Accounting Practice Sales: 4 Things to Know
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If you’re looking to grow an existing CPA firm or start a start a new consulting endeavor, finding an accounting business for sale could be a great path. Accounting practice sales can jumpstart a new business by taking over existing clients. Here are four things to know about accounting practice sales.
What is included in the sale of an accounting practice?
Most small accounting practices for sale include the sale of many aspects of the business, including the brand and client list. Some sales also involve physical office space. Accounting practice sales typically occur when a CPA is retiring or moving to another state and leaving the business behind. Purchasing an accounting practice is a great way to expand an existing brand or to move to a new geographic area or new type of clientele. Many people choose to purchase an existing CPA firm if they want to add to their current business or try something new, such as purchasing a practice focused on taxes or audits. Once the transaction is finalized, the buyer owns the entire practice, which can limit the contact the seller has with past clients. When finalizing the deal, both parties should agree to the specifics of what happens to existing clients.
How is the sale price determined?
The price of an accounting practice is based on its size and value. A large, profitable firm will typically have a higher cost than a smaller firm with less revenue. However, there are other considerations that go into the price including value of the client list, location, and financing options. Like all real estate and business transactions, the price is negotiable, but it is at the seller’s discretion if any other offers will be considered.
Can an accounting practice be financed?
When buying an accounting practice, consider how much cash you can put down up front. Most sales go through with around a 10% down payment, but that varies depending on the buyer and seller. The brokers can arrange a financing plan with all parties in agreement.
Who manages the sale?
The accounting practice sales process can be very involved because of the multiple parties and considerations involved. For this reason, most people choose to work through an accounting practice broker, like Pro Horizons, who is experienced in the field. When choosing a broker, look for a company with a deep understanding of the industry and with experience creating strong deals. Choosing the right broker can remove much of the stress of purchasing a CPA firm and make the process run much more smoothly.
Selling and buying an accounting practice is a big decision and requires plenty of time and paperwork. Understanding the process and getting the right people on the team can make a big difference in creating a smoother transaction.
Pro Horizons: Experts in Accounting Practice Sales
If you are looking to either sell or buy an accounting firm, consider the help of Pro Horizons, a trusted Broker who can help with every step of the process. Contact us today to discover how we can make the transition as smooth as possible.