Countplus’s planned roll out of an accounting franchise is not a threat to the operations of its parent group, Count Financial, according to the company’s chairman.
At Countplus’s first annual general meeting in Sydney yesterday, Barry Lambert said the launch of the franchise would not directly impact on Count’s advice business, but would instead complement it.
“Count’s relationship with its franchisees is on a financial planning basis. So Count has a financial planning franchise to its member network. It does not have an accounting franchise,” Lambert said in response to shareholder questions.
“Countplus uses Count as its dealer group, it intends to continue to do that, so what we are talking about with the accounting franchise is in fact complementary to Count’s financial planning franchise, so there is no issues there.”
As Count did not generally provide accounting services, it planned to use the Countplus accounting franchise in its network, he said.
“We intend to use those services from Count and anybody else, maybe some of the services that come from the Commonwealth Bank [of Australia (CBA)], and package them up along with what we’ve got with Countplus to offer a unique accounting franchise,” he said.
When asked whether he was concerned that CBA would alter Countplus’s model when it assumed ownership, he said such questions would need to be directed to CBA.
“You’d have to ask CBA,” he said.
“However, I personally would very much doubt that they would, because the success of Countplus is going to be because the actual principals, the operators, actually own a large part of the business.
“So for them to buy them out I think that would be a disastrous decision for them. So if the bank asked me for my view, that’s what I would tell them. But I don’t think they need to be told that, they’re not stupid.”
A CBA spokesperson said the bank’s decision regarding the consideration to acquire all of Count’s subsidiaries remained unchanged.
“We’ve said from the outset that we would consider Count’s strategic investments at the appropriate time,” the spokesperson said.
Countplus chief executive Michael Spurr said the group had the basis for the franchise model in a service called Count GPS.
“We aim to use the collective expertise of the group to launch an accounting franchise that will provide an additional recurring income stream to the group and a pipeline of future acquisitions,” Spurr said.
“Countplus already has the basis of this in a service called Count GPS, an Internet-based resource centre for accountants, development by the principal of one of the member firms, and has over 100 subscribers.
Meanwhile, member firm principals and staff would soon have the opportunity to qualify for further equity on an annual basis based on member firm performance, he said.
The equity will take the form of a loan-funded share scheme, with vendor principals only allowed to retain 50 per cent of any firm equity entitlement, with the remainder to be distributed to managers and other key staff.
