Document Type

Article

Publication Date

12-2019

Abstract

Family businesses account for over 50% of U.S. GDP, and 35% of Fortune 500 companies are controlled by families. These companies are vital to the economy, offering stability, a long-term commitment, and responsibility to their communities and employees. Although family-owned businesses are responsible for 60% of jobs in America, a recent family business survey done by the National Bureau of Economic Research’s Family Business Alliance indicates that despite succession being a critical issue for many family companies, only 15% of them have anything resembling a succession plan in place. Furthermore, businesses have a difficult time surviving through multiple generations; just making it to the second generation is a milestone event; only 30% make it through the second generation, and just 12% make it through the third (“The Family Business Sector in 2016: Success and Succession,” PricewaterhouseCoopers, https://pwc.to/2D3ftcF).

This article explains how CPAs, as trusted advisors, can play a significant role in establishing prudent and functional succession plans for their business owner clients.

Comments

This article was published in the December 2019 issue of The CPA Journal. https://www.cpajournal.com/

© 2019 The CPA Journal

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