1.1.1Segment

Audit & Assurance

CPA firms and audit practices providing independent financial statement audits, SOC examinations, and assurance services to public and private companies.

6
Verticals

Overview

Audit & Assurance is the independent-opinion business: financial statement audits and reviews, SOC examinations, employee-benefit-plan audits, and other attestation work performed by licensed CPA firms. It is the most heavily regulated corner of accounting, governed by PCAOB inspection, AICPA peer review, and strict auditor-independence rules.

The market is barbelled. The Big Four plus a handful of national firms own the audits of large public and complex private companies, while tens of thousands of small and mid-sized CPA offices handle private-company, nonprofit, and benefit-plan work. Engagements recur annually, making audit relationships unusually sticky once established.

Market snapshot

Market size
~$145B
Growth
~7.0%CAGR (2017–22, nominal)
Companies
~55,600
FragmentationHighly fragmented

U.S. Census Bureau 2022 CBP/Economic Census, NAICS 541211 (Offices of CPAs). Audit is one service line within these offices — receipts span audit, tax, and advisory.

Business model & economics

Revenue model
Engagement fees on recurring annual audit and attestation cycles
Recurring revenue
High — annual audits renew with high switching costs
EBITDA margin
15–25% (owner-comp adjusted)
Capex intensity
Low
  • Independence rules constrain cross-selling and shape how PE can own audit firms.
  • Annual recurrence and regulatory necessity make revenue durable and predictable.
  • Talent scarcity — the CPA pipeline — is the binding capacity constraint.

Geographic concentration

Audit work concentrates where public companies, large nonprofits, and corporate headquarters sit, reinforcing the major financial and metro centers.

CaliforniaNew YorkTexasFloridaIllinois

M&A deal context

High deal activity

Who’s acquiring

PE-backed platforms (alternative practice structures)National & super-regional CPA firmsConsolidating regional firms

What’s driving deals

  • Independence rules pushing deals into alternative practice structures that separate attest from advisory.
  • Aging partners and succession gaps driving sales of independent firms.
  • Buyers chasing capacity and talent more than the audit margin itself.

Verticals in this segment

  • 1.1.1.1Big 4 & National CPA Firms

    Global and national accounting firms auditing large public and private companies.

  • 1.1.1.2Boutique & Local CPA Firms

    Small local accounting practices serving SMBs and individual clients.

  • 1.1.1.3Internal Audit Services

    Outsourced internal audit and SOX compliance firms serving corporate clients.

  • 1.1.1.4Public Company Audit (SEC)

    PCAOB-registered firms performing audits for SEC-registered issuers.

  • 1.1.1.5Regional & Mid-Market CPA Firms

    Regional CPA practices serving mid-market private and family-owned businesses.

  • 1.1.1.6SOC & IT Audit Services

    Firms performing SOC 1, SOC 2, and IT controls examinations.

Find Audit & Assurance acquisition targets

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