Niche Opportunity—HR Consulting

Source: Journal of Accountancy

CPAs can help clients in the human resources area by:

Staffing a project or assisting HR employees with:
- Design of benefits plans.
- Administration of plans.
- Job classifications.
- Performance appraisal systems.
- Compensation programs.
Assisting new businesses with:
- Designing jobs.
- Recruiting.
- Applying for training grants.
In a merger, the acquiring business may need help with:
- Researching norms for industry wages, benefits, and turnover.
- Determining normal benchmarks such as benefits as a percentage of payroll, payroll as a percentage of income, etc.
Creating an HR department.
Writing employee manuals.
Moderating retreats.

When launching an HR consulting service, CPAs and their firms should:

Decide what engagements they can handle.
What additional training and resources are needed? Consider hiring a specialist.
Decide whether to set up a separate entity to avoid conflicts of interest with attest clients. The separate entity might be partially owned by the CPA firm partners.
Identify a leader of the niche.
Devise a cross-selling plan. Tax preparation interviews may provide opportunities to discuss benefit plans.
Develop a marketing plan. Use other firms as referral sources. Speaking and teaching engagements can develop referrals and direct business.

What other firms are doing:

Keiter, Slabaugh, Penny & Holme, LLC, a 26-person firm in Glen Allen, Virginia, chose the area of employee benefits because that is where clients said they needed help. This entity was spun off from Keiter, Stephens, Hurst, Gary & Shreaves and is partially owned by partners in the CPA firm.
Moore Stephens Apple, a 40-professional firm in Akron, Ohio, started offering HR consulting because clients often asked for staffing issues assistance
Miller Grossbard in Houston, a 24-person firm, helped a client find a CFO. The firm researched needs by other clients and found a significant opportunity to offer services such as “virtual CFO,” executive recruiting, compensation studies, compensation plan design, organization structuring, equity ownership planning, and contract negotiation.
Wisehart & Wisehart Inc., a two-partner firm in Dublin, Ohio, offers CFO outsourcing. It handles temporary projects like divesting part of a business, liquidating assets, and dealing with new government compliance requirements.
William Pirolli, CPA, of Warwick, Rhode Island, has built a network of alliances. To deal with a partner issue at a law firm, he engaged another CPA firm, DiSanto Priest & Co., which, based on the success of this engagement, set up a separate entity to offer HR services to professional firms.

From Journal of Accountancy, November 2006, http://www.aicpa.org/pubs/jofa/joahome.htm. For the complete article, click on the following link: http://www.aicpa.org/pubs/jofa/nov2006/hayes.htm.