Professional Services Monitor: Today

 

June 17, 2010

FY2009 Audit Fees Updated

In April, we took a preliminary look at FY2009 audit fees, based on the the proxy statements processed at the time.  We have updated this analysis with an additional 1,500 filers, bringing the total to 3,636 proxies tracked between January 1 and June 15, 2010.

The preliminary analysis showed PricewaterhouseCoopers with a small increase in total fees.  Now, PwC has a change of -0.8%, with KPMG next among at the Big Four at -2.8%.  Among the top ten firms by total fees, only ParenteBeard had positive growth at 6.1%.

(more…)

November 18, 2009

Auditor Market Share Lists: A Tale of Three Cities

In another look at audit marketshare, below are the total FY2008 fees, average FY2008 fees per client, and number of clients in three cities—Chicago, Denver and Seattle—based on the city from which the firm is serving a client. That is, the data is grouped on the office of the firm signing off on the client’s financials. This is often the same city as the client’s headquarters, but not always. The data is taken from Ames Research Group’s audit fees database, sourced primarily from DEF-14A proxy statements.

More lists are available on our Auditor Marketshare page.

Fees are listed in $US millions.

Chicago

Firm Total Avg Clients
Deloitte $198.5 $5.7 35
Ernst & Young $128.4 $2.7 47
PricewaterhouseCoopers $101.9 $4.2 24
KPMG $90.3 $3.0 30
Grant Thornton $9.8 $0.8 12
BDO Seidman $6.7 $0.6 12
Blackman Kallick Bartelstein $1.1 $0.4 3
McGladrey & Pullen $0.4 $0.2 2
Plante & Moran $0.3 $0.3 1
Crowe Horwath $0.2 $0.2 1
Virchow Krause & Co. $0.1 $0.1 1
Wipfli $0.1 $0.1 1

Seattle

Firm Total Avg Clients
Deloitte $51.1 $3.6 14
KPMG $39.3 $2.1 19
Ernst & Young $26.8 $3.0 9
PricewaterhouseCoopers $7.8 $1.0 8
Grant Thornton $1.8 $0.5 4
Moss Adams $1.5 $0.4 4
Peterson Sullivan $0.8 $0.2 5
Schwartz Levitsky Feldman $0.3 $0.3 1
McGladrey & Pullen $0.3 $0.3 1

Denver

Firm Total Avg Clients
KPMG $55.2 $3.1 18
Ernst & Young $45.9 $2.7 17
PricewaterhouseCoopers $26.2 $2.9 9
Deloitte $13.7 $1.2 11
Ehrhardt Keefe Steiner Hottman $5.8 $0.3 17
Grant Thornton $4.2 $0.5 8
Hein & Assoc. $2.8 $0.3 11
GHP Horwath $1.2 $0.2 5
BKD $1.0 $1.0 1
Crowe Horwath $0.6 $0.6 1
Causey Demgen & Moore $0.4 $0.2 2
Eide Bailly $0.3 $0.3 1
McGladrey & Pullen $0.1 $0.1 1
Gordon Hughes & Banks $0.1 $0.1 2
Stark Winter Schenkein & Co. $0.1 $0.1 1

July 17, 2009

Auditor Market Share Lists: DoD Contractors

Filed under: ARGI,Deloitte,Firms,KPMG,PricewaterhouseCoopers — psmtoday @ 2:30 pm

This afternoon, we have posted a new list to our Audit Market Share list section, a list of the Department of Defense’s largest contract recipients for FY2008.  We have followed this list for 15 years, and this is the first time we can recall that any of the Big 6/5/4 have appeared in the top 100.  Furthermore, BearingPoint received nearly $750 million in defense contracts, some of which will presumably go to Deloitte and PwC in Fy2009, all other things remaining equal.

(more…)

May 20, 2009

More Audit Fees Lists

Filed under: ARGI,Audit Fees,Firms,PricewaterhouseCoopers — psmtoday @ 9:47 am

We wrap up the March to April proxy statement busy season with three more lists of audit fees, as a follow-up to our earlier post. We again look at largest increases and decreases from FY2007 to FY2008, and we’ve added a third list of the 10 largest total audit fees.

These 30 companies were taken from about 2400 proxies filed during March and April, 2009. The average increase in this group was about 10.0%.

PricewaterhouseCoopers clients had an average increase of 8.9%. The three of the four largest audit fees-paid in FY2008 belong to PwC clients: JP Morgan Chase, Goldman Sachs Group and Bank of America. With the large acquisitions made by each of these three companies in the second half of 2008, one might expect that audit fees increases ought to be even larger in FY2009.  Net, audit fees increased for this group of PwC clients by about $6.5 million.

