LARSONALLEN CONSTRUCTION & REAL ESTATE

CONSTRUCTION ACCOUNTING AND FINANCIAL REPORTING FORUM

October 28, 2009 – OrlandoOctober 29, 2009 – Ft. Lauderdale

CONSTRUCTION ACCOUNTING AND FINANCIAL REPORTING FORUM

• 4:25 Introduction Sue Christopher• 4:30 Valuation Issues and Succession Planning Les Eiserman &

John Reed• 4:45 Auditing and Accounting Standards Update Michael Kosinski• 5:00 Tax Update Clint Freeman• 5:15 FIN 46 – Current Issues Jack Rybicki• 5:30 Banking and the Credit Markets Jerry Felicelli• 5:45 Current State of Construction Market Sue Christopher &

Tim Skelly• Open Discussion and Closing Sue Christopher • LarsonAllen Construction & Real

Estate Group• Social

CONSTRUCTION ACCOUNTING AND FINANCIAL REPORTING FORUM

• Questions and open discussions are encouraged

• Opportunity to share with one another

Business Valuation Issues and Succession Planning Strategies

Presented by Les Eiserman and John Reed

Valuation of a Construction Company

Valuation vs. Appraisal

• Valuation“To establish a value for an entire or partial interest in

a closely held business or professional practice, taking into account both quantitative and qualitative tangible and intangible factors associated with the specific business being valued.”

• Appraisal“To establish a value of certain specific tangible

assets based upon special market knowledge, education, and vocational training possessed by the appraiser.”

Common Approaches to Valuation

• Asset Approach

• Market Approach

• Income Approach

Asset Approach

• Useful forAsset-intensive businessesReal estate holding companiesEntities that hold mostly securities (or cash)Some contracting businesses that bid for work

Market Approach

• Guideline publicly traded company method (GPTCM) Based on similar and relevant comparable entitiesAdjustments are often necessary to make the comparables more similar

• Comparative transaction method (CTM) Based on actual transactions of similar entities

• Limited for Contractors

Income Approach

• Discounted earnings method-Future expected earnings-Apply discount rate-Terminal value added -Present value

• Capitalization of earnings method-Historical results used when future expected to be similar-Use capitalization rate (excludes growth factor)

What is Discount Rate?

• The rate of return, or cost of capital, necessary to convert a future income stream into present value

• Cost of capitalThe expected rate of return an investor requires in order to attract funds to a particular investment

Items to Consider

• Completed Contract versus Percentage of Completion

• Type of ConstructionGeneralSpecialty

• Source of Revenue (Now and Future)• Economic Activity (State and Local)

Rules of Thumb Method

• May use a multiple or a combination of approaches—Market/Income/Asset

• Common in some industries• Do not take into consideration the unique

characteristics of the subject—uses “average”• Sometimes used to support other approaches

Rules of Thumb - Examples

• Construction (general) - 1 to 2 times EBITDA• Construction (electrical) - 2 times SDE plus

inventory• Construction (heating & AC) - 2.75 times

EBITDA• Construction (specialty trade) - 1 to 2 times

EBITDA

Discounts & Premiums

• Discount for lack of control• Premium for control• Discount for lack of marketability• Key person discount• They depend on the interest to be valued and

the techniques used to establish the value conclusion

Discounts vs. Premiums

Value of Control$10.00 per share Shares

40% minority interest discount Control Minority

Premium or Discount66 2/3 control premium

$6.00 per share

40% discount for lack of marketabilty

$3.60 per shareValue of non-marketableminority shares

A combined 40% minority discount and a 40% discount for lack of control equals a total of 64% discount from value of control shares

Value of minority shares if freely traded on an active public market ("publicly traded value" or "stock market value"

Current Valuation Issues

• Tax affecting S-corporations– Should we or shouldn’t we?

• Built-in gains– The buyer may have to pay taxes on gains in the future

• Fair value vs. fair market value in divorce– State by state

• Goodwill– How is it measured?– Personal vs. professional goodwill

• Weighing of recent economic downturn

Succession Planning ConceptsOwnership Transfer and Business Succession

• Ownership transfer can occur with or without a change in management through the use of voting and nonvoting shares.

• Business succession can be planned with or without an immediate ownership transfer

• The process of business succession begins by widening the concentration of management responsibility and decision making among an assembled team

Why Consider It Now?

