Why Expand

For generations, CPAs have professionally served the tax and accounting needs of clients across America. But in today’s complex financial environment, the needs of their clients are changing – and growing.

CPAs Are Unique

CPAs are unique in that they are well positioned as clients’ key advisors and possess the necessary skills to expand their services in this area.

  • The traditional accounting and tax business is flat.
  • Offering additional services enhances the value of a CPA practice.
  • CPAs may have a fiduciary responsibility to review insurance contracts.
  • Many larger firms have enjoyed significant success by integrating financial services.
  • Clients are asking CPAs to become increasingly involved in their financial well-being.
  • Younger partners are looking for alternative sources of revenue to fund buyouts of senior partners.
  • AICPA is actively promoting financial services through its 360 Degrees of Financial Literacy initiative.

Servicing Client Needs:

  • As clients near retirement, their focus is shifting from accumulation to the ever more pressing issues of preservation, distribution and wealth transfer. Trillions of dollars are at stake and clients are increasingly asking their CPAs for help in managing their wealth, as well as their taxes.
  • Wealth Management no longer centers on just those clients preparing for retirement, individuals under age 46 now account for 17% of the high net worth individuals – with the shift to individual retirement plans, Gen X & Gen Y understand reaching retirement goals depends entirely on their own ability to save enough money.
  • Over the coming decade about $850 billion in new investable assets on average will come online each year in the US. By 2020, it is projected that there will be over $100 trillion in AUM.

Succession Planning:

  • A recent succession planning study conducted by KPMG resulted in the following findings:
    1. The number of potential buyers is not sufficient
    2. As revenues remain flat it becomes more challenging to affect a buy-out
    3. As the current demographic ages and revenues remain flat, the current supply of firms for sale exceeds demand resulting in a downward pressure on practice valuation.
  • This incremental opportunity provides a way for CPA firms to create revenue to fund their business succession plan.