{"id":46292,"date":"2016-02-16t08:00:24","date_gmt":"2016-02-16t13:00:24","guid":{"rendered":"https:\/\/48e130086c.nxcli.net\/?p=46292"},"modified":"2024-08-14t11:28:15","modified_gmt":"2024-08-14t15:28:15","slug":"firms-say-change-retirement-pay","status":"publish","type":"post","link":"\/\/www.g005e.com\/2016\/02\/16\/firms-say-change-retirement-pay\/","title":{"rendered":"should retired partners take staffers with them?"},"content":{"rendered":"

\"\"is your plan upside down?<\/strong><\/p>\n

by <\/span><\/i>bill reeb<\/span><\/i><\/a> and <\/span><\/i>dominic cingoranelli<\/span><\/i><\/a>
\n卡塔尔世界杯常规比赛时间 \/ succession institute<\/span><\/i><\/a><\/p>\n

we\u2019ve seen that other firms frequently have seen negative situations occur when they don\u2019t address them up front in their firm policies or agreements. this question addresses whether firms are proactively preparing for these occurrences.<\/p>\n

<\/p>\n

more on performance management:<\/b> 4 ways to create more capacity<\/span><\/a> | <\/span>partner retirement and the war for clients<\/span><\/a> | <\/span>succession: the questions to care about<\/span><\/a> | <\/span>hazards of not reallocating equity<\/span><\/a> | <\/span>cpa firm performance assessments: 15 core competencies, 21 questions<\/span><\/a><\/p><\/blockquote>\n

we asked, \u201cwhich of the following occurrences will force a change in the payment duration, monthly payment amount, and\/or total payout amount of standard calculated retirement pay?\u201d<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
answer<\/th>\n% in 2012<\/th>\n% in 2008<\/th>\n% in 2004<\/th>\n<\/tr>\n
competing with the firm after retirement<\/td>\n74%<\/td>\n53%<\/td>\n56%<\/td>\n<\/tr>\n
taking staff<\/td>\n43%<\/td>\nna<\/td>\nna<\/td>\n<\/tr>\n
early retirement<\/td>\n42%<\/td>\n36%<\/td>\n31%<\/td>\n<\/tr>\n
egregious misconduct in the community<\/td>\n26%<\/td>\n21%<\/td>\n13%<\/td>\n<\/tr>\n
uncollectible accounts receivables or work in process<\/td>\n21%<\/td>\n17%<\/td>\n17%<\/td>\n<\/tr>\n
sale of the business<\/td>\n14%<\/td>\n19%<\/td>\n14%<\/td>\n<\/tr>\n
merger<\/td>\n10%<\/td>\n13%<\/td>\n9%<\/td>\n<\/tr>\n
loss of retiring owner\u2019s clients at any time during the payout period<\/td>\n13%<\/td>\n10%<\/td>\nna<\/td>\n<\/tr>\n
loss of retiring owner\u2019s clients only within the first two years<\/td>\n9%<\/td>\n12%<\/td>\n24%<\/td>\n<\/tr>\n
loss of retiring owner\u2019s clients only within the first year<\/td>\n7%<\/td>\n12%<\/td>\nna<\/td>\n<\/tr>\n
liabilities incurred after retirement based on retiring owner\u2019s clients<\/td>\n9%<\/td>\n7%<\/td>\n6%<\/td>\n<\/tr>\n
sale of a line or business<\/td>\n1%<\/td>\n4%<\/td>\n2%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

 <\/p>\n

in a positive trend, 74\u00a0percent\u00a0of participating firms indicate that competing with the firm after retirement will result in a change in the retirement benefits, compared to just over 50 percent in past surveys. but only 43 percent of the firms said that a retired partner\u2019s benefit will be affected by his or her taking staff when they leave.<\/p>\n

given the importance of finding and retaining quality staff to every firm, why would any firm put their top people at risk without at least some financial consideration should a past owner woo them away, especially while the firm is paying them a retirement benefit for the value they are leaving behind? by the way, for the record, when owners leave and take clients and\/or staff, they normally take the best of each.<\/p>\n

just as bad, only 42 percent of the firms indicated that early retirement would result in an adjustment to a retiring partner\u2019s benefits. we not only believe that an effective policy in this area should have a tiered vesting schedule that reduces the retirement benefit for leaving early, but that the early vesting privileges should only be accessible with a minimum of two years\u2019 advance notice.<\/p>\n

remember that one of the central reasons for bringing in younger partners is so they can buy out the senior partners when it is time for them to leave. in many cases, we find poor policy design in this area that\u00a0actually will allow the younger partners to leave before the older ones, thereby turning the succession plan upside down. the good news is that there is an easy fix to this as long as you put it in place years before a partner is ready to retire. when you consider some of the major issues introduced here, such as:<\/p>\n