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Profit-sharing arrangements

Rightly so, partners are very interested in how profits are distributed. When a disagreement arises, it is frequently over the issue of equity versus performance. Partners with a modest equity holding may feel that their share of profits does not reflect their new business gains, while partners with a greater equity stake may have a larger burden of administrative duties that prevents them from seeking as much new work. Problems can also arise over sharing the profits from exceptional items such as the sale of a property.