The World According to Marc: Latest Rosenberg Survey

Source: CPA Trendlines

The following includes excerpts, reproduced with permission, from a blog entry in CPA Trendlines.

Revenues at the typical CPA firm are up 1.7 percent, a slight improvement from the 1.4 percent increase in the year before, according to the 2011 Rosenberg MAP Survey.

Still, when the impact of mergers is taken out, the growth rate was only 0.8 percent. The Rosenberg MAP survey, founded 13 years ago by nationally known practice consultant Marc Rosenberg, reports on the results of 408 firms, most of which range from $2 million to $20 million in annual fees. Nearly 100 metrics are collected and compared.

Though the revenue increase is small, the authors say it's noteworthy because – for the first time in two years – the growth rate increased from the prior year instead of decreasing. “The bleeding has stopped,” they say.

Revenues are up for firms in all size ranges in this year's report, though larger firms booked 4.6 percent growth rates.

“Overall, we saw a trend that many firms are reinvesting in the future,” say the authors. “Firms are spending the extra time and money in marketing and business development. In addition, many are considering or are in the process of mergers and acquisitions as partners are nearing retirement age.”

Profits, as measured by income per partner, average $360,000 compared to the year-before $354,000. Faced with flat growth, firms have cut salaries and overhead in order to generate “a modest improvement” in profits.

Projections for 2011 show a significant improvement over 2010. Overall, firms are projecting a 3.5 percent growth rate, the highest since 2008.

The percentage of partners over age 50 broke the 60 percent barrier for the first time ever, finishing at 61 percent – the key factor behind mergers and acquisitions.

For the complete article, read “Rosenberg Survey 2011: CPA Firms on Rebound.”

From CPA Trendlines, http://cpatrendlines.com, October 4, 2011.