REVENUE and profitability growth has been demonstrated by CPA firms, a survey from the American Institute of CPA’s and its subsidiary CPA.com has found.
Most CPA firms reported solid gains in revenue and profitability over the past fiscal year and are taking steps to make their practice management more innovative. Representatives from 1,537 CPA firms were asked, from May to July this year, details about their latest fiscal year financial results.
From 2014 to 2016, the average revenue growth rate rose from 4.9% (of larger firms) to 10.5% increase (with the lesser firm segments). Net profits, remaining per owner, showed that profitability grew by double digits for higher revenue firms, 11.2% to 13.3%.
The 2016 National Management of an Accounting Practice (MAP) Survey, conducted once every two years, was designed to examine CPA firm segments, from small practices with less than $200,000 (£163,000) in annual revenue to large firms with $10m or more, since key performance indicators often vary widely by firm size.
Mark Koziel, CPA executive vice president, said: “The survey shows that the business of public accounting is strong.”
The cost of employees continues to grow as a percentage of firm profits, with firms showing a strong preference for accounting graduates. Practice innovation is also on the rise with more firms, particularly small to midsize, shifting away from timesheets and experimenting with value or fixed pricing.
Richard White, Nicola Westbrooke and Richard Ross all join from KPMG, where they oversaw the real estate tax practice
Sheryl Davis joins the firm's High Wycombe office from Barnes Roffe
The appointments have been made across the VAT, audit and international tax teams
The firm has made six partner appointments, including five promotions, to the audit, corporate finance and private client tax practices