Selling an Auditing Business
This structure comes from hundreds of real buyer-seller diligence conversations we've helped happen on Rejigg. In auditing and CPA firm deals, price usually moves on client retention through the next cycle, reviewer and signer coverage, and whether WIP (Work in Progress) and realization match what the firm actually collects.
What buyers ask and how to be ready
Each topic below comes from real buyer-seller conversations. Here's what they ask, what they're really evaluating, and how to prepare.
Client retention
What’s the real client run-off after a partner exits?
Buyers are underwriting whether revenue survives the next renewal moment, usually the next filing season or audit cycle. They’ll trust what happened during past partner transitions more than anything a CRM says. If you can’t show a clean handoff track record, most buyers assume higher churn and build it into price and terms.
How to prepare
- List the last 3–5 client handoffs and show what percentage stayed 6–12 months later
- Break retention out by service line and note the most common reasons clients left
- Build a top-client coverage map with the day-to-day lead, backup contact, and reviewer for each account
Great Answer
We’ve had four real partner handoffs in the last three years. After 12 months, 92% of that revenue was still with the firm, and the two losses were clients that sold and moved to a national firm. For our top 25 clients today, every one has a day-to-day manager and a separate reviewer, and we can show names plus last-touch notes.
Okay
We don’t have formal retention reporting, but past transitions went smoothly and most clients stayed. Managers handle most communication on the bigger accounts.
Gives Pause
We’ve never tracked run-off. Clients like me, so I don’t think it’ll be an issue.
How Rejigg helps: Rejigg lets you share your client coverage map and transition plan under NDA, so buyers can price retention risk off evidence, not guesses. Learn more in the guide
Signer capacity
Do you have enough credentialed signers for what you sell?
For audit and attest work, signer and final-review capacity is both an operational ceiling and a compliance risk. Buyers want to see who can sign, who can do the technical final review, and how much work is still sitting on the seller’s desk. Thin coverage usually leads to longer seller commitments, retention bonuses, or more conservative deal terms.
How to prepare
- List who signs what today and what each person’s busy-season load looks like
- Write a post-close coverage plan with realistic timing and compensation ranges for promotions or hires
- Summarize peer review results and your quality-control steps that tie to sign-off
Great Answer
We have two partners who sign assurance work today, and one senior manager already does second-review on about 60% of files. I will stay through one full audit cycle, and we have a written plan to transition final review on smaller engagements to the senior manager by Q3. Peer review is clean, and our QC checklist is used on every engagement before issuance.
Okay
We have enough signers today, but it’s mostly concentrated with me. I expect to stay involved for a while after close.
Gives Pause
I’m the only one who can sign and review. We’ll figure the rest out after closing.
How Rejigg helps: Rejigg’s data room keeps licensing, QC, and peer review documents organized with permission controls, so signer coverage is clear without email attachments. Learn more in the guide
WIP discipline
Walk me through WIP and write-offs—what’s normal here?
WIP is where a firm can look profitable while margins are quietly slipping. Buyers look for whether WIP converts to invoices on a predictable cadence, or whether old WIP and late write-downs are masking under-scoped work. They also want to see that you understand your own WIP, because surprises tend to show up right after close.
How to prepare
- Pull a WIP aging snapshot and define what your firm considers “old” WIP
- Show write-offs by month and explain who approves write-downs and why
- Document the billing workflow by service line, including who can delay invoices
Great Answer
We review WIP every two weeks. Anything older than 45 days gets an owner and a next step, and we can show the last six review notes. Write-offs do spike after deadlines, but they’re concentrated in a small set of under-scoped cleanup jobs. We changed onboarding requirements and pricing over the last two seasons, and the write-down rate has come down.
Okay
We look at WIP monthly and clean it up after busy season. Write-offs happen, but they’re not extreme.
Gives Pause
WIP is whatever is in the system. We don’t really know until we bill, and we sort it out later.
How Rejigg helps: Rejigg’s secure data room lets you share WIP aging, billing workflow, and write-down patterns early, so diligence stays tight and factual. Learn more in the guide
Realization
What’s your realization story—and is it getting better or worse?
Realization tells a buyer whether your billed fees keep up with the hours your team burns. Buyers want the trend by service line and by level, because one recurring issue like scope creep, bad client records, or weak budgeting can eat the whole profit. They’ll also test whether improvements come from a repeatable process or one partner pushing hard for a season.
