New dealer rejects consolidation model
A group of 10 accounting and financial planning firms have teamed together to create a new planning group, Investment Taxation Services (ITS).
Managing director Ross Anderson says the group formally came together at the end of June but has chosen to keep its profile low key until it began the integration of the member firms.
Working alongside Anderson are some well-known industry names. Myles Cronin has joined the group as an executive director, while Peter Thornhill joins as non-executive director. The group will be chaired by Gary Tilsley, currently the managing director of BIS Shrapnel.
Anderson says the 10 firms have formed an unlisted public company and have adopted an integration model, as opposed to a consolidator model.
He says the reason for this is consolidators have yet to prove to be successful. ITS has intentionally chosen to start small and build systems across the group before beginning to expand further.
“There are enormous benefits in some of the principles of consolidators but promoters of those have tended to keep their eye on increasing earnings rather than building a solid business model,” Anderson says.
“There is no doubt that accounting and financial planning should be integrated but we have not set out trying to generate huge fees for our member firms.”
The new group has a combined staff of 110 , including about 15 proper authority holders. The 10 member firms are all based in NSW, with four in Sydney and Canberra and one each on the Central Coast north of Sydney, Griffith and Wagga Wagga.
The integration of the groups is complete, Anderson says, with each member firm taking equity in the new group.
Anderson says the group’s long-term aim is to have a presence in each capital city but so far the initial focus has been just in NSW due to the work involved in creating the fledgling group.
It currently has annual revenue of $11 million which Anderson says will expand to $350 million in five years, mainly sourced from financial planning.
He says the group will also remain unlisted for some time as it removed some pressure from the group and simplified accountability issues for the member firms.
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