Professional Services Monitor: Today

 

April 20, 2010

Preliminary FY2009 Audit Fees

Filed under: ARGI,Audit Fees,News — psmtoday @ 5:04 pm

Between January 1 and April 15, 2010, we have processed 2,322 DEF-14A proxy statements, the primary form on which US public companies disclose fees paid to their auditors.  While this is by no means a complete set of data on FY2009, it does represent about 40% of what should be eventually filed.  All analysis below is based upon that set of 2,322 filers.  We will update again in two months when most of the rest of FY2009 should be filed.

Emblematic of the overall economic climate, of the 10 firms with largest aggregate fees only PricewaterhouseCoopers experienced positive growth (1.9%) between FY2009 and FY2008.  Next closest was Grant Thornton at -2.1%.  Again, this is from among the 2,322 filers noted above.

Rank Auditor Clients FY2009 FY2008 Change
1 PricewaterhouseCoopers 375 $2,271,811,789 $2,227,815,201 1.9%
2 Ernst & Young 519 $1,545,044,911 $1,615,883,337 -4.6%
3 Deloitte 338 $1,345,466,037 $1,449,723,665 -7.7%
4 KPMG 364 $1,154,240,231 $1,182,562,186 -2.5%
5 Grant Thornton 114 $81,429,078 $83,163,732 -2.1%
6 BDO Seidman 64 $52,277,852 $54,521,828 -4.3%
7 Crowe Horwath 63 $20,672,469 $21,320,724 -3.1%
8 McGladrey & Pullen 38 $13,620,403 $14,690,576 -7.9%
9 Moss Adams 20 $9,114,058 $9,615,475 -5.5%
10 ParenteBeard 36 $8,471,851 $8,003,648 5.5%
All Others 391 $86,596,459 $88,549,838 -2.3%
2,322 $6,588,745,138 $6,755,850,210 -2.5%

The 25 largest filers by total fees between 1/1/2010 and 4/15/2010 had an average growth of about 4%.  AIG’s $193 million paid to PricewaterhouseCoopers is the largest total we have tracked, eclipsing the $156 million General Motors paid to Deloitte for FY2002.  AIG’s proxy included the explanatory sentence, “The 2009 increase in audit and audit-related fees was primarily related to nonrecurring divestiture and restructuring activities related to AIA, ALICO and Nan Shan and other separate reporting requirements related to the Company’s restructuring activities.”

Rank Company Auditor (FY09) Total Fees Change
1 American International Group Inc. PricewaterhouseCoopers $193.6 Mil. 32.3%
2 Bank of America Corp. PricewaterhouseCoopers $128 Mil. 34.8%
3 General Electric Co. KPMG $110.1 Mil. -20.8%
4 Goldman Sachs Group Inc. PricewaterhouseCoopers $106.9 Mil. 6.5%
5 Citigroup Inc. KPMG $95.9 Mil. -0.2%
6 JP Morgan Chase & Co. PricewaterhouseCoopers $95.8 Mil. -12.4%
7 Morgan Stanley Deloitte $70.7 Mil. 14.6%
8 International Business Machines PricewaterhouseCoopers $66.3 Mil. -8.1%
9 Merck & Co. PricewaterhouseCoopers $55.7 Mil. 49.7%
10 Hewlett Packard Co. Ernst & Young $53.8 Mil. 9.7%
11 MetLife Inc. Deloitte $51.2 Mil. 3.3%
12 Ford Motor Co. PricewaterhouseCoopers $51.2 Mil. -11.5%
13 Wells Fargo & Co. KPMG $50.2 Mil. 48.9%
14 United Technologies Corp. PricewaterhouseCoopers $46.9 Mil. 3.5%
15 Prudential Financial Inc. PricewaterhouseCoopers $45.1 Mil. 8.9%
16 Dow Chemical Co. Deloitte $44.1 Mil. 15.6%
17 Tyco International Ltd. Deloitte $39.9 Mil. -36.1%
18 Pfizer Inc. KPMG $37.4 Mil. 25.7%
19 Verizon Communications Inc. Ernst & Young $36 Mil. 0.0%
20 Thomson Reuters Corp. PricewaterhouseCoopers $34.8 Mil. -13.5%
21 Johnson & Johnson PricewaterhouseCoopers $34.1 Mil. -13.0%
22 Honeywell International Inc. PricewaterhouseCoopers $34 Mil. -3.8%
23 Exxon Mobil Corp. PricewaterhouseCoopers $33.5 Mil. -4.2%
24 Coca Cola Co. Ernst & Young $33 Mil. -5.6%
25 AT & T Inc. Ernst & Young $31.2 Mil. -1.9%

The SEC requires companies to disclose fees paid to their auditors in four categories–audit, audit-related, tax and other.  Audit represented 79.3% of the total in this segment, and the overall distribution is essentially unchanged between FY2009 and FY2008.