Today’s Top Six Trends in Partner Comp

Man's hands on pile of moneyPlus: Point and counterpoint on 10 tough issues.

By Marc Rosenberg

In today's CPA firms, six critical trends are emerging clearly.

MORE ON PARTNER COMPENSATION: Why Compensation and Buyout Plans Must Be Synchronized | When Partner Vacation Becomes Excessive | Management Stipends: Who, How and Why | Paying Part-Time Partners
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They are some of the toughest questions any firm can face. Get them right, and you can avoid a lot of trouble. Get them wrong, and, well, you may never need worry about them again.

The top six trends are:

  1. More compensation committees; fewer formulas.
  1. Linking compensation with strategic planning.
  1. Recognizing the value of intangible performance attributes.
  1. Less emphasis on book of business because other factors such as intangibles must be rewarded.
  1. Less emphasis on billable hour It’s more important what partners do with their non-billable hours (practice development, managing the firm, mentoring staff) than their billable hours.
  1. More firms are changing from open to closed systems, though the vast majority of firms under $15 million are still open.

But that's not all. Within firms, sometimes heated discussions are taking place over another 10 topics. Here they are in point/counter-point form:

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Which side of the argument is your firm on? And, is it the right for your firm's future?

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