Editor: How has your practice evolved?
Frankfort: I co-founded the Houston office of UHY Advisors in 1971 after passing the state bar and CPA exams. We started as a three-person office, and we have grown to a staff of over 400. UHY Advisors, Inc. and its subsidiary entities have over 1200 staff, and we continue to enjoy constant growth across the U.S.
Our Forensic, Litigation and Valuation Services Group started with two cases. One involved the property aspects of a divorce case. At its conclusion, the lawyer on the other side called and asked if I would work on the property aspects of another case his office was handling.
The other involved a dispute between a country western singer and his manager. Saul Solomon, who headed our Assurance Department at the time, wound up on the witness stand in that case for about three days. The jury awarded the moneys Saul documented as having been taken by the manager.
From these two cases, our litigation consulting practice has grown into one of the foremost of its kind in the state of Texas. Today our practice has over 100 people nationally providing forensic, litigation and valuation services. In addition to providing these services in Houston and Dallas, we also have offices in New York, Chicago, Boston, Los Angeles, New Haven, DC and St. Louis. We're in the country's major business centers, and we're continuing to expand in major cities throughout the U.S.
Editor: What has contributed to your growth?
Frankfort: The attraction for staff, in my opinion, is opportunity. I believe that it is their correct perception that they are able to handle client issues faster, their uniqueness and strong performance is noticed faster, and, as a consequence, their promotion is more rapid here. We've been fortunate in having been able to hire the best of the best.
What distinguishes us from other large firms is the amount of managing director involvement. We work as a team in taking care of our clients. The clients also like the breadth and depth of services and industry expertise that we offer throughout the firm.
Editor: Why are Houston and Dallas good locations from which to launch and grow a business?
Frankfort: First, let's talk about Houston. In the next 15 to 25 years, most people believe that Houston will be a gateway through which international business will come to the rest of the country. Houston and the Houston Gulf Coast areas are home to many energy and energy-related companies. In terms of banking and business, this is the place to be. The Texas Medical Center in Houston is one of the finest in the country and a major draw for healthcare-related companies. Housing is favorably priced here. I recently read that housing in 239 cities is overpriced based on historic standards while housing in Houston is priced 11 percent below historic standards. Travel and transportation is very easy through our international and local airports and our ports in Houston and Galveston.
As a major financial center, Dallas is home to numerous businesses that have been there for generations. We made our commitment years ago to establish a presence in Dallas and that presence continues to grow. It is easy access by air to reach both markets, and our staff often travels between the two cities for many of our client engagements.
Editor: What type of services and expertise does your firm provide?
Frankfort: Encompassing a wide variety of areas, we are organized by industry groups. We have significant depth in the energy, manufacturing, construction, real estate and healthcare industries, just to name a few. Our specialization attracts young talent into our firm. They develop an expertise not only in the specialized service area of the project, but they also gain in-depth knowledge of that particular industry.
We offer a wide range of service offerings in tax and business consulting including business structuring, compensation and benefits consulting to executive tax and cost segregation studies. To assist clients that are doing business in a variety of jurisdictions, our firm has a full team of professionals who specialize in state, local and international tax issues.
On the consulting side, we have a large flexible staffing group that can offer three levels of service, from fully outsourcing a business process to project staffing to conquer peak workloads to executive recruiting. Our internal audit department travels the globe offering in-depth expertise in internal controls and Sarbanes-Oxley documentation and testing. As Saul will discuss later, our forensic, litigation and valuation services group handles a wide variety of financial matters, settlement services, family law matters, investigative consulting and risk management and business valuation work. We also provide technology advisory, wealth advisory and strategy consulting services.
Through UHY LLP, the attest side of our practice, we provide a full range of assurance services including financial statement audits, reviews and compilations, agreed upon procedures, SEC registration, pension and benefit plan audits, and audits of internal controls to privately held and publicly traded companies. That typifies the breadth of services that we have across the board.
Editor: How do you see your firm growing in the future?
Frankfort: While we understand that many corporations need the Big Four accounting firms, a substantial number of clients prefer a large firm that can offer the nimbleness and personalization of service that is available from a firm of our size. We are very proud to be currently ranked as one of the top 25 professional service firms providing tax and business consulting services by Accounting Today . We believe by continuing to provide quality client service with the utmost integrity, constantly expanding our depth of resources by hiring experienced and dedicated staff, being passionate about solving our clients' problems and being results oriented - these important aspects - will allow us to enjoy continued growth.
Editor: What expertise did you bring to UHY, Saul?
Solomon: I started working with our firm about 25 years ago. I had been working for a "Big Four" accounting firm as an auditor. The audit practice at our firm covered a wide range of privately owned and publicly traded clients. I found when I was handling the dispute that Milton mentioned earlier that I had a unique skill set in being able to describe financial issues and how they apply to a fact pattern in a way that the litigants, judges and juries could understand. The analytical and investigative skills I had developed as an auditor were a tremendous resource in this area as well.
Houston's economic climate in the early 1980's was slow for business, but the court dockets were crowded with litigation. The litigators were looking for forensic accounting, business valuation expertise, and help with damage analysis and other litigation consulting work in complex commercial cases, bankruptcy, transactional disputes, fraud investigations and other cases.
Editor: What type of cases do you provide litigation consulting services for today?
Solomon: We provide a broad range of services, advising plaintiffs as often as we represent defendants. We do work for large, global corporations as well as for small, closely held companies. The services we provide range from forensic accounting and corporate investigations work to investigating securities fraud to preparing or reviewing damage analysis for commercial, intellectual property and other cases. We also prepare business and intellectual property valuations for litigation matters as well as for tax or transactional purposes.
Since one of our largest offices is in Houston, it is not surprising that we handle a variety of energy disputes. We have provided services to help resolve disputes about the amount of royalties due related to oil and gas production. Our practice is very broad covering most industries and types of engagements. Our practice has expanded throughout numerous areas across the U.S.
Editor: What differentiates your firm from other litigation consultants?
Solomon: Client service is our number one priority. We promptly return our clients' telephone calls and email messages and keep them apprised of the status of what's happening in their matters. Our most experienced professionals are extremely hands on in our approach to the engagements.
We provide more than just expertise with the substantive issues in our field. We provide the demeanor and competence needed from an expert on a witness stand to explain complex financial matters and to help present our opinions so they are not only understandable, but also well supported.
The diversity of our practice has helped us to develop a wide range of expertise performing financial analysis including assessing intellectual property damages, damages related to construction disputes, insurance claims, business interruption, product liability damages, lost profits and many others. We also advise clients in a wide range of industries.
This broad industry perspective helps us to contribute valuable insights into cases. For example, when involved with a case concerning a bank, our experts know how banks keep their books, evaluate credit risks and perform other banking functions, and are familiar with regulatory issues. This background helps us to identify issues and work more effectively with attorneys and the client to present the evidence or analysis to help support or refute the issues in the case.