For Australian accounting firms looking to maximise their accounting practice valuation in 2026, the traditional multiple based on gross recurring revenue is fracturing. A new trend is emerging: Intellectual Property (IP)—specifically, proprietary technology—is becoming the most valuable asset a firm can bring to a merger.
Buyers are no longer just acquiring compliance fees; they are acquiring scalable solutions that can be rapidly deployed across their existing national client base. This trend creates a huge opportunity for small to mid-sized firms that have invested smartly in systemising accounting firms around a niche.
The Rise of the SaaS-ified Accounting Firm
In 2026, accounting firms that have productised their service offerings—effectively becoming a ‘Software as a Service’ (SaaS) provider wrapped in a service firm—will command valuation multiples previously unheard of in the sector.
- What is IP in Accounting? This is not just using Xero; it’s building a unique, client-facing dashboard, a proprietary AI tool for niche compliance (like R&D or cost segregation), or a highly automated, branded client onboarding workflow that can be sold or replicated.
- The Buyer’s Motivation: A large merger partner can acquire a $2 million revenue firm with niche IP, strip out that IP, and deploy it across their $100 million client base. They pay for the IP’s potential scale, not just the acquired firm’s current cash flow. This drastically increases the value proposition of a smaller, specialized target.
Specialisation: The New Gold Standard
This technology focus is intrinsically linked to specialisation. Generalist firms using generic software will face valuation pressure, but firms that focus on a ‘vertical’ and build custom solutions for it will thrive.
Example: A firm that exclusively serves the dental industry and has built a unique, automated benchmarking tool is far more valuable than a generalist firm of the same size. Their expertise and data provide a defensible niche that is highly attractive to an aggregator seeking to roll up a national “Dental CPA Alliance.”
How to Position Your Firm for the IP Premium
To ensure your accounting firm performance justifies a premium valuation when exploring accounting firm mergers, focus on these strategic steps:
- Productise Your Best Advice: Identify your most repetitive, high-margin advisory services for accounting firms (e.g., quarterly forecasting or KPI reporting). Convert this service into an automated deliverable using integrated cloud tools for accountants (like Power BI or advanced Xero Add-ons).
- Document Everything: Treat your systems like software. Fully document the proprietary workflows, templates, and coding integrations. This documentation is the key asset the buyer needs for replication.
- Hire for Tech-Savvy Leaders: Ensure your next generation leadership accounting team is fluent in system automation and digital workflows. Buyers are paying for the ability to scale the tech, which requires internal expertise.
By shifting your focus from ‘hours spent’ to ‘systems built,’ you transform your practice from a commodity service firm into a valuable, scalable, technology-enabled asset, ready to command a premium in the 2026 M&A market.