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This post uses hypothetical scenarios for illustrative purposes only. It does not describe any actual client, transaction, or representation, and is not legal advice.

A common 2026 Florida CPA firm M&A pattern looks like this: a private equity-backed accounting platform arrives with a stated purchase multiple in the low-to-mid teens on EBITDA, the selling partners get excited, and then the compliance analysis lands on the table — Florida Statute Chapter 473 caps non-CPA ownership in a licensed public accounting firm at forty-nine percent, and requires that a simple majority of the ownership, financial interest, and voting rights be held by CPAs licensed to practice in some U.S. jurisdiction. That single statutory constraint changes everything about how a PE roll-up gets structured in Florida. The direct acquisition model that works in states with no ownership cap does not work here. Instead, the transaction has to be structured as a holdco or management services organization structure — with an operating CPA firm continuing to hold the attest license, majority-CPA-owned, and a separately owned services company holding the technology, back-office, non-attest advisory, and PE equity — and every diligence item and every rollover term has to fit inside that structure.

The § 473.3101 ownership cap is the whole game

Florida Statute § 473.3101 requires that a firm holding itself out as a certified public accountant firm, or performing attest services in Florida, have a simple majority of ownership held by natural persons licensed as CPAs in some U.S. jurisdiction. The forty-nine percent cap on non-CPA ownership is enforced by the Florida Board of Accountancy, and there is no waiver mechanism. The statute also requires that the CPAs holding the majority interest hold a majority of the voting rights, and — critically — that the majority ownership be beneficial ownership, not just record title.

The rule is deceptively simple to state and deceptively hard to structure around. The Board of Accountancy has interpreted “beneficial ownership” in a way that scrutinizes profit-participation rights, liquidation preferences, and effective voting control — meaning a naked forty-nine percent equity cap on paper, combined with a preferred-return waterfall that gives the PE sponsor economic control, will not survive a compliance review. Any PE sponsor doing a Florida roll-up has to structure the CPA firm’s cap table so that the CPAs are genuinely — economically as well as nominally — in control of the attest firm. The MSO or holdco captures the enterprise value; the operating CPA firm captures the license.

The two-entity structure that actually works

The dominant structure Florida PE-backed accounting deals now use has two entities. First, an operating CPA firm — usually a professional association or a PLLC — that holds the Florida Board of Accountancy license, employs the CPAs, performs the attest work, and has CPA majority ownership on both the equity and the voting axis. Second, a management services organization — typically a Delaware LLC, PE-owned — that provides technology, back-office operations, non-attest advisory services, marketing, HR, IT, and administrative infrastructure to the CPA firm under a long-form management services agreement.

The MSA between the two entities is the document that makes the economics work. It routes non-attest revenue and value to the MSO, provides for a management fee that captures a substantial share of enterprise economics, and gives the MSO real operating leverage over the platform without crossing into control of the attest practice. The MSA fee has to be structured to be reasonable and defensible — the Board of Accountancy will look at it, and so will the IRS and state tax authorities — but it is the mechanism that lets the PE sponsor capture the return on capital that made the deal viable in the first place. Getting the MSA wrong is not just a compliance issue; it is a fundamental deal-viability issue.

The three diligence items that decide whether the rollover holds

Once the structure is set, three specific diligence items determine whether the rollover economics hold or whether the deal has to be repriced. First, the peer review file. Every Florida CPA firm performing attest work is subject to peer review under the AICPA program, and the peer review report — pass, pass with deficiencies, or fail — is the single most important compliance document in the diligence room. A firm with a recent “pass with deficiencies” or a “fail” report has real work to do before a PE buyer can close, because the buyer’s platform will not accept quality risk into a growing attest practice, and the remediation timeline can be six to twelve months.

Second, the client-account concentration and roll-forward. A CPA firm’s book of business is not homogeneous — attest clients, tax-only clients, advisory clients, and monthly bookkeeping clients each have different retention economics, different margins, and different regulatory exposure. The buyer’s diligence needs to segregate the book by service line, look at the top-fifteen client concentration in each segment, and run the client roll-forward to see actual retention through partner and staff transitions. Firms with high tax-season concentration or with a small number of large attest clients get priced differently from firms with a broad advisory book and steady recurring revenue.

