Accounting Business Plan Template

Accounting Business Plan Template

If you want to start an accounting business or expand your current accounting business, you need a business plan.

The following business plan template gives you the key elements to include in a winning accounting business plan.

You can download our Accounting business plan template (including a full, customizable financial model) to your computer here.

 

Example Business Plan For Accounting Firms

Below is an accounting business plan example with each of the key sections to help you write an accounting business plan for your own company.

I. Executive Summary

Business Overview

[Company Name], located in [insert location here] is a new accounting firm that focuses on providing reliable expertise and exceptional customer service. The company is owned and operated by an experienced CPA who has been working in the industry for over fifteen years.

Products Served

[Company Name] will provide a full range of accounting services for individuals and small businesses.

• Accounting and auditing services for small business
• Tax filing and preparation services for small business and individuals
• Financial consulting and advisory services for small business and individuals

Customer Focus

[Company Name] will primarily serve individuals and small businesses within a 30-mile radius of the firm’s office. The demographics of these customers are as follows:

• 120,000 individuals
• Average income of $74,700
• 58.9% married
• 49.6% in management/professional occupations
• Median age: 38 years
• 1,500 businesses
• Under 100 employees (average is 42)

Management Team

[Company Name] is led by [Founder’s Name], an experienced CPA who has been managing a large accounting firm in [location] for the past eight years. She graduated from [University] with an accounting degree and has been working at the large accounting firm since then, starting at an entry level position and working her way up to a management level role.

Success Factors

[Company Name] is uniquely qualified to succeed due to the following reasons:

• There is a need for knowledgeable and affordable accounting services within the community. Currently, the area is served exclusively by two large firms that serve corporate clients and one small startup accounting firm that operates 100% online and has no brick-and-mortar presence.
• The firm’s office will be centrally located in a high-traffic commercial area, with easy access from multiple thoroughfares.
• The management team has a track record of success in the accounting business.
• Market trends such as changes to regulations and filing processes have spurred demand for accounting services.

Financial Highlights

[Company Name] is seeking a total funding of $150,000 of debt capital to open its accounting firm.

• Office design/build: $40,000
• Working capital: $110,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even

Top line projections over the next five years are as follows:

Financial Summary	FY 1	FY 2	FY 3	FY 4	FY 5
Revenue	$560,401	$782,152	$1,069,331	$1,379,434	$1,699,644
Total Expenses	$328,233	$391,429	$552,149	$696,577	$776,687
EBITDA	$232,168	$390,722	$517,182	$682,858	$922,956
Depreciation	$7,000	$7,000	$7,000	$7,000	$7,000
EBIT	$225,168	$383,722	$510,182	$675,858	$915,956
Interest	$6,016	$5,264	$4,512	$3,760	$3,008
Pre Tax Income	$219,152	$378,458	$505,670	$672,098	$912,948
Income Tax Expense	$76,703	$132,460	$176,985	$235,234	$319,532
Net Income	$142,449	$245,998	$328,686	$436,864	$593,416
Net Profit Margin	25%	31%	31%	32%	35%

II. Company Overview

Who is [Company Name]?

[Company Name], located in [insert location here] is a newly established accounting company that will provide a variety of accounting services for individuals and small businesses. The firm aims to be the community’s go-to source for reliable accounting expertise and exceptional customer service. The company is owned and operated by an experienced CPA who has been working in the industry for over fifteen years.

[Company Name] was founded by [Founder’s Name], a local CPA who has been in a management role for a large accounting firm in [location] for the past eight years. She graduated from [University] with an accounting degree in [Year] and has been working at the large accounting firm since then. [Founder] started out in an entry level position with the firm and has been working in progressively responsible roles where she learned how to manage and run an accounting business before starting [Company name].

[Founder] began researching what it would take to start her own accounting company and did a thorough analysis on the costs, market, demographics, and competition. [Founder] has compiled enough information to develop her business plan in order to approach investors.

[Company Name]’s History

Once her market analysis was complete, [Founder] began surveying the local office space for lease and identified an ideal location for the accounting firm. [Founder’s Name] incorporated [Company Name] as a Limited Liability Corporation on [date of incorporation].

Once the lease is finalized on the office space, interior design work can begin to make the office an appealing place to meet with clients.

Since incorporation, the Company has achieved the following milestones:

• Located available office space for rent that is ideal for the accounting firm
• Developed the Company’s name, logo, and website located at [website]
• Hired an interior decorating company to design and furnish the office
• Determined equipment and necessary supplies
• Began recruiting key employees with accounting experience

[Company Name]’s Products/Services

Below are [Company Name]’s product and service offerings:

A team of certified accounting professionals will be able to perform the following services:

1. Accounting and auditing for small business
2. Tax filing and preparation for small business and individuals
3. Consulting and advisory services for small business and individuals

III. Industry Analysis

The United States Accounting Industry is forecasted to generate more than $141B this year. According to Statista reports, the largest accounting firm in America generates approximately $22.9B annually. There are currently 1.3 million accountants employed throughout the United States.

