Valuing an accounting practice comes down to a handful of methods, each answering a slightly different question. Knowing which one a buyer will use matters as much as the figure itself.
Multiple of recurring fees
The most common starting point, and the least precise. It says nothing about client concentration, staff stability or how much of the work depends on the owner personally, which is exactly where the discount usually comes from.
Profitability-based methods
Working from adjusted operating profit gives a more honest picture, provided the owner’s own remuneration is restated at market rate. Skip that step and the result is meaningless.
What actually moves the number
Client retention, the share of fees tied to one or two accounts, the average age of the portfolio, and whether the team stays after the sale. These are decided years before the transaction, not during it.
