Thinking of Selling or Merging Your Accountancy Practice? A Personal Guide from Peter Watson on Getting It Right

Meet Peter Watson: The UK’s Specialist in Accountancy Practice Exits

For more than two decades, I’ve helped accountants, partners, and firm owners across the UK make successful exits—whether selling outright, merging with another practice, or stepping back in stages. Every journey is a bit different, but the same principles always apply: transparency, strategic preparation, and absolute professionalism.

This guide is here to demystify the process and highlight the key decisions you’ll face, all from my experience on the front line of accountancy practice sales, mergers, and valuations.

Evaluating Your Exit Options: Sale or Merger?

The first big question every practice owner faces: Do I sell, do I merge, or is there a hybrid option?

Selling Your Practice

If you’re ready for a clean break—perhaps to retire, pivot careers, or just enjoy some well-earned freedom—then an outright sale is your fastest route. Selling directly allows you to:

Realise immediate value for your years of work
Transition responsibility in a clear, structured handover
Plan your next chapter with certainty

It’s also the most straightforward transition… if you set things up right.

Merging: Combining Forces

A merger might be for you if you want to:

Stay actively involved but in a reduced or advisory capacity
Achieve greater scale or reach by blending teams, clients, and resources
Optimise the operational or financial health of your practice before fully stepping down

But beware: Successful mergers require more than just complementary balance sheets. Mergers are about people and culture as much as numbers. You’ll need mutual trust, shared vision, and a well-negotiated hierarchy for the new firm.

The Key to Value: Why Preparation is Everything

No matter your exit strategy, the groundwork you lay today directly impacts the financial outcome and attractiveness of your accountancy practice.

What Drives Value in an Accountancy Firm?

Based on hundreds of real deals, these factors stand out:

Fee Income History & Stability: Consistent or growing recurring revenue is king.
Client Profiles: Who you serve—industry mix, longevity, and how “sticky” clients are.
Team Structure: Loyal staff, comprehensive handover notes, and low risk of key person loss.
Systems & Compliance: Up-to-date digital records, strong regulatory track record, and documented procedures.
Market Trends: Current demand for practices in your area or sector.

Preparing Your Practice for the Market

I always advise owners to spend time on a few specific areas:

Tidy Up Your Client Base: If possible, resolve or disengage from legacy issues and ensure records are accurate.
Update Documentation: Ensure all engagement letters, contracts, and compliance documents are digital and accessible.
Prepare Management Accounts: Demonstrate profitability, margin trends, and growth opportunities to a potential buyer or merger partner.
Formalise Systems: Create clear process manuals for key tasks—this reassures buyers about smooth continuity.

Navigating the Sale: The Process from Start to Finish

Here’s what to expect from a well-structured sale—whether it’s a full firm disposal or just a block of fees.

Step 1: Initial Consultation and Valuation

Every journey starts with understanding where you stand. I perform a thorough practice valuation, incorporating market data, your firm’s unique strengths, and recent deal multiples in the UK. This isn’t a rough guess; it’s a bespoke, data-backed appraisal.

Tip: Tempted to use an online calculator? Don’t—it can’t capture the nuance or leverage that true expertise can.

Step 2: Confidential Marketing

Discretion is crucial, especially if staff, associates, or clients might get spooked by news of a possible sale or merger. I use trusted networks—not just splashy ads or public lists—to quietly find the right buyers or merger partners.

Step 3: Qualify Buyers or Partners

Not every party with funds is a good fit. I focus on:

Capability to complete the purchase or merger
Cultural and operational fit
Security of funding

Step 4: Negotiation

Negotiation isn’t just about price. It covers:

Transition timelines
Earn-out or deferred payments
Consultancy or post-sale involvement
Client handover arrangements

Having brokered scores of negotiations, my approach is to keep things clear, constructive, and always aiming for a true win-win.

Step 5: Due Diligence

Buyers want to check every file, every contract, every number. Preparation here is everything! By supplying clean, clear, and well-organised data, you reduce delays, keep leverage, and avoid re-negotiation.

Step 6: Legal Completion

Solicitors draw up the final contracts—sale agreement, warranties, restrictive covenants, and consultancy terms if you’re staying involved. Once signed, it’s official.

What About Merging? The Additional Layers

Mergers are more complex. Here’s what you need to keep front of mind:

Creating the New Organisation: A merger isn’t an acquisition. Both parties bring something to the table and must agree on a shared future—roles, compensation, and branding.
Alignment on Culture & Clients: Compatibility matters just as much as the numbers. A messy culture clash can destroy value fast.
Shared Vision for Success: It’s crucial everyone’s “endgame” matches up. If you want to step back and the other wants you fully involved for years, friction will follow.

This is where an experienced adviser like me becomes invaluable—helping navigate personalities as much as profit-and-loss sheets.

Exit Alternatives: Flexibility for Retiring Accountants

Not ready to sail off into the sunset just yet? There are flexible exits:

Deferred Sale: Receive an upfront sum, with the rest paid over an agreed timespan or performance metrics.
Enhanced Exit Income: Stay involved as a consultant, easing clients and staff through the handover.
Retirement-in-Stages: Sell just part of your fee base now, and the remainder later when you’re ready.

Peter Watson’s Checklist: Key Questions Before You Start

Ready to move forward? Ask yourself:

Why am I selling or merging now, and what does “success” look like for me?
Is my practice as “sale-ready” as possible?
Do I have current management accounts and updated client documentation?
Have I considered client and staff communications?
Which buyers or merger partners align best with my philosophy?
Am I open to alternative deal structures, or do I want a clean break?

Why Use an Expert? The Peter Watson Advantage

Let’s be honest: selling or merging an accountancy practice is not just another day at the office.

You need strong deal preparation
A robust, confidential approach to finding and qualifying buyers/partners
Skillful negotiation and problem-solving
Real-world experience navigating the UK’s professional, legal, and ethical landscape

That’s what I deliver—personally.

Want a deeper conversation about your situation? I offer confidential, one-day consultancy tailored to you, whether on-site or at a location that suits.

You can find out more about me and how I work here: Peter Watson – About

Or, if you’re ready to start the process, let’s talk: Contact Peter Watson

Useful Resources & Next Steps

Take the first step towards your ideal exit—your future self (and your staff and clients) will thank you for it.