The march toward proliferation of cloud accounting across the industry has taken another step.
To meet the growing demand by global clients for anytime, anywhere access to financial information, Aprio, LLP, a full-service, CPA-led business advisory firm, has entered into an agreement to acquire HPC, a technology-driven, cloud-based accounting firm with a global footprint.
We should note that, as of publication, the deal has not officially closed, and the closing of the transaction is subject to certain contingencies.
Aprio’s acquisition of HPC is a signal that larger firms are moving away from traditional processes and committing more resources to cloud accounting, automation, machine learning, artificial intelligence, remote work, analytics, and forward-looking insights based on data.
So why did Aprio choose to acquire a cloud accounting firm? According to Aprio CEO and Managing Partner Richard Kopelman, the move is part of a larger strategy focused on meeting expanding client needs and requirements.
“We have to meet our clients where they are,” Kopelman says. “And when we look at business leadership, it’s transitioning to more millennials and now Generation Z. These people are digital natives, and they want to work with their advisors differently.”
For Bruce Phillips, founder and CEO of HPC, the move toward cloud accounting and Aprio’s acquisition of his company signal the end of a barrier that has long prevented regional firms from reaching their full potential.
“Through the use of technology, geographic boundaries are being eliminated,” Phillips says. “The world has gotten so much smaller. Our clients can now sell products all over the world out of their garage. So they need a partner who can work with them globally and virtually.”
If Aprio wanted to grow its cloud accounting capabilities, there were a number of firms it could have chosen to acquire. So what’s so special about HPC?
For Kopelman, the decision came down to personal relationships and leadership.
“Bruce and I have been working together for 20 years,” Kopelman says. “Certainly having comfort with the leader is always helpful. But another reason was that I thought they were doing cloud accounting really well. When I called around and talked to executives and leaders in the profession, his firm’s name continued to come up.”
Phillips also points to his personal relationship with Kopelman as a reason for the acquisition but identifies HPC’s longevity and success in the cloud accounting world as another key factor.
“We’ve been doing this a long time. We are leaders and are on the leading edge of technology. We’ve figured out the financial pieces of the back office and cloud accounting,” Phillips says. “We’re making money at it. There’s a lot of people doing it, but I don’t think there’s a lot of people making money at it.”
Phillips and Kopelman both cite the ability to use technology to widen global capabilities as a major component in the decision.
“For a small virtual cloud accounting practice, we have a global footprint and global reputation,” Phillips says. “I don’t believe many people have that.”
“Twenty-five percent of our staff are foreign-born, and we have specific desks for Korea, Japan, China, the Netherlands, Germany, Russia, and other countries as well. This acquisition will give us an opportunity to serve foreign companies in a much more holistic way,” Kopelman says.
Picturing the future
So what does Aprio look like post-HPC acquisition? It’s difficult to speculate, as the ink hasn’t even dried on the deal yet. But Kopelman sees an Aprio that’s more virtual, more global, and more technology-driven.
“We serve a wide client base across multiple generations that like to work with their professionals in totally different ways,” Kopelman says. “And so we will continue to meet those clients where they want to be met and serve them how they want to be served. Right from the client who wants to bring their tax information into the office to the client who wants to load it all through an app.”
A better employee environment
Kopelman and Phillips both believe the HPC acquisition, as part of Aprio’s larger strategy of pushing the edges of technology, will make the company more attractive to future employees.
“I think this will add to the ability for people just joining the organization to contribute at a much higher level, not just to how we serve clients but how we operate,” Kopelman says.
“We currently have people in 15 states across the U.S., in Canada, and one traveling the world. I believe we’ve brought ‘flexbility’ to a new level. Once we become part of Aprio, our team members will have a lot more resources and excellent training that we’ll be able to tap into. They’ll have more opportunities to do many different things and learn so much more,” Phillips says.
When asked why someone working in the accounting or finance world would want to join the Aprio team, Kopelman identifies the company’s rapid growth and work flexibility.
“We’ve grown over the last 66 years by having an entrepreneurial spirit and culture within our firm,” Kopelman says. “Team members of all levels are encouraged to bring new ideas to the table for services, products, and ways of doing business. Everyone has an opportunity to be a part of the growth of the firm.”
Learn more about Aprio here.
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