the partnership

a crash course in partner retirement/buyout plans

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3 issues to decide and 25 main provisions to include.

by marc rosenberg

when firms call me for help on their partner agreement, i immediately ask this question: “do you want help with your entire partner agreement or just the retirement/buyout part?” two-thirds of the time, they want to address only the retirement plan.

more: 5 key reasons to have a partner agreement | protect your business with a solid partner agreement
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my practice in the area of cpa firm partner agreements consists of two parts:

  • the partner retirement/buyout plan.
  • everything else. i often refer to this as the general partner agreement.

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5 key reasons to have a partner agreement

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plus what can happen if you don’t.

by marc rosenberg
partner agreement essentials

what is a partner agreement?

according to nolo.com, “a partner agreement spells out the rights and responsibilities of the firm’s owners.  without one, firms will be ill equipped to settle or avoid conflicts because if certain key passages are missing or written improperly, the courts will intervene in ways that the partners may not like. a partner agreement allows the firm’s partners to structure their business relationships with each other in ways that suit their desires, needs and preferences.”

more on partnership: protect your business with a solid partner agreement | how business entity type affects partner income | equity vs. non-equity partners | partner pay in retirement transition period | buyout: the flip side of buying in
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but most readers probably knew this definition, so it might not be very illuminating. let’s try this one.
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protect your business with a solid partner agreement

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number 6plus 6 ways they’ve changed over the years.

by marc rosenberg
partner agreement essentials

buying a family home is one of the the biggest investment most people make in their lives. and because most of us are not real estate experts, we protect ourselves by engaging an attorney to ensure that the purchase is handled correctly.  we don’t hesitate for a moment to invest a few thousand dollars of attorney fees to hire an expert.

more on partnership: how business entity type affects partner income | what partnership gets you (and doesn’t) | 5 cautionary tales in partner compensation | partner pay in retirement transition period | 23 key provisions in a partner buyout | management stipends: who, how and why | when a firm tanks while a partner soars | research results: how firms pay new partners | what does buy-in buy? | how profitability affects income allocation | keys to bringing in new partners
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being a partner in a cpa firm should be no different.
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22 things leaders must do

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businessman carrying elephant on his backbonus: 4 ways not to choose a managing partner.

by domenick j. esposito
8 steps to great

in his 2008 book “strategy and the fat smoker,” david maister wrote that we often (or even usually) know what we should be doing in both our personal and professional life. we also know why we should be doing it and (often) how to do it.

more on strategic planning: the top 11 reasons cpa firm mergers fail | new year’s resolution: solve the partner comp problem | 6 rocks in the path to growth | use compensation to shape partner behavior | the importance of m&a culture due diligence | are you attracting the new breed of equity partners?
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figuring all that out is not too difficult. what is very difficult is actually doing what you know to be good for you in the long run, despite short-run temptations.
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solve the partner comp problem

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dial with arrow pointing to word "strategy"now is the time to take a hard look at your partners and your compensation model.

by domenick j. esposito
8 steps to great

let’s take a deep dive into both a firm’s partner mix and its compensation model.

more on strategic planning: 21 questions to help unlock accelerated growth | growth: the difference between the disruptor and the disrupted? | use compensation to shape partner behavior | the importance of m&a culture due diligence | are you attracting the new breed of equity partners?
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

in a “good to great” research study on high-performing organizations performed by jim collins, it was concluded that the method of compensation, as a causal factor for high and sustained performance, is largely irrelevant. the study concluded that whatever system is in use, it simply must be rational and equitably managed and that high sustained performance is largely the result of doing many things well.
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how much should partners make?