How to prepare
- Share realization trends by service line for at least the last two cycles
- Explain your write-down rules and who can approve overruns
- Show how you handle scope changes and fee increases before the work is delivered
Great Answer
Realization dipped in advisory last year because we weren’t scoping add-ons tightly, and we can point to the specific projects. We tightened estimates and required a documented scope change before doing extra work, and the last two quarters improved about 8 points in that line. Audit realization has been steady because managers own budgets and partners step in mainly for technical escalations.
Okay
We’re generally in a normal range, and we’ve been trying to tighten scope. We can pull reports if you want.
Gives Pause
We don’t really track realization. We try to keep clients happy and bill what feels fair.
How Rejigg helps: Rejigg keeps buyer requests structured so everyone reviews the same realization views and narrative, instead of you rebuilding reports for each buyer. Learn more in the guide
Owner dependence
What portion of revenue is contingent on you personally being in the room?
In many audit and CPA firms, the selling partner becomes the default escalation path for technical calls, deadline triage, and sensitive client conversations. Buyers want to see whether clients rely on the firm’s team or on you personally, and what capacity gap shows up when you step back. High owner dependence is workable, but it usually changes transition length and deal structure.
How to prepare
- Create a client touch calendar that shows who runs planning calls and who handles escalations
- Introduce a second face on top accounts before going to market and track acceptance
- Track your weekly time by delivery, review, relationship management, business development, and admin
Great Answer
For our top 30 accounts, I’m in about a third of the planning calls, but managers run the recurring cadence and I’m not the day-to-day contact. We started joint meetings on the highest-risk relationships and can show which clients now call the manager first. I also track my weekly time so you can see exactly what work needs to be handed off or replaced.
Okay
Clients know me, but the team does a lot of the work. I’m willing to stay involved during a transition.
Gives Pause
Most clients only want to talk to me. That’s why the firm works.
How Rejigg helps: Rejigg supports direct buyer-owner scheduling and documented Q&A, so the transition plan is clear and trackable without a middleman. Learn more in the guide
Busy-season capacity
What’s your capacity model going into busy season—and what breaks first?
Audit and tax firms rarely lose demand overnight. Problems show up when review capacity, staffing, or deadline load breaks and clients feel it. Buyers are testing how you handle stress cases like a manager quitting in March, an audit timeline compressing, or notices spiking right when returns are due.
How to prepare
- Build a peak-period coverage map for prep, review, and client communications
- Share utilization targets you actually hit and how you triage work when deadlines collide
- Document seasonal contractor usage and the training and review controls you apply
Great Answer
We plan capacity by deadline cycle and reviewer hours, not just total headcount. Each team has a named backup reviewer, and we can show a March-through-April plan by manager. We use seasonal staff for prep only with limited access, and every file runs through a standard review checklist before it goes out the door.
Okay
We're usually busy, but we get through it. If needed, we can bring in contractors.
Gives Pause
Busy season is always chaos. We push through.
How Rejigg helps: Rejigg lets you present staffing coverage clearly and track follow-up questions in one place, so buyers don’t misread capacity risk. Learn more in the guide
AR quality
What does the AR actually represent—current fees, old disputes, or slow-payers?
Buyers want to know how much receivables are collectible without damaging client relationships. In firms, AR often includes seasonal timing, unresolved scope disputes, or chronic slow payers that everyone has gotten used to. Buyers separate normal billing cadence from balances that will likely turn into write-offs.
How to prepare
- Prepare AR aging with notes on the largest past-due balances and why they’re past due
- Break AR out by service line and billing model
- Write down your collections routine and who owns follow-up
Great Answer
Here’s our AR aging with notes on every balance over 60 days. Most past-due AR is timing from post-delivery tax billing, and true dispute balances are limited to two clients we’re actively working through. Our monthly CAS (Client Accounting Services) clients are on auto-draft, so that AR stays current and predictable.
Okay
We have an AR report and most clients pay. A few are always slow, but it’s manageable.
Gives Pause
AR doesn’t mean much. People pay when they pay, and we don’t like to push clients.
How Rejigg helps: Rejigg ties AR support to the story in a single data room, so buyers see context, not just a raw aging report. Learn more in the guide
Quality controls
Any peer review findings, complaints, or ‘this keeps me up at night’ issues?
Buyers are underwriting reputation and compliance exposure alongside cash flow. Most firms have had a comment, a tough client, or a file that needed cleanup, and that can be fine if the seller can explain what changed and show proof it stuck. Vague answers and missing documentation tend to expand diligence and tighten terms.
