Top 60 Audit Uk 2003-2013

Top 60 firms survey Special Reports
25
accountancymagazine.com July 2003
T
he overall picture from this years
survey of the Top 60 firms by fee
income does not make for
comforting reading. The total fee
income of all the firms in the survey fell
slightly, by less than half of one percent
compared to last year. The occasional
oasis of individual growth can usually be
explained by a merger or acquisition.
Organic growth seems scarce and, it has
to be said, difficult to identify given the
less-than-transparent nature of the
accountancy profession in general. The
results contrast with last years table
which showed growth approaching 10%,
although it has to be noted that the sale
of some of PwC and KPMGs consulting
activities will have had an effect on this
years total income.
The firms may not say so, but most are
finding the current climate difficult.
Gareth Pearce, chairman of Smith &
Williamson, said that his firm was not
unusual in that it would have had a disappointing year were it not for a merger that boosted
its fee income figures. My perception is that the market is patchy but reasonably bouyant
and my suspicion is that no-one is finding it particularly easy. Clients are looking harder at
fees and there seems to be a slowdown in transaction-related work.
A trend beginning to emerge from this depressed market is that more firms are looking for
specialised areas that could bring in extra income. A number of firms are reporting a new fee
income category of corporate finance (see p28), perhaps as a means of replacing income
previously generated by their consulting divisions.
LLP structure gains popularity
Liability, of course, has also been an area for much discussion over the year, which is why we
asked all of the firms in the survey whether they had, or would consider, converting to an LLP
structure. The results show that an LLP structure is an increasingly attractive option, and not
just for the larger firms. In total, 10 firms in the Top 60 have already converted (including
Kingston Smith, which has chosen only to convert its insolvency practice), five more will
convert in the next few months and two more Buzzacott and AGN Shipleys are currently
discussing conversion. Others may well follow Haines Watts, for instance, says LLP status is
something we may consider in the future.
The reason why so many firms are choosing an LLP structure, though, is not simply the
liability issue. David Smart, managing partner of Solomon Hare, said that an LLP provided a
better structure for the firm than the outdated Partnership Act. The firm was one of the first
smaller firms to convert. If it was only about limiting our liability we wouldnt have
converted, he said. Instead, the main driver was to attract good potential partners in a climate
where equity partnership is often considered too risky. It was more about recruiting and
retaining the best people, but it has also given us more possibilities in terms of finance and
helps to create a corporate culture within the firm, said Smart. There have to be wider
business reasons to convert than simply limiting your liability. More on LLPs, p78
Top 60 stagnates
Accountancys annual Top 60
league table of accountancy firms,
shown on the next page, reveals
that growth has ground to a halt.
Liz Fisher reports
Top 60 firms: main survey findings
Total fee income for Top 60 of 6.201bn, compared to
6.229bn last year
10 firms already LLPs and five more planning to convert
The Top 60 firms have 4,786 partners, 438 of whom are
women
46,237 professional staff are employed by the Top 60 in 654
offices around the UK
Only one in 11 partners are female
For the first time, we have asked the
firms to tell us how many female
partners they have. Although our
findings will come as no surprise to
those who work in the firms,
statistically, the results are quite
shocking only around 9% of
partners in the Top 60 are women.
As part of our Top 60 special report
this month, we interview some of
the leading female partners in the
firms, including Ruth Anderson
(top) of KPMG and Andrea
Grimshaw of Horwath Clark
Whitehill, and ask them why they
think they are such a rare breed.
Whats in this special report...
The risers and fallers p26
The Top 60 league table p27
Women partners: one in 11 p31
Profitability problems p36
E
ntertaining as it is to highlight the firms with the best and worst performance of
the year, it is only fair to point out that many of the results are distorted by
acquisition and disposal activity. Tenons spectacular growth rate, for instance,
hides a less impressive story. The financial difficulties suffered by the consolidator
over the past 12 months have been well-documented. The group acquired 14
businesses in 2000 and 2001 which explains much of the increase in its fee income
but integration proved more complicated than expected. Andy Raynor, the companys
chief executive, admitted that Tenons performance in 2002 was extremely
disappointing and in February this year a fundamental review of the business was
announced.
Smith & Williamsons growth is largely due to its acquisition of the investment
management firm NCL during the year, and its acquisition of Andersens UK business
helps explains Deloittes 33% increase in fees.
A similar argument applies for the firms showing the largest falls in fee income. For
example, PricewaterhouseCoopers figures, although difficult to estimate given the
firms secrecy over its UK performance, does not include the large chunk of consulting
activities which the firm sold to IBM. Solomon Hares 7.7% fall in fee income can also be
explained by the sale of a 2m business during the year.
Special Reports Top 60 firms survey
July 2003 accountancymagazine.com
26
Top 60 firms:
The risers and fallers
Acquisitions and disposals explain most changes in fee income, says Liz Fisher
Biggest increases in fee income
This year Last year Change
1. Tenon Group 92m 55.4m 66%
2. Smith & Williamson 199.6m 69.7m 43%
3. Haslers 6.2m 4.4m 41%
4. Blueprint Audit 10.4m 7.6m 37%
5. Deloitte & Touche 1,244.7m 933.7m 33%
Biggest falls in fee income
This year Last year Change
1. PricewaterhouseCoopers 1,431m 1,936m -26%
2. Solomon Hare 15.5m 16.8m -8%
3. BDO Stoy Hayward 193.5m 201.5m -4%
4. Haysmacintyre 12.5m 13m -4%
5. MacIntyre Hudson 28.1m 28.5m -1%
PwC and the Big Four
With 797 partners and fee income estimated by
Accountancy of around 1.4bn PwC retains its
title as the largest UK firm. But there is a new firm
in second place Deloitte & Touche - which has
pushed KPMG into third place ahead of Ernst &
Young which remains in fourth position.
Deloittes rise can be attributed to the fact that
its Big Four rivals have disposed of major parts of
their consultancy operations, moves which
explain a significant fall in the fee incomes of
both PwC and KPMG since last year, and a
narrowing of the fee income lead that PwC has
traditionally held over the other Big Four firms.
PwC, however, remains secretive about its UK
peformance. While the global firm of PwC
released a glossy Global Annual Review at the end of 2002, described as the first of its kind for
a professional services organisation which fulfils a commitment made by PwC global CEO
Samuel DiPiazza to open the privately-held network to greater outside scrutiny, the firm has
again refused to provide any UK-specific fee income information. As a result, we have estimated
the firms fee income by taking an average of the fee/partner ratio for the remaining Big Four
firms and multiplying that figure by the number of PwC partners. The firm says that its
conversion to LLP status at the beginning of this year means that it will reveal UK income for the
first time later this year.
Notes to table (opposite)
*See Accountancy companies, p28
(1) Fee income figures estimated by Accountancy.
(2) Intention to convert announced in March 2003.
(3) Conversion planned for 1 July 2004.
(4) Conversion agreed, but date unconfirmed.
(5) Figures include three associated offshore practices and a wholly-
owned financial planning company.
(6) There are 126 fee-earning directors.
(7) Tenon has 170 directors, not partners.
(8) An outsourcing subsidiary was disposed of during the year.
Comparatives not re-stated. UK figures include the Channel Islands
and Isle of Man.
(9) 2003 figures are estimates.
(10) Numerica has 90 directors, 84 of whom are male.
Fee income figures are annualised.
(11) LLP is an option we may consider in the future.
(12) Fee income includes the results of WJB Chiltern Group. Partners
include WJB partners.
(13) Insolvency practice converted to LLP on 1 May 2003.
(14) Vantis does not have partners. 55% of professional staff are
male.
(15) Blueprint uses services provided by Tenon plc, including
facilities and personnel.
(16) Company has 42 directors. Uses services provided by Numerica.
(17) Conversion pending, probably from 1 October 2003.
(18) Conversion planned for 1 October 2003.
(19) Fee income estimated for 2003.
Top 60 firms survey Special Reports
27
Accountancy Top 60 league table of accountancy firms 2003
Position Company Fee Previous % change Male Female Total Fee/partner Prof No of UK LLP? Year end
income year's fee partners partners partners ratio 000s staff offices
m income
1 (1) PricewaterhouseCoopers
1