The accounting industry can be categorized by its various certifications. Approximately 52.7% of accountants are certified public accountants (CPAs), while 39.9% are non-CPAs. There is a much smaller percentage of certified management accountants (CMAs) with 3.1% and enrolled agents (EAs) with 4.2%. EAs are tax professionals who work directly with the IRS.

The top accounting firms industry-wide are Deloitte ($23.2B in annual revenue), PriceWaterhouseCoopers ($18B in annual revenue), Ernst & Young ($15.8 in annual revenue), and KPMG ($9.6 in annual revenue). All other accounting firms in the United States combined generate approximately $43.5B in annual revenue. An estimated 30% of industry revenue is generated through auditing services. Additional services such as tax preparation, planning, and consulting make up 36% of revenue.

One of the biggest challenges for accounting firms is the ability to keep up with changes in regulations. Additional hurdles include recruiting and retaining high quality employees, keeping up with evolving technology, and acquiring new clients. Millennials in particular are challenging to attract because they expect more flexibility, convenience, and better service levels from accountants; and prefer those who can offer all of these things at lower rates than the competition.

IV. Customer Analysis

Demographic Profile of Target Market

[Company Name] will serve individuals and small businesses in the community of [company location] and its surrounding areas.

The community of [company location] has thousands of individuals and small businesses who would benefit from affordable accounting services.

Customer Segmentation

The Company will primarily target the following three customer segments:

1. Business Startups: New businesses are often overwhelmed by the amount of information they must take in and the speed at which they must learn. They often seek accounting professionals for financial advice while looking out for their company’s best interests.
2. Small Businesses: Companies with up to 99 employees need a wide range of accounting services and can benefit from using a full-services accounting firm for all of their financial needs.
3. Individuals: Private citizens also often need help navigating their finances and may seek an accounting firm to help with tax planning and preparation, wealth management advice, and general CPA services.

V. Competitive Analysis

Direct & Indirect Competitors

The following businesses are located within a 30-mile radius of [Company Name], thus providing either direct or indirect competition for customers:

Star Standard Accounting Solutions

Star Standard Accounting Solutions is a large accounting firm in [location]. In business for over 40 years, Star Standard Accounting Solutions delivers accounting services to corporate clients across the area. Star Standard Accounting Solutions also offers a variety of ancillary services such as tax preparation, auditing, and financial reporting for large corporations. The company works with some of the most well-known companies in the region and has thousands of clients.

A Plus General Accounting Services

A Plus General Accounting Services is an accounting firm that specializes in financial strategy and consulting for businesses of all sizes. The firm has been in business for over a decade and has acquired a loyal client base.

Clients are able to work with accountants in person, over the phone, through email, on video conferencing software, or completely through a new digital application. Although this firm has an excellent track record for service, it is also the most expensive accounting company on the market.

Accounting Services For You

Accounting Services For You is also an accounting company that offers clients an array of accounting, auditing, tax preparation, and consulting services. The firm has adopted a technology-driven approach to accounting services to streamline the process for its busy clientele. Accounting Services For You is mostly known for its innovative use of technology to serve a large number of clients through an online portal. The company has been in business for about two years and has obtained quick brand awareness due to their unique branding and marketing strategy.

While Accounting Services For You has a strong branding and following, the online-only support is not equipped to handle complex accounting needs.

Competitive Advantage

[Company Name] enjoys several advantages over its competitors. Those advantages include:

1. Location: [Company Name] is centrally-located in the community, which provides ease of access for clients. The firm’s office will be located between the retail and business districts, making it accessible to a larger customer base.
2. Competitive pricing: [Company Name]’s pricing is more affordable than its closest competitors.
3. Management: The management team has years of accounting experience that allows the Company to market to and serve clients in a much more sophisticated manner than competitors.
4. Relationships: Having lived in the community for over 25 years, [Founder’s Name] knows all the local leaders, newspapers, and other influencers. As such, it will be relatively easy for [Company Name] to build brand awareness and an initial customer base.

VI. Marketing Plan

You can download our Accounting business plan template (including a full, customizable financial model) to your computer here.

[Company Name] seeks to position itself as a reliable source for accounting services at an affordable price with a guarantee of accuracy. Clients can expect to receive the best accounting services on the market from skilled CPAs, CMAs, and EAs in [location].

