What are the steps in SELLING a practice?
Contact a qualified professional broker/intermediary that has experience in public accounting as well as theacquisition/sales of businesses. Things to look for in a broker/intermediary:
• Experience in running a CPA firm. We believe it is vital for someone negotiating the sale of an accounting firm to be able to talk both the buyer and sellerʼs language.
• Confidentiality. One of the primary reasons to hire a broker/intermediary is to keep the name of your firm confidential from the local Accounting community.

What are the standard market conditions for CPA and accounting practices in my area?
Accounting practices are primarily sold on a multiple of gross billings with a client retention clause (usually 1 year). Unless the Buyer has an intimate knowledge of the firm (i.e. an employee or partner), we believe a retention clause helps to ensure an equitable deal for both the buyer and seller.

Is there financing available?
Yes, the majority of the practices that we list qualify for Small Business Loans (SBA Loans). A buyer can often finance a relatively high % of the sales price with the loan being amortized 7-10 years. The practice itself must exhibit strong cash flow and the buyer must qualify based on experience, credit history and other factors.

Is a down payment required?
If financing is obtained through SBA, the buyer can often borrow a relatively high % of the purchase price. The SBA generally requires a down payment of up to 20% of the purchase price. If the seller finances the purchases, he or she would generally require a down payment to insure the buyer’s commitment and give him or her more assurance of being paid.

What if the practice does not qualify for SBA funding?
When the practice itself does not qualify for SBA financing, the sellers are generally willing to carry a note for a reasonable part of the purchase price. Such note is generally for 2-5 years at an agreed upon rate of interest. The assurances the seller is looking for would be a good credit history, an adequate down payment, significant other assets, and buyer experience.

What are the major risks associated with purchasing a practice?

Retaining the employees of the practice is very important to the success of the buyer. It is also critical that the employees not enter into competition with the buyer after the purchase. Carefully assess the possibility of the firms current employees leaving the practice and taking clients with them. Buyers should inquire if employees have non-solicitation agreements and should draft new agreements to be signed by employees on the 1st day of the new firm.

Large Clients:
Our model for transition is based on a belief that if a buyer does his job in selling himself to the clients he should be able to retain most of the clients. A special risk, however, exists if one client represents an abnormally large share of the practice revenues. We recommend looking carefully at the 10 largest revenue producing clients from the prior year.

Buyer Apathy:
Immediately after closing the purchase of a practice, a buyer should market himself to all the clients as if they were new “prospective” clients. If the buyer does his job, he should retain the vast majority of the clients. Failure to do so can risk loss of clients.

Seller Remorse:
The Seller and the Buyer must work together in the transition period. Often times, the Buyer will begin making changes to the firm. The Seller must be ready to hand the keys over to the Buyer at close and actively work with the Buyer in the transitioning of the business. Buyers should always obtain non-compete agreements with the Seller.

Why use Alliance Accounting Sales?
• We will market your practice professionally and confidentially.
• We have highly qualified pre-registered buyers.
• We will evaluate the strengths and weaknesses of your practice and can address questions & concerns during the negotiation process.
• We will professionally estimate the value of your practice (rather than using a standard multiple as some of the national firms tend to do)
• We have alliances with local attorneys to draw up the legal documents and address any potential issues during the sales process. We also have alliances with several financial institutions for buyer financing.
• We assist in every step of the way from helping to set an asking price for your practice, negotiate with buyers and obtaining financing.

I plan to sell on my own. What are practices selling for in my area?
Do you want to know what you could sell your practice for or what we can sell your practice for? We believe you will likely net more by letting us do the work. It has been demonstrated that a competitive bidding environment almost always increases prices.

How do you find buyers? Where do you market my practice?
Alliance Accounting Sales will market your practice by direct mail and telemarketing. Also, because we are local, we have access to the informal network of professionals (CPAs, attorneys, bankers etc.) that are often the main source of finding potential buyers. The key to getting the best price and terms is to bring as many buyers as possible to the table.

How do you plan to market my practice while maintaining confidentiality?
Confidentiality is foremost in all of our contacts and transactions. Before we release any information or even your firm name, we obtain non-disclosure agreements with each of our prospects. All contacts with your office are very discrete. Once we agree to market your practice we prepare offering information to best present your practice to the market, with information on practice mix, your community, fee structures and the type of purchaser we are looking for.

I plan to sell to my employees. How can you help?
We can help negotiate the deal and, depending in the circumstances, we can significantly reduce our commission on firms sold to employees.

How can I make sure that my clients and employees will be taken care of?
Finding the right buyer is not just a matter of finding someone willing to meet your price and terms. How the personality and experience of the Buyer correlates with the practice being purchased is extremely important in the success of the transaction. We will screen potential buyers for sufficient experience and demeanor to treat your clients and employees as you would. The best way to insure you find a buyer you are comfortable with is to bring a multiple of qualified buyers to the table.

How long does it typically take to find a buyer and close?
It depends on the practice, time of year, business conditions, etc. On average, the process should take approximately 3-9 months. Our goal is to introduce you to several qualified buyers within a couple of weeks of beginning the process. In many cases, because we already have a large database of registered buyers, we can introduce you rather quickly to persons interested in your practice.

Will the buyer take over my existing lease space or buy my building?
The vast majority of our practices are sold to individuals that retain the existing location. In most cases, the buyer of your practice will want to retain your space either through lease or purchase. If this is a requirement either because you own the building or have a long term lease, we can qualify buyers with regard to their ability and willingness to keep the same space.

Note: If the Buyer plans to relocate the practice to another location and there is retention clause in the contract, there should be serious discussion as to how the retention is negotiated.