This may be one of the worst recessions in a generation. But CPA firms should be uniquely positioned to ride it out.
New data from IOMA, a BNA company, shows strength in profits and compensation, even while billing rates slip:
- Partner compensation (excluding bonuses or perks) rose slightly to $347,071 for the highest-paid owner group in 2008.
- For owners in the middle or average compensation range, compensation declined 5.6 percent to $204,292.
- Average net income per partner increased slightly, from $280,009 in 2007 to $283,364 in 2008.
- Billing rates for CPA firm owners declined on average $4 per hour to $225 in 2008.
- Billing rates were also down for supervisors/managers, seniors, juniors, and non-CPA juniors.
- Paraprofessionals held steady at $81.
- Marketers were the exception, with a 24 percent increase to $152 per hour.
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Over the next 6 to 12 months, what’s your outlook for your firm, your clients, your family and yourself?
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Meanwhile, some early comments are coming in…
- We have increased our business development efforts. Our IRAs and 401-Ks went to cash in August 2008 and remain there. We are meeting with a top Money Manager who is our client to determine what is a prudent way to proceed with an investment strategy.
- Save, save, save
- Better pre-qualification of new clients, offer greater resources for new and existing clients.
- Monitor costs
- We are beginning to actually do some marketing.
- Work more closely with our clients, offer consulting services, budgeting help, profit planning
- Hold the course as far as securties & real estate investments while building cash awaiting appropriate investment opportunities
- To stay with either Advisory/Consulting work for accounting or the Audit sector. I live in an area (Wash DC) that primarily supports the Fed. Govt. as a client.
- Tighten belt. Postpone Non-essential purchases.
- Try to get out of debt
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