The [Company Name] Brand

The [Company Name] brand will focus on the Company’s unique value proposition:

• Client-focused accounting services
• Service built on long-term relationships
• Thorough knowledge of the latest regulations
• Big-firm expertise in a small-firm environment

Promotions Strategy

[Company Name] expects its target market to be individuals and small businesses within a 30-mile radius of its location. The Company’s promotion strategy to reach these customers includes:

Targeted Cold Calls
[Company name] will initially invest significant time and energy into contacting potential clients via telephone. In order to improve the effectiveness of this phase of the marketing strategy, a highly-focused call list will be used, targeting individuals in areas and occupations that are most likely to demand the services of a CPA. As this is a very time-consuming process, it will primarily be used during the startup phase to build an initial client base.

Referrals
[Company name] understands that the best promotion comes from satisfied customers. The Company will encourage its clients to refer others by providing economic or financial incentives for every new client produced. This strategy will increase in effectiveness after the business has already been established.

Direct Mail
The Company will use a direct mail campaign to promote its brand and draw clients, as well. The campaign will blanket specific neighborhoods with simple, effective mail advertisements that highlight the credentials and credibility of [Company Name] as an accounting firm.

Billboards and Commercials
Advertisements such as billboards placed in high trafficked areas will be used as well as commercials that will be shown on TV, streaming platforms, and radio stations.

Website/SEO
[Company Name] will invest heavily in developing a professional website that displays all the features and benefits of the accounting company. It will also invest heavily in SEO so that the brand’s website will appear at the top of search engine results.

Pre-Opening Events
Before opening the accounting firm, [Company Name] will organize pre-opening events designed for prospective customers, local community, and press contacts. These events will create buzz and awareness for [Company Name] in the area.

Print Advertising
Advertisements in print publications like newspapers, magazines, etc., are an excellent way for businesses to connect with their audience. The Company will advertise its company offerings in local magazines and newspapers.

Social Media Marketing
Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. The Company will use social media to develop engaging content and post customer reviews that will increase audience awareness and loyalty.

Special Offers
Offers and incentives are an excellent approach to assisting businesses in replenishing the churn in their customer base that they lose each year. The Company will introduce special offers to attract new clients and encourage repeat business.

Pricing Strategy

[Company Name]’s pricing will be moderate, so consumers feel they receive great value when purchasing the accounting services. The client can expect to receive quality accounting services at a more affordable price than what they pay at other CPA firms.

VII. Operations Plan

Functional Roles

[Company Name] will carry out its operations at its headquarters in [Location]. To execute on [Company Name]’s business model, the Company needs to perform several functions, including the following:

Service Functions

• Accounting and Auditing Services
• Tax Preparation Services
• Financial Consulting and Advisory Services
• Customer Service

Administrative Functions

• General and administrative functions including legal/compliance, marketing, bookkeeping, etc.
• Hiring and training staff
• Brand management/social media

Milestones

The following are a series of steps that lead to our vision of long-term success. [Company Name] expects to achieve the following milestones in the following [xyz] months:

Date	Milestone
[Date 1]	Finalize lease agreement
[Date 2]	Design and build out [Company Name]
[Date 3]	Hire and train initial staff
[Date 4]	Kickoff of promotional campaign
[Date 5]	Launch [Company Name]
[Date 6]	Reach break-even

VIII. Management Team

Management Team Members

[Company Name] is headed by its founder, [Founder’s Name] who is an experienced CPA that has been managing a large accounting firm in [location] for the past eight years. She graduated from [University] with an accounting degree and has been working at the large accounting firm since then, starting at an entry level position and working her way up to a management position.

Hiring Plan

[Founder] will serve as the Owner and Manager of [Company Name]. In order to launch, she needs to hire the following personnel:

1. Assistant Manager: 1 full-time employee to manage the day-to-day office operations and assist [Founder] with managerial duties.
2. Tax preparation specialists: 2-3 who will work in the office full time.
3. Financial consultants: 2-3 who will work on an appointment basis.
4. Office staff: 2 employees who will manage the phone calls, scheduling, accounting, marketing, clerical, bookkeeping, billing, and any administrative task required.
5. Brand manager: 1 full-time employee who will be responsible for developing and launching the brand; manage the website, and social media accounts.
6. Sales and marketing staff: 2 employees to manage outbound sales activities.

IX. Financial Plan

Revenue and Cost Drivers

[Company Name]’s revenues will come primarily from its accounting services. The major costs for the company will be salaries of the staff, which are paid through a combination of salaries and commission. In the initial years, the company’s marketing spend will be high, as it establishes itself in the market. Moreover, rent for the prime location is also one of the notable cost drivers for the [Company Name].

Capital Requirements and Use of Funds

[Company Name] is seeking a total funding of $150,000 of debt capital to open its accounting firm. The capital will be used for funding capital expenditures and office build-out, hiring initial employees, marketing and branding expenses, and working capital.

