Quarrymoor Financial, a small-business funding service in Kingman, Arizona, arranges funding for accounting, tax preparation and bookkeeping firms through partners: CPA firm acquisition financing, lines of credit for uneven fee months, and working capital for added preparers. Mohave County, AZ had 62 accounting and tax employers in 2023, and 80.6% had fewer than five employees (CBP). Partners make credit decisions and set rates and terms.
| Tax, bookkeeping and accounting employer locations, Mohave County, AZ | 160 on payroll at 62 employer sites (CBP count, 2023) |
|---|---|
| Firms with fewer than five employees | 80.6% (CBP 2023) |
| Accounting and tax businesses with no paid employees | 277 with no payroll at all (NES count, 2024) |
| Annual payroll, these employers | $6.2 million of payroll across 2023 (CBP) |
Fees arrive unevenly; costs do not
Tax preparation concentrates fees around filing deadlines, while bookkeeping and payroll services bill monthly. Rent, software subscriptions, insurance and the owner's own pay continue regardless. Firms add preparers before the busy months and pay them before the fees from those returns are collected. Client billing on engagement letters can also leave large receivables from business clients.
Accounting firms have few hard assets, so partners lean on the firm's billing history and client retention rather than equipment.
CPA firm acquisition financing for a retiring practitioner's book
Buying a retiring practitioner's client list or a whole firm is the main growth route in this trade. CPA firm acquisition financing is usually a term loan, reviewed on the seller's billings, how many clients are expected to stay through the transition, and the buyer's own practice. A deal can include an earn-out or a retention adjustment; partners want to see how that affects the payment schedule.
What would a CPA firm cost to buy in Kingman, AZ?
There is no Kingman, AZ figure in the public data, and prices depend on recurring billings, client mix, how much work is tax versus monthly services, and the transition terms. A buyer should have the seller's billing records by client and service line before discussing price with anyone, including a funding partner.
A line of credit for preparers and uneven fee months
A revolving line covers wages for added preparers and software costs ahead of the busy months, then repays as fees arrive. Working capital fits a single, dated cost, such as a one-time software migration or a large client receivable that is late.
How to grow an accounting practice with funding
- Buy a book of business from a retiring practitioner
- Add bookkeeping or payroll services billed monthly, smoothing the fee calendar
- Hire an experienced preparer before the busy months
- Open a second office, or move to a space that suits client meetings
- Invest in practice software that frees hours for more clients
How to grow a CPA firm is mostly a question about recurring revenue. Partners notice the difference between a practice whose fees are mostly one-time returns and one with monthly retainers.
Items a partner tends to request
- Business bank statements across a full year, to show the fee cycle
- Billings by client or service line
- Accounts receivable aging
- For acquisitions: the purchase agreement and retention terms
- Years in business, plus the owner's credit file
An illustration with invented numbers
A two-person tax and bookkeeping firm buys a retiring preparer's book of 140 individual and 12 business clients. Suppose the seller's annual billings were $96,000 and the parties agree on a price tied to clients who stay through the first season. If 85% are retained, retained billings are about $81,600 a year. The buyer can compare that with the annual payment on the purchase loan plus the cost of an added preparer. These figures are made up for illustration.
Questions to ask before buying a book of clients
- How many clients are monthly retainers, and how many file once a year?
- Which clients does the seller handle personally, and will they stay?
- Is the price adjusted if retention falls short in the first year?
- Does the seller's software and file history transfer cleanly?
- Who will prepare the returns during the first busy months?
Partners tend to look at the same questions, because retention drives whether the purchase pays for itself. A buyer with clear answers, and an agreement that ties price to retained billings, usually has the easier review.
Work in progress, unbilled hours and the fee ledger
An accounting firm's real receivable is often larger than its invoices. Hours logged on returns, payroll filings and year-end close work sit as work in progress until the engagement is billed, and some clients pay only when the finished return is delivered. A firm that bills monthly retainers has a smoother pattern than one that bills each return at pickup, and a partner reading the bank statements will see the difference.
Before asking for money to hire a preparer or replace software, pull three reports from the practice-management system:
- An aging of billed fees by client, split into current, 30, 60 and 90-plus days
- Unbilled work in progress, with the expected billing month for each engagement
- The share of annual fees that comes from the ten largest clients
Our arithmetic from County Business Patterns 2023: the county's 62 accounting and tax employers paid about $38,400 per employee on average ($6,151,000 of payroll across 160 employees), with roughly 2.6 employees per location. The 277 no-payroll firms counted by Nonemployer Statistics 2024 averaged about $29,500 in receipts each (receipts divided by firms, our arithmetic), a separate program that is never added to the CBP figures.
Mohave County, AZ accounting and tax firms by the census figures
| Measure | Value | Source |
|---|---|---|
| Employer establishments | 62 | County Business Patterns 2023, NAICS 5412 |
| Paid employees | 160 | CBP 2023, pay period including March 12 |
| Annual payroll | $6.2 million | CBP 2023 |
| Locations below five employees | 80.6% (50) | CBP 2023 |
| Establishments with a ZIP 86401 address | 7 | ZIP Business Patterns 2023 (USPS ZIP area, not city limits) |
| No-payroll businesses (counted separately) | 277, receipts $8.2 million | Nonemployer Statistics 2024, NAICS 5412 (separate program; not added to CBP) |
This is a trade of very small firms: 80.6% of employer establishments had fewer than five employees in 2023, and 277 accounting and tax businesses operated with no paid employees in 2024 (NES, counted separately from CBP). The page of Kingman, AZ business figures has the county overview, and the industry list includes legal, insurance and real estate offices.
By Quarrymoor Financial · Updated
