Your M&A Advisor

Two-stage deal structures can work in certain circumstances. Basically, a two-stage deal structure is when you have an initial period (stage one) where the firm’s cohabitate together, typically into the buyer’s existing office, and then close the transaction and then have the seller retire at some future date (stage two).

Last week, Ali the Accountant sent in a question, “When buying or selling a practice, can you please advise how you split up the work in progress (WIP)?  I would presume it is done based on time spent and not billed before the sales and how much time is spent on the file after the sale can you please confirm?”

My response:

It is going to depend greatly on the timing of the sale, the amount of WIP, the nature of the WIP and the two parties in the transaction.

Last week, David the CPA sent me a great question that I thought would be relevant to the market at large.  He asked, “Is it possible to buy part of a practice or must we be willing to purchase all of it?”

My response:

It’s time I developed the next portion of a blog I posted back on January 21st.  The blog, Three Keys to Successful Accounting Practice Development, outlined that three key elements of any successful practice development plan are: client experience; lead generation; and lead conversion.  In February and March, I posted blogs on client experience and now would like to revisit this series with thoughts on lead generation.

No one lives forever.  A day will come when it is time for you to retire, or to begin a new chapter in your life.  When that time comes, if you have not planned for a successful transition of your practice and your clients, you will find that many options have been lost to you.  Whether you are considering a merger or sale or planning for an internal succession, Succession Planning begins with your decision to take responsibility for your future.