Success is no accident.
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CPA Trendlines Research
With Chelsea Summers
Inside Public Accounting
The firms in the 2025 IPA 500 are redefining what it means to grow in the accounting profession. Yes, many are getting bigger—but more importantly, they’re getting sharper. Growth without a plan is no longer enough. The firms pulling ahead are the ones making intentional choices about who they serve, how they work, and where they’re headed.
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“This year’s IPA 500 firms had a really strong year,” Chelsea Summers, executive director of Inside Public Accounting, says in a new webinar report, hosted by CPA Trendlines founder and CEO Rick Telberg. “But it wasn’t by accident. The firms that are winning right now are the ones doing things with purpose. It’s about making strategic choices—not just reacting to change, but leading it.”
Bigger Isn’t Always Better—Strategy Is
It’s tempting to think size alone determines success. But IPA’s data tell a different story. Firms that specialize, focus on profitability over pure growth, and modernize their internal structures are outpacing their peers—even at smaller revenue tiers.
Specialization stands out as one of the clearest performance drivers. Among the top firms, those generating more than 45% of their revenue from audit, tax, or advisory services report stronger margins, faster growth, and better partner income than their more generalized peers.
- Advisory-heavy firms are growing13.3%—outpacing the overall average of 10.4%.
- Tax-focused firms generate $256,000 per FTE and more than $1.1 million per equity partner.
- Audit specialists are seeing the lowest turnover at just 12.4%.
It’s a clear signal that strategic focus delivers results.
Governance, Pay, and Accountability
The IPA 500 also reveals a profession rethinking how leadership works. More firms are shifting away from informal partner management toward structured governance. In practice, that means clearer accountability, compensation tied to firm-wide metrics, and a growing emphasis on profitability—not just top-line growth.
Private equity-backed firms are leading the charge. These firms retain more earnings for reinvestment—17% of profits, compared to 5% at traditional firms—and post significantly higher income per partner: $1.41 million vs. $995,000.
Summers notes that even firms without private equity backing are picking up some of these habits. “It’s not about copying the ownership model,” she says. “It’s about borrowing the discipline—thinking like a business and holding leaders accountable.”
The Pricing Gap—and the Opportunity
Billing rates and compensation still scale with size, but IPA’s data shows an opportunity for smaller firms to close the gap.
- Equity partners in the IPA 100 average $597 per hour, compared to $387 in the IPA 500.
- Entry-level staff bill at $207 in the top tier, versus just $139 at the bottom.
- New equity partners in the IPA 100 are earning around $840,000; in the IPA 500, they start closer to $247,000.
Smaller firms can and should raise rates, according to Summers. “Clients expect more now. And they’re willing to pay for it—if you’re delivering value. Firms need to stop pricing like it’s 2010.”
Hybrid Staffing Is the New Normal
Offshoring and outsourcing have moved from the margins to the mainstream. Nearly half of all IPA 500 firms now offshore work, and one-third outsource tax returns. At the top tiers, that figure jumps: 83% of IPA 100 firms use offshore staff, and nearly 65% outsource compliance tasks.
Firms that offshore are more profitable. They’re also more scalable—able to handle growth without overwhelming their teams.
Summers stresses that hybrid staffing isn’t just a cost-saving tactic. It’s a strategy. “Firms that do this well are building it into their culture, not treating it like a Band-Aid,” she says.
The key, she adds, is integration. Offshore teams need proper onboarding, training, and alignment—not just a login and a deadline.
Clients and Culture: Making Space for the Right Work
Strategy also means being selective. More firms are formally culling clients to focus on higher-value relationships. According to the IPA, 50% of firms removed clients last year—most often due to misaligned goals, low profitability, or resource strain.
For larger firms, the average culled revenue was over $700,000. But even smaller firms are making moves, cutting up to $135,000 in clients that no longer fit.
“Client culling isn’t about being ruthless,” Summers says. “It’s about making room for your A clients—and reducing stress on your staff.”
That’s particularly important in today’s tight talent market, where culture and well-being are as important as salary in retaining high performers.
Tech Spending Is Up—But Only Smart Investments Pay Off
Tech budgets have climbed steadily—averaging 5.5% of revenue across all firms, up from 3.9% in 2015. But it’s not just about spending more. It’s about spending smarter.
Firms that align technology investments with specific business goals—automation, client experience, efficiency—are seeing better results. That includes integrating AI tools, cloud platforms, and advanced data systems into everyday operations.
“It’s not about having the latest tools,” Summers says. “It’s about what you’re doing with them. Intentional tech adoption is a differentiator.”
The Strategy Playbook for 2025
For firms looking to stay competitive—or break into the IPA 500—Summers offers four takeaways:
- Focus: Specialization beats generalization.
- Govern: Borrow from PE firms’ discipline—tighten accountability and align incentives.
- Price smarter: Value-based pricing isn’t optional anymore.
- Go hybrid: Offshoring and outsourcing are no longer just for the big players.
And above all: plan with intention.
“Every firm, no matter the size, has levers to pull,” Summers says. “But you have to pull them on purpose. That’s what defines the top performers in 2025.”
In today’s profession, strategy isn’t just a buzzword. It’s the backbone of success.