On Saturday, April 1, it was reported that, while the accounting profession struggles with an ongoing talent shortage, local CPA firm Watts, Taber and Fiske has found a viable option for staying independent: It raised its minimum age for partner retirement from 62 to 85, giving the firm an extra 23 years to search for the right talent to succeed its hard-working senior partners.
Many firms have a minimum retirement age for partners to receive a full buyout, which allows the organization to rely on owners working for decades to maintain continuity of leadership and client relationships. Changing this practice offers a new approach other firms can consider if they don’t have any successors in the wings.
While hoping to maintain their original age of 62, so that retiring partners could pass the torch to a promised line of up-and-coming CPAs, WTF realized that the pipeline was less than empty and they needed a new strategy.
“We thought we’d be able to promote Kayleigh and Brian, but it turns out they’ve decided they just want to work 45 hours a week while they raise their children. And that’s obviously inconsistent with the expectations of an equity partner,” said managing partner Bill Billings.
On paper, WTF had been doing everything right for succession planning: They had three senior partners and four newer partners, but firm growth resulted in the newer partners quickly having full books of business. This meant they were unable to take on significant amounts of the retiring partners’ practices (some of which they didn’t want anyway, according to sources familiar with the matter).
WTF recently turned to other tactics to attract and retain senior associates and managers to build their pipeline, including:
- Giving annual raises of 5% across the board, and 10% for the superstars they “can’t afford to lose.”
- Offering flexible work arrangements such as no mandatory Saturdays as long as at least 65 hours were worked between Sunday and Friday.
- Dual monitors.
Competitor firm Yates, Abrams + Yang also has experimented with recruiting and retention tactics, which WTF regarded as too extreme, such as:
- Capping busy season weekly hours at 55.
- Hiring full-time employees who live in a different state.
- Triple monitors.
“There was no way we could see a net benefit in trying these unproven practices,” Billings noted. The obvious answer, then, was to lean on the stalwarts of their organization and keep their partners busy for a while longer.
Founding partner Tom Fiske felt the most ambivalent about the initiative: “I was hoping to spend more time with my grandkids, but client service has been a lifetime priority, and I don’t want to let my clients down.”
Dick Watts, whose productivity and technology skills have been steadily declining since 2005, noted, “I don’t really have any hobbies anyway, so it’s OK with me.”
Harry Taber, who retired a few years earlier, added, “As long as they can keep paying my buyout, this is a definite win,” as he headed out the door for his 9:30 pickleball match.
This post was written in celebration of April Fool’s Day.