1,431 1,936 -26 734 63 797 1,796 7,990 36 Yes 30.06.02
2 (3) Deloitte & Touche
2
1,244.7 933.7 33.3 574 70 644 1,933 7,319 23 Planned 31.05.03
3 (2) KPMG 1,018 1,023 -0.5 543 67 611 1,666 6,903 22 Yes 30.09.02
4 (4) Ernst & Young 754.5 722.2 4.5 376 46 422 1,788 5,932 20 Yes 30.06.02
5 (5) Grant Thornton
3
216 204.5 5.6 222 20 242 1,078 1,991 36 Planned 30.06.03
6 (6) BDO Stoy Hayward
4
193.5 201.5 -4 241 21 262 738 1,726 30 Planned 31.03.02
7 (7) Baker Tilly 157 158 -0.6 248 25 273 575 1,499 32 No 31.03.03
8 (8) PKF
5
107.4 102.2 5.1 93 13 106 1,013 1,294 28 No 31.03.03
9 (11) Smith & Williamson
6
* 99.6 69.7 42.9 n/a n/a n/a n/a 846 11 Ltd 30.04.03
10 (9) Tenon Group Plc
7
* 92 55.4 66.1 n/a n/a n/a n/a 1,248 28 Plc 31.12.02
11 (10) Moore Stephens
8
77.3 71.8 7.7 140 14 154 502 921 24 No 31.12.02
12 (12) Mazars
9
61.1 59.7 2.3 58 4 62 985 687 18 No 31.08.03
13 (13) RSM Robson Rhodes 57 50 14 77 12 89 640 524 10 Yes 30.04.02
14 (16) Numerica
10
* 48 42 14.2 n/a n/a n/a n/a 501 9 plc 31.03.03
15 (14) Horwath Clark Whitehill 47.8 44.4 7.6 69 10 79 605 475 24 No 31.03.03
16 (15) Haines Watts Group
11
43.8 43.5 0.7 75 3 78 561 494 35 No 31.03.03
17 (-) MRI Moores Rowland LLP
12
35.8 30.8 16.2 46 4 50 716 176 2 Yes 31.03.03
18 (18) Saffery Champness 30.3 27.6 9.8 41 6 47 645 284 10 No 31.03.03
19 (17) MacIntyre Hudson 28.1 28.5 -1.4 41 4 45 624 311 9 No 31.03.03
20 (21) Bentley Jennison 27.5 24.5 12.2 32 0 32 859 410 10 No 31.05.03
21 (19) Kingston Smith
13
26.3 25.4 3.5 41 6 47 559 254 6 Partly 30.04.03
22 (20) Chantrey Vellacott DFK 26 25.5 2 31 1 32 812 268 7 No 30.04.03
23 (22) Hacker Young Group 22.5 19.3 16.6 62 2 64 351 314 10 No 30.04.03
24 (24) Vantis plc
14
* 19 16 18.7 n/a n/a n/a n/a 225 16 plc 30.04.03
25 (25) Menzies 18.6 15.8 17.7 32 2 34 547 182 9 No 31.03.03
26 (23) Solomon Hare LLP 15.5 16.8 -7.7 23 1 24 646 173 3 Yes 31.03.03
27 (27) Wilkins Kennedy 12.8 12.5 2.4 22 0 22 581 128 7 No 30.04.03
28 (26) Haysmacintyre 12.5 13 -3.8 19 2 21 595 107 1 No 31.03.03
29 (28) Armstrong Watson 12.4 12.4 0 24 8 32 387 188 15 No 31.03.03
30 (31) Reeves & Neylan 11.3 10.2 11 29 2 31 365 155 10 No 29.03.03
31 (30) Buzzacott 11 10.3 6.2 17 1 18 611 104 1 Considering 31.03.03
32 (40) Johnston Carmichael 10.7 8.9 20.2 24 1 25 428 145 10 No 31.05.03
32 (33) WBS 10.7 9.8 9.2 24 0 24 446 109 2 No 30.04.03
34 (34) Littlejohn Frazer 10.6 9.8 8.2 19 2 21 505 79 1 No 31.03.03
35 (35) Rothman Pantall & Co 10.5 9.6 10.2 25 3 28 375 128 14 No 31.03.03
36 (41) Blueprint Audit Ltd
15
* 10.4 7.6 36.8 n/a n/a n/a n/a n/a 24 Ltd 31.12.02
36 (32) Cooper Parry 10.4 10.1 3 20 2 22 473 111 3 Yes 30.04.03
38 (38) Price Bailey 10.2 9.1 12.1 26 0 26 392 130 9 No 31.03.03
39 (42) HLB AV Audit plc
16
* 10 8.9 12.3 n/a n/a n/a n/a 0 6 plc 31.03.03
39 (37) Lovewell Blake 10 9.2 8.7 18 0 18 555 170 7 No 30.09.02
41 (-) Duncan & Toplis 9.9 9.2 7.6 22 1 23 430 188 9 No 31.03.03
41 (29) Scott Moncrieff 9.9 9.2 7.6 22 1 23 430 156 2 No 30.04.03
43 (39) Larking Gowen 9.5 9.1 4.4 17 1 18 528 190 8 No 31.03.03
44 (36) CLB 8.9 8.6 3.5 16 1 17 524 93 6 No 31.03.03
45 (46) Mercer & Hole 8.6 7.2 19.4 14 1 15 573 81 4 No 31.03.03
46 (43) AGN Shipleys 8 7.9 1.3 12 2 14 571 66 3 Considering 30.04.03
47 (44) Morley & Scott 7.7 7.5 2.7 18 4 22 350 78 4 No 30.09.02
48 (53) DTE 7.1 6.4 10.9 7 0 7 1,014 101 4 No 30.04.03
48 (49) Simmons Gainsford LLP 7.1 6.7 6 10 0 10 710 38 2 Yes 31.03.03
50 (56) Bishop Fleming 7 6 16.7 15 2 17 412 128 5 No 5.04.03
50 (47) Pridie Brewster 7 7 0 12 1 13 538 n/a 4 No 31.07.02
52 (50) Barnes Roffe
17
6.9 6.6 4.5 12 0 12 575 90 4 Planned 31.12.02
53 (48) James & Cowper 6.7 6.7 0 13 1 14 478 74 3 No 30.04.03
54 (54) Hillier Hopkins
18
6.5 6.2 4.8 15 1 16 406 61 3 Planned 31.03.03
54 (52) Berg Kaprow Lewis LLP 6.5 6 8.3 12 1 13 500 66 3 Yes 31.03.03
56 (51) Monahans 6.5 6.4 2 14 2 16 406 86 4 No 31.03.03
57 (55) Critchleys 6.4 6.2 3.2 17 1 18 355 76 4 No 31.05.03
58 (-) Arram Berlyn Gardner
19
6.3 6 5 6 3 9 700 52 1 No 30.06.03
58 (-) Haslers 6.2 4.4 40.9 9 0 9 689 55 1 No 31.12.02
60 (-) Brebner, Allen & Trapp 6.2 6 3.3 18 0 18 344 57 2 No 05.04.03
Total 6,201 6,229 4,347 438 4,786 46,237 654
Special Reports Top 60 league table
26
T
he 60 largest accountancy firms in the UK are
still struggling in a stagnant market, according
to our latest survey. Unlike last years survey,
though, the Top 60 did manage to show a
small year-on-year increase in fee income. Overall,
the 60 firms showed a rise in revenue of just over 1%,
from 6.315bn to 6.392bn.
Organic growth is rare. Most firms reported only
modest growth or a slight fall in revenue and many
of the larger increases can be explained by mergers
or acquisitions.
One of the largest increases in fee income comes
from north-east London-based Haslers, ranked 50th
in the table, with 34%. According to managing part-
ner Stanley Baskin, the growth is entirely organic.Its
a case of a lot of earlier work on marketing and
development bearing fruit. Weve strengthened the
tax department considerably and have two partners
concentrating solely on corporate finance. As with
many firms, Haslers has consciously moved away
from compliance work. Audit and accounting just
doesnt put bread on the table any more.
Baskin also disagrees with the view of the larger
firms that the market conditions are more difficult
than ever.For our size of firm, looking for SME clients,
Id say that the market is buoyant.
Restructuring
Similarly, some of the more significant falls in fee
income can often be explained by restructuring or
reorganising. MacIntyre Hudson, which dropped out
of the top 20 this year after reporting a 29% fall in fee
income, says it remains buoyant about its prospects.
In previous years we aggregated the financial serv-
ices revenue of Moorgate House plc [the firms asso-
ciated financial services division] with that of the
main practice, said Dick Panter, the firms managing
partner.That company was taken over in September
2003 and we have excluded the financial services
revenue for the whole year. There is healthy growth
in all other areas, he said.
Overall, there seems to be growing evidence that
firms are reassessing their business and looking for
profitable niches or moving away from disciplines
that have proved less profitable in the past.
Accountancys annual Top 60 league table of firms finds
fee income at 6.4bn stagnant for the second year in a
row, reports Liz Fisher
Fees stuck
in doldrums
Notes to table
1. 2004 fee income is estimated.
2. 2004 fee income is estimated.
3. The figures for Smith & Williamson Ltd include revenue for services
provided to Nexia Audit. Nexia Audit Ltd is a legally independent
company which uses staff seconded by S&W together with related
services (see box left).Partners are fee-earning directors.
4. Financial year end is 30.06.04. Income includes revenue for services
provided to Blueprint Audit Ltd.
5. Figures are unaudited.
6. Fee income includes revenue from a services agreement with HLB
AV Audit. Business advisory services were transferred to an LLP
within the group on 1 June 2004 (see box left).
7. All figures taken from annual report and accounts (see How we
compile the Top 60, left).Partners are directors. WJB Chilterns main
business is tax consultancy.
8.Partners are executive directors.
9. Prior year figures have been adjusted to take account of a change
in the year end.
10.Partners are directors.
11. Staff are seconded from Numerica.Partners are client service
directors.
12. Staff are seconded from Smith & Williamson. Full year
comparatives not available Nexia founded in October 2002.
13. Fee income includes financial services and IT consulting income
conducted through associated companies.
14.Partners are members.
How we compile
the Top 60 table
Given that not all firms publish their annual
results, the table is mainly put together using
responses to a questionnaire sent out by
Accountancy. With the trend towards
transparency, the number of firms refusing to
complete them has dwindled to a few small
firms, with the exception given below.
Given the arrival of the consolidators and
Smith & Williamsons transformation into a
limited company, the term Top 60 firm should
now be interpreted in its loosest sense. We
include businesses that employ accountants to
carry on the sort of businesses traditionally
associated with accountancy practices, such as
audit, tax and business advice, which compete in
the accountancy market and which have links to
the professional accountancy bodies.
Hence our decision to include WJB Chiltern
which this year declined to complete a
questionnaire. We have therefore used its latest
published group accounts and website. WJB
Chiltern directors do not feel the company is
comparable to traditionally-structured
accountancy firms.
Note on consolidators income
The incomes of Tenon, Numerica, Smith & Williamson
and Vantis include income earned from services, such
as provision of staff, to their associated independent
audit organisations, respectively, Blueprint, HLB AV
Audit, Nexia (all in table) and AuditAssure (too small
to be included).
Top 60 league table Special Reports
27
Position Firm Fee Previous % change UK Total Female Prof staff Fee/partner LLP? Annual accounts Year end
(prior year income year offices number of partners ratio published?
