Diligence - Buying A Cpa Firm Due

: Analyze accounts receivable aging and collection efficiency. High WIP (Work in Progress) or aged debtors can signal poor billing practices.

: Review 3–5 years of Profit & Loss statements, balance sheets, and tax returns. buying a cpa firm due diligence

The goal is to verify that reported income matches actual cash flows and tax filings. The goal is to verify that reported income

: Break down revenue by service line. Recurring fees (e.g., CAS, monthly bookkeeping) typically command higher valuation multiples than one-time tax prep or lumpy audit fees. : Identify how much revenue is tied personally

: Identify how much revenue is tied personally to the current owner. If the owner is the primary rainmaker, retention risk increases post-sale. 2. Client Base Analysis

In a CPA firm sale, you are essentially buying a book of business; its "stickiness" is paramount.

CPA & Accounting Practice Due Diligence - Poe Group Advisors