When you say “I do? (problems facing those employees of UK accounting firms who are considering entering into partnerships)
Article Type: Abstracts From: Strategic Direction, Volume 27, Issue 7
Murray C. and Foster S.Accountancy, January 2011, Vol. 147 No. 1409, Start page: 79, No. of pages: 2
Discusses some of the problems facing employees of UK accounting firms, that are considering entering into partnerships where practices and partners have faced difficult times in the past two years, and many will have encountered awkward situations that have placed unrelenting strain on their practices, as well as their future career prospects. Presents some key issues that they need to familiarize themselves with, in order that they are better placed to deal with the challenges facing the modern-day accountancy partner in the uncertain economic times, focusing particularly on due diligence for lateral-hire partners where partners will often not be afforded the opportunity to review the partnership agreement before accepting partnership with a new firm, but where a partner should understand, as far as possible, their potential exposures and liabilities before signing up. Considers the following before accepting a lateral-hire move: ask for and review a copy of the partnership or members’agreement; request a copy of the accounts for each of the past few years, and details of the financials for the current year and performance against any budgeted figures; understand the profit-share structure; be aware of the extent of potential exposure to liabilities; determine how much capital is being asked to contribute; and how are key strategic decisions of the firm taken generally. Concludes that, while partnership brings with it benefits, it also brings potentially onerous liabilities and obligations such that, while economic stability remains uncertain, it is more important than ever that partners are fully informed on their potential rights and exposures.Article type:ViewpointISSN: 0001-4664Reference: 40AE262
Keywords: Accountancy law, Accountants, Accounting industry,Partnering, United Kingdom
