As consolidation across the professional services industry accelerates, accounting firms — especially those with under 30 staff — are entering a prime window for mergers and acquisitions (M&A). Whether you’re looking to grow, exit, or restructure, the next 12–18 months will shape your long-term value.
Here’s how to prepare for the upcoming wave of activity — and avoid becoming a reactive seller in a buyer’s market.
🔍 Why M&A Activity Is Increasing in the Accounting Sector
Recent reports from IBISWorld and Chartered Accountants ANZ suggest multiple tailwinds are driving M&A in Australia’s accounting space:
- Succession pressure: Baby boomer partners are retiring without clear handovers.
- Digital compliance: Smaller firms struggle to keep up with Xero, ATO, and AI reporting standards.
- Fee compression: Competitive pricing and offshore services are squeezing margins.
- Private equity interest: Mid-sized acquirers are gaining capital and scale rapidly.
📌 In 2024 alone, over 320 small-to-mid-sized accounting firms were acquired or merged in Australia — a 19% YoY increase.
👥 Who’s Buying — And Why?
It’s not just the Big 4.
We’re seeing acquirers emerge in 3 main categories:
1. Mid-tier accounting firms
- Looking to expand into new geographies or niche service offerings.
- Typically offer strategic mergers, not full acquisitions.
2. Private equity-backed rollups
- Want scalable, compliant firms with recurring revenue (e.g. SMSFs, business tax).
- Will push for aggressive systemisation post-merge.
3. Larger boutique practices
- May acquire struggling firms and retain the principal for a transition period.
- Often focused on acquiring books with good margins.
✅ What Makes Your Firm Attractive (or Not)
If you’re considering a merger, these are the factors that make your firm “deal-ready”:
| Attractive Traits | Red Flags |
|---|---|
| Strong recurring revenue | High client churn |
| Documented systems & processes | Over-reliance on principal |
| Cloud-based operations (Xero, FYI, Karbon) | Manual workflows & paper-based compliance |
| Clear org chart and role definitions | No second-tier leadership |
| Long-term client relationships | Low profitability per FTE |
Even if you’re not actively looking to sell, you should be preparing as if you are. It improves profitability regardless — and gives you control over your future.
💡 Smart Steps to Take Before Approaching Buyers
Thinking of exploring merger or acquisition options in 2025 or 2026? Follow these key steps first:
- Systemise Before You Strategise
Ensure your internal workflows, client handovers, and deliverables are mapped and automated where possible. - Run a Pre-Deal Health Check
Conduct a mock due diligence assessment — financials, staff turnover, software stack, and compliance risks. - Build a Growth Story
Show not just revenue, but retention, service expansion potential, and culture fit for scaling. - Understand Merger vs. Sale
Mergers can offer more freedom, culture preservation, and long-term wealth creation than full exits. - Don’t Wait for a Broker
The best deals are often off-market and relationship-based. Consider reaching out to aligned firms directly.
🤝 Is a Strategic Merger Right for You?
M&A isn’t just about exit — it’s about growth, relief, or legacy. Ask yourself:
- Do I want to scale, but lack the people or systems?
- Do I want to protect what I’ve built, even if I step back?
- Am I tired of patching staff gaps and chasing compliance?
If the answer is “yes” to any of these, a strategic merger might be your smartest next step.
🎯 Final Thought
In 2025–2026, standing still means falling behind. The accounting sector is maturing — and firms that proactively prepare for mergers or partnerships will win more value, freedom, and peace of mind.