Survey Says....

• Author: Murray, Christopher J.

The AICPA Private Companies

Practice Section (PCPS) conducts the National MAP Survey--the profession's largest benchmarking survey--every two years. The most recent survey, based upon 2017 firm information, was completed last summer and results released in November. Firms that submitted information can access their results at aicpapcpsmapsurvey.com.

The power of the survey is dependent upon the number of firms that participate. For the last survey cycle, nearly 2,000 firms nationwide submitted data. California, with 200 firms, had the largest participation by any state.

Survey results are grouped into seven gross income levels ranging from less than $200.000 to more than $10 million, with the greatest number of firms--19.2 percent--in the $1.5 million-S5 million level. For the 200 California firms, 87 percent were in bands with $1.5 million or less in income.

The survey's executive summary (aicpa.org/content/dam/aicpa/interestareas/privatecompaniespracticesection/financialadminoperalions/nalionalmapsurvcy/downloadabledocuments/2018-national-map-survey-executive-summary.pdf) listed the following top five takeaways, as compared to the previous survey's results:

* Finns in all revenue bands reported growth. And the median growth rate is 4.2 percent.

* Firms of all sizes are increasing the use of value pricing, value billing and fixed pricing.

* Billing rates increased an average of less than 1 percent.

* Firms report an overall average annual base salary increase for all staff of 3.6 percent.

* Turnover, a long-time challenge for the profession, is mostly down.

While the above generally represents good news, there were some troubling results. For example, despite growth in the profession, the median new income per partner or owner decreased 2.9 percent from the prior survey.

While the cause of this decrease is not clear, the downward pressure of fees in certain service areas, along with escalating costs for talent and premises are contributing factors.

The full report provides significant information, including: * Make up of service lines;

* Net client fees by partner;

* Net client fees by professional;

* Staffing levels by title;

* Average billing rates by title;

* Average chargeable hours by title;

* Cyberliability and security; and

* Checklist and practice aids to use the data. Benchmarking is a helpful tool to manage the growth and success of your firm. It is important to understand the methodology and definitions of the collected...