanked by fork and knife3 ownership percentage problems and 4 provisions for the capital section.

by marc rosenberg

the term “ownership percentage” has wrought havoc in cpa firm operations for decades. how so?

more: what’s in a (firm) name? | a crash course in partner retirement/buyout plans | 5 key reasons to have a partner agreement | protect your business with a solid partner agreement
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

first, let’s take a step back. there are five primary ways that ownership percentage may impact a firm and its partners: read more →

why do we accept poor new business results?

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5 critical steps to turn things around.

by domenick j. esposito
8 steps to great

the question to ask is why do so many firms accept poor performance from so many of their partners relative to growth and generating revenue?

more on strategic planning: is it time to manage your receivables like a real business? | profitability requires discipline | pitching vs. pursuing | the top 11 reasons cpa firm mergers fail | growth: the difference between the disruptor and the disrupted? | m&a: sometimes bigger is better | what a value proposition truly is (and isn’t)
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there isn’t a firm in existence that does not depend on constant growth to be successful and to generate enough profit to pay its staff and partners well.  yet, so many firms accept the old bell-shaped curve argument that they are winning if just 20 percent of their partners are good at generating business.
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client centricity leads to profitability

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man's fist with "thumbs up" crashing through paper wall; smiley face and gold crown on thumbthis is a job for your line partners, not your marketing department.

by august j. aquila
price it right

as one who has been on the inside of accounting firms as a partner and marketing director trying to implement such concepts as client centricity, i can honestly say that most marketing and management concepts are easier said than done.

more: tomorrow’s leader in 9 bullet points | checklist: 18 essential steps to effective billing | how to get partners to accept a new pricing philosophy | 12 pricing factors beyond cost | how utility and value affect pricing | understanding the product pricing life cycle | 4 ways a production orientation can harm a firm
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

when it comes to clients, many partners think they know what their clients really want, but in reality they scarcely do. in short, most client-centric service strategies produce neither the “wow” factor nor the profits.
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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
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

there are two primary scenarios to examine.
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a crash course in partner retirement/buyout plans

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3 issues to decide and 25 main provisions to include.

by marc rosenberg

when firms call me for help on their partner agreement, i immediately ask this question: “do you want help with your entire partner agreement or just the retirement/buyout part?” two-thirds of the time, they want to address only the retirement plan.

more: 5 key reasons to have a partner agreement | protect your business with a solid partner agreement
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

my practice in the area of cpa firm partner agreements consists of two parts:

  • the partner retirement/buyout plan.
  • everything else. i often refer to this as the general partner agreement.

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5 key reasons to have a partner agreement

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plus what can happen if you don’t.

by marc rosenberg
partner agreement essentials

what is a partner agreement?

according to nolo.com, “a partner agreement spells out the rights and responsibilities of the firm’s owners.  without one, firms will be ill equipped to settle or avoid conflicts because if certain key passages are missing or written improperly, the courts will intervene in ways that the partners may not like. a partner agreement allows the firm’s partners to structure their business relationships with each other in ways that suit their desires, needs and preferences.”

more on partnership: protect your business with a solid partner agreement | how business entity type affects partner income | equity vs. non-equity partners | partner pay in retirement transition period | buyout: the flip side of buying in
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

but most readers probably knew this definition, so it might not be very illuminating. let’s try this one.
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protect your business with a solid partner agreement

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number 6plus 6 ways they’ve changed over the years.

by marc rosenberg
partner agreement essentials

buying a family home is one of the the biggest investment most people make in their lives. and because most of us are not real estate experts, we protect ourselves by engaging an attorney to ensure that the purchase is handled correctly.  we don’t hesitate for a moment to invest a few thousand dollars of attorney fees to hire an expert.

more on partnership: how business entity type affects partner income | what partnership gets you (and doesn’t) | 5 cautionary tales in partner compensation | partner pay in retirement transition period | 23 key provisions in a partner buyout | management stipends: who, how and why | when a firm tanks while a partner soars | research results: how firms pay new partners | what does buy-in buy? | how profitability affects income allocation | keys to bringing in new partners
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

being a partner in a cpa firm should be no different.
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22 things leaders must do

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businessman carrying elephant on his backbonus: 4 ways not to choose a managing partner.

by domenick j. esposito
8 steps to great

in his 2008 book “strategy and the fat smoker,” david maister wrote that we often (or even usually) know what we should be doing in both our personal and professional life. we also know why we should be doing it and (often) how to do it.

more on strategic planning: the top 11 reasons cpa firm mergers fail | new year’s resolution: solve the partner comp problem | 6 rocks in the path to growth | use compensation to shape partner behavior | the importance of m&a culture due diligence | are you attracting the new breed of equity partners?
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

figuring all that out is not too difficult. what is very difficult is actually doing what you know to be good for you in the long run, despite short-run temptations.
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