Note: The following is a guest post written by Ira S. Rosenbloom, CPA, chief operating executive at Optimum Strategies, LLC.


Successful accounting firm merger and acquisition negotiations are not just a function of price and terms. In most cases, it is all about asking the right questions and the consistency of the answers.

As the discussion between the two parties considering a union evolves, a natural emphasis is placed on the financials, but the numbers are the easiest part of the M&A process. The actual questions and subsequent answers are the crucial part of the process. Questions and answers should be free-flowing throughout the process, but being persistent and asking the right questions can usually tell you everything you need to know. Here are some vital matters that should be addressed, when exploring CPA firm mergers and acquisitions:

  • Synergy: Determining if there is synergy between two firms that are considering a merger or acquisition yields a number of questions, including: What is the potential for synergy between the firms? Is there a synergy that currently exists? What are the possible roadblocks to the synergy? What is the timeline for realization? Will there be a 1 + 1 = 3 affect?
  • Operations: One of the most important factors for a successful implementation is having a clear and detailed vision of the firm’s daily operations. To assess if both firms share the same vision, you need to find out if the financial policies for both firms are in sync. Also, are the rates and service platforms compatible? Are personnel resources at capacity or will there be suitable “sharing” of talent? Is there a workable governance plan? Are the parties candid about their mutual problems or is everything considered “perfect” on all sides?
  • Strategic: The strategic focus for the merger or acquisition needs to be consistent. Find out if both firms are dependent on the deal to correct their current problems. Is there consistency to the motivation for the transaction or does it change with each conversation, and each person? Is there a history of “deal success” and an ability to have confidence in an integration program? In addition, are there demographic risks in either client base?
  • Priorities: It is essential to set reasonable priorities and expectations before merging or acquiring another practice. Ask yourself: Do each of the parties have well-defined priorities? Are the priorities among both parties aligned? Is there a rating system for the priorities, and a score card for the results? In a multi-partner firm, is there consensus as to the priorities? 

The conversation between two parties in a potential merger or acquisition should be spontaneous and forthcoming. The more candid the conversation, the better the pathway to the next steps — which are the financial models and requirements. As you approach or continue with a dialogue, emphasize the facts, factors, and concerns that can be captured through the Q&A – it will allow your time to be put to good use, and improve the decision-making process for all sides.

Want to learn more?
Rosenbloom will be leading an MACPA program titled “What It Takes to Be Successful in the Current CPA Firm M&A Market” from 8 to 11:30 a.m. on June 6. Get details and register here. Rosenbloom can be reached at or (973) 666-1980.

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