•Business valuations historically low

•Interest rates low

•Bonding is more difficult

•Having a succession plan in place is attractive to sureties

•Owner estate tax planning

Ownership Transfer Strategies

• Sale to an outside buyer or consolidator

• Employee Stock Ownership Plans (ESOP)

• Transfer at death or disability through an insurance contract

• Developing buyer(s) from within / becoming a Succession Organization. Hardest part usually is identifying and developing the new leader

Outside Sales and ESOPs Strategies Becoming Less Popular In Today’s Market

• Limited market for construction companies today.

• Contractor consolidators out of business

• Venture capital firms generally not interested in contractors.

• Employee Stock Ownership Plans (ESOPs) are less viable today than they once were.

Ownership Transfer Strategies

• NewCo - Create a new company and wind down the old company. (Often there are FIN 46R issues. Sometimes done to create a new contractor with minority status.)

• Insurance funded transfer at death or disability

• Bargain sale

• Significant bonuses to buyer used to purchase seller’s stock

• Phantom stock or nonqualified deferred compensation

• Gifting using annual and lifetime gift exclusions

Grantor Retained Annuity Trusts (GRATs) –Another Strategy To Consider

• An estate planning transfer technique• Not a new strategy, but one that can fit well in today’s

economy. • Transfer of shares from one shareholder to other(s)• Utilizes IRC 7520 rate for month of transaction, which in

2009 is almost ½ of what it was in 2006 and 2007.• Death during term results in estate tax inclusion.• Not a good technique for transfer to grandchildren as

GST allocated at end.• Can zero-out, resulting in no gift.• Authority for GRATs is defined in IRC.• Valuation self-adjusts.

Zero-Out GRAT• Owner transfers (often nonvoting) stock to

GRAT

• Owner retains an annuity interest equal to assets transferred, resulting in zero gift.

• If assets appreciate more than IRC 7520 rate, (2009 rates have ranged from 2.0% to 3.4%, currently at 3.2% for October 2009), all additional value is transferred to new owner without using any unified credit.

Sample GRAT Calculation

•Fact pattern – S corporation contractor worth approximately $3,000,000. Net income $250,000. Tax on S corporation income handled through owner withholding.

•Contractor wishes to make key employee a 10% to 15% owner.

•Normal shareholder agreements put in place.

•Uses a Zero-Out GRAT as the transfer vehicle.

Sample GRAT Results

•Shareholder contributes 35% of company in non-voting shares to GRAT in February 2009 in exchange for an annuity of $166,788 per year for 5 years (5 year annuity payment at 2%).

•New owner’s distributions (35% of $175,000) paid to old owner as partial funding of annuity. Difference between annuity value and distributions received paid in shares of stock (shares returned).

•At end of 5 year period, new owner retains 13% ownership in company.

•Zero gift, so no gift tax paid or exclusion used

Zero-Out GRAT Calculation

Zero-Out GRAT “Sweet Spot”

• Low IRC 7520 interest rate

• Income generates cash flow available to distribute without a net depletion to equity

• No debt service in company

• Equity growth (after distributions) greater than the IRC 7520 rate

• Ability to justify a larger valuation discount

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Questions?

Les Eiserman, CPA, CVAleiserman@larsonallen.com407.802.1203

John Reed, CPA, CITPjreed@larsonallen.com239.226.9903

Auditing and Accounting Standards Update

Michael Kosinski, CPAmkosinski@larsonallen.com

Level of Assurance

YesNoSubstantive Tests

YesNoDirect Verification

YesNoInternal Control Evaluation

YesYesRatio Analysis

YesYesAnalytical Review

Material Weaknesses and Significant Deficiencies

None-Written Communications

YesYes-Financial Statements

Deliverables

OpinionLimitedLevel of Assurance

AuditReview

Codification• Accounting standards now are referred to

through a single structure• Impact cosmetic for users of the financials

however new terms maybe unfamiliar• Example

– Old SOP 81-1– New ASC 605-35-25

Impairment• Was a large issue last year• Still is, however most companies should have

recognized impairment losses in prior year to readjust to the new environment

• Exposure still remains for contractors who have side investments in real estate and those who did not fully adjust in 2008

• Be aware of equipment asset levels that do not support the business activity

• Held and Used vs Available for Sale

Uncertain Tax Positions (FIN48)• Deferral is not available• Income attributable to the owner is not income tax• C Corporations

– More likely then not that the position will hold◊ Failure to file◊ Underreporting taxable income◊ Over reporting deductible expenses

– Inventory of tax positions– Probability of tax positions holding– Calculate a tax cushion and add a disclosure– Disclose interest and penalties– No tabular reconciliation of unrecognized tax positions

