Succession Issues Stalling Some M&A

Four businesspeople, left handshakeOwner agreements are seeing updates.

By Terry Putney
Rosenberg MAP Survey

The realization of the predictions for the increase in firms seeking external solutions to succession issues through upstream mergers and sales clearly was evident in 2016. The level of activity we experienced in consulting with firms on M&A deals was unprecedented.

MORE FROM THE MAP SURVEY: Firms Focus on Profitable Growth, True Leadership | Survey: Many Firms in Transition | Technology Playing Center Stage in CPA Profession
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Several trends were also evident. Many firms in larger markets are often approached directly by firms interested in discussing a merger. The days of discreetly pursuing an affiliation strategy appear to be waning.
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3 Ways Firms Scare Off Successors

Man in suit pointing thumb downAnd 7 steps to making ownership attractive to new leaders.

By Terrence E. Putney
Bridging the Gap

Buying into a firm as a new owner involves great opportunity, but also significant risk. It is reasonable for ownership candidates to evaluate the potential for professional and financial rewards before taking such a step.

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Therefore, firms must be willing to honestly assess the potential risks and benefits for candidates as they seek to attract new partner-owners who can contribute meaningfully to the firm’s continued success.
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SURVEY: Next Generation Balking at Buyouts

"Partnership" written on two connected puzzle piecesM&A doesn't solve succession problems.

By Terry Putney, Transition Advisors
The Rosenberg MAP Survey

Succession for retiring partners continues to be a pressing issue for many mid-size and small firms.

MORE FROM THE SURVEY: Many Firms Have Already Lost the Battle with Succession | Embracing New Technology a Must | Technology Will Solve Labor Shortages | Cybersecurity Grows in Importance | Don’t Just Win Work, Figure Out Why | Mergers Keep Racing Forward  | MAP Survey Top 10 Findings
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This is not a new trend. It is amazing how many firms are delusional about their prospects of remaining independent, while doing virtually nothing to address the core issue of acquiring and developing the talent necessary to build the new generation of owners.
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How Succession Issues Are Driving Desperation Mergers

2016-ROUNDTABLE-OUTLOOK-FOR-ROSENBERG-MAP-COMMENTARY-VF-240x219Millennials, aging partners both skeptical.

They say "past results are no indication of future performance." Maybe. Maybe not. But if anyone should know, it's our panel of experts, their comments drawn from the new edition of The Rosenberg MAP Survey. These are their bullet points and comments, verbatim, looking back at the last 12 months and looking ahead to 2016. – Rick Telberg, CEO

By Terry Putney
Transition Advisors

Lessons from 2015:

The issue we are seeing that is most troublesome for firms is their lack of talent that can be developed into future leaders. Often partners want to place blame on the millennials and the different views they have regarding work-life balance.

MORE FROM THE ROSENBERG MAP SURVEY: Outlook 2016: Change Catches Up with Auditors | Strategic Plans Undermined by Out-of-Control Partners | Growth, Succession Plans Critical for Firms | Talent Wars Go from White Gloves to Boxing Gloves | Trend Outlook 2016: Change Agents Needed

However, it is clear many firms have failed to invest in leadership development. So they don’t have enough time to provide succession for retiring partners in their firms.

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Good M&A Deals Start with Strong Leadership

Firms must act decisively or lose opportunities.

by Joel Sinkin and Terrence Putney

We work with hundreds of CPA firms across the country primarily assisting them with M & A of their firms. Firms that are successful with using M & A as a strategy to grow have to be agile and open to change. One of our mantras is if you want to stay the same, we can't help you.

The characteristics of the firms we work with that are the most successful are found in their leadership. The most agile firms have strong leaders that are able and willing to make informed decisions quickly. Firms that cannot make decisions quickly find that M & A opportunities pass them by.

Strong leadership is derived from several things, including:      READ MORE →

New Wrinkles in CPA Exit Strategies

Contrary to most predictions, the recession has not decreased valuations for accounting firms.

But sellers must be willing to agree to retention adjustments and smaller up-front payments, according to Joel Sinkin and Terrence Putney at Accounting Transition Advisors.

In addition, READ MORE →