2003 MAP Survey Results Reveal CPA Firm Growth Despite Sluggish Economy
A record-breaking 3,300 firms responded to the survey. The average participant firm employs seven CPAs and reported gross fees earned of approximately $1.4 million. As a percentage of total income, profits were up this year for local and regional firms, in part due to lower expenses and fewer write-downs (downward adjustments in the accounting value of accounts receivable). There was an increase in the percentage of firms offering certain specialized services, including payroll processing and investment sales. These are just a two of the broad spectrum of services available from CPA firms; the top ten specialized services offered by respondent firms are estate tax planning (75%), payroll processing (65%), personal financial planning (48%), M&A consulting (31%), forensic accounting (25%), investment sales (16%), bankruptcy or insolvency (16%), human resource services (13%), executive search (13%) and insurance (11%).
“The survey results show that local and regional CPA firms continue thrive by evolving to meet that changing demands on the profession,” noted Rich Caturano, Chair of the PCPS Executive Committee and leader of the MAP Survey Task Force. “In addition, PCPS is pleased with the incredible level of local and regional firm involvement in this year’s survey, which has enabled us to provide the most comprehensive body of benchmarking data available to local and regional accounting firms today. This is one of the most valuable tools that firms have to help improve business performance through practice management.”
Among other findings:
- Earnings and Rates: Firm employees reaped the benefits of local and regional firm success. The average salary increased five percent over last year and bonuses averaged five percent of total salary. On average, owners took home 36% of their firm’s income, averaging each owner approximately $150,000. Entry level CPAs’ salaries averaged $37,000. The average hourly billing rate for a professional earning $50,000 rose to $95 this year from $86 in 2002.
- Retirement Plans: The data reveal that nearly 74% of firms have a retirement plan. Among all firms, 45% have a provision for partner retirement, of which 70% are funded plans.
- HR Policies: The survey reveals that some “standard” HR practices are not embraced by local and regional firms. For example, only 62% of firms surveyed have an employee handbook; nearly half of the respondents – 46% – reported having no formal sick leave policy; and approximately 28% reported the absence of a set vacation guideline. Moreover, only 13% of firms provide maternity leave in excess of regular paid time off. In addition, few firms – 21% – hire interns. About one third – 32% – of the firms offer their professionals comp time and an additional 35% of the firms offer a choice of overtime or comp time.
- Non-CPA Participation: Of firms surveyed, 37% already have non-CPA professionals on staff. In addition, 47% are planning to hire non-CPA professionals or would consider it. Finally, four percent of firms surveyed have non-CPA owners.
About the Survey
This marks the second consecutive year that PCPS, the AICPA Alliance for CPA firms, has partnered with the Texas Society of CPAs (TSCPA) to produce the survey. This year, the survey was also sponsored by Aon Insurance Services, the broker and administrator for the AICPA Insurance Programs. Forty-six state CPA societies and the Association for Accounting Administration also played a key role by encouraging their members to respond.
IntelliSurvey, an independent market research company that specializes in helping leading researchers and organizations deploy complex projects, administered the online survey to firms between June 8 and August 29, 2003. The group encompassed a diverse range of firm types and the survey was modified accordingly to ensure that firms were asked questions relevant to their size and structure.
The National MAP Survey Results Report may be purchased for $300 with a $100 discount to participants and a $100 discount for AICPA members. Results are free to PCPS members. The participating firm report includes a customized PDF document as well as access to an online tool that allows firms to format and search the data to best fits their needs. The national report is available to non-participating firms. For more information, call 1-800-CPA-FIRM or visit www.pcps.org and click on the 2003 PCPS/TSCPA National MAP Survey logo on the left side of the screen.
For more information about PCPS, please call 1-800-CPA-FIRM, or visit the PCPS web site at www.pcps.org. PCPS is the AICPA Alliance for CPA Firms, with almost 6,000 local and regional CPA firm members within the American Institute of CPAs (AICPA). The AICPA is the national professional association of CPAs with more than 330,000 members in business and industry, public practice, government, and education. It sets U.S. private auditing standards and ethical standards for the profession. It also develops and grades the Uniform CPA Examination, which will convert to a computer-based format in April 2004.