• Examples◊ Failure to file◊ SALT◊ Unreasonable compensation◊ Disallowance of an S election

Fair Value• Three Levels of Fair Value

– Level 1 – Quoted market prices in an active liquid market (stock exchange)

– Level 2 – Observable information for similar items in active or inactive markets

– Level 3 – Unobservable inputs where the markets do not exist. Values are very subjective. (Client estimate)

Subsequent Events• Recognized –

– “events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements”

• Nonrecognized –– “events that provide evidence about conditions that

did not exist at the date of the balance sheet but arose subsequent to that date”

On the Horizon• Lease Accounting

– Largest off balance sheet financing transaction class◊ Operating Lease – No balance sheet impact but disclosed◊ Capital Lease – Lease obligation and asset recognized

– Lease obligations will be reflected on the balance sheet

– Largest impact will be ratio comparisons and benchmarks

Lease Example

Recognition of a $300,000 lease obligation currently reflected as an operating lease

$ 400,000 $ 100,000

25,000 25,000 Equity

375,000 75,000 Liabilities

$ 400,000 $ 100,000 Assets

NewOld

Going Concern• The Board decided that the time frame for the

disclosures of short-term and long-term risks as well as the assessment of an entity’s ability to continue as a going concern would be as follows:– Available information about the foreseeable future, which is

generally, but not limited to, 12 months from the end of the reporting period. Certain events that are expected to occur or are reasonably foreseeable beyond 12 months and would materially affect the assessment are considered part of the foreseeable future. The time frame beyond 12 months is limited to a practical period of time thereafter in which significant events or conditions that may affect the evaluation can be identified.

Going Concern• Impact –

– The ability to hold financial statements for 12 months to avoid a going concern opinion will be eliminated

– More going concern opinions may be issued• Evaluation

– Reoccurring operating losses– Loan defaults– Legal proceedings– Loss of business elements– Review management’s plan to stay in business

Tax Update

Presented by Clint Freeman, CPA, MBT

Cash is King• Cash Positive

– Tax Deferral Methods of Accounting– Other Deferral Opportunities– Net Operating Loss Carrybacks

• Cash Negative– Tax Deferral Methods of Accounting– AMT Tax For C Corporation Using Net Operating

Losses– Double Tax Payment March/April

Tax Deferral Methods• At Least Two Methods of Accounting• Deferral Methods of Accounting

– Cash– Completed Contract– NEW – Accrual less Retention for Non-Long-Term

Contracts (Automatic Change)– Others

Knowing Your Tax Deferral• Decrease in Tax Deferral

• Scenario– Book loss– Decrease in volume– Decrease in tax deferral– Taxable income– Tax due

Decrease in Tax DeferralBalance Sheet C/Y P/Y

Cash $ 10,000 $ 50,000A/R 200,000 700,000Total Assets $ 210,000 $ 750,000

A/P $ 40,000 $ 100,000Accrued Expenses 10,000 20,000Net Under/Overbillings 10,000 50,000Note Payable 100,000 400,000Equity 50,000 180,000Net Liabilities & Equity $ 210,000 $ 750,000

Tax Deferral $140,000 $ 530,000

Decrease in Tax DeferralCurrent year book loss - ($130,000)

Prior year deferral - $530,000

Current year deferral - ($140,000)

Current year taxable income - $260,000

Tax Due (At 40% combined rate) - $104,000

Other Deferral Opportunities• Falling Below $10 Million 3 Yr Avg. Gross

Receipts

• Prepaid Expenses

• Other Automatic Method Changes

• Increased Section 179 and Bonus Depreciation

Planning When FMV Lower• Good Time To:

– Consider S Corporation Election.– Succession/Estate Planning

◊ Gift Shares to Next Generation

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Questions?

Clint Freeman, CPAcfreeman@larsonallen.com813-286-2477

FIN 46 Update

Jack Rybicki, PrincipalTampa Office

Consolidation (SFAS 167 / ASC Topic 810)• FIN 46R amended by SFAS 167 • SFAS 167 guidance codified in ASC Topic 810• Effective in fiscal 2010 for calendar year entities• Changes-

– New model for determining primary beneficiary– Reassessment frequency– Enhanced disclosures

Variable Interest Entities• Entity whose equity investors do not have

sufficient equity at risk such that the entity cannot finance its own activities

-or-

• If equity investors lack any of the following:– Power to direct activities– Obligation to absorb losses– Right to receive residual returns

Consolidate if… and how…IF…• The Company is determined to be the primary

beneficiaryHOW…• Based on amounts reflected on VIE’s financials

if under common control.• Based on fair value at the first date the company

becomes the PB if not under common control.

