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In close race for No 1, Deloitte, PwC grow apace
In close race for No 1, Deloitte, PwC grow apace
In close race for No 1, Deloitte, PwC grow apace
In close race for No 1, Deloitte, PwC grow apace
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In close race for No 1, Deloitte, PwC grow apace

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The world's two largest accounting and consulting firms are bulking up with acquisitions and combing the globe for new hires. Head-to-head in a race for the title of world's largest private …

The world's two largest accounting and consulting firms are bulking up with acquisitions and combing the globe for new hires. Head-to-head in a race for the title of world's largest private professional services firm, Deloitte and PwC are on a major expansion drive.

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  • 1. In close race for No 1, Deloitte, PwC grow apace Page 1 of 4EDITION: U.S.CA Canada US United States UK United KingdomJanuary 15, 2012Like25KCONNECT Search the Huffington Post Submit QueryIn close race for No 1, Deloitte, PwC grow apaceFirst Posted: 9/20/11 08:05 AM ET Updated: 11/20/11 05:12 AM ETReactBy Dena AubinNEW YORK (Reuters) - Forget struggling economies, aggressive regulators, penny-pinching business clients.The worlds two largest accounting and consulting firms are bulking up with acquisitions and combing the globe for new hires.Head-to-head in a race for the title of worlds largest private professional services firm, Deloitte and PwC are on a majorexpansion drive.With audit revenues leveling off in developed markets, the firms have been making a push in growing countries such as Chinaand India and plowing ahead with investments in consulting, where business is growing after a recessionary slump.More is at stake than bragging rights. Just as important is cementing their status as professional service supermarkets, able tohelp clients in almost any market where commerce transpires."The more they position themselves as a truly trusted one-stop solution provider to clients, the more they can hope to be moreimmune to fee pressures from clients that might increase if the economy worsened," said Ashley Newton, associate director atKennedy Consulting Research and Advisory.Sponsored Links Are Annuities Safe? Dont Buy Any Annuity Until You Watch This Special Video Report! SeniorAnnuityAlert.com Hack The Stockmarket "Rogue" trader spills secret to get rich w/ dirt cheap penny stocks... www.heropennystocks.com Mom Makes Botox Doctors Furious Mom Reveals Clever Wrinkle Therapy That Makes Botox Doctors Furious! www.consumerproducts.com Buy a link hereLast year, a 15 percent jump in the consulting area helped Deloitte overtake PwC as No. 1 in total revenues among the bigfour global accounting and consulting firms, which also include KPMG and Ernst & Young.http://www.huffingtonpost.com/2011/09/20/in-close-race-for-no-1-d_n_971317.html?view... 1/15/2012
  • 2. In close race for No 1, Deloitte, PwC grow apace Page 2 of 4Deloitte claimed the lead by a margin of just $9 million, reporting $26.578 billion revenues to PwCs $26.569 billion. Prior to2010, PwC had been the largest for at least five years, according to data from Accounting News Report.ASIA, MIDDLE EAST GROWTH TARGETSOne factor behind the win was Deloittes decision to hold on to its consulting arm about a decade ago while other audit firmsshed theirs amid concerns of conflict of interest.The decision helped Deloitte keep its grip on the high-potential area of information technology, a business with good growthprospects even in a dodgy economy. Consulting got a further boost from Deloitte acquisitions such as the governmentbusiness of BearingPoint in 2009.Although regulators in the United States and elsewhere have tightened restrictions on the consulting services auditors canprovide, consulting has not been prohibited outright, and both Deloitte and PwC have focused their consulting work largely oncompanies that are not audit clients.Powerful brand names and close ties with C-suite executives, built partly through audit relationships, have helped make all ofthe big four formidable competitors in consulting, according to Gartner Research."What the audit work does is allow them to create competence in an industry," building credibility that is a big plus in pulling inconsulting work, said Gartner analyst Alex Soejarto.The move into consulting has been going on for some time, partly because it is far more profitable than mandatory audit work,said Arvind Hickman, editor of International Accounting Bulletin."Audit is labor-intensive and has suffered a lot from fee pressure due to the global financial crisis."PwC, which sold its consulting arm to IBM in 2002, has been rebuilding its consulting muscle with acquisitions such asParagon Consulting Group and the commercial services business of BearingPoint in 2009.Over the past 12 months, it picked up 700 consultants with its purchase of management consulting firm PRTM and hundredsmore