With the tsunami of CPA firm mergers over the past several years and with more unions projected for 2012 and beyond, a trio of managing partners whose firms have been in “buyer mode” gave attendees at the Winning Is Everything confab here a laundry list of hurdles and issues that firms must address in order for combinations to be successful such as communication, integration and compensation.

Howard Cohen

“A transaction makes sense when you’re doing it for the right reason,” said Howard Cohen of New York-based EisnerAmper, a $250 million firm, created in 2010 with the merger of Eisner and Amper. “Both firms were successful and neither needed to merge, but if you explain it [the deal] to your partners and openly communicate the reasons, they’ll get why it should be done. We were fortunate enough to have had our partner retreat shortly after the merger so the partners from both got together.”

“Communication is the key,” agreed Carl Johnson of Connecticut-based Blum Shapiro, a $47 million firm that has completed five mergers over the past 10 years. He advised attendees to begin immediately with an internal plan that also involves the CFO as well as the IT and HR departments. “How are you going to follow up after the other firm receives the news?” he added. “We have people on the ground right away.”

“Once we state and have a letter of intent we start training about our firm processes,” explained Alan Long of Richmond, Ky.-based Baldwin CPAs, a $4.2 million firm that has merged in a number of smaller local practices since 2004. “In the smaller firm environment, you will probably lose some employees in the deal, but you need to have someone in the acquired firm’s office to make sure the new processes are being followed. Integration is easier with smaller firms; it’s easier to turn around a speedboat than the Titanic.”

The session, titled “M&A: Buyer’s Panel,” was moderated by Allan Koltin, CEO of Chicago-based Koltin Consulting Group.

Deal breakers include having a “honeymoon clause” in the agreement or co-branding going forward. “If you have a honeymoon clause, you have to ask yourself if you really want to get married,” said Cohen, who also revealed that in an earlier merger with a Philadelphia firm, Goldenberg Rosenthal, the merged-in firm still had a list of its core values hanging in the conference room a full year after the agreement was final. “Co-branding rarely works,” he said. “You need to move forward.”

“Look for opportunities to cross-pollinate the staffs and have them help out in areas for both that need it,” said Johnson. “Be flexible—look at the long-term vision. That firm you acquired is watching every move you’re making. You will have staff people say this was the worst or best thing that ever happened.”