HAVING SERVED in the accounting profession for 40 years, you might think that a rest is well-deserved.
And for Rick Anderson, his move away from serving at Seattle-based Moss Adams – a $344m (£225m) firm by turnover – into chairing an international accounting alliance would afford that.
“I’ll be a little less busy,” says Anderson. Of course, he reveals that chairing the Praxity group of firms will take 40% of his time – and he’s actually “still going to do some things for Moss Adams”. As with most senior executives, taking a big break never really occurs.
Praxity ranks alongside professional services group Geneva as the largest of the world’s alliances and associations. It hauled in $3.7bn (£2.4bn) in 2011, according to Accountancy Age’s latest Top 35 International Networks and Alliances Survey. UK member firms include Albert Goodman, Forrester Boyd and most notably Mazars.
As an ‘association’ structure, Praxity avoids many of the potential issues that revolve around being defined as a network: where common branding and more formal links between the firms are payoff for the continued threat of vicarious liability.
Praxity members, Anderson explains, are essentially local firms, with mid-market clients geographically close to them. Yet businesses want to expand into international markets, and this is where the alliance must show its breadth of local expertise.
“The strength of every individual location is the ultimate key to success. If we have that, plus high quality firms – with a different brand – but in a different country, then a non-public company is unconcerned about the name on the door of the firm looking after them in the UK.”
In fact, Anderson doesn’t see huge differences between the way the big, ‘global’ firms operate as networks, and that of alliance and associations.
While being a network might leave the door ajar for more regulatory pressure, the ability to service clients cross-border means that they have the same risk, “that somebody is the weak link in the chain”. This is where Anderson sees what he describes as “a little deceptiveness”, in that the single brand networks are still a relatively loose banding of local firms.
“The investing public believe they are something different than what they are – [they believe they are] one firm controlled by one person. But they’re only as good as their ability to work together, regardless of what the formal structure is.”
“I’m sure there are situations where [networks] have a tighter bond… but I’m very familiar of situations where bonds are not nearly as strong as what we have in Praxity.”
With movement and consolidation among accounting practices, what does that mean for the sheer number of networks and association out there?
For Anderson, the huge markets that they operate in necessitates the number of accounting groups. But individual networks and associations are always liable to suffer during consolidation. As an example, PKF losing its London office to BDO in a merger presents it with a “real issue”, he believes.
“If they do [replace] it won’t be of the substance of PKF in London,” Anderson suggests.
So there’s no shortage of issues for Anderson and Praxity to contend with. His next three years as Praxity chairman will see Anderson looking to maintain the high quality of firms it already has on board, and making sure that servicing international clients is “an extremely high priority”.
“How strong is the Praxity alliance? Right now – very strong. We’re in discussions to add a couple of firms. I feel pretty good about the stability of our membership.
Rick Anderson: Biography
Joined Moss Adams in 1973 atfer graduating from Western Washington University
Provided audit and consulting services to manufacturing, agricultural and food-processing businesses until 1978, then in Yakima to 1993.
Became director of operations for Moss Adams in 1993, then president/COO in 1999.
In 2004 was named chairman and CEO of Moss Adams.
Joined Praxity’s management board and governing council in 2010.
He also serves on the Financial Accounting Foundation’s board.
He is married to Lori, and they have two children; Eric and Kristi.
Praxity: Key facts
Combined turnover: $3.73bn
Countries represented: 96
Member offices: 550+
Member firms: 69
Employees worldwide: 30,200
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