This accounting and financial planning firm is located some 40 – 45 kms south west of Brisbane’s CBD with anticipated accounting fees of $3.3 Mill and financial planning revenue of $420K for FY 2023. It is a full service firm offering tax and business services, audit and financial planning to its clients, who are predominately based locally, in the surrounding regions, and more broadly throughout S/E QLD. Broadening the current services offered by the firm and growing the audit division both represent potential opportunities for the purchaser, as does actively marketing the firm, which has historically not been performed.
The firm lodged some 2,300 odd returns in tax year 2022, which contributes just under 73% of annual revenue. These consist of 1,526 ‘I’ returns, 56 partnerships, 226 trusts, 190 companies, 69 super funds and 238 quarterly BAS. There were also 38 statutory audits, as well as 36 SMSF audits, equating to 6.4% of fees for the same period. The firm also offered management advice, bookkeeping, corporate secretarial, as well as other ad hoc services to make up the balance of its annual revenue. Overall, this represented an average billing of $1,154.
There were 496 accounting client groups serviced in the 2022 FY, representing an average of $6,510 per annum. Some 44.5% of annual fees were over $20K, with a further 29.5% within the $5K – $20K fee range. The financial planning division serviced 131 client groups where some 60% of revenue was contributed by annual fees ranging from $3K – $20K, in addition to two further substantial clients at 15% collectively of fees. Fees are mostly charged as a fee for service based on a percentage of FUM with a focus on investment based revenue streams.
Whilst there are a number of long term clients who are aging, in a number of instances, the next generation has taken over the business or is in the process of taking over the business and they remain clients. The top 20 accounting client groups for the 2022 financial year contributed approximately 34% of annual fees, the largest of which equated to around 4.5% of revenue. All but two of these groups are located in Brisbane or S/E QLD and are mostly provided with the breadth of the firm’s services. The average age of the main contact within these groups is 57, the youngest of which is in their mid thirties and the eldest of which is in their mid seventies.
As would be expected, the financial planning services are provided through a separate entity, with around 80% of the clients accepting regular reviews, and a commonality of accounting and financial planning clients in the range of 75% – 80%. FUM was $56 Mill in 2022 FY with a strong predominance of the annual revenue generated through recurring services. The top 20 financial planning client groups contributed some 49% of FY 2022 revenue at an average annual fee of $9,400, whilst these groups represented some 46% of overall FUM at an average of just under $1.3 Mill per group. The largest planning client equated to 8.3% of annual fees or 13% of FUM for FY 2022. The average age of the main contacts within these groups is 68, with a range from mid fifties to early eighties.
As would be expected, the firm’s partners are supported by a range of qualified and administrative personnel. The firm has spent the past couple of years modernising its technology and moving towards cloud based software including Greatsoft, Nowinfinity, Class Super, as well as Xero based programs.
A related party owns the firm’s current premises, which does have some excess capacity, and whilst it’s not imperative the firm remain in this location, this would certainly benefit a purchaser seeking a secondary location.
The practitioners are wishing to reduce their working hours and move to semi retirement over the short term. Two of the equity holders are wishing to move immediately to a part time involvement, with the remaining two available in a full time capacity for 1 – 2 years, before reducing their involvement.
E-mail broking@robknightsbroking.com.au to request a confidentiality agreement or contact Michelle directly on 0413 047 077.
The completion of a confidentiality agreement is essential prior to the supply of any information.
