Tuesday, February 1, 2011

The 2010 Big Four Firms Performance Analysis by www.Big4.com

Big4.com Big4.com is the accounting, tax consulting and IT professions’ premier resource that focused on professionals and alumni of the Big Four Accounting and Consulting Firms – Accenture, Deloitte, Ernst & Young (E&Y), KPMG, PricewaterhouseCoopers PwC, Andersen, BearingPoint and Capgemini. It is not affiliated with any Big Four firm.

Recently, it has published “The 2010 Big Four Firms Performance Analysis”, an analysis report of the 2010 Financial Performance of the World’s Largest Accounting Firms, PricewaterhouseCoopers PwC, Deloitte Touche Tohmatsu, Ernst & Young and KPMG.

Within the executive summary, it reports that after an extraordinary period of continuous revenue growth from the early 2000s to 2008, combined revenue for the four firms in fiscal 2009 fell by 7% from fiscal 2008 in US dollar terms, ranged from negative 5% for Deloitte to negative 7% each for Ernst & Young and PricewaterhouseCoopers to negative 11% for KPMG. However, in 2010 the situation improved remarkably, with $95 billion combined revenue for the four firms in fiscal 2010 increasing 1.4% from $94 billion in fiscal 2009 in US dollar terms, ranged from negative 0.9% for Ernst & Young, 1.5% for PwC, 1.8% for Deloitte and 2.6% for the fastest-grower, KPMG.

The big story of 2010 was that Deloitte with its 1.8% growth was able to beat PricewaterhouseCoopers with its 1.5% growth to gain first place and become the largest accounting firm on the planet. In 2009, PwC was narrowly ahead of Deloitte, but Deloitte’s 2010 revenues of $26.578 billion was ahead of PwC’s 2010 revenues of $26.569 billion by an ultra-slim, but very significant, $9 million. Ernst & Young took the third spot at $21.3 billion, and KPMG maintained its position as the smallest of the Big Four firms at $20.6 billion, but narrowed the gap against E&Y.

While the outlook for 2011 and beyond is quite optimistic. Revenue is expected to grow at a steady pace, with help from strong emerging markets and advisory services. 2011 will also prove whether Deloitte can maintain its lead over PwC; and whether the gap between E&Y and KPMG will narrow further.

The full study can be downloaded as Adobe pdf at http://www.big4.com/bigfourperformanceanalysis.html