Time Waits for No Man – or CPA Firm!

In full disclosure, I’m impatient by nature. Always have been always will be. My parents would often council me, either via a soft lecture (my mother) or by an avuncular gesture by my father – a swift crack to the back of the head - about the importance of taking your time about things.

Like the time I broke a basement window with an errant baseball toss and then in my haste incorrectly measured the frame. Later I felt the full brunt of my father’s wrath when he tried to refit a pane that was obviously too large.

I’ve settled down a bit since then, but still, when something drags along far more than it should have, I begin pacing like an expectant father.

The accounting profession is no venue for someone with a patience quotient like mine. If someone assured a CPA that McDonald’s sells hamburgers, he/she would likely have to perform a prolonged due diligence.

And that goes double for M&A.

We have a company axiom regarding the mergers of CPA firms that goes like this: “Time kills all deals.”

There’s no exception to that rule – ever.

Obviously, a merger is not something that you should rush headlong into. For many, it’s the biggest business decision they will make in their lives. But it should not encompass nearly two years as did one of our recent deals, or two other potential ones that extended nearly three years before both collapsing.

There are just too many things that can happen when an affiliation deal becomes protracted and all of them are not good.

First, there will be concerns from either the buyer or the seller that a pending deal is not a priority. Or perhaps fears that the successor firm is so busy how would they handle the integration and added revenue of another firm?

Or the fact that staff may find out about a merger before it’s officially announced setting off a panic and possible exodus.

And as most already know, the 14^th time you read something, you’re bound to notice something you hadn’t in the previous 13. Lastly, if a deal drags along or repeatedly hits roadblocks, you unwittingly may be opening the door to your competition to enter the fray.

By all means, firms should take enough time to ensure they are merging with the right partner and that the terms of the deal are fair to both. But if you have trouble remembering when the negotiation process began then there’s going to be a problem.