By THOM SENZEE Contributing Reporter One of Southern California’s best-known mid-sized accounting firms, Good Swartz Brown and Berns LLP (GSBB), is combining forces with a New Jersey firm ten times its size. But GSBB managing partner, Scott M. Sachs, says the merger is not an acquisition of his firm by another. “Although they are decidedly larger, it is not a purchase,” Sachs said. “It is really a combination of the firms.” However, the larger firm, J.H. Cohn LLP of Roseland, N.J., will be at the front end of post-merger branding, though not initially. “During an initial period of time, that will be at least two years, we will be Good Swartz Brown and Berns, a division of J.H. Cohn LLP,” Sachs said. Actually, said Sachs, depending on how well the company is able to build brand awareness of J.H. Cohn in Southern California, the Good Swartz name might endure even longer, or could be cut sooner than two years , although, he doubts the latter scenario is likely. Operationally, not much will change at the Woodland Hills offices of the new, combined entity, Sachs said. Yet he is sure the company and its employees will be more prosperous as a result of the partnership. “We’re not changing people,” he said. “They are not bringing people from the East Coast to work in this office and live out here permanently.” Sachs, who will continue to lead the firm locally after the merger, says from a customer’s point of view, the merger process will be seamless and transparent. But, he said, his company will be able to offer customers a wider array of services in addition to traditional accounting. “In areas like tax and tax consulting, auditing and accounting work, we will have more brilliant minds to bring to the table, plus we will be able to offer things outside traditional accounting.” Those services include real estate transactions, wealth management, money management, human capital consulting (e.g., executive compensation, etc ), and international issues. “Internally, what we get is better training infrastructure,” he said. Sachs says GSBB’s training programs have been a point of pride at the firm for a long time. But he and the firm’s other partners have wanted to augment training. “We are large enough to need a robust, high-quality internal training program, but not large enough to build the one we want,” Sachs said. “We will be able to do that now.” Stewardship of younger employees is at the core of GSBB’s corporate values, said Sachs, who is himself just 42. Sachs said GSBB had had no interest in merging at first, but was willing to listen when J.H. Cohn proposed the idea. “It’s just good business to have an open mind and listen to ideas,” he said. “But we were pretty intent on staying independent.” However, Sachs said the larger firm’s people impressed him and his partners. “Sometimes you click and there is chemistry between you and the other group,” he said. “I’ve experienced just the opposite many times, but this was unique. There was an instant bond.” Both firms have reviewed ethical issues relative to the merger, and the agreement is a go in principle. Sachs expects documents to be signed in early June. “At this point the due diligence activity has been completed, and it does not appear as if there are any client conflicts,” said Thomas J. Marino, a partner at J.H. Cohn LLP, speaking to NJ Biz magazine. J.H. Cohn was founded in 1919, and has more than 1,000 employees with nine offices in New York, New Jersey, Connecticut, the Cayman Islands, and one in San Diego (also the result of a merger). With FY 2008 revenues of $221.4 million, J.H. Cohn dwarfs Good Swartz Brown and Berns, which had $22 million last year. But the companies compare almost evenly in terms of the ratio of employees to revenue. GSBB has 125 people on staff compared to J.H. Cohn’s 1,000. J.H. Cohn’s strategic growth plans include opening offices in specific major markets, rather than achieving a nationwide presence. Despite that self-imposed limit, the firm is the number 16 accounting firm in the country. Last month, the company was selected as one of the five best places to work in New Jersey by NJBiz. No exchange of cash is involved in the proposed merger.