How to prepare
- Summarize peer review outcomes and corrective actions with dates and evidence
- Document quality steps from planning through issuance, including who signs off
- List claims, complaints, or recurring file issues and how they were resolved
Great Answer
We had one peer review comment two cycles ago on documentation consistency. We updated our file checklist, trained managers, and we can show the new template plus evidence it’s being used. No claims, and client complaints are logged with the resolution and the process change we made afterward.
Okay
Nothing major. Peer review has been fine overall, and we take quality seriously.
Gives Pause
I don’t remember the details, but it wasn’t a big deal. We don’t have documentation on it.
How Rejigg helps: Rejigg lets you share peer review and QC materials securely, with access controlled by NDA and where the buyer is in the process. Learn more in the guide
Growth engine
What’s your referral engine—and what happens if one source dries up?
Buyers want to know whether new work comes from a repeatable firm presence in the local ecosystem or a handful of personal relationships. Referral concentration can be fine if multiple people at the firm hold those relationships and referrals get a consistent onboarding experience. This also helps buyers forecast growth without assuming the seller keeps selling forever.
How to prepare
- List your top referral sources and estimate how much new work each drives
- Show how referrals are handled and who besides the owner participates
- Document your niche focus and how you onboard referred clients consistently
Great Answer
About 45% of new clients come from three referral partners, and each has multiple touchpoints inside our firm. We run a standard onboarding process so referred clients get the same experience regardless of who brought them in. We can show new-client counts by source for the last two years.
Okay
We get most work through referrals and relationships. They’ve been stable for a long time.
Gives Pause
It’s mostly a couple friends who send us business. If they stop, we’ll figure out marketing later.
How Rejigg helps: Rejigg connects you with pre-vetted buyers and keeps outreach organized, so you can find a buyer who values your niche without paying a broker. Learn more in the guide
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Questions Auditing Owners Ask Us
What is an auditing or CPA firm typically worth?
Most auditing and CPA firms are valued off owner earnings, but the multiple usually moves with retention through the next cycle, reviewer depth, and whether WIP reliably converts into invoices and cash. Firms with strong monthly CAS retainers and manager-led delivery often price higher than owner-centric books that rely on deadline heroics. Get a starting range with Rejigg’s free valuation calculator, then pressure-test it against your client concentration and transition plan.
How do buyers think about tax vs audit vs CAS revenue in a firm sale?
Buyers price each line based on how predictable renewal is and how hard delivery is to staff and review. Tax work can be sticky, but it still gets “re-won” each filing season based on responsiveness and deadline performance. Audit and attest revenue usually brings more quality and signer-capacity scrutiny. CAS often looks most like recurring revenue when it bills monthly and runs on standardized workflows.
Can I sell an audit practice without a broker?
Yes. You do not need a broker to sell an audit practice, and you should not pay 5–10% of your sale price for work you can run directly with the right tools. Rejigg gives you pre-vetted buyer access, NDA-gated disclosure, a built-in data room, and an offer dashboard to compare terms side-by-side. Start with the Owner’s Guide to preparing and list your firm when you're ready.
How long does it take to sell an auditing firm?
Many auditing firm sales close in about 3–9 months, and timing is usually driven by busy season and how quickly you can answer firm-specific diligence questions like WIP aging, realization trends, signer coverage, and the transition plan. Going to market right before deadlines can slow buyers down because they do not want to disrupt delivery. Rejigg keeps buyer Q&A, documents, and offers in one tracked process instead of scattered email threads.
What documents should I have ready to sell an auditing firm?
Expect requests for financial statements, service-line revenue splits, WIP aging, AR aging, staffing by level, and proof of signer and reviewer coverage. For audit work, buyers will also want peer review summaries and a plain-English walkthrough of your quality-control process. Sharing in phases keeps confidentiality intact. Rejigg includes a secure data room so you control who sees what and when.
How does seller financing work for an auditing practice sale?
Seller financing means you take part of the price over time, usually as monthly payments, instead of getting all cash at closing. In auditing and CPA firm deals, it often shows up when retention risk is real but manageable, so the buyer wants alignment through the next cycle. Terms still matter a lot, including rate, length, and what happens if clients leave. Rejigg’s offer comparison dashboard helps you compare seller-financed offers cleanly.
What is an earnout in a CPA or audit firm sale?
