The Gazette 1979

JULY-AUGUST

1979

GAZETTE

DECISION TO MERGE

(2) Accountants/Consultants At an early date, the new partners must choose which accountants will be acting for the new firm. The accountants will be able to advise on the Taxation aspects and also on whether or not a Service Company should be .employed. Apart from the accountancy advice and work for the new firm, there is another aspect. This is the employment of outside Consultants to advise and carry out much of the work in preparing for the merger. The accountants for the new firm may or may not be the best persons for this consultancy work. The advantage of bringing in Consultants in my view is overwhelming. The existing partners will already have a lot of extra work by reason of the merger and the very heavy and detailed thought and work necessary in planning the merger has a much better chance of being done successfully if Consultants are employed. This does not mean that the partners can leave everything to the Consultants. The sort of details that will need to be worked out are:- (a) The filing system: A new code will need to be worked out to fit in with the Accountancy system and the ledger card system chosen. All existing files in the two offices will be renumbered so that the files in the existing firms will be part of the one new system BEFORE the merger takes place. A lot of work will also be needed in destroying old files and papers so as not to clog up the new premises unnecessarily. (b) Accountancy system: The accountants will need to advise on what accountancy machines and systems will best suit the new firm. Nowadays, consideration must also be given as to whether to use a computer and if so whether to buy or rent a computer. (c) Office equipment and furnishings: These will need careful study. It will be necessary to standardise on the types of dictating and other machines used in the new firm. A suitable telephone system for the new firm will also need to be arranged. (d) Stationery/Notepaper: Notepaper for the new firm will have to be designed and in addition thought will need to be given to providing various other types of firms stationery including all the various forms frequently in use in solicitors' offices. (e) The physical problem of moving: This will require careful planning and coordination. The furniture will need to be labelled and all files will need to be marked so that when the big day comes the firm carrying out the moving will know exactly where the furniture is to go and where the files are to go so that the move can be carried out with the least possible confusion. (0 Preparation of Notice to the Press, Notice to clients, etc.: A notice to clients will need to be drafted. Each firm will need to list its clients. It will also need to list the solicitors and the accountants with whom it deals out- side Ireland because these also should be circularised. The Law Society will facilitate merging firms in circularising solicitors in Ireland. (3) Integration of Staff In any merger, there should be some saving by integration of staff. Each of the two firms will have Receptionists and their own accounts department. In the new firm, it may be that only one Receptionist will be required and that the number to be employed in the new accounts department may be less than the combined total of the persons previously employed. A choice may have 73

Having considered the factors to which I have referred, the decision to merge is made. A number of matters immediately arise. Probably the best way of dealing with these matters are for the prospective partners to arrange sub committees to deal with various aspects and to put a particular person in charge of each sub committee.

(1) Premises A merger will usually involve a move by both parties and this I think is an advantage. It is new for both sides and removes any sense of one party moving in on the other party's ground. It is I think better to rent the new offices than to purchase them. A purchase by one or more of the new partners can cause problems in the future. Renting premises also makes for greater efficiency as the partnership has to bear full commercial overheads. The location of the new offices will obviously be important. In a city the main factors that are likely to apply are the desire to be near to other Solicitors' offices and also if possible to be near the Courts and the various Govern- mental and other offices with which Solicitors have to deal. Car parking is also a factor. New premises will give an opportunity to plan the new offices for maximum efficiency with as much horizontal space as possible. A much better use of space than may have existed in old premises, should be possible. The work on the premises is likely to be very sub- stantial. In order to ascertain the size of the premises that will be required it is necessary to make a detailed list of the staff employed by each of the two firms and from this to make some assessment of the space requirements of the new firm. Allowance must also be made for expansion as there is no point in moving into new premises and then finding that after a few years the premises are too small. In assessing space requirements, you will probably need to give consideration to some features which you may not have had in your existing offices. These may include the provision of a strong room, the provision of a simple canteen, the provision of plenty of storage space. Whether the premises are bought or rented, there will be a lot of work required in planning the details of the lay- out and finish of the office and also built in furniture. Whether you buy or rent, it will also be necessary to agree the financial arrangements with your other partners. Prior to the move, careful study must be given to the allocation of rooms. This is not as simple as it sounds. Firstly, there is the problem of seniority not only between the partners but also between the staff. You must be able to allocate rooms in such a way as will not cause offence. In allocating rooms also it is desirable to give thought to the degree that you intend to departmentalise so as to put persons who will be working in a particular line in rooms that are close to each other. One point that may not seem obvious is that there is no reason why the date for moving into the new premises must coincide with the date of the merger and 'for the commencement of the new partnership. Indeed, it seems to me that there are advantages in moving into the new premises a couple of months earlier than the merger be- cause this gives time to settle down and time for the staff to integrate before the critical date.