in brackets) m m partners 000s
1 (1) PricewaterhouseCoopers 1,500 1,600 -6.25 35 769 61 14,100 1,950 30.06.03
2 (2) Deloitte
1
1,248 1,191 4.8 21 610 70 7,823 2,046 31.05.04
3 (3) KPMG 1,008 1,018 -0.9 26 568 82 8,146 1,774 30.09.03
4 (4) Ernst & Young 811.6 754.5 7.6 21 404 51 5,506 2,008 30.06.03
2
231 218 5.9 34 239 21 1,995 966 30.06.04
6 (6) BDO Stoy Hayward 181 193.5 -6.5 15 197 16 1,343 919 31.3.04
7 (7) Baker Tilly 168.2 157 7.1 33 151 8 1,583 1,139 31.03.04
8 (8) PKF 110 107.4 2.4 25 101 4 1,288 1,089 Planned 31.03.04
9 (9) Smith & Williamson Ltd
3
107.6 99.6 8 11 139 20 650 774 Ltd 30.04.04
10 (11) Moore Stephens 83.7 77.3 8 24 167 13 935 501 Planned 31.12.03
11 (10) Tenon Group plc
4
81.4 96.1 -15.4 27 160 12 1,250 486 plc 31.12.03
12 (13) RSM Robson Rhodes
5
74.4 65.8 13.1 9 91 14 681 817 30.04.04
13 (12) Mazars 60.7 59.7 1.7 18 75 7 707 809 Considering 31.08.03
14 (15) Horwath Clark Whitehill 48.8 47.8 2.1 22 94 11 442 519 31.03.04
15 (14) Numerica Group plc
6
46.6 45.2 3.1 7 92 7 447 506 plc 31.03.04
16 (16) Haines Watts 44.9 43.8 2.5 36 81 6 494 554 31.03.04
17 (20) Bentley Jennison 35.3 26.5 33.2 10 40 2 850 882 31.05.04
18 WJB Chiltern Group plc
7
31.9 28.2 13.1 4 33 3 255 967 plc 31.03.03
19 (18) Saffery Champness 31.6 30.3 4.3 10 52 7 231 608 31.03.04
20 (21) Kingston Smith 27 26.4 2.6 6 46 6 241 587 30.04.04
21 (22) Chantrey Vellacott DFK 24.1 26 -7.3 7 32 0 238 753 Planned 30.06.03
=22 (23) UHY Hacker Young 24 22.5 6.7 10 68 2 300 353 30.04.04
=22 (24) Vantis plc
8
24 19 26.3 16 23 0 274 1,043 plc 30.04.04
24 (25) Menzies MRI 21.5 18.6 15.9 9 37 2 186 581 Planned 31.03.04
25 (19) MacIntyre Hudson 20 28.1 -28.8 9 42 4 224 476 Considering 31.03.04
26 (27) Wilkins Kennedy 15.2 12.8 18.7 6 34 2 141 447 30.04.04
27 (26) Solomon Hare 14.8 15.5 -4.5 3 24 1 173 617 31.03.04
28 (29) Armstrong Watson 13.1 12.4 5.3 15 34 8 176 385 31.03.04
29 (28) Haysmacintyre 12.6 12.4 1.6 1 21 2 103 600 Considering 31.03.04
30 (32) Johnston Carmichael 12.35 10.7 15.4 10 28 0 177 441 31.05.04
31 (31) Buzzacott
9
11.6 11 5.5 1 19 1 108 610 Considering 31.09.03
32 (30) Reeves & Neylan 11.4 11.3 0.9 9 29 2 154 393 31.03.04
33 (35) Rothman Pantall & Co 11.3 10.5 6.9 14 27 3 143 418 31.03.04
=34 (36) Cooper Parry 11.2 10.4 7.7 3 19 0 128 589 30.04.04
=34 (39) Lovewell Blake 11.2 10.5 6.7 7 20 1 152 560 30.09.03
36 Francis Clark 11 10.4 6.1 6 24 2 142 458 Considering 30.04.04
37 (32) WBS 10.95 10.7 2.3 2 25 1 120 438 30.04.04
38 (41) Scott-Moncrieff 10.9 10.9 0 2 19 1 70 574 30.04.04
=39 (34) Littlejohn Frazer 10.8 10.6 1.9 1 20 2 86 540 Planned 31.03.04
=39 (38) Price Bailey 10.8 10.1 6.9 9 26 0 130 415 31.03.04
41 (41) Duncan & Toplis 10.5 9.9 6 9 26 2 189 404 31.03.04
42 (36) Blueprint Audit Ltd
10
10.4 7.6 36.8 16 68 6 218 153 Ltd 31.12.02
43 (43) Larking Gowen 10 9.5 5.3 7 17 1 165 588 31.03.04
44 (48) DTE 9.7 7.1 36.6 5 8 0 96 1,212 30.04.04
45 Hazlewoods 9.3 8.5 8.6 3 15 0 92 620 Planned 30.04.04
46 (46) AGN Shipleys 9.2 8 15 3 15 2 70 613 Considering 30.04.04
47 (45) Mercer & Hole 9.1 8.6 5.8 4 16 3 83 568 31.03.04
48 (44) CLB 8.5 8.1 4.9 6 17 2 81 500 31.03.04
49 (39) HLB AV Audit plc
11
8.4 10 -16 6 41 2 0 205 plc 31.03.04
=50 (58) Haslers 8.3 6.2 34.4 1 11 1 51 754 31.12.03
=50 Nexia Audit Ltd
12
8.3 n/a n/a 5 23 2 0 361 Ltd 30.04.04
52 (47) Morley and Scott 8.1 7.7 5.2 4 17 2 67 476 30.09.03
=53 (50) Bishop Fleming 7.5 7 7.2 6 18 2 112 416 05.04.04
=53 (54) Berg Kaprow Lewis
13
7.5 6.5 15.4 2 12 1 77 625 31.03.04
=53 (50) Pridie Brewster 7.5 7 7.1 4 14 1 62 535 31.07.03
56 Streets 7.4 4.9 51 5 15 2 71 493 Considering 30.06.03
57 (48) Simmons Gainsford
14
7.2 7.1 1.4 2 9 0 36 800 31.03.04
=58 (52) Barnes Roffe 6.9 6.9 0 4 12 0 85 575 31.12.03
=58 (53) James & Cowper 6.9 6.7 3 3 14 1 76 493 30.04.04
=58 Lubbock Fine 6.9 6.7 3 1 14 0 54 531 30.11.03
Total 6,392m 6,315m 630 5,062 485 53,841
Accountancy Top 60 league table of accountancy firms 2004
28
P
ricewaterhouseCoopers retained its top spot
although revenues fell by over 6% in the UK.
One of the factors impacting revenue, the firm
said, was its decision to deselect unprofitable
or high-risk clients. Chairman Kieran Pointer said he
was pleased that the results have held up so well in
the toughest market conditions I can remember.
Deloittes revenues include an estimate for the last
few weeks of the year since the firm is due to release
shortly its first full-year audited results since it con-
verted to LLP status on 1 August 2003. In 2003 the
firm reported a 33% rise in revenues thanks largely
to the 3,000 former partners and staff of Andersen,
which joined Deloitte during the year. This years
results are more modest, with the firm reporting a
4.8% rise in revenues. Senior partner John Connolly
said when the firm announced its interim results in
November that performance was satisfactory, given
largely dull markets.
The news was good for the partners of Ernst &
Young, who saw average profit per partner increase
by 26% from 378,000 to 478,000 during the year.
The firm says its 8% rise in revenues mark a very
creditable financial performance despite continued
low business confidence and regulatory and market
reactions to the crisis of confidence in the US corpo-
rate system.
KPMG partners also had a good year, with average
operating profit per partner rising by 18% to
414,600. KPMG UK senior partner Mike Rake said
the results were a good performance in what was
another tough trading year for the professional
services sector.
The Big Four suffer
dull markets
Flight from consultancy
The analysis of fee income split is, as predicted last year,
becoming more difficult as the boundaries between disciplines
become more indistinct. We are also including fee income split
for PwC, which did not provide detail for last years survey.
Most telling is the significant shift away from consultancy,
which was at one time one of the most lucrative areas for firms.
Deloitte remains the only large firm to retain its consultancy
practice and is the biggest earner of any of the firms by a factor
of 10.
We predicted last year that corporate finance could become a
substitute for firms looking for an alternative to consultancy as a
source of income. That seems to be the case (both Ernst & Young
and Deloitte show an increase in corporate finance income of
over 10%), although the issue is clouded by differing definitions
of the discipline. PwC, E&Y and Robson Rhodes all combine
corporate finance income with corporate recovery income,
although Robson Rhodes chose to classify the area as corporate
recovery rather than corporate finance. For ease of comparison,
we have included the Robson Rhodes figure under corporate
finance.
Women partners still a
rare breed
This is the second year that we
have asked the firms to specify
the number of female
partners.The results show a
slight increase in the
percentage of female partners
within the Top 60, although
the number just 9.6% is
still low. Last years survey
showed a total of 4,786
partners in the Top 60, 438 (or
9.1%) of whom were women.This year there are a total of 5,062
partners in the Top 60, including 485 women. Armstrong Watson
proved to be the firm with the highest percentage of female
partners, with eight out of a total of 34.
Women are still to make a significant impact at partner level in
the Big Four. KPMG leads the list with 14%, followed by Ernst &
Young with 13%, Deloitte with 11% and PwC with 8%.
Audit and accounting income
(Prior years figures in brackets)
Ranking Firm Audit/accounting 000s
1 (n/a) PricewaterhouseCoopers 757 (n/a)
2 (2) Deloitte 356 (344)
3 (3) Ernst & Young 320.8 (297.7)
4 (1) KPMG 291 (421.5)
5 (4) BDO Stoy Hayward 88.7 (95.7)
6 (5) Baker Tilly 81.9 (74)
7 (6) Grant Thornton 68.4 (66.1)
8 (7) PKF 46.5 (45.6)
9 (-) Tenon* 45 (-)
10 (8) Moore Stephens 36 (33.2)
11 (9) Mazars 30.3 (30.9)
12 (10) Horwath Clark Whitehill 27 (27)
13 (12) RSM Robson Rhodes 26 (20.3)
14 (11) Numerica Group 19.6 (21.2)
15 (14) Haines Watts 16 (15.3)
16 (13) Smith & Williamson 15.1 (15.9)
17 (15) Kingston Smith 14.3 (15)
18 (16) UHY Hacker Young 12.5 (11.7)
19 (19) Saffery Champness 10.8 (10)
20 (18) Blueprint Audit 10.4 (10.4)
*Includes some tax consultancy. Does not carry out audit work.
Consultancy
Ranking Firm Consultancy 000s
1 (1) Deloitte 299 (321)
2 (3) PKF 19.2 (18.8)
3 (4) RSM Robson Rhodes 11 (7)
4 (5) Moore Stephens 6.7 (5.4)
5 (8) Vantis plc 5 (4)
6 (7) MacIntyre Hudson 4.5 (4.3)
7 (9) Kingston Smith 3.6 (3.5)
8 (6) Mazars 2.4 (5.1)
9 (-) Duncan & Toplis 2.2 (-)
10 (10) Solomon Hare 2.1 (2.5)
Corporate recovery
Ranking Firm Corporate recovery 000s
1 (1) KPMG 102 (82.2)
2 (2) Grant Thornton 44.1 (42)
3 (4) Baker Tilly 21.7 (19.5)
5 (5) Tenon Group 15.1 (15.9)
6 (6) PKF 12 (11.1)
7 (9) Haines Watts 10 (8.8)
8 (8) Smith & Williamson 9.7 (9)
9 (7) Numerica Group 9 (9.5)
10 (10) Moore Stephens 8.4 (7)
Tax income
Ranking Firm Tax 000s
1 (n/a) PricewaterhouseCoopers 495 (n/a)
2 (1) Deloitte 374 (328)
3 (2) Ernst & Young 287.6 (283.1)
4 (3) KPMG 267 (265.2)
5 (4) Grant Thornton 72.8 (69.1)
7 (6) Baker Tilly 49.4 (51.8)
8 (7) PKF 25.6 (25.6)
9 (8) Smith & Williamson 20.4 (20.9)
10 (10) Moore Stephens 14.2 (13.1)
11 (12) RSM Robson Rhodes 13 (12.8)
12 (11) Horwath Clark Whitehill 13 (13)
13 (9) Haines Watts 13 (13.1)
14 (13) Mazars 11.3 (21.1)
15 (15) Saffery Champness 8.9 (8.6)
16 (14) Chantrey Vellacott DFK 8.7 (9.5)
17 (16) UHY Hacker Young 6.1 (6.1)
18 (17) MacIntyre Hudson 5.9 (5.7)
19 (18) Mercer & Hole 5.1 (4.8)
20 (20) Vantis plc 5 (4)
KPMGs
Ruth Anderson
Fee income of Top 60
accountancy firms
2005 6.???bn
2004 6.392bn
2003 6.201bn
Note: Total income of all Top 60 firms. Year is year of survey
30
I
t has been a happier year for the Top 60
accountancy firms in the UK. After struggling
through stagnant market conditions in recent
years, the 60 largest firms in the country showed
an increase in total revenue of a respectable 4.8%.
This compares with an increase of just over 1% in last
years survey and zero growth the year before that.
Those firms reporting a fall in fee income
generally have a clear explanation for the decrease.
PricewaterhouseCoopers, for instance, restated its
comparatives to reflect its internal restructuring of
business divisions, and the previous years figures
include income from discontinued operations.
Horwath Clark Whitehill shows an apparent drop in
fee income and has fallen from 14th in the table to
18th as a result, but explains that it has excluded
firms from the UK group that are not part of the LLP
from its results.
While some firms have grown through acquisition
most notably BDO Stoy Hayward and Vantis plc,
who shared the spoils from Numerica, and Smith &
Williamson, which recently merged with Solomon
Hare (see our feature on p68) there are signs that
organic growth has returned to the market. Many
firms have reported an improvement in the market
conditions, particularly from the last quarter of 2004.
