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Recipe for Success: How an Accounting Firm Merger Created One Very Efficient Practice

Thomson Reuters Tax & Accounting  

· 6 minute read

Thomson Reuters Tax & Accounting  

· 6 minute read

[Image ©Will Bragg]

With an eye toward offering comprehensive financial services and excellent customer service, Davis & Graves, CPA LLP, has spent years investing in integrated systems.

Before merging their practices into Davis & Graves in Gresham, Oregon, the two founding partners had gained decades of experience. Jerry Davis, CPA/PFS, and Thomas Graves, CPA/ABV, had even worked with the same clients. “We’d shared clients back and forth for years when Tom called me and said his wife wondered what would happen if he didn’t wake up one morning,” Davis says. “I told Tom my succession plan was that my wife, Vickie, would call him. One thing led to another and we decided to merge our firms.”

Davis had started offering financial planning services to his clients, and Graves had already been doing work in business valuation. The duo realized that these were exactly the kinds of services their clients needed most. “Most of our clients are small, closely held businesses,” Davis explains. “A significant amount of their net worth is wrapped up in their businesses, so when they start thinking about their exit strategy, we can help them.”

In fact, he says, having gone through the process of merging their two firms gives Davis & Graves a unique perspective on what their clients need most.

“It’s like the analogy that it’s one thing to be the engineer who builds the rocket but it’s another to be the astronaut who flies in it,” Davis says. “We know what challenges our clients are facing because we’ve been through them.”

It’s not just the financial aspects of a business transition, either. It’s the human element that often requires additional guidance. For example, if two separate firms merge, you suddenly have two of everything. So who is going to be the receptionist? Will someone else feel slighted if they’re put in a new position?

Becoming one firm was a lot of work. But it was well worth it, Davis says, both for their practice and for their ability to serve their clients. “Our ultimate goal is to take care of our clients, so being able to answer every question they may have helps us do that,” Davis says.

An Easy Equilibrium

While some firms struggle to balance the demands of tax and accounting services with advisory services such as financial planning, Davis & Graves sees them as naturally interconnected.

According to Davis, all of the services they offer can be compartmentalized, and some clients only need one service, such as tax return preparation. But if the day comes that a client needs something else, such as financial planning services, the firm is well equipped to jump right in. “We don’t have to educate ourselves about what’s going on, because we’ve been doing their tax returns for 10 years and we know what’s going on,” Davis says.

What’s more, the full-service nature of Davis & Graves means the firm can help clients make much better financial decisions across the board—spotting potential pitfalls a firm with a single focus might miss. For example, when helping a client with financial planning, the firm understands the potential tax liabilities of any investment decision. Handling the entire package of services for a client adds real value, Davis says.

“By adjusting the investments just a bit, we can help them achieve their financial goals and get them a significant tax efficiency,” he explains. “Our clients respond very positively to the complete services we offer.”

Investing In Integration

At Davis & Graves, the pursuit of efficiency extends to the tax and accounting software they chose. Most of their clients use QuickBooks®, and the firm wanted a solution that would easily integrate with that. Plus, when the two firms merged, they needed a fully electronic solution because their operation spans three floors of their building.

“If someone calls with a question about their tax return, running around to the file cabinet on another floor means putting them on hold for too long,” Davis says. “And that’s assuming the file is where it’s supposed to be!”

Deciding a fully integrated system was the only way to go, in the summer of 2013, the firm switched to the Thomson Reuters CS Professional Suite. Davis admits the transition from their old tax preparation software wasn’t easy. There was a steep learning curve and an initial downturn in efficiency. But after some training from Thomson Reuters—the cost of which Davis balked at initially, but now says was worth the investment—the firm was not only back up to speed, they were more efficient than ever by the second year.

“We’re seeing such efficiencies that it saves us one experienced tax preparer during tax season compared to our old system,” Davis says.

In addition to the significant reduction in the time it takes to prepare tax returns, the firm saw other time-savers. With Workpapers CS, getting a client’s QuickBooks file into UltraTax CS is a snap—and something the firm’s previous software couldn’t do. Plus, the firm no longer has to update addresses or other new client information in multiple places. Enter it once, and it’s updated everywhere.

“We think Thomson Reuters has an outstanding product,” Davis says. “It does everything that was promised.”

With technology that improves efficiency, Davis & Graves can spend more time on the tasks that really add value for their clients. “We know about our clients’ businesses and we can help them with all of the transitions they may face, including retirement,” Davis says. “We have a great team, and we’re in a great position to help our clients achieve all of their financial goals.”

Firm Facts

Jerry Davis, CPA/PFS, and Thomas Graves, CPA/ABV, merged their two independent practices in 2010. Two and a half years later, they were joined by a third partner, Steve Stegeman, CPA/CGMA.

Basics: Davis & Graves, CPA LLP, is based in Gresham, Oregon. With three CPAs and four additional staff members, the practice is a full-service firm. Although they specialize in small businesses—with services such as business planning and support—they also provide services for individuals, such as tax preparation and estate planning.

Website: At, the firm offers a wide range of information for clients, such as helpful tax preparation tips, as well as a secure client portal to send documents. A second website——highlights the firm’s financial planning services and also provides online client resources.

Software: Davis & Graves uses a number of Thomson Reuters software products: Practice CS®, UltraTax CS®, Workpapers CS, FileCabinet CS®, Fixed Assets CS®, Planner CS® and Thomson Reuters Checkpoint®.

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