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Technology considerations in an accounting firm merger

Mary Ellen Biery
December 28, 2016
Read Time: 0 min

Aside from the accounting firm’s staff, technology likely represents the area where a firm has made its biggest investments over the years, so it makes sense that technology considerations should be included in discussions about possible mergers or acquisitions.

However, according to industry consultant Jim Boomer of Boomer Consulting, people from a firm’s IT department are too often involved “too little and too late” in deals, if at all. This can result, Boomer has said in a previously published article, in the firm’s IT staff being looped in only when management announces that 50 new people will join the firm next week and need the technology to hit the ground running.

Technology plays into accounting firm mergers and acquisitions a lot more than people give credence, says Philip J. Whitman, CPA, president and CEO of Whitman Business Advisors LLC. “It should never be a deal breaker, but it is critical to explore before going down the aisle and signing anything,” he says. [A replay of Whitman’s webinar hosted by Sageworks, “Lean CPA M&A: Getting to the Finish Line Faster,” can be accessed here.]  

Accounting firms considering the purchase of another firm or seeking a merger partner can be better prepared for post-merger integration and perhaps avoid or reduce unexpected expenses by taking into account several factors related to technology during merger discussions or the due diligence process. Some of these, according to Boomer, Whitman and other experts, include:


Does every desktop in the firm making the acquisition have two monitors while the firm being acquired has only one per desk? What are the minimum standards of memory and processing speed that will be acceptable to the combined firm, and how many work stations will require an upgrade to meet those standards? Does the Storage Area Network (SAN) have sufficient capacity to handle the needs of the firms when combined? How about the servers? In some cases, acquiring a small firm that will require substantial investments in technology to bring it up to par with the acquiring firm can affect the deal price.

Software/Operating systems

How current are the operating systems, standard accounting software and other applications that are being used by the firm being acquired? Does one firm operate in the cloud while the other continues to rely on user-installed software? If so, what does this mean for the ability to work remotely and enhance collaboration after the merger? Does the firm being acquired utilize a solution that can benefit the acquiring firm? Are there licensing issues to resolve for software or certain applications?


What are the differences in crucial security awareness training and how quickly must these be addressed? Will any system changes be required to secure client data more effectively?

Integration timeline

What kind of deadline will be set to have all of the data from the firm being acquired integrated with common software applications, or to have multiple platforms streamlined? Are there obstacles to reaching that deadline that need to be addressed up front? Whitman recalls one deal reached close to busy season where the parties agreed to operate separately through April 15 in order to avoid unexpected technology issues during that time. 


Does one firm have a history of adopting new technology while the other has been resistant to change? What will need to happen for the combined entity to move forward in a productive way? Which staff from each firm can lead efforts? The AICPA in its survey, “CPA Firm Succession Management: Multi-Owner Survey Report,” noticed the largest firms were more likely to be leveraging technology than were those in the smallest category. Planning ahead to ensure “buy in” from all parties may either highlight potential potholes or may prepare for a smooth road transitioning.

Terrence Putney and Joel Sinkin, principals of advisory firm Transition Advisors, have named technology as one of the 10 biggest reasons mergers fail. With technology as with other merger-related issues, they say, “A good understanding of the potential hazards relating to the variables involved and planning for the unexpected can help your firm prepare a better deal structure and business plan.”


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About the Author

Mary Ellen Biery

Senior Strategist & Content Manager
Mary Ellen Biery is Senior Strategist & Content Manager at Abrigo, where she works with advisors and other experts to develop whitepapers, original research, and other resources that help financial institutions drive growth and manage risk. A former equities reporter for Dow Jones Newswires whose work has been published in

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