The bigger firms have enjoyed something of a
bonanza from providing Sarbanes Oxley and
International Financial Reporting Standards advice.
The biggest leap up the league table was by
Barnes Roffe, which rose by 11 places as a result from
58 to 47th place. According to audit partner Gordon
Train, the firms 25% growth rate is entirely organic.
Its partly down to new clients and partly down to
increasing services to existing clients. He adds that
all service areas are performing well.
A time of adjustment
Even so, the profession still faces a time of massive
adjustment, particularly at the larger end of the
scale. The traditional service areas for accountancy
firms are no longer significant cash generators,
which means that firms are looking for income
Good times
return for
Top 60 firms
Notes to table
1. Staff includes support staff.
2. Fee income includes partial forecast.
3. Fee income includes firm's purchase of three Numerica offices and
includes partial forecast.
4. Includes Solomon Hare, with which it merged on 31 May 2005. Fee
income includes revenue for services supplied to Nexia Audit Ltd.
Partners include fee-earning directors.
5. Income includes Tenon Audit Ltd (formerly Blueprint Audit).
Partners are directors.
6. All figures estimated by Accountancy from press and broker
reports. Partners are plc directors.
7. Partners are directors.
8. Based on figures for Horwath Clark Whitehill LLP only. Previous
year includes other members of the UK group.
9. Results exclude Reeves and Neylan in Scotland, which merged and
changed its name during the year. Including the Scottish firm (which
continues to have the same relationship with Reeves & Neylan), fee
income is 12.8m, up 12.3%.
10. Administrative year end is 31.12. Year end for LLP is 30 June
11. Fee income includes partial forecast.
For more information on fee income per partner and
personnel issues, see the additional table on p42
In this Top 60 special report...
The Top 60 league table 31
Firms: case studies 32
LLPs 33
Service line breakdowns 34
Making partner at 30 36
Personnel profile table 42
Profits from practice 44
Mid-tier: strategic warfare 46
bn 0 1 2 3 4 5 6 7 8 9 10
UK accountancy firms are enjoying above-inflation fee
income growth after a couple of flat years. Liz Fisher
analyses our annual league table of firms
6.772bn
6.392bn
6.201bn
(to p32)
Top 60 league table Special Reports
31
Position Firm Fee Previous % change UK Total Prof staff LLP? Annual accounts Year end
(prior year income year offices number of published?
in brackets) m m partners
1 (1) PricewaterhouseCoopers
1
1,568 1,604 -2.2 35 757 13,243 30.06.04
2 (2) Deloitte & Touche
2
1,350 1,246 8.3 18 587 6,800 31.05.05
3 (3) KPMG 1,066 1,006 6 22 553 8,204 30.09.04
4 (4) Ernst & Young 828 812 2 23 429 8,433 30.06.04
2
254.3 237 7.3 33 239 2,092 30.06.05
3
210 187.9 11.8 16 220 1,900 30.06.05
7 (7) Baker Tilly 172.9 166.8 3.7 32 143 1,505 31.03.05
4
127.5 122.7 4 14 161 750 Ltd company 30.04.05
9 (8) PKF 113.7 110 3.3 23 98 1,286 31.03.05
10 (11) Tenon Group
5
90.5 81.4 11.2 27 131 1,050 plc 30.06.04
11 (12) RSM Robson Rhodes 85.2 75.2 13.3 8 89 669 31.04.05
12 (10) Moore Stephens 83.4 81.5 2.4 25 155 857 31.12.04
13 (=22) Vantis
6
65 23.7 see note 23 8 800 plc 30.04.05
14 (13) Mazars 62.5 60.7 3 18 80 482 30.08.04
15 (16) Haines Watts 50.3 44.9 12 36 84 503 31.03.05
16 (17) Bentley Jennison 48.8 35.5 37.5 10 53 598 31.05.05
17 (18) Chiltern
7
36.8 34.3 7.3 2 48 164 plc 31.03.05
18 (14) Horwath Clark Whitehill
8
35.6 48.8 see note 9 60 341 31.03.05
19 (19) Saffery Champness 34.9 31.6 10.4 10 55 229 31.03.05
20 (20) Kingston Smith 28.7 27 6 6 45 256 30.04.05
21 (22) UHY Hacker Young 26.2 24 9.2 10 63 296 30.04.05
22 (21) Chantrey Vellacott DFK 25.1 24.1 4.2 7 50 166 30.06.04
23 (24) Menzies MRI 22.4 21.5 4.1 9 38 183 31.03.05
24 (25) MacIntyre Hudson 21.3 20 6.5 9 40 229 31.03.05
=25 (26) Wilkins Kennedy 15.3 15.2 0.2 7 31 131 30.04.05
=25 (30) Johnston Carmichael 15.3 12.4 23.6 11 33 203 31.05.05
27 (28) Armstrong Watson 14 13.1 7.2 15 33 158 31.03.05
=28 (=34) Cooper Parry 13.1 11.2 17 3 22 141 30.04.05
=28 (31) Buzzacott 13.1 11.6 13.1 1 19 105 30.09.04
30 (29) haysmacintyre 12.8 12.6 1.2 1 21 101 31.03.05
31 (33) Rothman Pantall 12.6 11.3 12.2 14 27 137 31.03.05
32 (36) Francis Clark 12.4 11 12.4 6 24 155 30.04.05
33 (=34) Lovewell Blake 12 11.2 7.1 7 23 156 30.09.04
=34 (=39) Littlejohn Frazer 11.6 10.8 7.4 1 20 87 31.03.05
=34 MRI Moores Rowland 11.6 10.3 12.6 1 16 50 31.03.05
36 (44) DTE 11.3 9.7 16.5 6 8 94 30.04.05
=37 (=39) Price Bailey 11.2 10.8 3.7 5 21 116 31.03.05
=37 (48) CLB 11.2 9.3 20.2 5 17 106 31.03.05
39 (41) Duncan & Toplis 11.1 10.5 6.2 9 27 190 31.03.05
40 (38) Scott-Moncrieff 11 10.5 4.8 2 23 128 30.04.05
41 (32) Reeves & Neylan
9
10.7 9.3 15 7 23 118 02.04.04
42 (47) Mercer & Hole 10.4 9.1 14.3 4 16 57 31.03.05
43 (45) Hazlewoods 10.3 9.3 11.2 3 15 98 30.04.05
44 (43) Larking Gowen 10.2 10 2 6 17 170 31.03.05
45 (46) AGN Shipleys 9.5 9.2 3.3 3 13 70 30.04.05
46 (=50) Haslers 9.4 8.3 13.4 1 11 49 31.12.04
47 (=58) Barnes Roffe
10
8.6 6.9 24.6 4 13 73 31.12.04
=48 (=53) Berg Kaprow Lewis 8.4 7.5 12 2 13 73 31.03.05
=48 (56) Streets 8.4 7.4 13.5 5 13 63 30.06.04
50 (52) Morley and Scott 8.3 8.1 2.5 4 18 76 30.09.04
51 (=53) Bishop Fleming 8.2 7.5 9.3 8 20 78 31.03.05
52 (=53) Pridie Brewster 7.9 7.5 5.3 4 12 43 31.07.04
53 (=58) James & Cowper 7.5 6.9 8.7 3 14 82 30.04.05
54 Hillier Hopkins 7.2 6.9 4.3 3 16 58 31.03.05
55 (57) Simmons Gainsford 7.1 7.2 -1.4 2 12 47 31.03.05
56 Critchleys 7 6.8 2.9 4 18 71 31.05.05
57 (=58) Lubbock Fine 6.8 6.9 -1.4 1 12 49 30.11.04
=58 Arram Berlyn Gardner
11
6.7 6.5 3.1 1 7 43 30.06.05
=58 Forrester Boyd MRI 6.7 6.2 8.1 3 16 95 31.03.05
60 Unity 6.3 5.8 8.7 6 17 62 31.03.05
Total 6,772 6,461 593 4,847 54,569
Accountancy Top 60 league table of UK accountancy firms 2005
32
from newer disciplines. Audit work remains highly
competitive and financially unfulfilling and the
improving economy means that corporate
recovery work is becoming less lucrative. Tightened
regulation is also having an effect on the way firms
earn income, with many companies seeking to cut
back on spending on other services from their
auditors. And there is growing competition in areas
that have long been seen as traditional ground for
accountants, such as tax structuring work, from
other professions.
The overall result is that many firms are reporting
disproportionate rises in income from newer
service areas. This shift in emphasis is illustrated by
KPMGs results for the year. Income earned from
audit rose by just 3% during the year, and tax
income rose by 5%. Corporate recovery income fell
by 9% but by far the largest increases came from
risk advisory work (23%), private equity work (23%)
and corporate finance (17%). Chief executive John
Griffiths-Jones reported that the firm has seen a
13% increase in work from non-audit clients during
the year but added that the market for professional
services remains highly competitive, both in terms
of clients and the competition for skilled staff.
Blurring of service lines
The evidence suggests that this is the beginning
of a new shift in the way firms provide services to
their clients and a further blurring of the lines
between the traditional service areas. The fee
breakdown figures provided by the firms, in
particular, are becoming more difficult to compare
each year, as various firms restructure their
divisions or redefine their service areas (see p34).
While the profession has talked for years about
being business advisers, most were still run in a
format that appeared remarkably like the
accountancy firms of decades ago. Today, an LLP
structure is becoming the norm and previously
unseen business advisory services are coming to
the fore. The age of the modern firm, it appears,
has come.
Liz Fisher picks three top performing firms from the
Top 60 league table and looks at their progress
A tale of three firms
PwC: Turnaround after two tough years
Fee income: 1,568m Ranking in table: 1
PricewaterhouseCoopers results represent, according to UK chairman Kieran Poynter, a
strong turnaround following two of the toughest years I can remember in the UK
professional services market. The 2.2% fall in PwCs fee income shown in our table is
slightly misleading since the firms 2003 results have been restated following its
restructuring of its business into three service lines: assurance, tax and advisory. If
turnover from discontinued operations in 2003 of 99m is excluded, total turnover for
the year rose by 4%, which compares with a fall of 7% the previous year.
The strongest growth was in assurance work (8%) and advisory (9%), although the
firm saw a 4% fall in revenue from tax during the year. A combination of changes to the
regulatory environment and an overall fall in demand for services, particularly in tax
work originating in the US, meant that the firm was beginning to struggle at the end of 2003. Its answer was to
concentrate on winning work from non-audit clients.
Our growth this year includes a 16% increase in revenues from companies we do not audit, reflecting our
decision to focus on this area, said Poynter at the announcement of its results.Of the firms 25 largest clients,
14 are now non-audit, compared with eight a year ago.
Bentley Jennison: Ambitious expansion
Fee income: 48.8m Ranking in table: 16
Bentley Jennisons 37.5% jump in fee income is the largest increase reported by any
of the Top 60 firms and continues the remarkable growth for a firm that celebrates its
21st anniversary this year. Bentley Jennison embarked on an ambitious expansion
strategy last year, aiming to become the largest independent firm outside the Big
Four in each of the cities in which it operates. In April the firm achieved its ambition in
Birmingham when it announced that it would acquire Moore Stephens office in the
City. Perhaps as a result of this acquisition, the firm has been named accountancy firm
of the year by the Birmingham and West Midlands Society of Chartered Accountants
for the past two years, ahead of the Big Four as well as BDO and Grant Thornton.
