Mazars' disquiet over consolidators
A senior partner at a mid-tier firm has voiced his concerns over the emergence of the consolidation movement in the UK accountancy profession.
John Mellows of Mazars Neville Russell said the moves signalled a ‘desperate conclusion of the old style goodwill’ system of partner succession.
Mellows believes that in small firms young professionals are being put off becoming partners by the burdensome goodwill payments that go with partnership. Instead, the younger accountants are using their qualification and skills to move away from practice.
Last week AccountancyAge.com revealed that Mazars’ mid-tier rival BKR Haines Watts is leading a top-secret move towards creating a new accountancy consolidator. The news followed hot on the heels of Levy Gee announcing its position as the cornerstone of the latest consolidator Numerica.
Numerica intends to follow fellow accountancy-based services group Tenon in floating on the stock market along with consolidator Jobtel.
But Mellows told AccountancyAge.com that the pressure of responding to shareholders could compromise the work of accountancy firms.
‘Partnerships have benefited from not having pressures from investors,’ he said.
‘As a profession, independence is all important. The pressure of responding to the wishes of external shareholders does not lend itself to such independence.’
And ultimately, this could be bad for the client. ‘Cashing in on the “family silver” does not bode well for clients and the profession alike,’ he said.
Mellows said Mazars was committed to retaining a partnership model in which there is a responsibility to pass the practice on to successors unencumbered from external interests.
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