An attractive SME and SMSF fee base suited as a tuck in or secondary location.
This accounting firm was established over 20 years ago on the mid Northern Beaches with fees currently circa $820K. Given its longevity, it has many long term clients, and now their children, with its predominate focus on tax returns, financial statements and bookkeeping for small business & SMSFs. The firm’s culture is geared towards high end, attentive service leading to close client relationships. The purchaser will need to be highly experienced and proficient. There is significant growth potential in the areas of business advisory and financial planning amongst the current client base, and currently potential new clients are typically not being accepted at present, despite referrals from existing clients.
The firm’s lodgements equated to 371 in 2022. These consisted of 229 ‘I’ returns or 14% of fees, 6 partnerships, 32 trusts, 43 companies or 55% of revenue, and 30 super funds at 15% of fees. Additionally, there were 28 quarterly BAS equating to 9% of the firm’s revenue and 3 SMSF audits. Corporate secretarial and consulting services are sourced externally to the firm as required, representing an opportunity to bring such requirements back in house. Overall, this represented an average billing of $2,374.
There were 217 client groups serviced in the 2022 FY, representing an average of just over $4K per annum. Some 23% were within the fee ranges of $5K to $10K, a further 19% in the $10K to $30K range and 34% with annual fees greater than $30K. Fees are based on hourly rates as opposed to fixed fees with payment generally upon completion with the exception of the largest client.
The top 20 client groups for the 2022 financial year contributed almost 60% of overall revenue including the largest client at 34% of 2022 fees, although this was abnormally high due to a special project with fees generally more in keeping around $250K. That said, this client continues to expand, requiring greater assistance. Almost half of these groups are located on the Northern Beaches with the balance throughout Sydney and a couple interstate. Two of these groups, whilst based in Sydney, do report to boards internationally. The age of the main contacts within these groups range from their early forties to eighty years of age, albeit 8 of the 20 groups have key contacts aged in their fifties. More broadly, clients are generally within their 40’s to 50’s.
The firm has around 2 FTE professional staff, plus a contractor, and 1.2 FTE support personnel, some of whom will be imperative to the transition. WIP, debtors and write offs are all positive.
The firm runs a virtual server with 7 desktops. Software is MYOB AE tax, MAS, BGL 360 and Simple Ledger whilst clients equally utilising MYOB and Xero.
The firm’s premises is 69 m2 and owned by the principal. Whilst the fee base would be relocatable, the principal believes it would be important to retain the current location in the first instance to assist with a smooth transition. Favourable terms will be offered.
The practitioner is wishing to retire but is available for up to 2 years to assist with the transition, particularly in respect of the larger couple of clients, which will require this time to ease over to the purchaser.
E-mail broking@robknightsbroking.com.au to request a confidentiality agreement or phone (02) 9233 4333.
The completion of a confidentiality agreement is essential prior to the supply of any information.
