Weyrich, Cronin & Sorra Expands a Niche with Merger

By Jason Bramwell
 
Baltimore-area CPA and business consulting firm Weyrich, Cronin & Sorra, Chartered (WC&S) was trying to expand its niche in the region for auditing employee benefit plans. So when Michael Sisk Sr., CPA, the president and managing partner of Baltimore-based Michael D. Sisk & Co., PC, which specializes in auditing local and national employee benefit plans, approached WC&S about a possible merger, WC&S listened.
 
"We really weren't looking [to merge with another firm]. They came knocking," Frank Savarese, CPA, managing partner of WC&S, told AccountingWEB. "The reason I entertained the idea was that Mike did about seventy employee benefit plan audits a year, so it immediately grows my niche of sixteen to twenty plans that we were auditing a year to nearly a hundred. He also does about thirty not-for-profit audit jobs annually that we were interested in. So it fit very well into what we were trying to do to grow our niche area."
 

Tips for a Successful Merger

Frank Savarese, CPA, managing partner of WC&S provides three tips on what made the firm's recent merger with Michael D. Sisk & Co. successful.
 
1. Make sure both firms have the same philosophy and culture: "The thought process has to be clear and very well-defined and well-discussed, even before you start thinking about the numbers, the clients, and everything else. Mike [Sisk] and I had probably five meetings to make sure there were enough synergies and complements on each side to make the merger work."
 
2. Make sure the merging firm produces high-quality work: "If [Michael D. Sisk & Co.] wasn't doing high-quality work, then I really didn't want to get involved in that client base. I didn't want to have to raise their level of quality. I wanted to make sure I was getting involved with a practice that was also really good."
 
3. Talk to people from the merging firm: "Long before Mike and I even signed a deal, I interviewed his very key people. I didn't want to do a merger like this without knowing that I was going to be able to keep and maintain the key people and the components that made Mike successful. You want to make sure these people are on the same page as you, and, if not, we try to iron something out that's going to work."
 
The merger between the two firms became official on July 7. Financial details of the transaction were not disclosed. 
 
Seven employees from Michael D. Sisk & Co. were relocated from the firm's Baltimore office to WC&S's office in Lutherville, Maryland, bringing the total number of WC&S personnel to forty-eight. WC&S also has offices in Bel Air and Elkton, Maryland.
 
"What was appealing to Mike was that we were going to be able to incorporate the majority of his staff right into our Lutherville office," Savarese said.
 
No layoffs are expected with WC&S employees; however, Savarese said because of crossover in administrative support, Sisk lost two administrative staff members because of the merger.
 
Sisk will not have an executive role with WC&S. He will be providing clients with audit and tax services, while also consulting with WC&S partners through a transition period of up to two years, according to Savarese.
 
Expanding the Firm's Brand and Services
Savarese said WC&S, which has been in the Baltimore region for nearly thirty-five years, will now market its growing niche of employee benefit plans audits in areas the firm may not have much name recognition.
 
"We're now marketing toward third-party administrators that handle a lot of the administration of these retirement plans," he said. "We're letting them know we now have a niche and will be doing nearly a hundred retirement plans a year."
 
Savarese believes that Michael D. Sisk & Co. clients will benefit from the merger because WC&S will be able to provide services that a smaller practice like Sisk's wasn't able to offer.
 
"We're a fairly diversified practice, so we have the ability to offer their client base additional consulting work and services in some areas of planning," he said. 
 
Savarese said the firm is always interested in growing  if the opportunity is right.
 
"If it wasn't the right situation, I wouldn't have done this deal," he added. "But the fit seems to be there, and the culture seems to work. We weren't actively looking, but it was a good opportunity that we had to take advantage of."
 
Combining Workflow Processes
The software packages and some of the workflow processes that Michael D. Sisk & Co. used internally were compatible to what was already implemented at WC&S.
 
"There clearly were some good synergies that worked well together, but there's going to be a learning curve, there's no doubt about it, on their behalf to adapt to the way we're doing things," Savarese said. "Coming from a smaller firm environment to a larger firm environment, there are a few more infrastructure areas they may not have addressed in the past. For example, we've been in the Cloud for more than two years now, and they weren't. But we do have a very good orientation program in which they'll be acclimated to, and training is constant all the time."
 
One CCH software program that both firms use for audit engagements is Engagement.
 
"They were using it, we were using it, so the audit process itself will not be a big learning curve for them, and that's going to be very helpful to us," Savarese said.
 
Taking Advantage of Opportunities
As a small regional firm in the Baltimore market, WC&S will have opportunities to pick and choose which sole practitioners and small partner groups it wants to work with in the future, Savarese said.
 
"These practices can't merge amongst themselves because there's just not enough there to work with," he concluded. "The industry is at the point where you have to be a little bit bigger in order to make it work for your client services, so I think it's just the beginning of what's going to be happening in our region."
 
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