The saga is just beginning: Block files suit against McGladrey

M&P chief Scudder tells WebCPA: “We’ve always had the right to walk away.”

“We are disappointed that H&R Block has chosen to pursue litigation,” McGladrey & Pullen managing partner Dave Scudder tells WebCPA. “Under the terms of our shared services agreement, we have every right to terminate that arrangement.”

Earlier:

• McGladrey cuts the cord with H&R Block
• Now it’s getting ugly: H&R Block talks tough with McGladrey

More from Scudder at WebCPA:

“We’ve always been an independent firm, and there’s no reason we wouldn’t retain those rights going forward.”

“Times are very different from 1999 when we entered into this arrangement to outsource some of the administrative services to them,” he said. He described the decision as a “combination of economic conditions and the overall cost benefits of that agreement, combined with what we think is the opportunity and what’s going on in the marketplace right now.”

“Certainly [it’s] a much more complicated time for our clients, a highly regulated, complex environment for CPAs, and the structure and the services agreement that we have does cause some complexity,” he added. “So when you look at it as a combination, it’s a very simple business decision about looking forward and serving our clients.”

Posted on July 24, 2009