In June, Bentley Jennisons expansion continued with the announcement that its
Leeds office would merge with the Yorkshire-based firm WBS. WBS ranked 37th in our
survey last year with a fee income of 11m, 25 partners and 120 professional staff.
Bentley Jennison, which was set up in 1984 by John Jennison, David Bentley and Tony Stockdale, has now set
its sights on expansion in Scotland, Manchester and Newcastle.
Mercer & Hole: Private clients boost organic growth
Fee income: 10.4m Ranking in table: 42
A 14.3% increase in fee income during the year took the 16-partner Mercer & Hole up
five places in the Top 60 to 42nd place. The firm specialises in tax work, particularly for
high net work individuals, which accounts for around 6m of its 10.4m fee income.
According to senior partner Howard Wilkinson, the firms growth is entirely organic and
consistent across all business areas. The private client side has expanded but weve also
seen increases in other areas, he said. Recovery work has increased materially, for
instance, mainly because we took on a former Numerica partner, but audit and
assurance has also performed well. The firm made a small number of acquisitions over
the past few years which are well bedded in and overall, says Wilkinson, the market
appears to be stronger than in recent years. Some sectors are still struggling,
particularly manufacturing and retail, but we do feel that it has picked up. Banks are
keen to lend money and some geographical areas in the UK Milton Keynes, for instance seem to
be very buoyant.
Barnes Roffe: Organic growth of 25%
Poynter
Stockdale
Wilkinson
(from p30)
accountancy firms
2003
2004
2005
2006
Special Reports Top 60 firms
28
I
t may not be popular with everyone, but the
accountancy profession must be praising the day
that Sarbanes-Oxley was passed. Accountancys
latest survey of the top 60 firms in the UK shows
a dramatic 14.1% growth in fee income over the
year, far outstripping the 4.8% reported in last years
survey.
Just three years ago, the top 60 firms were
reporting stagnant fee income growth. It is clear that
after years of difficult economic conditions,
confidence has well and truly returned to the market.
Much of the growth, although not all, has been
driven by the increased workload generated by
Sarbanes-Oxley, the introduction of International
Financial Reporting Standards (IFRS) in Europe and
other regulatory developments. The larger firms in
particular have reported strong growth in audit and
assurance-related income, a relatively unusual
phenomenon for the accountancy profession. But
smaller firms too, which are less likely to be affected
by the boom in regulatory work, are also performing
strongly.
Big Four
All the Big Four firms performed well this year, with
KPMG having a particularly good year (see box on
p30). While much of the growth was driven by
Sarbanes-Oxley and IFRS-related work, all firms
reported strong growth in other divisions (with the
possible exception of corporate recovery, which is
generally not performing as well as other service
lines). KPMGs tax practice, for instance, had a good
year, reporting 15% growth, although Ernst &
Youngs tax practice reported growth of just 4%.
Ernst & Youngs business assurance practice
reported a 27% rise in income over the year. Nick
Land, E&Ys UK chairman, was not alone in
speculating how long the Sarbox boom will last.We
anticipate that the growth weve experienced as a
result of our clients IFRS and Sarbox challenges will
level off in the current year, he said, although our
clients will no doubt face other regulatory issues.
Mid tier
In the mid tier, BDO Stoy Hayward performed
particularly well. The volume of companies choosing
to list on AIM has helped the firm, as one of the most
Billion pound
boost for
Top 60 firms
Notes to table
1. Fee income includes estimate
2. Fee income includes estimate. Partners include 79 salaried partners
4. Partners are directors
5. First published accounts due to be released shortly
7. Currently in closed period fee income and profit estimated by
brokers. Partners are directors
9. Partners are principals
11. Partners known as salaried responsible individuals
Staff numbers exclude partners
For more information on fee income per partner and
personnel issues, see the personnel profile on p32
In this Top 60 special report...
Fees per partner/personnel table 32
Profitability and LLPs 34
Fee income breakdown 35
Oxera and the mid-tier 36
Partners: endangered species? 40
Partners: case studies 44
bn 0 1 2 3 4 5 6 7 8 9 10
The combined income of the UKs 60 largest
accountancy firms has grown by 1bn to 7.7bn,
an increase of 14%. Liz Fisher reports
6.201bn
6.392bn
6.772bn
7.727bn
Top 60 firms Special Reports
29
Position Firm Fee Previous % change UK Number of Staff LLP? Annual Auditor Year end
(prior year income year offices partners accounts
in brackets) m m published?
1 (1) PricewaterhouseCoopers 1,780 1,580 12.6 30 755 14,095 Horwath Clark Whitehill 30.06.05
2 (2) Deloitte & Touche 1,550 1,355 14.4 18 624 9,900 Grant Thornton 31.05.06
3 (3) KPMG
1
1,281 1,066 20.2 22 560 8,936 Grant Thornton 30.09.05
4 (4) Ernst & Young 945 825 14.5 21 392 7,294 BDO Stoy Hayward 30.06.05
2
284.1 255.8 11.1 32 245 3,097 PKF 30.06.06
3
275 228 20.6 15 225 2,600 PwC 30.06.06
7 (7) Baker Tilly 183.9 172.9 6.4 30 141 2,125 31.03.06
8 (8) Smith & Williamson Ltd
4
136.9 127.5 7.4 10 169 1,046 Ltd Deloitte 30.04.06
9 (9) PKF
5
116.8 113.7 2.7 22 91 1,529 31.03.06
6
100 90.5 10.5 30 141 1,391 plc PwC 30.06.05
11 (11) RSM Robson Rhodes
3
94.5 85.6 10.4 9 83 874 Horwath Clark Whitehill 30.04.06
12 (12) Moore Stephens 89.5 82.3 8.7 28 167 1,188 31.12.05
13 (13) Vantis plc
7
70.5 65 6.5 19 8 1,030 plc Horwath Clark Whitehill 30.04.06
14 (14) Mazars 64.9 62.8 3.3 18 90 833 Horwath Clark Whitehill 31.08.05
15 (15) Haines Watts 59.1 50.3 17.5 40 90 803 31.03.06
16 (16) Bentley Jennison 57.9 48.8 18.6 13 64 950 31.12.05
17 (19) Saffery Champness 39.5 34.9 13.2 10 56 391 31.03.06
18 (18) Horwath Clark Whitehill 37.6 35.6 5.6 9 63 349 Grant Thornton 31.03.06
19 (21) UHY Hacker Young 36 26.2 37.4 17 76 517 30.04.06
20 (20) Kingston Smith 31.1 28.7 8.4 6 45 328 30.04.06
21 (23) Menzies 27 22.4 20.3 8 40 278 31.03.06
22 Begbies Traynor plc
4
24.7 22 12.2 32 53 297 plc Horwath Clark Whitehill 30.04.05
23 (22) Chantrey Vellacott DFK
8
23.5 25.1 -6.4 7 47 244 30.06.05
24 (24) MacIntyre Hudson
9
22.9 21.3 7.5 9 42 325 Hillier Hopkins 31.03.06
25 (25) Johnston Carmichael 18 15.3 18 10 35 354 31.05.06
26 (25) Wilkins Kennedy 15.7 15.3 2.9 7 29 183 30.04.06
27 (27) Armstrong Watson 15.5 14 10.6 15 34 318 31.03.06
28 (34) CLB Littlejohn Frazer
10
15.4 11.6 32.7 1 27 162 31.05.06
29 (36) DTE 15.2 11.2 35.7 6 11 190 30.04.06
30 (28) Cooper Parry 14.5 13.1 10.7 3 20 226 Buzzacott 30.04.06
31 (28) Buzzacott 13.9 13.1 6.4 1 17 152 30.09.05
32 (33) Lovewell Blake 13 12 8.3 7 23 217 30.09.05
33 (30) haysmacintyre 12.9 12.8 1.4 1 20 130 31.03.06
34 (32) Francis Clark 12.7 12.4 2.1 6 26 217 31.03.06
35 (31) Rothman Pantall & Co 12.2 12.6 -3.2 14 28 171 31.03.06
36 (34) MRI Moores Rowland 12.1 11.6 4.3 1 10 60 Deloitte 31.03.06
=37 (37) Price Bailey 11.7 11.2 4.5 5 21 114 Horwath Clark Whitehill 31.03.06
=37 (40) Scott-Moncrieff 11.7 11 6.4 2 21 181 30.04.06
39 (39) Duncan & Toplis 11.6 11.1 3.9 9 26 260 31.03.06
40 (43) Hazlewoods 11.4 10.3 10.7 3 15 137 30.04.06
41 (44) Larking Gowen 11 10.2 7.6 9 21 223 31.03.06
=42 (41) Reeves & Neylan 10.6 10.7 -0.9 6 22 171 01.04.06
=42 (46) Haslers 10.6 9.5 11.7 2 14 98 31.12.05
44 MGI Wenham Major Ltd
11
9.9 4.2 135.7 1 4 57 Ltd Grant Thornton 31.03.06
45 (48) Streets 9.8 8.4 16.7 5 12 55 30.06.05
46 (45) AGN Shipleys 9.7 9.5 2.1 3 13 92 30.04.06
=47 (48) Berg Kaprow Lewis 9.6 8.4 14.3 2 13 110 Leslie Woolfson & Co 31.03.06
=47 (42) Mercer & Hole 9.6 10.4 -7.7 4 16 123 31.03.06
49 (51) Bishop Fleming 9.4 8.2 14.6 6 17 169 31.05.06
50 (60) Unity Business Services 9.2 6.3 46 5 13 95 31.03.06
51 (47) Barnes Roffe 9 8.6 4.6 4 14 91 SB Jones 31.12.05
52 (50) Morley and Scott 8.7 8.3 4.8 4 18 106 31.03.06
53 (53) James Cowper 8.5 7.5 13.3 3 17 115 30.04.06
54 (54) Hillier Hopkins 8.2 7.2 13.6 3 16 99 Price Bailey 31.03.06
55 (58) Forrester Boyd MRI 7.8 6.7 16.4 3 15 145 31.03.06
56 (55) Simmons Gainsford 7.7 7.1 8.5 2 12 70 Ivan Sopher & Co 31.03.06
57 (52) Pridie Brewster 7.6 7.4 2.7 4 14 95 31.07.05
=58 (56) Critchleys 7.1 6.5 9.2 2 13 120 31.05.06
=58 (58) Arram Berlyn Gardner
12
7.1 6.7 6 1 7 67 30.06.06
60 Beever and Struthers 6.7 5.4 23.5 2 13 98 30.09.05
Totals 7,726.6 6,781.1 617 4,914 65,691
30
Special Reports Top 60 firms
active reporting accountants on the AIM market, sustain its
growth rate since last year. Tenon plc also performed well. Its
10.5% increase in turnover is partly explained by acquisitions,
with the group acquiring businesses in Scotland during the
year.
Merger activity
A further sign that confidence is returning to the market is the
increase in merger activity among firms, although generally at
the smaller end of the scale. DTE completed its merger with the
specialist insolvency practice Leonard Curtis & Co, following a
two-year joint venture with the firm. The merger of Littlejohn
Frazer with CLBs London office lifted the firm to 28th in the
table with a fee income rise of almost 33%.
