You Don’t Always Get What You Pay For

In our line of work, we get asked about value and valuations on a daily basis. It’s only natural CPA firm owners who have worked most of their adult lives to build up a profitable practice and are now ready to take a step back want to know what they can expect to be paid for their years of sweat equity. 

The answer unfortunately isn’t always so simple – there are multiple factors that go into determining a fair valuation for a firm. It’s not a basic asset sale or service where you pay a set price and in return acquire a business or sign up for cable.

I realize this is a bit far afield from accounting, but I wanted to regale you with a value-oriented vignette regarding my local newspaper.

In full disclosure I’m a print newspaper junkie. I read two papers religiously with my morning coffee- my local paper and one of the New York-based tabloids. The newspaper closer to home keeps me up to date on what’s happening in terms of news, taxes, culture and education within my zip and area codes. But like many print businesses, it’s suffered at the hands of digital publishing in terms of readers and revenue.

First, they eliminated the daily op-ed column, then integrated the paper with sections of USA Today. The news “hole” – usually the first section of any paper – is aggregated with at least half the content from the Associated Press or other wire services. Since we’re in baseball season, the paper has not one “beat” writer covering the Yankees or the Mets, going instead with game coverage from one of their parent company’s affiliate holdings.

A sad statement on the future of print journalism – at least on a local level - to be sure.

But here’s the rub. Or multiple rubs known colloquially as a “bait and switch.”

The subscription department has now on three occasions tried to blindside me in terms of raising the price. One month I suddenly received an invoice for $15 a month more than I had paid previously. When I called to complain we settled on an increase of $7.50. Mind you this was for less content and certainly less deliverables.

Two months later, my bill called for a $10 hike. Again, I called to complain and after a heated back and forth settled on receiving the paper just Thursday through Sunday.

Not satisfied, this month my bill was again raised $12. That was it. I called and cancelled my subscription after 20 years. I was not going to be a loyal and not to mention – paying – customer to a vehicle with the demonstrated honesty of a carnival barker.

Valuing an accounting firm may at times be somewhat vague, subscribing to a daily newspaper should not be.