(more…)

March 24, 2009

Deloitte & PwC Purchase Business Units from BearingPoint

Filed under: Consulting,Deloitte,Firms,PricewaterhouseCoopers — psmtoday @ 5:16 pm

Deloitte and PricewaterhouseCoopers separately announce their purchases of business units BearingPoint in North America.

Deloitte will “acquire substantially all of the assets” of BearingPoint’s Public Services practice.

Deloitte today announced that it has signed an asset purchase agreement to acquire substantially all of the assets of the North American Public Services practice of BearingPoint out of bankruptcy for total consideration of $350 million in cash and the assumption of certain BearingPoint liabilities. BearingPoint is a global management and technology consulting company that filed for Chapter 11 bankruptcy protection on February 18, 2009. The agreement is subject to approval by the bankruptcy court, which may consider competing bids, and there can be no assurance that the purchase will be consummated.

PwC announced its own acquisition of BearingPoint’s North American Commercial Services practice.

he United States firm of PricewaterhouseCoopers LLP (PwC) today announced that it has reached an agreement in principle with BearingPoint, Inc. to acquire portions of BearingPoint’s North American Commercial Services practice, which includes its financial services segment. At the same time, PwC Advisory Co., Ltd. (PwC Japan), a PricewaterhouseCoopers firm operating in Japan, has reached an agreement in principle to acquire and integrate with BearingPoint’s entire Japan practice consulting business, which has a leading position in the business consulting market.

In the United States, the proposed transaction will integrate selected contracts and assets of BearingPoint into PwC’s Advisory practice, while bringing to the firm client service professionals with significant business and consulting expertise in industries including energy, utilities, insurance, pharmaceuticals and life sciences.

In Japan, the strength of BearingPoint’s business means that this transaction will create a combined team of over 1,500 professionals which will be one of the largest advisory practices in the Japanese market.

The Washington Post reported that PwC will pay $25 million for the unit.

In BearingPoint’s Fy2007 Annual Report, Public Services and Commercial Services comprise two of BearingPoints three principal North American units, with Financial Services being the third.  Public Services generate $263 million in gross profit in Fy2007, and Commercial Services $82 million.

June 23, 2008

PricewaterhouseCoopers Predicts Olympics Medal Counts

Filed under: Firms,PricewaterhouseCoopers — psmtoday @ 9:23 am

Yahoo Sports says that a PricewaterhouseCoopers report predicts that China will edge the US in total medals for the 2008 Summer Olympics.

“As the host nation in Beijing and (with) an economy which has grown very strongly since 2004, the medal ‘target’ of 88 for China according to our model is much higher than its actual medal totals in Athens (63) or Sydney (59),” said John Hawksworth, the report’s author.

China was third in overall medals at Athens 2004, behind first-place United States (102) and Russia (92). China was second in gold medals behind the U.S. in 2004—32 to 36.
 

It is also worth noting that PwC’s Chinese firms, PricewaterhouseCoopers Zhong Tian CPA, is “accounting services supplier” for the Games.

January 28, 2008

Russian Court Upholds PwC/Yukos Ruling

Filed under: Firms,PricewaterhouseCoopers,Tax — psmtoday @ 3:32 pm

The Wall Street Journal reports this evening that a Russian appellate court has upheld a ruling by a lower court.

A Russian court upheld a ruling that PricewaterhouseCoopers LLP essentially was a participant in massive tax evasion by former oil giant OAO Yukos.

The ruling ratchets up pressure on the auditor as the Kremlin gears up for more charges in the politically tinged Yukos case.

On Monday, Russia’s Ninth Arbitration Appellate Court abruptly ended consideration of Pricewaterhouse’s appeal of a lower-court ruling. The original ruling found that Pricewaterhouse’s contract with Yukos should be voided because it involved criminal wrongdoing.

The article also say that is still unclear what impact this will have on PwC’s Russian firm business. PwC says that it is looking for other avenues for appeal.

August 22, 2007

BusinessWeek: “Consulting Pays Off for Accountants Again”

On Monday, BusinessWeek published an article on the new face of the old consulting-services businesses at the Big Four. Specifically, the article discusses Deloitte Consulting and the serendipitous collapse of the deal to spin-off the consulting in March 2003. Since then, Deloitte has continued as the only of the Big Four to have a major consulting practice named as such. E&Y sold its consulting practice to Cap Gemini; KPMG spun-off its consulting business to become BearingPoint; and PwC sold its consulting division to IBM to become part of IBM Global Services. And in the luckiest break of all, Andersen Consulting completed its prolonged and painful departure from Arthur Andersen in August 2000 to become Accenture.
Deloitte bucked the trend by keeping Deloitte Consulting under the same roof. Not only did it retain the business, as the article details, Deloitte has made the consulting business even more integrated with the audit and tax practices.