Moore Stephens results for next year will include the results
of its merger with Macnair Mason, which was completed in
May 2006. The merger is expected to add some 4m to the
firms fee income and Macnair Mason also brought seven
partners and 46 staff to the new firm.
Overall, the new business environment is effectively
rewriting the long-established rulebook for accountancy firms.
For years firms struggled to find new service lines as they faced
the fact that the audit market was becoming so competitive
that the annual audit was effectively a loss-leader. Yet the past
two years have seen revenues boom from audit and
accounting-related work. As Nick Land says, though, the work
generated by IFRS and Sarbox is unlikely to continue at this
rate into the future. Accountancy practices have transformed
over recent years with new service lines introduced and the
boundaries between the traditional service lines becoming
more blurred. The new corporate structures adopted by many
firms have added a new layer of complexity. Even so, most
firms are not operating on a stable platform. The future
remains as unpredictable as ever.
Case studies
KPMGs most successful year ever
Fee income: 1,281m Ranking in table: 3
KPMG reported the best performance by a Big Four firm this year,
with a rise in fee income of more than 20% to 1,281m for the 12
months to 30 September 2005 and operating profits of 305m
(compared with 253m in 2004). It has been a good year to be a
KPMG employee, with staff bonuses and profit share increasing by
57% on a per-head basis. UK senior partner Mike Rake said it had
been the most successful year in the history of the UK firm.
As with many other firms, much of the growth was driven by
assurance services. KPMGs risk advisory services turnover grew by
48% during the year but the firm stressed that Sarbox-related
work was responsible for part, but by no means all, of this growth. Transaction services also
performed strongly, showing a 38% increase in revenues. Overall, Rake said that the firms
results vindicates our strategy to invest at a time when the economic environment was less
promising.
Hacker Young enters top 20 after merger
Fee income: 36m Ranking in table: 19
UHY Hacker Young continued its rise up the table, entering the
top 20 for the first time. In May the firm completed its merger
with the 14-partner Scottish firm Campbell Dallas, which boosted
the overall growth rate to 37.4%.
Managing partner Ladislav Hornan said the firm had seen
fairly good growth generally but had been particularly
successful in its work with new AIM offerings and with internal
audit work for US subsidiaries. We have positioned ourselves well
with our international network, which is the 11th largest network
in the US, and we are seeing a lot of referral work, particularly
from the US but also from China and Russia. The UK accountancy market, he added, is not
in a bad state but the question for Hacker Young, along with other firms, will be whether
growth can be sustained when Sarbox-related work dries up. Its the margins we all need
to look at, especially at the smaller end of the market, he said.
Johnston Carmichael expands in Scotland
Fee income: 18m Ranking in table: 25
The Scottish firm has doubled in size over the past four years and
has continued its strong growth rate with an 18% rise in fee
income for the year to 31 May 2006. According to chief executive
Patrick Machray, 16.5% of that growth is organic. If you asked me
what one single thing has contributed the most to our growth, Id
have to say people, he said. Weve made some excellent
recruitment choices and our tax, corporate finance and financial
services teams have done particularly well. The firm named four
new partners in June this year, bringing its total to 39.
The firms plan to expand its practice to the south of Scotland
has also paid dividends, with new offices in Edinburgh and Glasgow performing well. We
acquired some practices a few years ago that have done well but a lot of our growth is on
the back of our geographical strategy, said Machray.
Rake
Hornan
Machray
(from p28)
How we compile the table
Information about the firms is gathered from a questionnaire sent
out by Accountancy. Wherever possible, we adhere to the firms
description of their service areas and structure. The exception is
Vantis plc, which is currently in its closed period and so cannot
release details of its results. We have instead gathered information
from brokers reports.
Comparison of firms in the Top 60 is becoming more
complicated by the year, thanks to the differing structure of firms
in terms of their business divisions, but also due to the emergence
of consolidators, business advisory companies and specialist firms.
For the purposes of this survey we have included organisations
that could reasonably be described as an accountancy firm, even if
they operate under a more corporate structure.
In practical terms this means that they compete with
traditional accountancy partnerships and have a large proportion
of qualified accountants on their payroll. We have, however,
excluded Chiltern plc from the survey in spite of the fact that the
organisation meets these criteria. Chiltern plc, which appeared in
last years list at number 17, declined to participate in this years
survey on the grounds that it is a tax-led business and a member
of the Chartered Institute of Taxation rather than the ICAEW. Its
complex structure makes it difficult to determine its financial
position from accounts logged at Companies House.
Analysis Top 60 firms
22
T
he boom days are well and truly back for the
UK accountancy profession. Accountancys
latest survey of the top 60 firms in the UK
showed that total fee income increased by
13.8% during the year, slightly lower than the 14.1%
reported last year but still considerably outstripping the
growth rate of 4.8% reported in 2005. These two years of
above-inflation increases follow a number of years of
stagnating fee income growth.
Almost all of the firms in the survey reported positive
fee income growth during the year, with some reporting
fee income increases of 25% or more. While some of the
growth is driven by increased acquisition activity, many
firms report strong organic growth or are finding new
income streams to exploit. The best performance this year
came from Wenham Major, which jumped 20 places from
last year (see box on p24).
The larger firms are continuing to see work generated
by Sarbanes-Oxley and the implementation of
International Financial Reporting Standards (IFRS),
although there have been suggestions for the past two
years that this will begin to taper off. Even so, many of the
firms reported healthy growth in their audit and
assurance practices.
Big Four
KPMG reported an increase of just 2% in its audit-related
income, although revenues for statutory and regulatory
work grew by 8%. Overall, its advisory practice grew by
23%, with forensic accounting services and corporate
finance services performing particularly strongly.
John Connolly, senior partner and chief executive at
Deloitte, said that the professional
environment remained reasonably
buoyant. The firm reported a 17% rise in
fee income from its audit division, which
was only outstripped by a 22% rise in
consultancy revenues. Connolly said that
IFRS implementation and Sarbox-related
work remained a steady growth area,
although this had been boosted by a 30%
rise in revenue from technology risk
services.
In common with other senior partners,
though, Connolly is not complacent about
the future state of the market. There are
undoubtedly good signs, particularly for
the mid tier and larger firms London remains an
attractive place for investors, the mergers and acquisitions
market is booming and the Alternative Investment Market
has enjoyed unparalleled success. Even so, recent rises in
interest rates and concerns over the US economy are
expected to impact on corporate confidence, which will
have a knock-on effect for the profession.
Mergers and the mid tier
In the meantime, the re-emergence of merger activity in
the mid tier is taken as another sign of returning
confidence in the accountancy profession. While the Big
Four still dwarf their rivals, Grant Thornton was the first
second-tier firm to come close to the 400m fee income
barrier following its merger with RSM Robson Rhodes,
arguing that its expansion makes it a serious alternative to
the Big Four.
The merger between Mazars and MRI Moores Rowland
was also announced recently. The inclusion of Moores
Rowlands fee income lifts Mazars from 14th to 12th in the
Top 60 table.
Firms in the lower half of the table have also seen
increased merger activity during the year. The recent
merger of Shipleys with the London office of Rothman
Pantall & Co (which is not reflected in the results for either
firm in this years survey) is expected to lift the firm from
46th to around 31st in the table, with a fee income in the
region of 14m.
Notes to table
1. Fee income is estimated.
2. Includes fee income for RSM Robson Rhodes (previous year on a pro
forma basis).
3. Fee income is estimated.
4. Converted to LLP status on 1.4.2007.
7. Fee income includes Moores Rowland fee income to 31.03.06 and
pro forma estimate of Mazars' fee income for the year ending 31.08.07.
8. Currently in closed period. Revenue and pre-tax profits are brokers'
estimate.
9. Includes salaried partners.
10. Some offices operate as LLPs.
11. Currently in closed period. Figures are for 2006.
12. Fee income estimated.
13. Fee income estimated.
14. Figures include Enoch & Partners (acquired Feb 07) and separate
financial services and IT consulting companies.
15. Abbreviated LLP accounts published.
16. Statutory year end is 30.06.06.
17. Includes salaried partners.
Boom boom
accountancy firms
2004
2005
2006
2007
bn 0 1 2 3 4 5 6 7 8 9 10
6.392bn
6.772bn
7.727bn
8.797bn
Firms are enjoying a second year of inflation-busting growth.
Liz Fisher reports on the good times
In this Top 60 report...
Mid-tier roundtable 30
The importance of being
profitable 40
23
Top 60 firms Analysis
Position Firm Fee Previous % change UK Number of Staff Status Annual Auditor Year end
(prior year income year offices partners accounts
in brackets) m m published?
