Benchmark Your Firm - MAPSurvey - California Society of Certified Public Accountants' Management of an Accounting Practice survey

CalCPA has a 20-plus year history with Management of an Accounting Practice surveys, most recently with the new Web-based 2002 National MAP Survey. The process, member response and results are even better than we had anticipated.

The survey included 2,521 firms from 42 states. California had the highest participation with 404 firms completing the 2002 survey. This high response from CalCPA members helped to ensure the survey's statistical validity and reliability.

The goal of the MAP Survey is to measure key factors that firms need to rely on to measure their performance and effectiveness against other firms in the Western United States, as well as by their geographic region, size of firm, compensation levels and level of profitability.

"We downloaded our firm report right away, reviewed it and made adjustments to some of our firm practices," said Paul Regan, president of Hemming Morse Inc., CPAs in San Francisco.

NATIONAL VERSUS CALIFORNIA

The results are broken down by six geographic regions for California: North Coast/Sacramento; Bay Area/Silicon Valley; Central Coast/Central Valley; Los Angeles; Orange County/Long Beach; and San Diego/Inland Empire.

Many MAP Survey statistics offer a valuable comparison of California results to national results. For example:

Average Firm Size: National--12 people, eight of whom are CPAs; California--7.5 people, 5.25 of whom are CPAs.

Average Income Per Firm (gross): National--$1.5 million; California--$1.2 million.

Largest Sources of Income: National--tax services (45 percent), write-up/data processing (13 percent) and audit/attest (11.2 percent); California--tax services (52.5 percent), write-up/data processing (10.2 percent) and audit/attest (8.2 percent).

Largest Firm Expense: Total non-owner professional salaries. National-$386,580 or 25.5 percent of total income; California--$368,014, or 31 percent of total income.

Interestingly, 52 percent of California firms are charging interest on accounts receivables; electronic tax return filings have grown to 52 percent; a new hire with less than one year of experience had a starting salary of $35,404 as compared with $28,524 in 1998; and the average annual salary increase for professionals last year was 5.8 percent.

There was little mystery in the number of hours partners work per week. From April 15 to Dec. 31, 69 percent of partners/owners worked 40-48 hours and 30 percent worked less than 40 hours. In contrast, the last four weeks of the busy season are busier than ever with 21 percent of partners/owners working 40-48 hours, 35 percent working 49-56 hours, and 35 percent working more than 57.

BILLING RATES

One of the most frequently asked questions is on billing rates in California, which the Map Survey contains for all levels of professionals.

While the ranking for multi-owner and single-owner billing rates is about equal for most of the regions, Orange County/Long Beach has the highest billing rates for single-owner firms in the state and is the only region where the single-owner rate is higher than the multi-owner rate.

"I've already made changes to compensation and billing that, without the MAP Survey, I would not have otherwise known needed adjusting," said Mike Ueltzen, managing partner of Ueltzen & Company LLP in Sacramento.

MORE INFORMATION

These are just a few highlights of the 2002 MAP Survey. The full version contains much more practice benchmarking information.

Non-participating firms who are members of CalCPA can download the California Report at www.calcpa.org/members/MAP and non-CalCPA members can visit the AICPA/PCPS website at www.map.pcps.org, where results can be purchased.

If you did not participate in 2002, look for the 2003 MAP Survey and don't miss your chance to get your own firm report.

Average CPA Compensation

CATEGORY                       NATIONAL     CALIFORNIA

Active Owners             $161,481/year  $176,447/year
CPA > 10 yrs. experience         66,981         74,875
CPA 6-10 yrs. experience         54,274         64,728
CPA 4-5 yrs. experience          45,045         52,646
CPA 1-3 yrs. experience          37,917         45,578
CPA < 1 yr. experience           31,051         29,873

Average Billing Rate of Owners in $$ by Geographic Region with Region
Ranking in ( )

REGION                        MULTI OWNER  SINGLE-OWNER

North Coast/Sacramento            174 (5)       148 (5)
Bay Area/Silicon Valley           233 (1)       174 (3)
Central Coast/Central Valley      163 (6)       137 (6)
Los Angeles                       224 (2)       192 (2)
Orange County/Long Beach          199 (4)       210 (1)
San Diego/Inland Empire           213 (3)       152 (4)

J. Russell Roy, CPA, is managing partner of Roy & O'Connor CPAs Inc. in Paso Robles and chair of CalCPA's Management of an Accounting Practice Committee. You can reach him at rusty@royandoconnor.com.

Maria N. Nazario is CalCPA's associate director of member relations and liaison to the Management of an Accounting Practice State Committee. You can reach her at maria.nazario@calcpa.org

COPYRIGHT 2003 California Society of Certified Public Accountants
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