Six Reasons You’ll Wish You had a Partnership Agreement

With 18 key clauses and 24 essential ingredients.

By Marc Rosenberg
CPA Firm Management & Governance

A partnership agreement  contains clearly defined terms and conditions of the firm including, but not limited to, each partners’ responsibilities, their pay and their roles within the business.  It also includes rules and regulations that are to be followed by the partners in the business. It is essential for a CPA firm to have a partnership agreement, regardless of how collegial and friendly the partners are with each other.

More CPA Firm Management & Governance:  How The Structure of an Accounting Firm Changes through the Years    |    Congratulations! Your Firm Needs a Human Resources Director    |    The 19-Point Marketing Director Job Description    |    Checklist: How the Best Managing Partners and Firm Admins Work in Concert     |    21 Questions for Managing the Managing Partner    |    No Partner Vote Needed: 17 Decisions Best Left to the Managing Partner Alone    |    New Rules: 13 Items that Should be in Your Managing Partner’s Job Description    |    When Is It Time to Shift Your Firm from Partnership-style to Corporate-style Governance?    |    Not Every Firm Needs a General Patton    |

A partnership agreement can prevent potential future disagreements that could occur pertaining to the objectives and responsibilities of the firm.

A number of years ago, I was engaged by the managing partner of a firm to draft their first-ever partnership agreement.  The firm had three partners: the 57 year old founder, who was a dominant, rainmaking managing partner, and two other younger partners who performed at a much lower level than the founder.