1 (1) PricewaterhouseCoopers LLP 1,980 1,780 11.2 30 793 14,302 LLP Yes Horwath Clark Whitehill 30.06.06
2 (2) Deloitte & Touche LLP
1
1,790 1,559 14.8 21 638 10,412 LLP Yes Grant Thornton UK 31.05.07
3 (3) KPMG LLP 1,454 1,281 13.5 22 556 9,815 LLP Yes Grant Thornton UK 30.09.06
4 (4) Ernst & Young LLP 1,130 945 19.6 21 435 7,902 LLP Yes BDO Stoy Hayward 30.06.06
5 (5) Grant Thornton UK LLP
2
387.1 353.7 9.4 40 320 4,121 LLP Yes PKF 30.06.07
6 (6) BDO Stoy Hayward LLP
3
330 288 14.6 15 227 2,999 LLP Yes PwC 30.06.07
7 (7) Baker Tilly
4
200.4 183.9 9 28 138 2,126 LLP No 31.03.07
5
152.6 136.9 11.5 10 184 1,124 Ltd Yes Deloitte & Touche 30.04.07
9 (9) PKF 130.4 116.8 11.6 23 95 1,718 LLP Yes Kingston Smith 31.03.07
6
123.6 100 23.6 29 140 1,356 plc Yes PwC 30.06.06
11 (12) Moore Stephens UK 107.2 89.5 19.8 44 169 1,312 Part'ship No 31.12.06
12 (14) Mazars
7
91.2 72.3 26.1 18 103 1,060 LLP Yes HCW/Deloitte see note
13 (13) Vantis
8
85.3 71.2 19.8 21 209 840 plc Yes E&Y 30.04.06
14 (16) Bentley Jennison
9
63.7 57.9 10 12 68 870 Part'ship No 31.12.06
15 (15) HW Group 54 45.7 18.2 41 90 810 Part'ship No 31.03.07
16 (17) Saffery Champness 44.7 39.5 13.2 10 57 398 Part'ship No 31.03.07
17 (18) Horwath Clark Whitehill LLP 41.2 37.6 9.6 8 62 496 LLP Yes Grant Thornton UK 31.03.07
18 (19) UHY Hacker Young
10
39.7 36 10.3 19 84 582 Part'ship No 30.04.07
19 (20) Kingston Smith LLP 34 31.1 9.3 6 47 360 LLP Yes Price Bailey 30.04.07
20 (22) Begbies Traynor Group plc
11
30.7 24.7 24.3 33 67 500 plc Yes Horwath Clark Whitehill 30.04.06
21 (21) Menzies 30.2 26.9 12.3 8 41 341 Part'ship No 28.02.07
22 (24) MacIntyre Hudson LLP 24.4 22.9 6.6 9 46 341 LLP Yes Hillier Hopkins LLP 31.03.07
23 (23) Chantrey Vellacott DFK
12
23.8 23.5 1.3 8 47 247 LLP Yes Grant Thornton UK 30.06.07
24 (44) Wenham Major 22.2 9.9 124.2 1 8 65 LLP No 31.05.07
25 (25) Johnston Carmichael
13
19.5 18 8.3 10 40 376 Part'ship No 31.05.07
26 (29) DTE Group 18.1 15.2 19.1 6 11 204 Group Yes Harold Sharp 30.04.07
27 (27) Armstrong Watson 17.8 15.5 14.8 15 36 365 Part'ship No 31.03.07
28 (26) Wilkins Kennedy 17.7 15.7 12.7 7 31 187 Part'ship No 30.04.07
29 (28) CLB Littlejohn Frazer 17.1 15.4 11 1 26 168 Part'ship No 31.05.07
30 (31) Buzzacott 15.02 13.9 8 1 17 173 Part'ship No 30.09.06
31 (30) Cooper Parry LLP 15 14.5 3.4 3 21 234 LLP Yes Buzzacott 30.04.07
32 (33) Haysmacintyre 14 12.9 8.5 1 23 144 Part'ship No 31.03.07
33 (32) Lovewell Blake 13.7 13 5.4 7 22 207 Part'ship No 30.09.06
34 (34) Francis Clark 13.6 12.7 7.1 7 28 230 Part'ship No 31.03.07
35 (39) Duncan & Toplis 13.4 11.6 15.5 10 28 289 Part'ship No 31.03.07
36 (42) Haslers 13 10.6 22.6 1 14 106 Part'ship No 30.12.06
37 (37) Scott-Moncrieff 12.6 11.7 7.7 2 22 191 Part'ship No 30.04.07
38 (40) Hazlewoods LLP 12.5 11.4 9.6 3 15 166 LLP Yes Princecroft Willis 30.04.07
39 (35) Rothman Pantall & Co 12.3 12.1 1.7 14 28 178 Part'ship No 31.03.07
40 (41) Larking Gowen 11.7 11.2 4.5 9 23 254 Part'ship No 31.03.07
41 (47) Berg Kaprow Lewis LLP
14
11.69 9.6 21.9 2 17 123 LLP Yes Leslie Woolfson 31.03.07
42 (37) Price Bailey LLP 11.5 11.7 -1.7 5 21 154 LLP Yes Horwath Clark Whitehill 31.03.07
43 (42) Reeves & Neylan 11.2 10.6 5.7 4 22 161 Part'ship No 31.03.07
44 Campbell Dallas 10.7 8 33.8 5 16 182 Part'ship No 31.05.07
45 (47) Mercer & Hole 10.6 9.6 10.4 4 17 130 Part'ship No 31.03.07
46 (46) Shipleys LLP 10.5 9.7 8.2 3 16 135 LLP Yes Steele Robertson Goddard 30.04.07
47 (45) Streets
15
10.4 9.8 6.1 6 10 59 LLP No 30.06.06
48 Target Chartered Accountants 10.1 n/a n/a 3 7 140 Ltd Yes Berkeley Hall Marshall 31.03.07
49 (49) Bishop Fleming 10 7.8 28.2 6 17 182 Part'ship No 31.03.07
50 (60) Beever and Struthers 9.7 6 61.7 3 19 134 Part'ship No 30.09.06
51 (51) Barnes Roffe LLP
16
9.3 9 3.3 4 14 105 LLP Yes SB Jones & Co 31.12.06
52 (52) Morley and Scott 9.2 8.7 5.7 4 18 114 Part'ship No 31.03.07
53 (53) James Cowper 8.9 8.5 4.7 3 16 125 Part'ship No 30.04.07
54 (54) Hillier Hopkins LLP 8.8 8.2 7.3 3 17 103 LLP Yes Price Bailey LLP 31.03.07
55 Gerald Edelman 8.5 7.8 9 4 13 103 Part'ship No 30.06.06
=56 (55) Forrester Boyd 8.1 7.8 3.8 3 15 144 Part'ship No 31.03.07
=56 Silver Levene 8.1 6.8 19.1 1 16 100 Part'ship No 31.05.06
58 (56) Simmons Gainsford LLP 7.8 7.7 1.3 2 12 67 LLP Yes Ivan Sopher & Co 31.03.07
59 Barber Harrison & Platt 7.6 6.9 10.1 2 10 157 Part'ship No 31.12.06
60 Spofforths LLP
17
7.46 6.9 8.1 6 22 152 LLP Yes Critchleys 31.12.06
Totals 8,797.57 7,709.5 647 5,324 70,139
24
Ernst & Young puts in best performance
Ernst & Youngs 19.6% increase in fee income for the year to 30 June 2006
was by far the best performance among the Big Four firms. Strong growth
was reported across all service lines and average profit per partner rose
during the year to 686,000.
The strongest growth area for the firm came from assurance and
advisory business services, which reported a 23% increase in revenue to
587m. According to the firm, the growth was driven by new audit wins, by
IFRS implementation work and by a continuance of work generated by
Sarbanes-Oxley. The firms new business advisory services practice
reported revenues of 32m in its first nine months of existence.
Transaction advisory services also performed strongly, with revenues
rising by 19% to 234m. It was also a better year for tax work, with the
division reporting a growth rate of 14% to 309m.
Mark Otty, chairman of E&Y, paid tribute to his predecessor Nick Land in
announcing the results.Our financial success stems from our early
reaction to changes in our chosen markets, he said.As a consequence, we have performed favourably when
compared with our industry and to previous years.
How we compile
the table
Information about the firms is
gathered from a questionnaire sent
out by Accountancy. Wherever
possible, we adhere to the firms
description of their service areas
and structure. The exception is
Vantis plc, which is currently in its
closed period and so cannot release
details of its results. We have instead
gathered information from brokers
reports.
Comparison of firms in the Top
60 is becoming more complicated
by the year, thanks to the differing
structure of firms in terms of their
business divisions, but also due to
the emergence of consolidators,
business advisory companies and
specialist firms.
There have also been concerns
expressed to Accountancy that our
Top 60 survey includes a few firms
that are more in the nature of
jointly-branded networks than
profit-sharing firms. While we have
some sympathy with these views,
we have decided not to exclude any
firms on this basis for reasons of
presenting a fair picture of the
market, year-on-year consistency,
the wide variation in structures, and
because many firm structures are
opaque, making it difficult to make
judgments in this regard.
For the purposes of this survey
we have included organisations
that could reasonably be described
as an accountancy firm. In practical
terms this means that they
compete with traditional
accountancy partnerships and have
a large proportion of qualified
accountants on their payroll.
Otty: Early
reaction
Wenham Major has growth spurt
The most impressive growth rate in the entire Top 60 comes from
Midlands-based Wenham Major it reported an astounding 124%
increase in fee income during the year, which coincides with the firms
140th anniversary.
The catalyst for the growth spurt over the past two years, says
executive chairman John Joyce, was the management buyout of the firm
that was completed at the end of 2005. The firms service areas have since
been restructured and now include a specialist tax consultancy and a
wealth management team. Our performance demonstrates that the firms
client-focused, highly-commercial strategy is paying dividends, says chief
executive Ammar Azam. Sustained high growth in our core services,
particularly in tax consultancy coupled with a substantial return on last
years investment in new services have catapulted the business forward.
It is a signal of the firms ambitions that it has poached a number of
staff from the Big Four over the past year and also took the highly
unusual step of opening a new office in Dubai (the income from which is not included in the survey). Acquisitions
within the UK are high on its list of priorities for the future. We mean business, says Joyce. We are right on track to
achieve our ambition of being the UKs leading trusted business advisory firm.
Joyce:
Means
business
Beever and Struthers on the mergers trail
The Manchester-based firms growth this year lifting it from 60th to 50th position in the Top 60 was partly due to
the acquisition of two smaller firms, Hoban Nelson Lang and Ainleys, at the end of last year. Even so, Beever and
Struthers managing partner Phil Roberts says there is plenty of scope for organic growth for the firm.
Weve got the capacity in our main office to house another 40 people and were always looking for niche firms in
areas that complement our own business, he says. Beever and Struthers has a strong reputation in the not-for-profit
sector and is the fourth largest firm in the UK for housing association audits.
Roberts adds, though, that the firm has worked hard to make sure that any mergers are a good fit:We spent 10
months on those two mergers because we wanted to be sure that the people were the right fit. We have a strong
firm culture here that we dont want to damage. Since the mergers were completed, he estimates that the firm has
been attracting between one and two new clients every day.Were doing extremely well and the critical mass is
beginning to kick in, he says.People are definitely more aware of us than they were.
CASE STUDIES
Our financial
success stems from
our early
reaction to
changes in our
chosen markets
July 2008 accountancymagazine.com 24
W
ith the fallout from the credit crunch
beginning to be seen in many areas
of the economy, the next few months
should give some indication of how
and by how much the profession will suffer. Using the
results of this years survey of the Top 60 accountancy
firms in the UK as a guide, though, the future is suddenly
looking less rosy.
After a couple of years of strong fee income growth,
this years results show an overall increase in fee income
among the Top 60 of 6.4%. In any other circumstances
this would be a good result, but with nerves jangling
over the state of the economy, it may well be taken as an
omen of things to come particularly when compared
with overall fee income growth last year, which
was 13.8%.
Overall, performance among the Top 60 is still good,
with only a handful of firms reporting negative growth
(and generally because they have disposed of part of
their business). A slowdown in growth in some of the key
numbers, however, is a cause for concern.
Tough times ahead
The profession knows only too well how tough a recession
can be. If, as some economists are predicting, we are
heading for a downturn on the scale of the early 1990s,
firms will have to tighten their belts. There are already
indications that this could be happening
our figures show that the number of new
partners created during the year is almost
negligible, with average fees per partner
also showing only a very small increase
over the year (see p27). Staff numbers
generally, though, remained steady, with
an overall increase of 6.5% over the year.
Over the past few weeks the profession
has been further rocked by the collapse of
Wenham Major (see p52), which was one
of the star performers in terms of growth
in last years Accountancy Top 60 survey.
The largest firms mentioned the credit
crunch in their annual reviews for the last
financial year, although all hedged their bets on what
it might mean for their businesses. In some respects, a
downturn is not all bad news as corporate recovery and
restructuring revenues tend to increase, but the lack
of available credit is already having a severe effect on
merger and acquisition activity in the UK, and therefore
on the firms corporate finance practices.
Merger activity within the profession itself, however,
remains healthy. A number of small mergers and
acquisitions have been completed during the year
(Moore Stephens UK, for example, recently announced
its merger with the GBC Partnership in Guildford).
Comparing like with like
A point to note from this years survey is that comparison
between the firms is becoming more difficult
year-on-year. Many firms, particularly the Big Four,
have restructured their businesses and no longer have
readily comparable business divisions. And as an added
complication, two of the larger firms have restructured
their international business and KPMG Europe, for
instance, now includes the UK, German and Swiss firms.
In the case of Deloitte, which merged its Swiss and
UK practices, this means that figures for the UK
business alone are no longer available. If this trend
continues, analysis of the UK profession will become
extraordinarily difficult.
