Plus the impact of ownership percentage on partner issues.
By Marc Rosenberg
How to Bring in New Partners
Let’s go over structuring a new partner buy-in step by step.
MORE: What Buying In Actually Means | Why Buying Into a Firm Is Such a Great Investment | The Business Side of CPA Firms | It Shouldn’t Take So Long to Make Partner | Three Types of Skills You Need to Become a Partner | Seventeen Basic Expectations of Partners | Nine Ways to Woo a Prospective Partner
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1. Calculate the value of a CPA firm as accrual basis capital PLUS goodwill. Goodwill is commonly expressed as a percentage of the firm’s annual revenue. This total value should not be given away to anyone without being paid for. Bringing someone in as an owner in a profitable, viable business for little or no buy-in makes no sense.
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