{"id":48885,"date":"2016-05-18t05:00:29","date_gmt":"2016-05-18t09:00:29","guid":{"rendered":"https:\/\/48e130086c.nxcli.net\/?p=48885"},"modified":"2024-10-11t12:39:39","modified_gmt":"2024-10-11t16:39:39","slug":"practice-continuation-agreements-and-why-solos-need-them","status":"publish","type":"post","link":"\/\/www.g005e.com\/2016\/05\/18\/practice-continuation-agreements-and-why-solos-need-them\/","title":{"rendered":"practice continuation agreements and why solos need them"},"content":{"rendered":"

\"woman<\/a>it’s a favor, so treat it like one.<\/strong><\/p>\n

by marc rosenberg<\/span><\/i>
\ncpa firm mergers: your complete guide<\/span><\/i><\/a><\/p>\n

a practice continuation agreement (pca) is a written contract between a sole practitioner and another firm for the latter to take over the solo\u2019s practice, either permanently or temporarily, in the event of a sudden, unexpected event that prevents the solo from working, most commonly a health issue.<\/p>\n

download: <\/b>practice continuation in event of a death or disability sample agreement and letter of instruction,\u00a0 prepared by ed mendlowitz<\/a><\/p>\n

more on mergers:<\/b> how to merge sole practitioners<\/span><\/a> | <\/span>merging in smaller: what to ask<\/span><\/a> | <\/span>18 concerns about merging in smaller firms<\/span><\/a> | <\/span>12 reasons to merge in a smaller firm<\/span><\/a><\/p><\/blockquote>\n

logically, it would make total sense for every one of the 30,000 sole practitioners in the u.s. to have a pca in place. after all, the solo has no other partners to take her place and in the vast majority of cases, the solo\u2019s staff doesn\u2019t have the skill level or the certifications needed to run the practice in the absence of the owner.
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\nbut very few sole practitioners have a pca with another firm, and very few firms have pcas with smaller firms.<\/p>\n

why do we see so few pcas?<\/strong><\/p>\n

what may seem like a simple, logical, win-win arrangement between two firms is in fact, very complicated. in some ways, a pca is more difficult to negotiate than a merger.<\/p>\n

a life insurance policy is a boilerplate document you sign, pay the premiums for and tuck away in your file cabinet, knowing that it never has to be looked at except in the unfortunate event that it is invoked, at which time it can be instantly and effortlessly implemented.<\/p>\n

there is a tendency by some to see a pca in a similar light. but it is a totally different animal.<\/p>\n

here are several factors that cause pca to be so rare:<\/p>\n

1. the effort to negotiate and agree on pca terms is at least equal to the effort and complication of buying or selling a firm. key provisions such as the following have to be negotiated:<\/p>\n