Specifically, these funds will be used as follows:

• Office design/build: $40,000
• Working capital: $110,000 to pay for marketing, salaries, and lease costs until [Company Name] reaches break-even

Key Assumptions

The following table reflects the key revenue and cost assumptions made in the financial model:

Number of clients
Year 1	42
Year 2	63
Year 3	96
Year 4	162
Year 5	243
Annual rent	$36,000

 
5 Year Annual Income Statement

		Year 1	Year 2	Year 3	Year 4	Year 5
Revenues
	Product/Service A	$151,200	$333,396	$367,569	$405,245	$446,783
	Product/Service B	$100,800	$222,264	$245,046	$270,163	$297,855
	Total Revenues	$252,000	$555,660	$612,615	$675,408	$744,638
Expenses & Costs
	Cost of goods sold	$57,960	$122,245	$122,523	$128,328	$134,035
	Lease	$60,000	$61,500	$63,038	$64,613	$66,229
	Marketing	$20,000	$25,000	$25,000	$25,000	$25,000
	Salaries	$133,890	$204,030	$224,943	$236,190	$248,000
	Other Expenses	$3,500	$4,000	$4,500	$5,000	$5,500
	Total Expenses & Costs	$271,850	$412,775	$435,504	$454,131	$473,263
EBITDA		($19,850)	$142,885	$177,112	$221,277	$271,374
	Depreciation	$36,960	$36,960	$36,960	$36,960	$36,960
EBIT		($56,810)	$105,925	$140,152	$184,317	$234,414
	Interest	$23,621	$20,668	$17,716	$14,763	$11,810
PRE-TAX INCOME		($80,431)	$85,257	$122,436	$169,554	$222,604
	Net Operating Loss	($80,431)	($80,431)	$0	$0	$0
	Income Tax Expense	$0	$1,689	$42,853	$59,344	$77,911
NET INCOME		($80,431)	$83,568	$79,583	$110,210	$144,693
Net Profit Margin (%)		-	15.00%	13.00%	16.30%	19.40%

 
5 Year Annual Balance Sheet

		Year 1	Year 2	Year 3	Year 4	Year 5
ASSETS
	Cash	$16,710	$90,188	$158,957	$258,570	$392,389
	Accounts receivable	$0	$0	$0	$0	$0
	Inventory	$21,000	$23,153	$25,526	$28,142	$31,027
	Total Current Assets	$37,710	$113,340	$184,482	$286,712	$423,416
	Fixed assets	$246,450	$246,450	$246,450	$246,450	$246,450
	Depreciation	$36,960	$73,920	$110,880	$147,840	$184,800
	Net fixed assets	$209,490	$172,530	$135,570	$98,610	$61,650
TOTAL ASSETS		$247,200	$285,870	$320,052	$385,322	$485,066
LIABILITIES & EQUITY
	Debt	$317,971	$272,546	$227,122	$181,698	$136,273
	Accounts payable	$9,660	$10,187	$10,210	$10,694	$11,170
	Total Liabilities	$327,631	$282,733	$237,332	$192,391	$147,443
	Share Capital	$0	$0	$0	$0	$0
	Retained earnings	($80,431)	$3,137	$82,720	$192,930	$337,623
	Total Equity	($80,431)	$3,137	$82,720	$192,930	$337,623
TOTAL LIABILITIES & EQUITY		$247,200	$285,870	$320,052	$385,322	$485,066

 
5 Year Annual Cash Flow Statement

	Year 1	Year 2	Year 3	Year 4	Year 5
CASH FLOW FROM OPERATIONS
Net Income (Loss)	($80,431)	$83,568	$79,583	$110,210	$144,693
Change in working capital	($11,340)	($1,625)	($2,350)	($2,133)	($2,409)
Depreciation	$36,960	$36,960	$36,960	$36,960	$36,960
Net Cash Flow from Operations	($54,811)	$118,902	$114,193	$145,037	$179,244
CASH FLOW FROM INVESTMENTS
Investment	($246,450)	$0	$0	$0	$0
Net Cash Flow from Investments	($246,450)	$0	$0	$0	$0
CASH FLOW FROM FINANCING
Cash from equity	$0	$0	$0	$0	$0
Cash from debt	$317,971	($45,424)	($45,424)	($45,424)	($45,424)
Net Cash Flow from Financing	$317,971	($45,424)	($45,424)	($45,424)	($45,424)
SUMMARY
Net Cash Flow	$16,710	$73,478	$68,769	$99,613	$133,819
Cash at Beginning of Period	$0	$16,710	$90,188	$158,957	$258,570
Cash at End of Period	$16,710	$90,188	$158,957	$258,570	$392,389