Primary Beneficiary DecisionNew guidance considers two factors

• First criteria - The power to direct the activities that mostly impact economic performance; Qualitative (New)

• Second criteria - The obligation to absorb losses or right to receive benefits; Quantitative (Old)

Both need to be significant to the VIE to requireconsolidation.

Shared Power• No primary beneficiary (and no consolidation) if

power to direct the significant activities is shared by multiple unrelated parties.

• Power is considered Shared when:– More than one unrelated party has power to direct the

significant activities of the VIE, and– All decisions about significant activities require

consent of each party sharing power

Reassessment of PB Decision• Old standard – only in the event of certain

explicit triggering events that co

• New standard - Reassess conclusion periodically

Disclosures• Significant judgments and assumptions made in

the primary beneficiary analysis• Nature of restrictions on assets and liabilities for

which creditors have no recourse against PB• Nature of, and changes, in the risks associated

with involvement in VIE• How involvement in VIE affects financial

position, financial performance and cash flows

Questions?

State of Community Banking

2009

Jerry FelicelliPrincipal

Ben Sargent December 23, 2008

Things to be Concerned About• Economy and Regulatory

– “Problem” Bank list at 15-year high– FDIC insurance premiums– Regulatory attitudes (SCAP Program –Stress Test Worst Case Loss Rates)

• Credit Risks– Record high loan loss provisions and net charge-off rates (2.55% - Q2 2009 vs.

1.95% - Q4 2008) set a record– Noncurrent loan rate rises to record levels (4.35% - Q2 2009 vs. 3.76% - Q1

2009)– Institutions continue to add to loan loss provisions – Commercial real estate concentrations– Consumer

• Asset Valuation– Fair Value (OTTI)– Goodwill– OREO

• Capital – Availability of Capital – Cost of Capital

Six Worst Years of Stock Performance Since 1925

Year Bank Stocks S&P 500

1931 -51% -42%2008 -50% -38%1930 -42% -28%1990 -41% -8%1974 -37% -32%1993 -32% 40%

Profile of a Failing Bank

• 416 Banks on FDIC “Problem List” as of June 30, 2009 – 98 Bank Failures as of October 6, 2009 compared to

25 in all of 2008. • On-going operating losses

– 28.3% of all Banks reported a 2009 2Q loss • Undercapitalized • CAMELS 3-5 rating with enforcement action • Classified assets approaching or exceeding

100% of capital

FDIC Quarterly Banking Profile, Second Quarter 2009

Texas Ratio by State(Texas Ratio= Nonaccrual +OREO/ ALLL +Tier 1 Capital

# Total Banks in

State # Total Banks in

State ALASKA - 7 MONTANA 1 75 ALABAMA 5 151 NEBRASKA 1 239 ARKANSAS 2 135 NORTH CAROLINA 1 106 ARIZONA 10 47 NORTH DAKOTA - 94 CALIFORNIA 19 288 NEW HAMPSHIRE - 24 COLORADO 2 146 NEW JERSEY 2 122 CONNECTICUT 1 55 NEW MEXICO 2 52 WASHINGTON DC 1 5 NEW YORK 4 191 DELAWARE - 31 NEVADA 7 32 FLORIDA 48 252 OHIO 6 245 GEORGIA 58 265 OKLAHOMA 1 250 HAWAII - 9 OREGON 6 32 IOWA 3 373 PENNSYLVANIA 3 222 IDAHO - 18 RHODE ISLAND 1 12 ILLINOIS 35 614 SOUTH CAROLINA 2 88 INDIANA - 155 SOUTH DAKOTA 2 84 KANSAS 6 337 TENNESSEE 2 195 KENTUCKY - 199 TEXAS 3 636 LOUISIANA 1 157 UTAH 9 56 MASSACHUSETTS 1 171 VIRGINIA 2 118 MARYLAND 5 88 VERMONT - 14 MAINE - 29 WASHINGTON 15 81 MICHIGAN 7 142 WISCONSIN 4 278 MINNESOTA 19 406 WEST VIRGINIA - 66 MISSOURI 11 338 WYOMING 1 38 MISSISSIPPI - 95 Total 309 7,863

FDIC – Deposit Insurance Fund(In Billions) 6/30/09 E 2008 2007

Gross Assessments 11.70$ 4.40$ 3.70$

Less One-Time Assessment Credit - (1.50) (3.10)

Special Assessments 5.60

Prepaid Assessmnets 45.00

Total Assessments 62.30$ 2.90$ 0.60$

Fund Balance 10.30$ 17.30$ 52.40$

Expected FDIC Losses Next 5 Years 100$ Reserves for Future Failures - 6/30/2009 (32)$

E - Estimated1.15 times insured deposits at 6/30/2009 = $55 Billion

* 106 banks in Florida with nonperforming loans of > 5% of total assets at June 30, 2009.

