Texas CPA Firms Saw Increased Revenue and Expenses in 2004
Survey Shows Texas Accounting Firm Growth Mirrored National Trend

DALLAS — Texas CPA firm growth in 2004 closely mirrored the national trend of growth in revenues, profits and annual base salaries, according to the 2004 National Management of Accounting Practice survey conducted by the Texas Society of Certified Public Accountants and the American Institute of CPAs’ Alliance for CPA firms.

Thirty-four percent of the firms surveyed reported at least a 10 percent increase in gross fees, compared to 32 percent of accounting firms nationwide. Only 50 percent of the fees earned by firms were for tax work. Other services such as auditing, write-ups and data processing, and business consulting contributed to Texas accounting firms’ bottom lines.

Sarbanes-Oxley has increased demand for CPAs, a trend that likely helped boost the number of professional staff employed by Texas accounting firms by one full-time equivalent staff member over the 2003 results.

Overall, profits as a percentage of total income remained steady, due in part to higher expenses for firms statewide.

The top 10 specialized services offered by respondent Texan firms are: estate tax planning (71 percent), not-for-profits (62 percent), payroll processing (48 percent), personal financial planning (47 percent), forecasts and projects (44 percent), litigation support (43 percent), business valuation (39 percent), mergers and acquisitions (33 percent), outsourced controllership (28 percent), and information technology software selection and implementation (23 percent).

Nearly 250 Texas accounting firms responded to questions relating to the management of their respective accounting firms, making up more than 10 percent of the more than 2,300 accounting firms that responded nationwide. The survey provides firms with both statewide and national data against which they can benchmark their policies and performance.

Among other findings:

• HR Policies: Seventy-three percent of firms offer their staff flexible work arrangements. This is slightly lower than the 77 percent of accounting firms nationwide who offer flexible work arrangements.
• Going Paperless: The survey showed that CPAs continue to embrace technology, with 19 percent of Texas accounting firms maintaining electronic versions of most records. Another 20 percent of firms say they are planning to make the transition to paperless records, while 40 percent of the accounting firms surveyed said they would consider going paperless in the future.

ABOUT TSCPA

TSCPA (http://www.tscpa.org) is a nonprofit, voluntary, professional organization representing Texas CPAs. The society has 20 local chapters statewide and has 27,000 members, one of the largest in-state memberships of any state CPA society in the United States. TSCPA is committed to serving the public interest with programs that advance the highest standards of ethics and practice within the CPA profession.