New York (Dec. 17 , 2010) — In a tough economic environment over the past two years, a majority of CPA firms reported being able to maintain their profitability. The results were part of the 2010 National Management of Accounting Practice benchmarking survey conducted by the American Institute of Certified Public Accountants and the Texas Society of Certified Public Accountants.
“CPA firms really sharpened their pencils and carefully managed their expenses,” said James C. Metzler, AICPA vice president - small firm interests. “So while revenues were flat, CPA firms still came out ahead on profits.”
Eighty percent of the CPA firms surveyed reported either a decline in revenue, no growth or modest growth over the two years from May 2008 through June 2010, indicating “flat is the new up,” Metzler said.
“Firms are making partners more accountable for the revenue and the bottom line. It’s showing up in the survey statistics. We are seeing leaner, meaner accounting firms,” Metzler said.
“The next challenge for CPA firms will be how to maintain or increase that profitability,” noted Metzler. “Firms have managed expenses so closely the past two years that bottom line growth will have to come from new lines of service such as cloud computing and higher-value consulting and advice.”
The National Management of Accounting Practice survey is conducted every two years by the AICPA’s Private Companies Practice Section and the Texas Society of CPAs. It is sponsored by Aon Insurance Services. The Private Companies Practice Section is a community of AICPA firms committed to making CPAs and their firms more successful through education and advocacy. It draws on the strength of more than 6,900 local and regional CPA firms and includes more than 83,000 CPAs from across the United States.
“The National MAP survey provides the most comprehensive benchmarking resource in our profession,” said Metzler. “It represents data from the smallest to the largest firms and gives CPAs a way to measure themselves against peers across geographical regions.”
More than 2,900 CPA firms participated in the comprehensive survey to provide national averages and meaningful benchmark data in billing rates, expenses, revenue, realization, service offerings, staffing, marketing and benefits. The data is delineated by region and firm size to allowing CPAs to evaluate their management decisions and financial results such as revenue per partner, revenue per employee, and other key measurements, against comparable firms.
PCPS firms may download the 2010 National MAP Survey results report for free as a member benefit via the PCPS web site. AICPA members may purchase the report for $200; the general public may purchase it for $300.
For further information, please visit www.aicpa.org/pcps.
Support of 44 state societies and the Association for Accounting Administration ensured a strong response that allows each state society to obtain a comprehensive report of state and local results. In the last national biennial MAP survey, conducted in 2008, more than 2,700 firms had participated.