Third, the partner and manager retention structure. The value of a CPA firm walks out the door every night, and the deal only works if the human capital stays through the transition. Retention bonuses, non-competes calibrated to Florida’s post-2023 non-compete environment, equity rollover structures, and post-closing role definitions all have to be built into the LOI, not left for the definitive agreements. The partners rolling into the MSO equity are the people whose alignment matters most, and the terms on which they roll — preferred return, catch-up rights, board representation, exit rights — have to be negotiated with the same care that goes into any private equity stockholders agreement.

The Chapter 473 licensure look-back — an underappreciated diligence item

A specific Florida-item that gets missed in national roll-up diligence is the Chapter 473 licensure look-back on the selling partners. Every CPA license in Florida has a continuing education requirement, a peer review requirement for firms performing attest, and a discipline history that lives in the Board of Accountancy’s records. Buyer’s counsel should pull the full DBPR record on every partner rolling into the MSO, look for open complaints, look for prior disciplinary actions, and confirm current CE compliance. A partner with a pending Board investigation is a real problem for a PE-backed platform — the buyer inherits reputational risk, and the platform’s ability to add new clients or expand into new service lines can be constrained by a partner’s regulatory status. This is not a hypothetical risk; the Board of Accountancy actively pursues CE audits and complaint investigations, and the discipline docket is public.

The tax structuring layer

Under the two-entity structure, the tax model gets its own layer of complexity. The rollover partners are typically rolling from an operating professional entity into an MSO LLC interest, with the transaction structured to qualify for tax-deferred rollover treatment under Section 351 or, more commonly, an F reorganization followed by a partnership contribution. The CPA firm continues to be taxed as a pass-through in most structures, distributing to the CPA owners; the MSO is taxed as a partnership for federal purposes with its own K-1 to the PE sponsor and the rolling partners. Getting the interaction right between the two entities — allocation of income, character of distributions, treatment of the MSA fee, state and local tax overlay — is a real tax exercise, and it has to be modeled at the LOI stage, not after.

The partners rolling into the MSO are effectively swapping personal-goodwill economics for equity in a leveraged holding vehicle. That is a good trade for a partner who is bullish on the platform and has some runway; it is a mediocre trade for a partner near retirement who values liquidity certainty over upside. Sophisticated PE buyers structure the deal to accommodate both types — a higher cash-out mix for the near-retirement partners, a higher rollover mix for the partners who will drive the next-decade growth — and the LOI should reflect that segmentation before the definitive agreements are drafted. Founders and partners should read the general framework for how deal terms allocate risk between sellers and buyers alongside the industry-specific structural work.

The regulatory closing conditions

Two regulatory closing conditions typically go into a Florida CPA firm APA. First, notification to the Florida Board of Accountancy of the change in ownership structure and confirmation that the post-closing entity ownership complies with § 473.3101. This is not a pre-approval regime — the Board does not pre-approve transactions — but the licensee has an ongoing compliance obligation, and a well-run deal will have the compliance memo, the cap-table diagram, and the MSA in place at signing, ready to be filed or provided on request. Second, if the firm performs SEC-registered issuer audits, PCAOB notification and compliance is a separate track, and any deal involving public-company clients has to build in a PCAOB notification-and-reporting stack that is different from the state-level analysis. Most Florida CPA firms coming to market do not have public-company clients, but the ones that do carry a materially different diligence profile.

The final observation

Florida CPA firm M&A is one of the more constrained regulated-industry roll-ups in the state, and it is also one of the more active ones — the PE thesis on accounting-services consolidation is real, and Florida has both a large addressable market and a licensing regime that channels every deal through the same handful of structural choices. The winning deals get the structure right at the LOI, run the peer review and licensure diligence early, segment the partner rollover by career stage and appetite, and build the MSO so that the CPAs are genuinely — not just nominally — in control of the attest practice. The deals that get repriced or unwound are the ones where somebody in the room assumed Florida works like their home state. It does not. The controlling statute is , and every professional on the deal should read it once before signing anything. This kind of structuring analysis fits into the broader Florida M&A practice, and it rewards the founders and buyers who do the structural work early.

If you are a Florida CPA firm partner considering a PE recapitalization, or a PE sponsor structuring a Florida platform acquisition in the accounting services vertical, feel free to reach out to my firm manager, Magda, at Magda@montague.law, or fill out our contact form. Mention you read this post.

— John