{"id":55463,"date":"2018-11-22t23:00:33","date_gmt":"2018-11-23t04:00:33","guid":{"rendered":"https:\/\/48e130086c.nxcli.net\/?p=55463"},"modified":"2019-05-06t12:09:15","modified_gmt":"2019-05-06t16:09:15","slug":"15-partner-agreement-weaknesses-and-omissions","status":"publish","type":"post","link":"\/\/www.g005e.com\/2018\/11\/22\/15-partner-agreement-weaknesses-and-omissions\/","title":{"rendered":"15 partner agreement weaknesses and omissions"},"content":{"rendered":"

make sure your agreement meets current standards.<\/strong><\/p>\n

by peter fontaine<\/em>
\ncpa firm partner agreement essentials<\/a><\/em><\/i><\/p>\n

too many firms\u00a0suffer from major \u2013 often hidden \u2013 weaknesses and omissions in cpa firm partner agreements.<\/p>\n

more:<\/b> when solos bring in partners<\/a> | 8 key items for partner agreements<\/a> | 14 partner agreement issues in mergers<\/a> | partner duties, prohibitions and grounds for expulsion<\/a>
\n\"goprocpa.com\"exclusively for pro members. <\/span><\/strong>log in here<\/a> or 2022世界杯足球排名 today<\/a>.<\/span><\/p><\/blockquote>\n

start with this checklist to test yours.<\/p>\n

<\/p>\n

    \n
  1. managing partner and executive committee lack sufficient authority to effectively run the firm.<\/li>\n
  2. firm governance is heavily weighted toward original owners or the older generation. younger partners feel disenfranchised and underrepresented.<\/li>\n
  3. partner duties and expectations are not well defined. performance of partners is hard to monitor and control.<\/li>\n
  4. insufficient criteria for terminating partners.<\/li>\n
  5. new partner admission and buy-in process unclear.<\/li>\n
  6. twenty to 30 percent of all firms don\u2019t have a goodwill-based partner retirement\/buyout provision in their partner agreement. many of these firms\u2019 partners incorrectly<\/strong> believe that this protects them against claims by departed partners to get paid for their interest in the firm that includes<\/strong> goodwill.
    \n<\/span><\/li>\n
  7. retirement\/buyout benefits based on ownership percentage or \u201cbook of business\u201d instead of what each partner has contributed to the firm.<\/li>\n
  8. virtually no requirements for client transition by retiring partners to be eligible for goodwill-based retirement benefits.<\/li>\n
  9. draconian and therefore unenforceable provisions for the handling of partners who withdraw from the firm. example: valuing goodwill in excess of 150 percent of revenue.<\/li>\n<\/ol>\n

    rosenberg adds:<\/strong>\u00a0<\/strong><\/p>\n

      \n
    1. notice periods these days are at least one year, and many are 18-24 months. it\u2019s incredible how often we read old agreements that provide for only 12 months\u2019 notice or less.<\/li>\n
    2. non-solicitation agreements should not only cover clients taken but prospective<\/strong> clients as well. for prospects, the firm must be able to provide documentation, such as written proposals, emails and sales reports, to prove the prospects are bona fide.<\/li>\n
    3. the vast majority of partner agreements we see do not include the taking of staff, which should carry a liquidated damages provision of 30-100 percent of the compensation (including bonuses, commissions and overtime) of the staff.<\/li>\n
    4. new partner buy-ins are much lower today than 20 years ago. most today are disconnected from ownership percentage. instead they are determined at the firm\u2019s discretion, usually $75,000 to $175,000.<\/li>\n
    5. very few agreements address the compensation of disabled partners who stop working but intend to return.<\/li>\n
    6. no provision for non-equity partners.<\/li>\n<\/ol>\n

      excerpted from peter fontaine\u2019s publication \u201cgetting in touch with your legal side \u2013 a potpourri of issues and updates.\u201d\u00a0<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

      make sure your agreement meets current standards.<\/strong>
      \nby peter fontaine<\/em>
      \n      cpa firm partner agreement essentials<\/a><\/em><\/i>
      \ntoo many firms\u00a0suffer from major \u2013 often hidden \u2013 weaknesses and omissions in cpa firm partner agreements.<\/p>\n","protected":false},"author":1392,"featured_media":52068,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":""},"categories":[2741,3120,3002,2266],"tags":[],"class_list":["post-55463","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-checklist","category-pro-member-exclusive","category-special","category-partner"],"acf":[],"yoast_head":"\n15 partner agreement weaknesses and omissions - 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