Accounting Firm Pro Forma Template

Once assumptions are set, move to Revenue Projections and review the output by service line. Check that the mix between tax, audit, CAS, advisory, and payroll reflects how your firm actually earns revenue — and adjust the growth rates for each line based on your business development pipeline and strategic plan. If you're planning to launch a new service like fractional CFO work, set the year-one revenue conservatively (80% of capacity) to account for ramp-up time. The staffing capacity check on the Staffing sheet will tell you if your projected revenue targets are achievable given your current team.

The metrics that determine a firm's profitability are layered. First, how many available hours does your team have? That depends on headcount and the typical number of working hours (firms commonly assume 1,800–2,000 available hours per year per person). Second, what percentage of those hours are billable — your utilization rate? Well-run firms target 60–75% for most staff levels; partners typically run lower due to business development and management time. Third, how much of the standard rate value actually gets billed? Realization rates at healthy firms run 85–95%. Finally, how much of what's billed actually gets collected? Collection rates below 95% indicate write-off problems that compound over time. The pro forma models all four layers simultaneously.