Write a brief note on revenue sharing models for a Mega Firm.
CS Executive · Company Law · PYQS · June 2024
Write a brief note on revenue sharing models for a Mega Firm.
Answer & Explanation:
The revenue sharing model of a Mega Firm could be the following: Partner bringing new client shall be given referral or induction share, say, @ 15% of the fees settled and received; it can be for the first year or for given number of years; Certain percentage of fees, say 15% shall be retained in business in common pool for meeting expenses; 70% of the fees shall be given to the partner or partners who actually work on the assignment (assignment share). When more than one partners are involved in an assignment their share can be determined based on respective role; At the year-end after meeting expenses resultant profit shall be shared in proportion of contribution of individual in the gross earnings/ net profit of the firm; Internally, different verticals can be created and surplus generated by each one can be assessed as an independent cost centre.
Topics: Company Secretary in Practice / Secretarial Standards
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