Albuquerque Firms Combine

Pulakos CPAs (FY16 net revenue of 4.4 million) of Albuquerque, N.M. and Satter & Hiller of Albuquerque announced their combination effective Aug. 1. Both firms specialize in tax, audit and comprehensive business advisory services.

Russ Hiller, who has more than 20 years of experience in both public accounting and private industry, joins Pulakos as a shareholder and officer. Satter & Hiller founder, Dick Satter, joins the Pulakos team along with the firm’s staff.

“This combination will benefit the clients, employees and strategic partners of both firms. Our mutual goals for outstanding client focused professional service and improving New Mexico’s competitive position in the national/international business community will also be enhanced through this combination of professional resources and business talent,” says Brad Steward, Pulakos CPAs leading partner.

Pulakos CPAs clients include individuals, businesses and community organizations throughout the state of New Mexico.

INPACT North America Welcomes Safe Harbor

INPACT North America announced that Safe Harbor of San Francisco, has become a member firm. The firm works closely with clients to streamline their financial and accounting processes and provide full service audit and tax services. The firm also has expertise in international tax issues, particularly in China and India.

A new area of specialty is assisting start-up businesses to correctly set up financial and tax systems and explore stock option and tax planning opportunities.

INPACT continues to steadily grow its global reach adding new members from Japan, Nigeria, Sweden, Germany, Norway, Morocco, Belgium, Chile and Israel. INPACT now has more than 145 members in nearly 70 countries.

Martini Iosue & Akpovi Names Passmore as New MP

Christopher Passmore

Christopher Passmore

After serving in the position of MP for 25 years and helping grow the firm to 50 people, Don Iosue and the management team at Martini Iosue & Akpovi (FY16 net revenue of $9.2 million) of Encino, Calif., have named Christopher Passmore as the new MP and audit and consulting partner.

“Don has done an outstanding job during his tenure. He set the standard for excellence and integrity and created a firm culture of dedication and service to staff and clients. We owe a debt of gratitude to Don for a job well done,” says Passmore.

“Chris has been with the firm for a decade, and in that time he’s developed the unique skill set that is required for this position. It is a combination of strategic thinking and management skills, and you can’t be a successful leader without each one,” says Steve Martini, one of the founding partners. “Chris brings to the role the new generation’s ability to incorporate cutting-edge technology coupled with strategic thinking. This will ensure the firm maintains its commitment to client service and support its future expansion including satellite offices throughout Southern California.”

Zacks Investment Research Upgrades CBIZ to “Strong-Buy”

Cleveland-based CBIZ (FY16 net revenue of $661 million) was upgraded by Zacks Investment Research from a “hold” rating to a “strong-buy” rating. The firm currently has a $17 target price on the business services provider’s stock. Zacks Investment Research’s price objective points to a potential upside of 14.48% from the stock’s current price.

CBIZ last announced its quarterly earnings results on Aug. 3, reporting $0.20 earnings per share for the quarter, topping analysts’ consensus estimates of $0.18 by $0.02. The company had revenue of $211 million for the quarter, compared to analysts’ expectations of $207.42 million. CBIZ had a net margin of 5.54% and a return on equity of 9.59%. The business’s quarterly revenue was up 7.1% compared to the same quarter last year.

Institutional investors have recently made changes to their positions in the company.

  • First Manhattan Co. boosted its position in shares of CBIZ by 4.2% in the first quarter, now owning 2,884,455 shares of stock worth $32.3 million.
  • P2 Capital Partners LLC upped its position in shares of CBIZ by 67.6% in the first quarter. They now own 2,361,073 shares of stock worth $32 million.
  • Vanguard Group Inc. boosted its stake in CBIZ by 6.9% in the first quarter. They now own 2,194,818 shares stock valued at $29.74 million.
  • State Street Corp boosted its stake in CBIZ by 12.0% in the fourth quarter. Now owning 896,848 shares of the business services provider’s stock valued at $12.3 million.
  • Norges Bank bought a new stake in CBIZ during the fourth quarter valued at approximately $10 million.
  • 84.97% of the stock is currently owned by institutional investors.

Eide Bailly Marks its 100th Year

Eide Bailly, born in 1917 in Fargo, N.D., is celebrating its 100th year in the same way that it has always operated, with team members enjoying their work and their colleagues.

