The enduring appeal of CPA-to-CPA M&A

The accounting profession continues to consolidate at an accelerating pace. While private equity has attracted significant attention in recent years, many transactions still occur quietly between CPA firms themselves. These deals are often driven by long-term alignment, continuity and professional fit. Understanding why these transactions occur requires examining motivations on both sides of the table. Over the course of my career — as the head of corporate development at Sikich and as a sell-side investment banker with over 18 years of experience – I’ve had the opportunity to do just that.

Why CPA firms buy other CPA firms

Established CPA firms pursue acquisitions as a strategic growth tool rather than a financial engineering exercise. Several factors make peer acquisitions particularly compelling. At Sikich, I’ve reviewed hundreds of potential acquisitions — many of them CPA firms — and overseen dozens of completed acquisitions. I’ve also spoken to numerous firms that have acquired CPA practices. The following are the most common motivations.

Talent acquisition in a constrained labor market

The profession continues to face persistent talent shortages. Acquiring another firm provides immediate access to experienced professionals, managers, and future leaders. This is often more effective than traditional recruiting. These teams arrive trained, credentialed and client‑ready.

Geographic expansion with local credibility

Acquisitions allow firms to enter new markets with an established client base and community presence. Rather than building from scratch, acquirers gain local relationships, brand recognition, and referral networks that can take years to develop organically.

Service line and industry specialization

Many acquisitions are driven by capability gaps rather than pure scale. Buyers seek niche expertise, such as audit, tax specialization, advisory services, or industry verticals, that can be leveraged across the broader firm.

Scale and operating leverage

Larger platforms benefit from spreading investments in technology, compliance, marketing, and administration across a broader revenue base. Scale also enhances competitiveness against national firms and private equity‑backed platforms.

Why CPA firms sell to other CPA firms

For buyers, understanding seller motivation is critical and has always been a primary topic in my initial conversations with CPA firms seeking to sell. 

For sellers, the decision to transact with another CPA firm is often rooted in continuity and long‑term outcomes rather than maximizing near‑term proceeds.

Succession and leadership continuity

Many firms face aging partner groups with limited internal successors. Selling to another CPA firm provides a clear path for leadership transition while maintaining professional stewardship of the practice.

Client retention and service continuity

Clients tend to respond more favorably to a transition into another CPA‑led organization. Similar service models, standards, and client philosophies reduce disruption and increase the likelihood of long‑term retention.

Cultural and professional alignment

CPA firms value shared ethics, independence, and long‑term client relationships. Selling to another CPA-led firm often feels like a continuation of the firm’s legacy rather than a fundamental change in direction.

Practical deal structures

CPA‑to‑CPA transactions commonly rely on familiar structures, such as deferred compensation, earn‑outs tied to client retention, and phased partner retirements. These structures often feel more intuitive and achievable for sellers than institutional deal models.

Advantages of CPA‑to‑CPA transactions

When executed well, peer transactions offer several inherent advantages:

• Lower integration risk due to similar operating models
• Stronger client retention outcomes
• Easier alignment on quality, independence, and risk management
• Long‑term strategic focus rather than near‑term exit pressure

These benefits often outweigh incremental valuation differences when compared to alternative buyers.

Risks and issues to consider

Despite their advantages, CPA‑to‑CPA deals are not without risk. Firms on both sides of the transaction must carefully evaluate potential challenges.

Cultural and governance integration

Differences in underlying vales, compensation models, decision‑making authority, and partner expectations can create friction. The importance of cultural alignment cannot be overstated – particularly in financial services, where the primary assets are the people. A poor cultural fit will almost always lead to poor morale and attrition. Sikich has declined to buy other CPA firms when the cultures did not align. Usually, a decision not to come together due to a poor cultural fit is mutual.

Client transition risk

Client relationships are personal. Poor communication, pricing changes, or service model shifts can erode trust and impact retention. This is particularly true in cases where partners of the acquired firm use the transaction to retire without a structured client transition. Experienced buyers plan proactively by identifying key employees with client relationships and working with them on a smooth hand-off.

Financial strain and deal economics

Deferred payments and retirement obligations can pressure cash flow, particularly if integration takes longer than expected or client attrition exceeds assumptions.

Operational and technology challenges

Differences in practice management systems, audit platforms, and workflows can temporarily reduce productivity. Integration is often more complex, expensive and time consuming than expected, especially when transactions close during peak periods (e.g., tax season).

Regulatory and independence considerations

Licensing, ownership structures, and independence requirements must be carefully managed, particularly for firms with audit practices or regulated clients.

Choosing the right advisory partner

Advisors with deep industry experience can play an essential role in evaluating options, structuring practical deals, and navigating integration. At Sikich, we understand CPA firm transactions from both sides of the table and help companies evaluate strategic alternatives aligned with their long‑term goals. Our investment banking and corporate development teams are available to discuss your goals.