Despite a change in the ranking method, the two top spots on Arkansas Business’ list of largest accounting firms remain the same as last year.
Firms were ranked last year by total professional staff members practicing in Arkansas. This year, firms are ranked by CPAs on staff in the state.
Baird Kurtz & Dobson increased its CPA staff to 60 from 58 and remains the state’s largest.
Moore Stephens Frost of Little Rock increased its CPA staff to 43 from 37 and held on to second place. The firm’s purchase much of the Arkansas business of KPMG Peat Marwick, which ranked ninth last year, added five of those CPAs to the firm’s tally.
Ernst & Young retains third place on this year’s list with 32 CPAs and a total professional staff of 50.
The next three spots have been scrambled since last year. Deloitte & Touche moved from fifth to fourth, with 27 CPAs, while Beall Barclay & Co. of Fort Smith moved to fifth from sixth, with 26 CPAs. Arthur Andersen roster of CPAs has dropped from 31 last year to 25 this year, and the firm dropped from fourth place to sixth on the list.
The top 10 firms would differ vastly under the old ranking system.
For example, Bell & Co. of Little Rock is 18th on this year’s list, with 10 CPAs and 17 professional staff members. Under the old ranking system, Bell & Co. would finish ninth.
And on the flip side, Engstrom Grayson Green & Patterson of North Little Rock, new to the list this year, ranks eighth with 15 CPAs. But the firm’s total professional staff of 20 would have left it in a tie for 12th with Jordan Woosley Crone & Keaton of Hot Springs.
Four of the six top firms added CPAs this year. Baird Kurtz & Dobson, Moore Stephens Frost, Beall Barclay & Co. and Hudson Cisne Thessing & Co. LLP of Little Rock added 10 CPAs altogether.
Moore Stephens Frost’s purchase of KPMG Peat Marwick’s Arkansas business brought 10 new CPAs into the firm, but only five of those are still in Arkansas to help Moore’s ranking on the list.
“With the purchase of KPMG, we added 10 CPAs,” said Greg Flesher, Moore Stephens Frost’s managing partner. “Two of the 10 CPAs left for jobs in Tulsa and Dallas, and three of those CPAs transferred to other [Moore Stephens] offices around the world,” Flesher said.
Under the terms of the purchase, Flesher said his firm got all of KPMG’s business with private companies while KPMG’s business with publicly traded companies was transferred to other KPMG practices.
“We do some work with publicly held companies, but it’s not our focus,” Flesher said. “I’m not sure I know why KPMG left this market. Part of the reason had to be that Dorsey Jackson [managing partner of KPMG in Little Rock] wanted to retire. That probably started them to thinking about what to do with the office.”
Joe Strack, tax partner of KPMG, holds the same position on the management team at Moore Stephens Frost, according to Flesher. Strack was active in completing the terms of the transaction.
Moore Stephens Frost, which was founded in 1974, has developed a national practice in animal agriculture, food processing and health care, and a regional practice in construction, banking and manufacturing. The firm serves clients in more than 40 states and 10 countries. Moore Stephens Frost posted more than $10 million in revenue for its fiscal year ending April 30, 1999.
Moore Stephens Frost is a member of Moore Stephens North America Inc., a network of professional service firms. MSNA is a member of Moore Stephens International Ltd., one of the top 15 worldwide consulting and accounting networks, with nearly 400 offices in 75 countries.
Flesher said that after nine months, the firm’s purchase of KPMG was everything he had hoped it would be.
“It was about 10 percent of what we had previously been doing,” Flesher said. “We acquired some good people and a good deal of work from KPMG. We’re very pleased.
“Our plan is to continue to grow. We want to do that intelligently and continue to remain comfortable in the way we do it. We have seven entry-level people set to start Jan. 1.”
Most of that growth will most likely come from what Flesher described as the firm’s two major specialties: family-owned private companies and animal agriculture.