“We’re not a stodgy 100-year old firm,” says MP and CEO Dave Stende. “We’re innovative, we offer a great learning environment and we have a lot of fun.” During the busy tax season, fun needs to be injected into the day to lighten the mood and sometimes a wacky costume does the trick. Staff members have been known to dress as Star Wars characters or movie stars from the 1980s. “It’s amazing how over the top some of them get,” Stende says.

Eide Bailly, which started with pencils and paper as its most advanced tools, is now one of the largest firms in the nation, with $269.4 million in revenues for FY17, 29 offices in 13 states and 1,700 staff members.

The story began when Bishop Brissman & Co. CPAs of Minneapolis and St. Paul, Minn., opened a Fargo office. Eide Helmeke & Co., one of the two primary lines of heritage of Eide Bailly, eventually came into being from that Fargo birthplace. That name stayed in place until 1998 when the fim joined with Charles Bailly & Co. and assumed the Eide Bailly name. At that point the firm boasted $31 million in revenue and 56 partners. Growth really took off in the early 2000s, with new locations in Idaho and Oklahoma, then Minnesota, then Colorado and then Utah by 2012. Growth has continued unabated, and Stende is eyeing other areas in the West for further expansion.

Maintaining the firm’s team-oriented, fun culture across so many offices and states is one of the main considerations when Eide Bailly is looking to acquire other firms to continue its impressive growth. Stende says ‘are they a good fit,’ and ‘are we starting with a good group of people,’ are central questions in the merger process.

Technological tools keep team members connected, Stende says, and the firm gathers members together for various training events. While firm locations are vastly different – think of Phoenix versus Des Moines, Iowa, versus Norman, Okla., versus Mankato, Minn. – Stende says he strongly believes the firm reflects one culture with 29 different personalities.

Stende, who’s been with the firm for 35 years, says his mentors, who had been with the firm for more than 20 years when he was a young accountant, are responsible for the culture the firm enjoys today. He foresees technology continuing to change the profession profoundly, as artificial intelligence and other advancements promise to transform firms dramatically within five years.

“You must be doing a lot of things right to stay in business for 100 years,” Stende says. “For our next century, we’ll keep building on the culture we have to remain successful.”

BKR Welcomes Disanto Priest as New Member

BKR International announced the acceptance of Warwick, R.I.-based DiSanto Priest & Co. into membership.

Established in 1963, DiSanto Priest & Co. provides an array of accounting, audit, tax, management and other professional services. With 11 partners and a staff of 48, the firm specializes in real estate, wholesale distribution, manufacturing, professional services, and housing and urban development.

Nathan Wechsler & Company Promotes Greenwood to Principal

Julie Greenwood

Julie Greenwood

Concord, N.H.-based Nathan Wechsler & Company PA announced the promotion of Julie Greenwood to principal.

“Julie is a key part of our leadership team and deserving of this promotion,” says Oreste Mosca, managing director of Nathan Wechsler & Company. “She worked hard to gain the experience and depth of knowledge needed for this role and I look forward to the firm’s success as a result of her contributions as principal.”

A member of Nathan Wechsler & Company since 1999, Greenwood currently provides clients with tax and technology services, and also oversees the firm’s Keene, N.H., office location.

Nathan Wechsler & Company is a full-service accounting and tax firm with more than 40 professionals offering a broad range of services. In addition to traditional tax and accounting engagements, the firm serves clients with business valuation services, management consulting and employee benefit plan audits. The firm sustains industry-specific expertise in construction and real estate companies, non-profit entities including independent schools and manufacturers, and wholesale distribution firms.

KPMG, New York Stock Exchange Join Forces to Offer Roadmap for Entrepreneurs

New York-based KPMG LLP (FY16 gross revenue of $8.6 billion) has collaborated with the New York Stock Exchange and others to create, “The Entrepreneur’s Roadmap: From Concept to IPO” to help inspire and empower entrepreneurs through each stage of their journey. It addresses concerns such as global expansion into high growth markets, potential tax implications when selling your business and SEC requirements when preparing for an IPO.

