Selling an Accounting Practice- Deal Comparison

TRANSACTION AFTER CLOSE

WITHOUT AN INTERMEDIARY-

Transition is lengthy with an uncertain end. Differences between buyer and seller as to management of the firm are common. When it comes to reporting problems and seeking advice, clients and staff may be confused about whom to approach. Seller is unable to “move on” with other important life goals. Buyer is unable to step out from under the shadow of the previous owner.

WITH POE GROUP ADVISORS-

Transition is expedited. Parties develop an effective, strategic transition based on key concepts acquired over a large number of closed transactions. Roles and responsibilities are clear. The buyer is empowered to excel at managing the practice and the seller is able to leave the practice to focus on retirement or other more important opportunities.

 

PROCESS

WITHOUT AN INTERMEDIARY-

Selling is time-intensive which can put a strain on operating your business and consume your personal time.

WITH POE GROUP ADVISORS-

We are the experts in working with and motivating buyers while making the process clear and straightforward. We introduce qualified buyers who are financially and professionally capable of purchasing your practice, knowing you’d rather not waste time with anyone else. We have served clients with significant business sales experience of their own (gained by helping their past clients) engage us because of our contacts, but cite the ease of our process as one of the greatest aspects of our service.

 

FAIR MARKET VALUE

WITHOUT AN INTERMEDIARY-

Value is determined by negotiations between the seller and the single buyer or a relatively small number of buyers with various levels of interest.

WITH POE GROUP ADVISORS-

Price is best negotiated by matching the practice with multiple suitable and motivated buyers. We have a ready stable. We are the market leader and have the largest number of potential buyers in your area. The cumulative effect of years of marketing to the accounting profession on a nationwide basis, coupled with our proven system of identifying suitable buyers produces the intended results.

 

TERMS

WITHOUT AN INTERMEDIARY-

The most common structure employed in private transactions is an “earn-out” formula where the buyer pays over a number of years based on a % of future collections. The payout that the seller ultimately receives therefore depends on the buyers ability to retain clients. Responsibility for client service is often bourne by both buyer and seller which is confusing for both parties and for the client. Disputes over client retention are frequent. Disputes over client service are also common. The seller often ends up involved with the firm in some capacity during the entire earn-out period.

WITH POE GROUP ADVISORS-

Our most common structure is an all-cash or all-cash equivalent transaction. By maximizing the number of potential buyers (as cited above) the seller is also able to negotiate fair terms. The price is fixed as of the date of closing. The buyer bears responsibility for client retention. Additionally, we have a network of specialized banking professionals which enables us to help buyers get attractive loans while allowing sellers to receive cash at closing. Being fully released from the financial risk of ownership, the seller experiences a “clean break” providing the freedom to effectively pursue new endeavors.

 

FEES

WITHOUT AN INTERMEDIARY-

No fees for the intermediary.

WITH POE GROUP ADVISORS-

The NET amount realized is what is ultimately important. Past clients have been pleasantly surprised by the price and terms achieved with us when contrasted with transactions that were contemplated prior to our involvement. The likelihood is excellent that we can get more for your practice than if you sell on your own even after paying our success fee.

 

To see this as a full screen table please click on the pdf link: The Missing Structure

PS – Whenever you’re ready, here are 4 other ways we can help:

  1. Seller FAQ: Answers to the questions sellers are asking. From practice value, to timing, we’ve got you covered.
  2. Strategic Guide to Selling your CPA Practice Video: The how-to of selling a CPA firm.
  3. Accounting Practice Academy: If you’re looking for benchmarks, our 8-week workshop has a community of established firm owners that will help you get perspective, reduce your owner hours, and raise your bottom line. email ibrennan@poegroupadvisors.com with “APA” and we will fill you in on the details.
  4. If you want to chat about your exit strategy, email bball@poegroupadvisors.com with “strategy call” or request a call here.