Profitability by State – 6.30.09

Non Profitable Banks by State# State Total % Nonprofitable # State Total % Nonprofitable1 Alabama 147 35.25% 26 Missouri 321 21.81%2 Alaska 5 0.00% 27 Montana 73 15.07%3 Arizona 55 78.95% 28 Nebraska 229 13.10%4 Arkansas 130 11.77% 29 Nevada 35 74.29%5 California 284 57.65% 30 New Hampshire 9 55.56%6 Colorado 138 24.33% 31 New Jersey 67 47.76%7 Connecticut 24 28.57% 32 New Mexico 49 12.24%8 Delaware 24 41.91% 33 New York 130 27.69%9 District of Columbia 5 66.67% 34 North Carolina 77 46.75%10 Florida 264 70.43% 35 North Dakota 92 11.96%11 Georgia 304 56.79% 36 Ohio 154 13.64%12 Hawaii 7 33.34% 37 Oklahoma 247 6.48%13 Idaho 16 66.67% 38 Oregon 35 60.00%14 Illinois 564 24.50% 39 Pennsylvania 140 27.14%15 Indiana 109 17.42% 40 Rhode Island 7 42.86%16 Iowa 358 13.30% 41 South Carolina 67 44.78%17 Kansas 327 18.95% 42 South Dakota 82 14.63%18 Kentucky 180 13.57% 43 Tennessee 181 30.94%19 Louisiana 133 9.49% 44 Texas 590 13.22%20 Maine 9 3.45% 45 Utah 59 40.68%21 Maryland 52 34.41% 46 Vermont 9 0.00%22 Massachusetts 36 18.02% 47 Virginia 105 29.52%23 Michigan 133 38.25% 48 Washington 80 62.50%24 Minnesota 403 21.83% 49 West Virginia 61 8.20%25 Mississippi 90 13.68% 50 Wisconsin 247 14.57%

51 Wyoming 36 16.67%

FDIC Quarterly Banking Profile, Second Quarter 2009

Year End

6.30.09 2008 2007 2006

Florida Banks 28% 38% 59% 145%

Florida Banks < $1B 31% 41% 61% 225%

Atlanta District 55% 70% 92% 190%

Allowance for Loan and Lease Losses Total Portfolio (Commercial + Retail): ALLL / Total Loans & Leases

Florida banks 2.04%

Florida banks 3.05%

Florida banks 8.80%

Capital & Liquidity Issues • Capital & Liquidity

– Capital is King!– Build capital levels relative to risk profile (stress

testing)– 24 Florida Banks received TARP ($307 million)*– TRUPs non existent, subordinated debentures – Relatively low valuations– Well capitalized buyers can take advantage of failed

bank opportunities and branch spin-offs – Treasury and FDIC programs have provided liquidity – Extinguishment of TRUPS at a discount

*As of 10/01/09

TARP Capital Purchase Program• Can obtain up to 3% of risk-weighted assets• Preferred stock pays 5% dividend for 5 years;

thereafter it increases to 9% (non-voting)• Treasury gets warrants up to 15% of funds

committed as preferred stock • Negatives

– Government ownership– Warrants represent common stock

• Positives – Use capital to make loans or expand operations

TARP Capital Purchase Program• Treasury has invested $365 billion in 700

institutions• 34 Banks did not pay their quarterly August 2009

dividend payments ( largest CIT and AIG) • 40 Banks have totally repaid their TARP

principal. • Treasury has $134 billion to 660 Banks

outstanding at 10.07.09*

* Does not include AIG

Regulatory Issues and Events • Fed Purchases of Assets (Public Private Investment

Program)• Capital Assistance Program (Banks greater than $100

billion were required to participate)• TLGP, TARP, TALF • Prevent systemic risks and “Too Big to Fail”• FDIC Insurance • Liquidity Management and Contingency Funding Plans• Capital• Allowance for Loan Loss Reserves• Loan Participations Purchased

Execution Priorities for Community Banks

• Capital & Liquidity • Regulatory Issues and Events• Credit Quality and Loss Mitigation • Build the Right Team• Growth, Profitability and Cost Efficiency• Customer Service

Accounting Hot Topics • Business Combinations (SFAS 141R)• Fair Value Accounting Issues (OTTI) • Loan Participations• Deferred Tax Assets• Goodwill Impairment

The Construction and Real Estate Industry

What’s Next?

