Posts Tagged ‘CPA-Partner-Agreements’
Commonly Omitted Provisions in CPA Firm Partner Agreements
Partner agreements are a key organizational document for any business, including CPA firms. Firms normally don’t find themselves needing to refer to them, but in the event that they do it’s important to have the right provisions included to be able to effectively handle situations as they arise. Many partnership or operating agreements from CPA…
Read MoreNew Non-Compete Laws Have Little Impact on CPA Firms
In July, President Biden signed an executive order that made it more difficult for non-compete agreements, in general, to be enforceable. In Illinois, a more restrictive version of this change is ahead of the curve, making it more challenging for Illinois employers to enter into non-compete and non-solicitation agreements with employees. I have heard that…
Read MoreHow Voting Should Work at a CPA Firm
A great deal of the content of this blog was obtained from in-depth discussions with Peter Fontaine, a nationally-known attorney specializing in CPA firm legal issues and business practices. Peter is the founder and managing partner of NewGate Law. He has served as legal counsel for RSM and Arthur Andersen. Fontaine can be reached at…
Read MoreShould Non-Equity Partners Vote?
We recently received this question from a long-time client about income partners and voting: “We can see having several income partners in the next two years and have been discussing what voting rights, if any, they should have. We are currently restating our partnership agreement to include our new Executive Committee and thus we would…
Read MoreBad Behaviors By Partners… And What Management Should DO About It
In my experience, roughly 60% of all CPA firms (below the Top 100) have either major partner conflict or a pronounced lack of effective partner communication and/or relations. This is a huge problem because unless the partners of a firm work reasonably well together, it is very difficult for their firm to be truly successful.…
Read MoreOpposing Views on Mandatory Retirement
Two-thirds of partner agreements include a mandatory retirement provision. This provision usually requires partners to give up their equity but allows them to continue working in some fashion. A common stipulation is that if a “retired” partner wishes to continue working, either full or part-time, this must be approved annually by the other partners. Here…
Read MoreSurvey: How MPs Ensure Their Firms Optimize Technology Usage
I have a keen interest and understanding of how managing partners perform their jobs. Their duties encompass a long list of critically important management functions. Certainly, one of these is to ensure that technology has an optimal impact on the firm’s success, profitability and efficiency. This can be quite challenging because, unlike most MP duties,…
Read MoreGetting Sick and Tired of Ownership Percentage Driving Your Partner Decisions?
I sure am. Why? Imagine you entered into an ownership position in a CPA firm in your mid-30s. Over the next 30 years or so, you’ll be paid your share of millions of dollars. Do you want your share to be based on judgments that are rational and logical, or unfair and lacking in common…
Read MoreIs Your Partner Agreement Deficient? 16 Must-Have Provisions
Properly written partner agreements contain more than 200 provisions, all important. We have reviewed hundreds of partner agreements and helped firms create or revise several dozen, and based on this experience, I’ve identified what I consider the 16 most critical provisions in CPA firm partner agreements. The items are not listed in order of importance. …
Read MoreCPA Partner Agreements: Cutting Edge Issues
At a recent meeting of my monthly roundtable of 20 of the 30 largest local CPA firms in Chicago, we invited attorney Russell Shapiro, partner with the law firm of Levenfeld Pearlstein, to speak to us about key issues which are rarely addressed in CPA firm agreements. The first four items are listed below; the last four will appear in a future blog post.
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