through its acquisition of Diamond Management & Technology Consultants. Recently it announced it was building itsedge in the so-called sustainability or responsible resource use area, by taking on "green" business consultant AndrewWinston as an adviser.Still the worldwide leader in audit revenues, it also has targeted emerging markets such as India, China and the Middle East torev up growth.Deloitte has bought a slew of consulting firms, including energy consultants Altos Management Partners and AJM PetroleumConsultants; performance management advisory firm Jackson Browne; economic consultancy Access Economics andbusiness analytics firm Oco. It also beefed up in the sustainability area, picking up Clear Carbon Consulting and DOMANISustainability Consulting.Full-service clout has helped the firms compete against a range of firms, from management giants such as McKinsey totechnology consultants such as IBM Corp <IBM.N> and Accenture <ACN.N>.HIRING NONSTOPBoth Deloitte and PwC have been hiring nonstop.PwC said its member firms across the globe hired about 45,000 new staff in the 2011 fiscal year ended in June. Deloitte willnot announce its hires until it releases fiscal 2011 revenue figures, but said it was on track with a projection announced lastyear of 50,000 hires a year globally over the coming five years.The big four are expected to report their fiscal 2011 revenues in coming weeks and any significant growth will likely onceagain be in the consulting area, said Jonathan Hamilton, managing editor of Accounting News Report."The audit business, while certainly the staple of all these firms, is a slow-growth business," Hamilton added.The firms growth raises challenges, however, such as assuring quality as their empires expand."They are really individual firms that are badged together, but they dont have a tight centralized control," said Shan Nair, chiefexecutive of Nair & Co, which advises companies on international expansion and works with the big four firms.Expansion in China, a key market, has already brought headaches in the audit area. The Chinese arms of both Deloitte andPwC have had to drop clients because of concerns about their accounting and Deloittes Shanghai office has beensubpoenaed for records by U.S. regulators.More worries loom from stepped-up regulatory scrutiny. As consulting revenues grow, complaints are surfacing again thatfirms will be tempted to go easy on audit clients for the sake of winning or keeping a consulting job -- a charge the audit firmsdeny.Last week, European Union lawmakers approved a report that calls for barring auditors from providing audit and non-auditservices to the same client. The report is nonbinding but could shape a draft law in the works.http://www.huffingtonpost.com/2011/09/20/in-close-race-for-no-1-d_n_971317.html?view... 1/15/2012
  • 3. In close race for No 1, Deloitte, PwC grow apace Page 3 of 4PwC and Deloitte both said there was no conflict of interest in the consulting services they provide. Much of their consulting isdone for companies they do not audit and they follow regulators standards and companies own restrictions on the kind ofconsulting they do for audit clients.PwC also said it follows a code of ethics set by the International Ethics Standards Board for Accountants to assure itsindependence.Also to the firms advantage, much of their consulting work -- such as helping companies cut costs and become more efficient-- should be in demand even if the economy slows, analysts said."All-in-all, Id say theyre generally taking a pretty prudent approach to expansion, even if it is aggressive," said Newton atKennedy Consulting Research.(Reporting by Dena Aubin; editing by Howard Goller and Andre Grenon)FOLLOW HUFFPOST BUSINESSONFacebook:Like25KTwitter: Enter Email Address Get AlertsCONTRIBUTETO THIS STORY • Send Corrections • Send us a Link • Contact us • Send a Tip • Send Photos/Videos • Comment Sponsored Links Free Day Trading Classes Become an Expert Trader With A Free Day Trading Course Near You Today! www.TradingAcademy.com/FreeWorkshop Do Your Taxes Tax season is here. Let TaxSlayer.com do all the tax work for you! www.TaxSlayer.com 57 Year Old Mom Looks 28 Mom Reveals $4 Wrinkle Trick Angering Doctors! See 14 Days Results... MUST-SEE.TheHigherLifestyle.com The Stock Market Santa? $200 in pocket change can turn into a pile of cash w/ dirt cheap stocks... www.preferredpennystocks.com Buy a link here Related Business Videos... Play Play Play Incarceration Guide - How Creative Builds a How KKR Private Equity Sentencing Consulting Consulting Career and Bain Consulting Jobs Firm Differ - Dan Street Filed by Reuters | More in Business... • Commentshttp://www.huffingtonpost.com/2011/09/20/in-close-race-for-no-1-d_n_971317.html?view... 1/15/2012
  • 4. In close race for No 1, Deloitte, PwC grow apace Page 4 of 4 • 0 • Pending Comments • 0 • View FAQView AllRecency |Popularityhttp://www.huffingtonpost.com/2011/09/20/in-close-race-for-no-1-d_n_971317.html?view... 1/15/2012

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