At Deloitte, partners say consultants are far more intertwined with the rest of the business than ever before, starting with their wallets. The SEC outlawed the practice of paying auditors based on non-audit work. So now Deloitte has one big pool of profit that auditors, tax experts, and consultants all share. Audit partners can still refer business to their consulting counterparts, but they only benefit in a broad sense, no longer directly. “Teaming became our mantra,” says Salzberg. James Quigley, chief executive of the global firm, Deloitte Touche Tohmatsu, says the U.S. firm’s array of services makes it “a category of one.”

But, as the article continues, the rest of the Big Four might quibble with Quigley’s assertion of Deloitte’s singular station in consulting. “And it hasn’t taken long for the other audit firms to do the math, and quickly rebuild their own consulting arms. KPMG Worldwide last year sold $5.3 billion of consulting, a 12% jump from the year before; PricewaterhouseCoopers (PwC) $3.7 billion, up 20%; and Ernst & Young $2.4 billion, a 2% increase.” As a Deloitte consulting executive told me even three years ago, “I know the rest of the firms have consulting, even if they’re aren’t calling it that anymore, because they’re bidding against me for the same consulting work.”

Link: Consulting Pays Off for Accountants Again – BusinessWeek

July 6, 2007

PwC Settles Tyco Litigation

Filed under: Firms,Liability,PricewaterhouseCoopers — psmtoday @ 4:17 pm

PricewaterhouseCoopers today paid $225 million to settle audit malpractice claims in conjunction with Tyco International. The firm said it settled due to the cost of defense and the size of the class action suit, despite saying that it was prepared to defend itself against the claims.

The settlement applies to claims from both Tyco investors, who had filed a class-action lawsuit against the accounting firm in federal court in New Hampshire, and the company itself. The agreement was disclosed Friday in a legal filing by PwC, Tyco and the class-action investors.
Tyco’s involvement in the PwC deal followed on its agreement in May to settle for $2.975 billion claims brought against it by the same class-action plaintiffs — removing a cloud of liability that shadowed the conglomerate as it split into three publicly traded companies. As part of that agreement, Tyco allowed investors to pursue its claims against PwC, while the company would pursue claims on behalf of shareholders against former executives including L. Dennis Kozlowski.

The WSJ article also included some interesting metrics on the size of the settlement relative to the case and PwC.

The PwC settlement ranks among the top 10 legal payouts made by accounting firms related to work on behalf of one company. Ernst & Young LLP’s $335 million settlement in 1999 related to work for Cendant Corp. remains the biggest-ever payout by an auditor.
As a percentage of the overall settlement reached by the company and other parties — a key metric considered by accounting firms — the PwC deal represented a payout on its end of about 7% of the total. That is generally in line with payouts by accounting firms, which tend to range from 5% to 15% of total payouts.

Tyco had reached its own agreement with plaintiff’s in May, paying out $3 billion to settle suits, ahead of its June split into three separate public companies. The terms of Tyco’s settlement turned Tyco’s claims against PwC over to the plaintiff shareholders.

PricewaterhouseCoopers didn’t settle. As part of the agreement, Tyco assigned to the shareholder plaintiffs the right to pursue the company’s claims against Pricewaterhouse for accounting malpractice and to keep any damages. Jay Eisenhofer of Grant & Eisenhofer, one of the lead-counsel firms in the case, said, “Pricewaterhouse is liable potentially for billions of dollars” for not spotting and stopping fraud while auditing Tyco’s books.

May 14, 2007

ARGI Releases 2007 Big Four Annual Report

Released today, ARGI’s 2007 Big Four Annual Report is the leading, comprehensive analysis of annual Big Four market share and operating results. The report uses a special methodology to analyze firm results and covers all areas critical to major professional service organizations.

2007 Big Four Annual Report cover

For 2007, the Report assesses trends and issues such as “Public Accounting in the Public Eye,” the need for world-class talent, the Post Crisis SOX 404 environment, and prospects for Big Four growth in the next 5-10 years. The report also provides an overview of important market share metrics, such win and losses, net audit market share gain in 2006, and total professional fees billed to public companies during 2006.

In other words, the Big Four Annual report offers an independent and objective comparison of the Big Four firms in clear measures. The biggest firm by revenue, the most profitable firm for partners, the firm with the most employees, and the firm with the highest average per-client fees are all questions answered.

Ordering information, along with sample pages from the report, are available from the Annual Report’s product page. Questions on the report may be directed to sales@amesrgi.com.

Next Page »