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Compatibility & Risk

It is like finding a mate on, many factors have to be disclosed, analyzed, and studied before a “match” can even be considered when buying or selling an accounting practice. But what creates the “real synergy” in this relationship is the realization of long-term goals and objectives. And let’s not forget the all too important “personalities” involved. Buyers and sellers ‘liking each other’ can be an overwhelming impetus to put a “deal” together, but it is not enough. The purpose of this step in the process to insure that decisions are being made based the compatibility of personalities, practices, and defined expectations. And to ensure that neither party agrees to something that they cannot live with. If any issues are derailed, or glossed over, during negotiations, a long-term successful transaction will not ensue. A neutral third party, like Ragan & Associates is often recommended for this very reason; to ensure that negotiations, contracts and the transition stay on target.

Compatibility Issues:

    • Corporate Culture; similar work ethic, human resource policies, management style, tax strategies, and quality control
    • Financial Performance; similar billing rates, realization and profitability
    • Human Resources; similar compensation, productivity, expertise, credentials, client interaction, etc.
    • Partner Compatibility – Personalities, strengths, weaknesses, and what each brings to the table
    • Business Opportunities – Specific growth strategies; what, where, when and how
    • Real Synergy’ a similar realization of long-term objectives and goals

Determining these important variables can be achieved by the following procedure.

  1. Signing a Confidentiality Agreement (Chapter 5 of our Book)
  2. Completing a Buyer Profile (Chapter 5 of our Book)
  3. Buyers providing Financial Statements and Credit Reports

From Blog

  • All Cash Transactions – A Boom or Bust??
    All Cash Transactions – A Boom or Bust?? Many of our competitors promise their clients all cash deals. But we have found that those are the worst M&A transactions for long-term success, for both parties.  If the Seller gets all cash at closing then he/she has no incentive to carefully

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Get The Complete Guide To Mergers & Acquisitions of CPA Firms
* Acquisition Strategies
* Valuation of CPA & Accounting Firms
* Practice Presentation
* Compatibility & Risk
* Economies Of Scale & Financing
* Letters Of Intent
* Due Diligence
* Legal Documents
* Closing Requirements
* A Smooth Transition