system vs. system: partner compensation best practices

chart outlining multitier system
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bonus lists: 12 allocation systems and 22 intangible performance attributes.

by marc rosenberg
cpa firm retreats

“if people are concerned about their absolute level of compensation, then they can be satisfied. however, if their focus is on relative standing, then they can never be satisfied.” – andrew grove, former chairman of intel

you’ve decided you’re going to discuss partner compensation at your next retreat, then you’ll need to start with some warm-up materials.

begin with this partner compensation best practices13-point checklist:

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partner comp: three subjective compensation systems

plus balloting details for those who use paper and pencil.judge gavel,dollar banknotes and calculators

by marc rosenberg
partner comp: art & science

there are at least three performance-based systems for partner compensation. none rely completely on intractable formulas, but instead introduce various degrees of subjectivity. needless to say, none are without some controversy.

more on partner compensation: 11 points in designing a partner comp system | 3 tiers of compensation | what partners earn and how they earn it | how partners view compensation: it’s not all about the money

but each system requires serious thought. here’s a comprehensive of the three approaches. which does your firm use now? why? which might be a better approach?

let’s take a closer look:

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11 points in designing a partner comp system

businessman sitting on scales with stack of coins in other traybonus checklist: the 12 systems used by firms to allocate partner income.

by marc rosenberg
partner comp: art & science

because partner compensation is the most sensitive aspect of cpa firm practice management, adopting a new system or modifying the current one requires an exceptional amount of thought, care and study. here we summarize the many issues firms need to address in designing their partner compensation system.

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