Ron Goldsmith, managing director of accountancy firm service provider the Goldsmith Group, painted a picture in which the accounting landscape was dominated by large national practices.
‘While the national firms will continue to grow, acquiring accountants from smaller rivals, small practices would struggle to survive,’ he said.
Latest figures from the ICAEW year book, show there are 2,883 firms comprising between 2 to 5 partners operating in the UK, with a further 327 firms made up of between 6 and 10 partners.
‘Within the next five years, a large proportion of these small practice owners will be reaching retirement age. But these owners are reluctant to hand the reins over to junior partners, while at the same time they are not attracting interested buyers,’ Goldsmith said.
But Goldsmith believes large accounting firms will thrive because of the range of services they offer and are best suited to servicing the SME market.
Small firms have difficulties attracting or retaining quality employees, with graduates favouring the national firms, and their most talented staff are often lured across to big players.
But Peter Mitchell, chairman of the Small Practitioners Association, was sceptical. He told AccountancyAge.com the SPA had not noticed any change in the general trend for small firms.
‘These claims are just a guess. Our evidence suggests that there is no slackening in the number of small practices. If this is happening then it is something we are unaware of,’ he added.
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