Things Are Changing in the CPA Firm M&A World

Some of the things that we used to think of as common in the world of CPA firm mergers and acquisitions are beginning to change.

By Gary Adamson, CPA
Adamson Advisory, Practice Management Consultants
April 2019

Consider this scenario: Management from another, usually larger, firm approaches you "just to talk." Never hesitate to do that. As the old saying goes, "talk is cheap" and you’ll probably learn a lot by just talking to another CPA firm’s management. And they will probably learn a lot from you. Talking does not mean merging. If that comes, it's probably farther down the road.

What I’m seeing in my merger and acquisition (M&A) advisory practice is quite similar to what you have been reading about for several months now. M&A, in the CPA profession, is hot and it's going to continue to be hot for the foreseeable future.

Although the activity level continues to thrive, there have been some changes. I’m seeing, much like many other M&A consultants, that some acquirers are becoming much more selective. They are looking more to build their consulting practices and the multiples for traditional practices are starting to suffer.

Be prepared: Do a self-assessment of your firm and your management practices, and ask these questions:

  • Are you profitable?
  • Are your people high-quality performers and are they loyal to you and your firm?
  • Are you truly paperless and can your firm be classified as a digital firm?
  • Is feedback a common practice within your firm?
  • Do you have a strong niche?
  • And, most importantly, are you open to change?

So many small to mid-size firms are facing two huge hurdles, finding/retaining top talent and the cost of keeping up with technology. Then there is the long-running challenge of succession. Unlike previous decades, younger, talented, up-and-comers may not want to take on the debt of multiple partner retirements. Ask yourself, is it really a smart investment for them?

If you plan to hold out and seek someone to acquire you later rather sooner, beware. We are seeing valuations of firms beginning to decline. Times are changing and so should you. Status quo is not a long-term option.

About the Author: Gary Adamson, CPA, is the CEO of Adamson Advisory, a CPA practice management consulting firm specializing in succession strategies, strategic planning, M&A, compensation and partner issues. Contact him at




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