A recent survey conducted by the esteemed law firm Kingsley Napley reveals a significant shift in the UK accounting sector, with nearly half of the firms surveyed showing openness to private equity (PE) investment. This growing trend highlights evolving attitudes toward alternative funding strategies as firms seek new capital to drive innovation, expansion, and long-term sustainability.

Overview of Kingsley Napley’s Survey Findings

Kingsley Napley surveyed 22 senior partners representing some of the largest accounting firms in the UK, specifically targeting the top 60 by revenue. The results, collected in spring 2025, demonstrate that 27% of these firms have already embraced private equity funding, while an additional 19% are considering it as a viable option for future growth.

Notably, 86% of respondents indicated that their firms have been approached by private equity firms or external investors during 2024, underscoring the sector’s attractiveness to outside capital. However, 54% of firms still expressed no current or future interest in pursuing PE investment, reflecting a cautious stance among a substantial portion of the market.

Why UK Accounting Firms Are Attracted to Private Equity Investment

Accelerating Technological Advancement

One of the most compelling reasons driving accounting firms to consider private equity is the opportunity to secure significant funding to invest in advanced technology platforms. Firms recognise that modernising their technological infrastructure is essential to maintain competitiveness and meet client demands in an increasingly digital business environment.

John Young, Partner in Kingsley Napley’s Corporate, Commercial & Finance team, explains: “Private equity investment offers firms a substantial capital injection that enables them to make transformative technological improvements without relying solely on partner capital contributions or traditional bank financing.”

Facilitating Geographical Expansion and Succession Planning

Beyond technology, private equity funding is also seen as a catalyst for strategic growth initiatives such as expanding into new geographic markets and managing succession effectively. This external capital can provide stability and resources to navigate leadership transitions while supporting organic and acquisitive growth.

Addressing the Risks and Challenges of Private Equity Investment

While private equity brings promising benefits, UK accounting firms remain cautious due to a variety of perceived risks.

Internal Concerns: Control, Identity, and Partner Retention

Firms frequently cite fears about losing operational autonomy and strategic control, which can alter their established culture and identity. Additionally, there is concern over partner retention, especially among younger partners who may be apprehensive about compensation models tied to unpredictable earn-out structures post-investment.

John Young notes, “Older partnerships generally demonstrate a more favourable attitude towards private equity, whereas younger partners tend to prioritise stability and predictable remuneration, making them more hesitant.”

External Risks: Client Relationships and Regulatory Compliance

Externally, firms worry about potential client loss and conflicts of interest arising from new investor relationships. Regulatory compliance—particularly for firms with audit functions—is another significant consideration, given the strict rules protecting audit independence and other statutory licenses.

Julie Matheson, Partner specialising in Accounting Regulatory at Kingsley Napley, comments: “Although regulatory scrutiny can be daunting, many firms have successfully structured their governance and compliance frameworks to meet regulatory demands without compromising on control.”

The Importance of Alignment Between Private Equity Investors and Accounting Firms

Kingsley Napley’s survey highlights the critical need for mutual understanding between private equity investors and accounting firm partnerships. Each party brings unique objectives, concerns, and expectations to the table. Clear and transparent communication from the outset is essential to establish a good fit and prevent costly deal failures.

John Young emphasises, “A candid discussion about motivations and priorities helps both investors and accounting firms avoid misunderstandings and fosters stronger partnerships.”

The Future Outlook: Private Equity’s Transformative Role in UK Accounting

Private equity is reshaping the accounting landscape at every level—from large multinational firms to mid-market and smaller practices. The Kingsley Napley survey suggests that this funding avenue is not a passing trend but a structural shift in how firms finance growth and innovation.

Julie Matheson concludes, “Many accounting firm leaders recognise private equity as a sustainable funding source that will remain relevant. It will be fascinating to observe how firms that embrace private equity evolve compared to those opting to maintain traditional partnership funding models. The sector’s future could be dramatically different in the years ahead.”

About the Survey and Kingsley Napley

The survey respondents primarily consisted of senior or managing partners from UK-based accounting firms with annual revenues ranging from £10 million to £1 billion. Kingsley Napley has a long-standing reputation for providing top-tier legal advice, especially in complex transactional and regulatory matters affecting the accounting sector.

For detailed insights and full survey results, Kingsley Napley’s White Paper is available for download on their website.