“Developing a business from the startup stage is filled with challenges and securing the funding to catalyze that growth is tough without a strong value proposition,” says Brian Hughes, national PIC of private markets group and national venture capital co-leader for KPMG. “This roadmap seeks to guide company leaders at each stage of their life cycle with critical insights to help foster growth.”

“In the first half of the year, global deal-making activity has been strong and, for companies that are considering a divestiture or whole company sale, they need to properly position themselves in the marketplace,” says Phil Isom, global head of mergers and acquisitions and head of U.S. corporate finance and restructuring for KPMG. “In order to aid company leaders in positioning their enterprise for sale and maximize value, they will learn about the steps they should consider when an acquirer approaches them or when they are soliciting interest in their business.”

“As recent volatile markets have shown, companies need to have the flexibility to file an IPO when the best market conditions are present,” says Aamir Husain, national IPO readiness leader for KPMG. “The roadmap helps to prepare companies going public by addressing key issues to be resolved early, especially those that involve complex accounting rules, to allow a company to file at the most opportune moment.”

Topics explored by KPMG include:

  • Going Global in High Growth Markets
  • Getting your Pre-IPO Accounting House in Order
  • 409A Valuations and other Complex Equity Compensation Issues
  • Exiting the Business: What are the Tax Implications

Comparing Law and Accounting Firms in Terms of Innovation

In an article by Lawyers Weekly, Campbell Jackson, EY Australia’s national professional services leader, shares his view on law’s growth agenda, comparing it to the accounting profession.

“Innovation to me is doing more with less,” says Jackson. “The challenges come down to revenue growth and competitiveness. The firms have to ask themselves ‘How do we remain relevant? How do we optimize costing structure? How do we deal with disruption? How do we utilize technology and how do we get the best out of it for our workforce?’ “

According to Jackson, there are law firms on both ends of the innovation spectrum. Some are moving forward, but others remain stagnant. What he is most adamant about it is that the firms that do not change will not survive. Firms must shift with their clients’ expectations and in his view, the next five years will be the indicator of which firms have done so.

Jackson commented that accounting firms have shown more willingness to diversify their traditional revenue streams than law firms, but even those who do, have innovated much more conservatively. He suggested that in some cases this may be attributed to the fear of being viewed as a ‘hobbyist’ rather than a ‘specialist’.

“I do have a saying that I think is critical to professional services: fail quickly and fail cheaply. Failing’s okay. Just make sure it’s cheap, and just keep trying because eventually you’ll get it right,” says Jackson.

He offers the traditional, segmented way that most law firms bill as an example of the kind of aversion that law firms show to diversifying their revenue streams. Packaging legal services according to practice areas may have been a useful and effective way to deliver a service offering to clients, but today’s clients expect more holistic attention.

Jackson believes that accounting firms have been more progressive and have “extended the tentacles into other areas by moving from compliance to advisory services.”

He said that law firm partnerships should consider how diversification could introduce new channels of business and the benefit of being able to portray the firm as a ‘one stop shop’.

“If there is client demand, the ability to implement and execute is going to be profitable, which will be a good thing. It makes sense if it is profitable and there is client demand,” says Jackson. “If you don’t innovate, you’re dead in this environment. You’ll go backwards.”

BDO Partners with AI Firm MindBridge for Audit

Chicago-based BDO USA LLP (FY17 net revenue of $1.4 billion) and MindBridge Analytics Inc. have formed a strategic relationship augmenting BDO’s existing data analytics and global forensics capabilities through MindBridge’s artificial intelligence platform.

MindBridge’s AI technology enables organizations to analyze various types of transactions and detect anomalous patterns of activity.

“The MindBridge AI auditor enables our team to pinpoint unusual transactions and enhances the thoroughness and precision of our analytics,” says Kirstie Tiernan, managing director in BDO’s technology and business transformation services practice. “Investigations that have historically involved months of combing through millions of transaction samples are now much more comprehensive – yet more narrowly focused – and can be concentrated in just hours.”

“Our relationship with MindBridge is a continuation of BDO’s commitment to helping our clients cost-effectively mitigate their risk of financial loss and reduce corporate liability in a time when data volumes are exploding,” says Stephanie Giammarco, BDO partner and head of the technology and business transformation services practice. “By leveraging the intelligence derived from the platform, we are able to accelerate findings and ultimately, case resolution, resulting in significant cost savings for clients.”