Is Your Accounting Practice Worth More Than You Think?

When I sit down with an accountant considering the sale of their firm, the first question is almost always:
“How much is my practice worth?”

It’s no surprise — they’re numbers people. And lately, my answer is often:
“More than it was a couple of years ago. In fact, maybe twice as much.”

Why Are Accounting Firms Worth More Today?

There are a couple of key reasons for this increase in valuation. The biggest? Technology.
Savvy firm owners have embraced modern tools and transformed how they operate. As a result, their practices have become more efficient, more scalable, and significantly more profitable.

I actually use a formula that factors in a firm's level of modernization. Accounting practices that have:

• Remote staff

• Minimal or no physical office space

• Offshore support

• Client portals

• Workflow automation

• Advisory service offerings

…are receiving offers up to 2x gross annual revenue.

Meanwhile, practices that still rely on physical offices and paper processes — and primarily handle annual tax filings — are lucky to receive 1.0–1.25x gross revenue.

Modernization doesn’t just boost profit margins. It also makes firms more appealing to both strategic buyers and private equity groups, who are eager to invest in scalable, future-ready firms.

Why It’s a Seller’s Market

Right now, there are more buyers than sellers in the market for accounting practices. This imbalance is driving up demand and valuations.

But many accountants — being naturally risk-averse — are hesitant to move forward. Some are waiting for the outcome of the national election, concerned about future tax policies that could impact their net proceeds.

And it’s true: the political party in charge post-November 5th could significantly affect:

• Income tax rates (which influence how much of the sale proceeds you keep)

• Capital gains rates (something every accountant pays close attention to)

But Timing Is Everything

Here’s the catch: once the election ends, tax season begins — and that’s no time to focus on selling a business.

I anticipate a flood of accounting practices hitting the market next summer. And when supply rises, values often dip. So if you’re thinking about selling in 2025, don’t be surprised if your practice’s value isn’t quite as high as it could be today.

How to Boost Your Firm’s Value Right Now

When I provide a Broker's Opinion of Value, I also recommend quick wins that can significantly increase a firm’s market value in the short term.

One of the easiest, most impactful upgrades?
👉 Invest in a virtual client portal to streamline communication and document management. It saves time, reduces administrative workload, and impresses buyers.

Another overlooked area? Standard Operating Procedures (SOPs).
Many firms lack written SOPs. While the owner may know every workflow by heart, staff often execute tasks inconsistently. Documented SOPs:

• Simplify onboarding

• Allow for delegation and remote staffing

• Reduce micromanagement

• Enhance the firm’s transferability

These improvements not only make your business easier to manage — they also make it more attractive to buyers.

Ready to Discover Your Practice’s True Value?

Whether you’re looking to sell now, in a few years, or just want to understand your net worth, I offer a complimentary and confidential valuation opinion for accounting firm owners.

Because no matter where you are in your business lifecycle, it’s always smart to know how your practice contributes to your personal wealth.