Timothy J. Skelly, CPA, PrincipalSue Christopher, CPA, Principal

As 2009 Winds Down…..• Excess capacity of contractors continues to

pressure margins• Increased pressure to cover fixed costs; cannot

cut expenses and still operate• Quality of backlog is a concern• 2009 backlog carryover to 2010 severely

diminished from prior year carryover levels• Unemployment at Architectural and Engineering

Firms exceeds 50-60% in certain markets. • Private development experiences lack of

demand and available financing.

2010 – Where’s the Market?• Specialty and diversified contractors are

in the best position to succeed• Public/Government work will become a

necessity … and even more competitive• Risk/Reward for contractors to travel and

seek new markets will escalate• Benefits of sound financial management

and history will be realized• Commercial construction market will

start/continue to shake out

Financial and Credit Markets• Collateral position of many contractors has been

impaired – receivables/equipment / real estate• Successive years of losses and negative cash flow

impact underwriting• Less flexibility with loan covenants, default provisions

and guarantees

• Greater focus on cash flow and debt service• Generally, more aggressive action expected as banks

clean up credits and reduce exposure/risk• Real estate involvement will continue to saddle

contractors

Commercial Real Estate – the Parallel to Residential?

• Vacancy will continue to increase– Shadow vacancy– Compounded by

Decreasing rents and increasing cap rates

– Values may decrease another 25-35% from today’s values

– Defaults on commercial mortgages will increase

Commercial Real Estate – the Parallel to Residential?

• Sentiment that this is not a sustainable recovery – rather more of a fragile recovery

• No real market mechanism to clear the bench –may take up to five years to normalize

• Downward pressure on rental rates and lack of demand – hard to establish true market

• Mismatch of lower market rates and cost to lease up

Possible Survivors?• Public REITS and private equity groups

– Replenish capital positions in real estate portfolios– Defense, stabilize portfolios

• Commercial Real Estate– $2 trillion industry– >$45 billion on the sidelines – waiting for market

fundamentals to return

Stimulus – Is it working?• Commitments vs

delivery of contracts• 2010 activity?• More incentive on the

way?• Agencies are getting

more bargains – as a consequence and expanding scopes through changes.

Green Movement• Alternative Energy

– Wind and ethanol –Hit / Miss

• LEED Building– No one wants to be last buyer of

non LEED building– Banks not paying much attention

– buyers are– Government & Non Profits are

better market than private.– AGC initiative to increase SEC

179D deduction or convert to credit.

What’s Next for Contractors?• Merger and acquisition

activity• Start ups and emerging

businesses• Roll ups and

consolidations?• Back to financial

fundamentals – cash flow and liquidity

• Competitive market will demand cost control and efficiencies.

LarsonAllen Construction and Real Estate Group

Nationally Oriented CPA & Business Consulting FirmEstablished in 1953 by Rholan Larson & John Allen

History & Focus on Privately-Owned, Owner-Operated Businesses

Primary Advisor Relationship – “Total Client Service”

Managed by the “LEADERS” culture

Ranked in the top 20 CPA firms in the U.S.; approximately 1,400 employees; 30 offices in 11 states

LarsonAllen LocationsUpper MidwestMinneapolis, St. Cloud, Austin, Alexandria and Brainerd, MinnesotaEau Claire, Wisconsin

MidwestSt. Louis, MissouriDallas, Texas

EastPhiladelphia, PennsylvaniaWashington DCBoston, Massachusetts

SoutheastCharlotte, North CarolinaFort Myers, Naples, Orlando and Tampa, Florida

SouthwestPhoenix, Arizona

In addition, there are nine client service centers.

Construction & Real Estate Group Construction and Real Estate industry commitment –

Focus on industry knowledge and practice developmentDedicated construction group staff of 100 professionals Firm-wideSpecialized A&A and tax training for all staff and principalsConstruction industry association memberships and active involvement

Serving construction and real estate clients ranging from startups to companies with revenues greater than $1 billion covering a wide variety & type of contractors and real estate entities.