Your working
Ten statements, each worth up to 3 points, so 30 points in total. Your score is that total expressed out of 100. A higher score means less dependency — more of the firm survives your absence.
| # | Statement | Your answer | Points |
|---|
What to fix first
Anything you scored 0 or 1 on is listed below, hardest-hitting first, with the practical first move.
Send me this result
We'll email your score and the fix list back to you, with a note on the order we'd tackle them in for a firm your size. No obligation, NDA on request.
Why owner dependency is the number one thing buyers look at
When somebody buys your practice they are not buying last year's fees. They are buying next year's, and the year after that. Everything a buyer does in diligence is an attempt to work out how much of that future income is attached to the firm and how much is attached to you personally. Owner dependency is the name for the second category, and it is the single biggest reason two firms with identical fee income sell for materially different amounts.
It is worth being precise about where dependency actually lives, because owners routinely mis-diagnose it. It sits in five distinct places:
- Relationships. Whose name is in the client's phone. If every conversation of substance goes through you, the client's loyalty is to you, not to the letterhead.
- Pricing judgement. Who decides what a job is worth. This is the most under-rated form of dependency — it is rarely written down anywhere, and a buyer who cannot price your work correctly will either lose margin or lose clients.
- Technical review and sign-off. Who takes responsibility for the file. For many sole practitioners this is the hardest to transfer, because it can require a hire, a licence, or both.
- Business development. Whether new work arrives because of the firm or because of you. A referral network that is personal walks out with you.
- Operational access. Logins, licences, bank mandates, the one spreadsheet nobody else has opened. Trivial to fix, and surprisingly often unfixed.
How the score converts into money
The score is mapped onto an adjustment to the multiple of recurring fees used in our practice valuation calculator. These weights are Practice Group's stated working assumptions about how much retention risk a buyer prices in — they are not market data, and you are free to disagree with them. They are set out here so you can see exactly what is being applied:
| Score | Band | Effect on the multiple |
|---|---|---|
| 80–100 | Low dependency — the firm runs without you | +0.15 |
| 60–79 | Moderate — a phased handover covers the gaps | +0.07 |
| 40–59 | Average — the firm leans on you in specific places | 0.00 |
| 20–39 | High — a buyer prices in real retention risk | −0.10 |
| 0–19 | Critical — you are the practice | −0.20 |
The spread between the top and bottom band is 0.35× recurring fees. On a £300,000 book that is £105,000, on identical fee income, decided entirely by how the firm is organised. That is why this is the first thing to work on and the thing that takes longest.
Worked example
A sole practitioner with £300,000 of recurring fees scores 12 out of 30 — a score of 40. That sits in the "average" band, so the effect on the multiple is 0.00. Nothing gained, nothing lost.
Over eighteen months she does four things: a manager is introduced as second contact on every client file and leads half the year-end meetings; the top five job types get written down as checklists; enquiries move to a firm inbox; and every system gets a second named user. Three answers move from 1 to 3 (+6 points) and four move from 2 to 3 (+4 points), taking her to 22 out of 30 — a score of 73, the "moderate" band, worth +0.07.
On £300,000 of recurring fees that is £21,000 on the mid-point of the valuation, for work that also gives her back most of a day a week. The remaining gap to the top band — another £24,000 — is the review and sign-off question, which is the one that needs a hire.
The order to fix things in
Not everything on the list costs the same. Operational access and documentation are cheap and quick — a few weekends of unglamorous work. Moving relationships takes a full annual cycle, because a client only really transfers when they have sat through a meaningful meeting with someone else and it went fine. Pricing judgement transfers when you stop setting prices and start reviewing them. Review and sign-off is the expensive one, and if it needs a qualified hire it should be started years rather than months before an exit.
The trap is leaving all of it until a sale is imminent. By then the buyer is looking at the firm as it is, not as it will be, and there is no time for any of it to become true. If you are within a year of going to market, the honest advice is to do the cheap items, be straightforward about the rest, and plan for a phased handover rather than a clean break.
Frequently asked questions
What is owner dependency in an accountancy practice?
Owner dependency is the share of the firm's value that exists only because the owner is there. It shows up in five places: who the client actually deals with, who prices the work, who reviews and signs it, who brings in new business, and who can access and run the systems. The more of those that answer "the owner", the less of the firm transfers when the owner leaves.
How does owner dependency affect what my practice sells for?
A buyer is paying for fee income that will still be there in two years. Owner dependency is the risk that it will not be. In this tool a score of 80 or above adds 0.15 to the multiple of recurring fees, and a score below 20 takes 0.20 off it — a spread of 0.35× recurring fees between the ends. Those weights are Practice Group's stated assumptions, not market data, and they are shown so you can adjust them.
How long does it take to reduce owner dependency?
Access, documentation and moving enquiries to a firm inbox can be done in weeks. Shifting client relationships to a second person takes a full annual cycle, because clients need to meet that person in a real meeting rather than an email. Getting to a position where someone else can review and sign off the work is the longest job and can take years if it involves recruitment or a practising certificate.
Is low owner dependency always better?
For sale value, yes. For a firm you intend to keep running yourself, the honest answer is that reducing dependency costs money and management effort before it pays back. The case for doing it early is that it takes 12 to 24 months to move the needle, so it cannot be started once a buyer is already at the table.
Does staying on after the sale fix owner dependency?
It manages it rather than fixing it. A phased handover reduces the buyer's retention risk and often supports a stronger total figure, but it also ties you into the business for longer and usually pushes more of the consideration into deferred or retention-linked payments. Reducing dependency before you go to market gives you the option of a clean break.
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