Accrual, an AI platform built for accounting practices, announced in early September that it had entered into an agreement to acquire Puzzle’s accounting practice technology and business, including its ledger and month-end close products. Puzzle founder and CEO Sasha Orloff, along with members of the accounting firm team from Puzzle, have joined Accrual as part of the deal.
Accrual started with a focus on automating income tax preparation, and this acquisition moves Accrual further into its vision of an intelligence platform for ambitious accounting firms, adding CAS, with Advisory and Audit currently in development with partners.
Shortly after the announcement, Joe Woodard spoke with Puzzle Founder Sasha Orloff about what led to the acquisition, why the two companies fit together, and what happens next for Puzzle and the accounting practices using it.
Orloff told Woodard that Puzzle had essentially been operating two businesses. One side served startups and small businesses directly, while the other focused on building accounting practices. The original idea was that those two sides could work together. Businesses could come into Puzzle directly, some could be introduced to accounting practices, and those practices could also move their existing clients onto the platform.
Orloff said the basic idea worked, but accounting practices varied quite a bit in how ready they were to use AI. Some were ready to commit heavily, while others wanted to experiment with a small number of clients and learn more before making a bigger change. There were also practices with very little interest in changing tools or processes at all. Puzzle found itself spending a significant amount of resources educating practices that were still exploring what AI could mean for them.
The practices that committed more heavily were running into a different problem, but a good one. Some had gained enough capacity through the technology that they were ready to take on more clients. Puzzle decided to focus more of its effort on this small group of practices that want to make AI a larger part of how they operate and grow.
Orloff said Puzzle had negotiated a revenue sharing model with five accounting practices, with another five on a waitlist. Puzzle plans to work with those practices to use Puzzle to expand their CAS practices. In this model, practices will continue to handle the client relationship and any services they provide beyond the scope of CAS. Orloff said the idea is to show what can happen with practices that are ready to commit more fully to the technology.
For existing firms, nothing changes. They can keep their clients on Puzzle, add more, and continue to get support from CPAs and experienced bookkeepers, in addition to their 24-hour AI chat, cowork, and close.
As Puzzle was moving toward a more focused approach with accounting practices, while continuing to support the practices already using the platform, Accrual was looking for the accounting infrastructure it needed to expand further into CAS. This convergence was key to Accrual’s acquisition of Puzzle.
Accrual came into the acquisition from a different part of the accounting technology market. It started with income tax for enterprise accounting firms, but with a longer-term goal to create one technology layer across tax, audit, as well as client accounting and advisory work (CAS). Its CAS offering is already in early access.
Puzzle had already built much of the accounting infrastructure Accrual needed as it moved further into CAS. A big part of the fit came down to the trial balance and the accounting work shared across several service lines.
Accounting, tax, and audit all have their own processes, but Orloff said some of the underlying work is similar. Documents need to be collected, read, and adjusted, and the information must be mapped correctly before the work moves in different directions across complex workflows and firm oversight. The trial balance becomes a key part of that shared foundation, and Puzzle’s ledger technology gives Accrual infrastructure it can build on as it expands further into CAS.
Accrual’s announcement says Puzzle’s ledger and close capabilities will be combined with Accrual’s client record, firm methodology, permissions and review model. Orloff was also clear that Accrual is not planning to simply sell Puzzle as a general ledger product. “They needed expertise in trial balance, effectively general ledger,” he said. “They’re not going to go sell Puzzle. They’re not selling general ledger. They primarily needed the infrastructure for and around the trial balance to support the platform across tax, advisory and audit.”
Orloff said tax and CAS are a natural fit in smaller practices, where clients are often looking for a fuller range of services. Larger practices can be more divided, with tax and CAS operating as separate practice functions – each with their own P&L. However, larger firms are realizing the synergies between tax and CAS, even if those service lines operate independently.
Accrual is focused on larger practices, and part of the opportunity is bringing those areas closer together on a shared platform. Puzzle’s ledger technology gives Accrual part of the accounting infrastructure needed to do that.
Puzzle is still available to accounting practices. Existing practices can keep their clients on the platform and add new clients. Practices not currently using Puzzle can still sign up.
The bigger change is how Puzzle plans to market and sell to accounting practices. Puzzle is pulling back from broad sales and marketing, while continuing to support the accounting firms that use the solution with a team of CPAs and experienced bookkeepers. Practices on the higher AI tier receive priority support, while concierge support is available at the highest level. Accounting practices at lower tiers will have access to human support, but with credits available for AI chat, cowork, and close, which can answer (and do) most accounting questions and tasks.
Puzzle is also offering a concierge conversion option for practices that want help moving books onto the platform. They’ll handle the conversion, mapping, and validation as part of that service.
Accrual is acquiring Puzzle’s accounting practice technology and business, while Puzzle’s direct business serving firms will continue to operate independently. For Accrual, the acquisition supports its move further into CAS, particularly with larger accounting practices.
According to Accrual’s announcement and discussions with Sasha, Puzzle’s technology will become part of Accrual’s broader platform. Its CAS offering is already in early access, with broader availability planned shortly.
Technology was only part of the reason Orloff felt the companies fit together. He also talked about their shared view of AI, and the role accountants will continue to play.
He believes AI can significantly increase productivity, but he does not see accounting professionals disappearing from the process. He sees people continuing to set parameters, review the work, and apply professional judgment. Accrual describes its approach in similar terms, with AI preparing the work while professionals retain judgment, review, and control.
After this conversation, we reached back out to Sasha Orloff of Puzzle with a few more questions.
1. Should current users of Puzzle expect any pricing changes?
“No. There are no pricing changes. Firms should expect the same product, the same pricing, and continued investment in new features and improvements.”
2. How do you see Puzzle’s relationship with smaller accounting practices changing, if at all?
“Very little changes for smaller firms already using Puzzle. They can keep their existing clients on the platform, add new ones, and continue using Puzzle as they do today.
There are three main changes: we’re aligning human support more clearly with each pricing tier; we’re making AI Chat, Cowork and Close available across all tiers; and when new businesses come to Puzzle looking for an accounting firm, we’ll prioritize referrals to partner firms participating in our revenue-sharing program.
So we’re not stepping away from smaller firms. We’re continuing to support them while becoming more focused about where we invest our highest-touch growth resources.”
3. What do you want current Puzzle users to understand about the acquisition that you think has been misunderstood so far?
“The biggest misunderstanding is that Puzzle is going away or that existing firms will be moved to Accrual. Neither is true.
Puzzle continues to operate independently, and firms using Puzzle today can keep using it, add clients, and expect continued product investment. Accrual is acquiring technology and expertise from Puzzle to help build its broader platform for larger accounting firms.
For current Puzzle users, this is much more about focus than disruption.”
The most immediate takeaway is that Puzzle is still available, and accounting practices can continue using it and adding clients.
The longer-term picture will become clearer as Accrual begins incorporating Puzzle’s technology and Puzzle continues with its more focused approach to working with accounting practices.
This article was written with the assistance of AI and edited by a human.