An earnout is a portion of the sale price you only receive if the firm hits agreed results after closing, often based on retained revenue or retained gross profit through the next season. In CPA and audit deals, it’s usually tied to client retention uncertainty. Define measurement clearly and watch for levers the buyer controls, like fee changes or staffing cuts, that can reduce payouts. Use Rejigg’s negotiation guide to sanity-check earnout terms.
How do SBA loans work for buying an auditing or CPA firm?
Some buyers use SBA 7(a) loans to fund the purchase. Banks focus on stable cash flow, reasonable add-backs, and whether the firm can pay debt after replacing partner labor with market compensation. In CPA and audit firms, lenders also pay close attention to client retention and signer coverage, because revenue can walk after a transition. You can estimate payments with Rejigg’s SBA loan calculator before negotiating terms.
What add-backs are common when selling an auditing firm?
Add-backs are expenses that ran through the firm but likely would not continue for a new owner, which can increase the earnings used in valuation. In auditing and CPA firms, the big one is usually partner compensation, including partner labor that is effectively underpaid and needs to be normalized to market pay. Other add-backs can include one-time recruiting, owner personal expenses, or unusual legal fees. Buyers discount add-backs they cannot verify, so document them clearly in your data room.
How do non-competes work when selling a CPA or audit practice?
A non-compete is an agreement that limits you from starting a competing firm or soliciting the same clients for a set time and geography. In CPA and audit deals, buyers usually pair it with a defined transition commitment, because continuity is mostly relational. Enforceability varies by state, and overly broad restrictions can get challenged. Rejigg helps you keep drafts, edits, and buyer feedback organized so version control doesn’t become a mess.
What is a working capital adjustment in an audit firm sale?
A working capital adjustment is a closing true-up based on the level of short-term assets and liabilities that transfer with the firm, usually receivables, payables, and accrued expenses. In auditing firms, this can get tricky because billing and collections are seasonal, and WIP and AR can swing hard around deadlines. A reasonable target should reflect “normal” operations, not a random month. See Rejigg’s due diligence and closing guide for what to gather.
Should I sell my firm right before busy season or after?
Many owners choose to go to market right after busy season, when results are fresh and the team has a bit more breathing room. Timing still depends on your book and your personal plans, since many buyers want the seller committed through at least one full cycle. Launching before deadlines can work if you have a clear coverage plan and a tight diligence process. The main risk is distracting managers during peak delivery months.
Can a non-CPA buy an auditing or CPA firm?
Sometimes, but state rules and professional standards can limit ownership and control, especially for attest work. Even when a non-CPA buyer can own the firm, you still need licensed leadership for signing authority, technical review, and quality control. Buyers usually need a specific plan for who will sign, who will review, and how they will retain the team through the transition. If that plan is vague, financing and closing tend to get harder.
How do I keep a sale confidential from staff and clients?
Most firm owners keep confidentiality by staging disclosure. Early conversations stay anonymous, and details get shared only after trust is built and an NDA is signed. Staff and clients usually hear about the deal closer to a signed LOI and a real transition plan. Rejigg supports this by pre-vetting buyers, collecting digital NDAs, and keeping documents in a permissioned data room instead of email.
What does a typical transition period look like after selling an audit practice?
Most transitions are built to carry the firm through the next deadline-heavy cycle without losing clients or burning out reviewers. The seller often stays involved for introductions, a defined set of escalations, and a few key planning calls, then steps back as managers become the clear continuity point. Strong plans are usually segmented by client type, because a long-time audit client and a one-off cleanup return do not need the same overlap. Rejigg’s transitioning guide walks you through it.
Do I need to clean up QuickBooks before selling an auditing firm?
Clean books help, but buyers in auditing usually focus even more on firm operating numbers like WIP aging, realization, write-down patterns, and normalizing partner time and pay. Messy bookkeeping slows diligence and tends to widen the “trust gap” on add-backs and cash flow. If you use QuickBooks, Rejigg can speed up prep by importing data through QuickBooks integration and organizing it into your data room.
How should I compare offers for my audit firm beyond just price?
Compare offers based on what will actually happen after closing: seller financing, earnout triggers, transition expectations, and whether the buyer has credible signer and manager coverage. Also weigh timeline and certainty, since a high offer that drags into busy season can cost you staff and clients. Rejigg’s deal tracking and offer comparison dashboard shows price, earnouts, seller financing, and timelines side-by-side so you can make a clean call.