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scale with coins on one side, alarm clock on the otherdo they deliver or develop?

by rob nixon

how much should a partner of a multipartner accounting firm be paid? should it be equal pay because you have equal shareholding?

more on strategy: the entrepreneurial accountant: an oxymoron? | how to structure your firm for success | why average project value matters | do your clients want more? | the bizarre habits of accountants | 12 traits of a better you
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if it is going to be equal pay then each person must pass the checklist of the ideal partner. it’s my opinion that most should not be paid equally.
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use compensation to shape partner behavior

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do you have the right mix of partners?

by domenick j. esposito
8 steps to great

visualize your partner group fitting into a bell curve.

more on strategic planning: ai likely to accelerate merger mania | what a value proposition truly is (and isn’t) | does your firm need an independent executive committee member? | 10 ways to link compensation and strategy | develop home-grown future leaders | how to capitalize on the trusted business advisor opportunity | leadership must be persistent and consistent
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in quartile #1, you have the stallions – the very high performers who produce outstanding contributions to the firm year in and year out. these equity partners want to win and know how to do it.
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6 questions for planning your succession

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august aquila: "holding on too long is the most serious sin you can commit."make your planning spell success.

by august j. aquila

it’s no surprise to anyone thinking about retiring or selling a practice today that the number one issue they face is finding someone to take over the practice.

more on great partnerships: 7 issues in partner retirement planning | solving underperforming or dysfunctional partners | the 3 types of partners you need | how mps can make a real difference | 5 reasons that leaders fail | 11 things all partners must do | why partners need written goals
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there is a definite shortage of buyers and those who are buying are becoming more and more selective. many firms will find that it has now turned into a buyers’ market.
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7 issues in partner retirement planning

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older businessman with jacket over shoulderplus 6 steps for transitioning clients.

by august j. aquila

the biggest danger facing the future of accounting firms today is not the economy. it is the lack of planning for partner retirement.

more on great partnerships: solving underperforming or dysfunctional partners | underperformers come in many shapes and sizes | 6 focuses for managing partners | 10 steps to transitioning to a new mp | what managing partners should be doing | 11 things all partners must do | why partners need written goals | fighting restraining forces
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you would think that this would be one of the most important strategic issues for firms, but unfortunately it is not.
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solving underperforming or dysfunctional partners

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two businessmen arguingplus 21 ways to identify them.

by august j. aquila

i’ve been dealing with underperforming or dysfunctional partners for a quarter of a century. while the underperformers and dysfunctional ones haven’t changed much in that time, the way firms are dealing with them certainly has.

more on great partnerships: underperformers come in many shapes and sizes | is it time for a partner compensation checkup? | 13 points of a good compensation plan | 5 ways to keep your edge | how to become the firm of choice | why ‘walking together’ is so important | how to build a better firm through teamwork | 8 questions to analyze your pricing | 5 questions for every mp to answer honestly | 6 practical ways to innovate
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the so-called white gloves in the accounting profession came off many years ago when dealing with competitors. they are now off when dealing with these two types of partners.
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underperformers come in many shapes and sizes

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stressed businessman resting head on hands at desk6 questions to ask … about the firm.

by august j. aquila

over the years i have been called in to firms to help address an underperforming partner. i have learned that underperforming can mean a lot of different things and the underperformer can have many different problems.

more on great partnerships: is it time for a partner compensation checkup? | the 3 types of partners you need | how mps can make a real difference | 5 reasons that leaders fail | 11 things all partners must do | why partners need written goals
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

i have also learned that many managing partners waste a lot of time and energy either trying to “fix” the underperformer or just ignoring the 5-ton elephant in the room.
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the 3 types of partners you need

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two men shaking hands as woman stands with oneyes, you need new clients, and new business from old clients. but there’s another key player.

by august j. aquila
what makes a great partnership

it seems like no matter what the topic is at partner meetings, it always reverts to compensation. there isn’t a partner out there who is not interested in his or her compensation, and maybe even more interested in what the other partners make.

more on great partnerships: 6 focuses for managing partners | 13 points of a good compensation plan | 5 ways to keep your edge | the toughest job in the world: managing an accounting practice | how to become the firm of choice
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compensation is also a topic on which all the partners can never agree. each partner likes the compensation system that most favors his or her strengths. hence, non-business developers favor production while business developers favor origination.
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