THERE ARE MANY general accounting practices – those offering a wide range of services to clients – but how many operate with two leading partners each in possession of not only accounting, tax and audit skillsets, but also insolvency?
The experience and qualifications of managing partner Martin Atkins and long-serving senior partner Barry Lewis seems to make Harris Lipman unique.
The firm was formed in 1954 and undertook its first liquidation a year later. “Right from the beginning, we’ve always had a mixed practice,” says Atkins.
Business recovery and insolvency work represents roughly half of the firm’s income, which Atkins believes has always allowed it to “weather the storm” in terms of the changing economic winds.
“If the economy is doing well then we turn our attentions to business services and tax planning, then on the other side if it gets a bit tough we can call on our corporate recovery experience,” he says.
All for one and one for all
The Harris Lipman team has seen several instances where clients have approached them thinking that the corporate end is nigh, only for its partners to find more informal work-outs.
The firm operates an “all for one and one for all” approach, so that clients get the most appropriate advice and service, rather than what bests suits the introducing partner. “Freddy [Khalastchi, partner] focuses on insolvency but we don’t stand by and say that client will have an insolvency…If Freddy thinks it’s better off as an audit client, he’ll happily pass it across.”
Harris Lipman expanded its insolvency remit back in 1998, although there wasn’t a ‘grand scheme’ behind its growth. Based primarily in Whetstone, Barnet, the firm “was to a large extent minding its own business”, admits Atkins. But a plea from an insolvency practitioner in Cardiff, struggling with 238 outstanding cases, saw the work handed to Harris Lipman
“His primary concerns were the cases and his staff. So we took on the cases, of which there were some good cases and some not so good cases. We picked up good members of the team and we quickly felt that Cardiff was a place where we wanted to do business,” Atkins says.
While Harris Lipman undertook some due diligence, Atkins says that the move was opportunistic. “You have to take these chances when they come along.”
Partner John Cullen moved to head up the office in 2002, since then the office has gone “onwards and upwards”.
However, the office doesn’t operate in a silo. Much of the ‘front-end’ insolvency work takes place in North London and much of the administrative process passes through to Cardiff.
But, taking risks doesn’t always work out. Forays into Reading, St Albans and the City failed to pan out. The difference, Atkins believes, is that the Cardiff office had an infrastructure and caseload from day one, that was supplemented by an established member of the team taking control.
“I think they’ve not worked out either because we’ve not been able to get the momentum moving quick enough, or because the individuals in those offices have not run things the Harris Lipman way. If we were to plan any future expansion, it would be on the basis that there was an individual, senior manager or a partner here who said to me ‘You know what Martin, I think there’s a great opportunity to go into Cambridge’ or wherever they want to go, and take it forward from there.”
That is not to say that Harris Lipman doesn’t have bigger plans. But it knows what it does well (and could improve on), and more fundamental changes require deeper consideration.
A “good half-dozen” firms looking to expand have approached it. Harris Lipman’s success has seen it picking up and holding onto larger and larger clients. But without the high-level expertise in corporate finance, financial services and high-level tax work, a deal has been on the cards.
It progressed deeply along the merger front, but the deal process ended in March 2012. While there’s nothing on the agenda at the moment, in many ways the deal process has left its mark on the firm.
As Atkins describes candidly, the partners had to face up to what the deal would mean, and did they really want it? “We were all very flattered that we were approached – but once you start talking to people and realise that things are never going to be the same again, and you’re going to be part of a larger organisation, things will inevitably change, people have to.”
Subtle, but important parts of working life would change. The five minute drive down the road to the office might become an hour, for example.
Atkins “doesn’t want to dwell” on that period, but what was an 11-partner practice has become seven-partners – due to a combination of those for whom the merger wasn’t for them, and those who left as the merger didn’t happen.
Out of what was a difficult, distracting time for the practice, is a slightly leaner practice, but with minds focused on getting the practice working at its optimum – without distraction.
“I think everybody has done the right thing for them and probably in the long term the right thing for the firm,” Atkins says.
The firm still has its two most senior individuals in place: Atkins and Barry Lewis. With Lewis a mainstay at the practice since 1967 – and notorious for his early morning starts, how can the firm move forward while maintaining a multi-disciplinary skillset?
Atkins is sanguine, in that while no-one has expressed a desire to ‘switch codes’ within the team, he believes that the insolvency and accounting departments probably know more about each other’s disciplines than most.
“While we have our rising stars, there’s nobody that’s going to step straight into our shoes, but nevertheless, you’ve got people who have got very broad experience,” says Atkins.
With succession planning an issue with most practices, Harris Lipman has formalised its efforts to maintain the firm, with its Path to Partnership scheme. “People talk about becoming a partner, but don’t really understand what it is or how they’re going to get there. That’s why we have introduced our Path to Partnership programme which is running very well, and I very much hope that this will enable all the participants to become partners of the future.”
The firm has always made efforts to keep up to date with what clients want and need, and how to market to them. So despite being built on what Atkins would describe as traditional values, it makes an effort to maintain a lively and relaxed website, while LinkedIn, Twitter and the apps market are becoming more important communication tools.
Services are evolving too, from Harris Lipman keeping its ear close to the ground on the development of crowd-funding (where the internet is typically used to pool funds for investment), and more up-to-date client bookkeeping.
On the charity front the firm has set up the Harris Lipman Foundation, aimed at supporting Olympic legacy projects. It fits into an explicit ‘human element’ in the way the firm as a whole operates.
“While we are always – and will continue to be – commercially minded, we treat our clients as friends, and only have friends as clients.
“It creates a very stable and often long-lasting relationship, and that’s one of the foundations that the firm is built on. We’re not a firm to charge very high fees and then not service the client, who will then leave after a couple of years. It really is about building long-lasting relationships.”