As the UKs economic prospects darken, Liz Fisher reports
on the health of the countrys Top 60 accountancy firms
The calm before
the storm?
In this Top
60 report
Fees per partner/personnel
table 27
Diversity special report 30
Notes to table
1. Fee income includes the Swiss practice as the UK and
Switzerland now operate as a single entity.
2. Financial information is provided in a pro forma basis
to reflect aggregated basis as if the merger with Robson
Rhodes, which took place on 2 July 2007, had been in place.
3. Previous year restated to show effect of sale of financial
services business.
4. Network of independent firms.
5. Income and profit are brokers estimate.
6. Some partnerships have converted to LLPs, others are
incorporated, majority are partnerships.
accountancy firms
2004
2005
2006
2007
2008
bn 0 1 2 3 4 5 6 7 8 9 10
6.392bn
6.772bn
7.727bn
8.797bn
9.363bn
accountancymagazine.com July 2008 25
Position
(prior
year in
brackets) Firm
Fee income
m
Previous
year m
%
change
UK
offices
Number
of
partners Staff
Status
(in red if
considering
conversion)
Annual
accounts
published? Auditor
Year
end
1 (1) PricewaterhouseCoopers LLP 2,100 1,980 6.1 28 822 15,462 LLP Yes Horwath Clark Whitehill 30.06.07
2 (2) Deloitte & Touche LLP
1
1,803 1,559 15.7 20 641 10,911 LLP Yes Grant Thornton UK 31.05.07
3 (3) KPMG LLP 1,607 1,454 10.5 22 559 10,331 LLP Yes Grant Thornton UK 30.09.07
4 (4) Ernst & Young LLP 1,226 1,130 8.5 21 473 8,723 LLP Yes BDO Stoy Hayward 30.06.07
2
389 352.9 10.2 38 311 4,100 LLP Yes PKF 30.06.07
6 (6) BDO Stoy Hayward LLP 350 317 10.4 15 245 3,000 LLP Yes PricewaterhouseCoopers 30.06.08
7 (7) Baker Tilly
3
204.6 187.4 9.2 27 117 2,163 LLP Yes Kingston Smith 31.03.08
8 (8) Smith & Williamson 170.7 152.6 11.9 10 192 1,181 Ltd Yes Deloitte & Touche 30.04.08
9 (9) PKF 143.2 130.4 9.8 23 98 1,814 LLP Yes Kingston Smith 31.03.08
10 (10) Tenon Group plc 137.1 123.6 10.9 49 134 1,519 Plc Yes PricewaterhouseCoopers 30.06.07
11 (11) Moore Stephens UK
4
120.2 107.2 12.1 43 160 1,371 Network No 31.12.07
12 (13) Vantis
5
97.3 89.7 8.5 20 135 912 Plc Yes Ernst & Young 30.04.08
13 (12) Mazars LLP 91.2 72.3 26.1 18 105 1,148 LLP Yes Horwath Clark Whitehill 31.08.07
14 (14) RSM Bentley Jennison 72.4 63.7 13.6 15 71 977 Part'ship No 31.05.08
6
60 54 11.1 45 91 787 Part'ship No 31.03.08
16 (16) Saffery Champness 49 44.7 9.6 10 58 438 Part'ship No 31.03.08
17 (17) Horwath Clark Whitehill LLP 46.6 41.2 13.1 8 71 552 LLP Yes Grant Thornton UK 31.03.08
18 (20) Begbies Traynor Group plc 44.5 33.2 34 40 87 579 Plc Yes Deloitte & Touche 30.04.07
19 (18) UHY Hacker Young Group 43.4 39.6 9.6 19 86 653 Part'ship No 30.04.08
20 (19) Kingston Smith LLP 39 33.1 17.8 6 49 397 LLP Yes Price Bailey 30.04.08
21 (21) Menzies 33 30.2 9.3 8 43 368 Part'ship No 28.02.08
22 (22) MacIntyre Hudson LLP 27.1 24.4 11.1 9 50 380 LLP Yes Hillier Hopkins 31.03.08
23 (23) Chantrey Vellacott DFK 24.5 23.8 2.9 8 47 270 LLP Yes Grant Thornton UK 30.06.08
25 (25) Johnston Carmichael 22.3 20.25 10.1 10 36 398 Part'ship No 31.05.08
26 (27) Armstrong Watson 19.1 17.8 7.3 16 36 370 Part'ship No 31.03.08
27 (29) Littlejohn 18.1 17.1 5.8 1 30 165 Part'ship No 31.05.08
28 (30) Buzzacott LLP 17.1 15.02 14 1 20 205 LLP No 30.09.07
29 (26) DTE Group 16.8 18.1 -7.2 7 10 195 Ltd Yes Harold Sharp 30.04.08
30 (31) Cooper Parry LLP 16.6 15 10.7 3 24 259 LLP Yes Buzzacott 30.04.08
32 (32) Haysmacintyre 15.8 14 12.8 1 24 147 Part'ship No 31.03.08
33 (47) Streets 15.1 11.1 36 9 21 170 LLP No 30.06.08
34 (48) Target Chartered Accountants 15.1 10.1 49.5 4 12 190 Ltd Yes Berkeley Hall Marshall 31.03.08
36 (38) Hazlewoods LLP 14.13 12.5 12.8 3 16 194 LLP Yes Princecroft Willis 30.04.08
38 (36) Haslers 14.03 13 7.7 2 17 110 Part'ship No 31.12.07
39 (33) Lovewell Blake 14 13.7 2.2 5 20 205 Part'ship No 30.09.07
40 (42) Price Bailey LLP 13.5 11.5 17.3 6 23 187 LLP Yes Horwath Clark Whitehill 31.03.08
41 (37) Scott-Moncrieff 13.1 12.6 4 2 22 171 Part'ship No 30.04.08
43 (43) Reeves + Neylan LLP 12.47 11.1 12.6 5 24 198 LLP Yes Clive Owen & Co 31.03.08
44 (44) Campbell Dallas 12 10.7 12.1 5 17 194 LLP No 31.05.08
47 (49) Bishop Fleming 10.5 10.27 1.9 6 18 179 Part'ship No 30.03.08
48 (51) Barnes Roffe LLP 10.43 9.3 11.8 4 15 112 LLP Yes SB Jones & Co 31.12.07
49 (41) Berg Kaprow Lewis LLP 10.4 11.7 -11.1 1 13 105 LLP Yes Leslie Woolfson & Co 31.03.08
50 (39) Rothman Pantall & Co 9.8 12.3 -20.3 14 24 155 Part'ship No 31.03.08
51 (50) Beever & Struthers 9.6 6.3 52.3 3 19 153 Part'ship No 30.09.07
52 (52) Morley and Scott 9.5 9.2 3.3 4 17 123 Part'ship No 31.03.08
53 (53) James Cowper 9.46 8.7 9.2 4 16 133 Part'ship No 30.04.08
54 (54) Hillier Hopkins LLP 9.18 8.7 5.5 3 17 105 LLP Yes Price Bailey 31.03.08
55 (59) Barber Harrison & Platt 9.13 7.6 19.7 2 10 162 Part'ship No 31.12.07
56 (55) Gerald Edelman 9.1 8.1 12.3 4 15 86 Part'ship No 30.06.07
57 (56) Silver Levene 9.1 8.1 12.3 1 17 103 Part'ship No 31.05.08
58 SJD Accountancy 8.6 4.7 83 9 8 130 Ltd No 31.03.08
59 (60) Spofforths LLP 8.5 7.7 14.3 5 21 145 LLP Yes Critchleys 31.12.07
60 (56) Forrester Boyd 8.4 8.1 3.7 3 13 150 Part'ship No 31.03.08
Totals 9,363.19 8,473.64 692 5,396 74,675
July 2008 accountancymagazine.com 26
CASE STUDIES
How we compile
the table
Information about the firms is
gathered from a questionnaire
sent out by Accountancy. Wherever
possible, we adhere to the firms
description of their service areas
and structure. The exception is
Vantis plc, which is currently in
its closed period and so cannot
release details of its results. We
have instead gathered information
from brokers reports.
Comparison of firms in the Top
60 is becoming more complicated
by the year, thanks to the differing
structure of firms in terms of their
business divisions, but also due to
the emergence of consolidators,
business advisory companies and
specialist firms.
There have also been concerns
expressed to Accountancy that
our Top 60 survey includes a few
firms that are more in the nature
of jointly-branded networks than
profit-sharing firms. While we have
some sympathy with these views,
we have decided not to exclude
any firms on this basis for reasons
of presenting a fair picture of the
market, year-on-year consistency,
the wide variation in structures,
and because many firm structures
are opaque, making it difficult to
make judgments in this regard.
For the purposes of this survey
we have included organisations
that could reasonably be
described as an accountancy firm.
In practical terms this means that
they compete with traditional
accountancy partnerships
and have a large proportion
of qualified accountants on
their payroll.
Deloitte is Big Four star performer
Deloitte is the strongest performer among the Big Four this year,
reporting a rise in fee income of 15.6%, to 1,803m. Senior partner
John Connolly said the firms performance reflects strong markets
over the previous 12 months, as well as (at the time) a healthy level of
merger and acquisition activity.
It is clear, though, that the credit crunch and general economic
downturn will have an impact on the profession at all levels. Connolly
added that credit availability and confidence generally has been
affected since the firm announced its year-end results in September
2007. Undoubtedly we will have a more cautious environment going
forward, with particular impact on some parts of the merger and
acquisitions market. But he added that the underlying economy
remained strong and business levels during the first months of the
firms following financial year were good.
Connolly: Benefited
from strong markets
Wilkins Kennedy leaps four places
Wilkins Kennedy jumps from 28th to 24th place in the table this year,
reporting an impressive growth rate of 33.9%. The firm has been on the
acquisition trail over the past few months. In 2007, it announced mergers
with Hampshire firm Jordan Brookes and with Bridgers, a Reading-based
insolvency practice, followed by a merger with the Kent firm Finn-Kelcey &
Chapman in May this year (which is not reflected in this years results).
The mergers have accounted for about 3m of fee income but our
organic growth has been strong, at about 16%, said managing partner
Colin Wiseman. We had a flat year about three years ago but we made
some changes, consolidating our areas of expertise into services to clients,
and they have really paid off. He added that there were no immediate
signs of a downturn in business. There are a few more enquiries on the
insolvency side but the general practice is fine. Firms with large corporate
finance divisions may suffer but we are not that exposed. Things are
looking very good for us at the moment.
Wiseman: Things are
looking very good
Target aims to stand out
Its difficult to believe that Target, which appears at number 33 in this years
table, a rise from 48th place last year, is barely 10 years old. The firm began
life as a niche tax consultancy in 1998, but has emerged as an ambitious
multi-disciplinary adviser following a series of acquisitions. The group
added the London-based firm Winters to its business in July 2007 and
has completed three other mergers in recent years Limehouse (based in
Rugby), Ernest Francis (based in Reading) and DNP (based in Bath).
Managing director Keith Seeley says the firms success proves that clients
are looking for more than the usual accountancy services. What clients
are happy to pay for are accountants who are going to make a difference
to their business, he says. Owner-managers, in particular, are looking for
someone who understands what they are doing and what they are trying
to achieve. He adds that the firm is not expecting to see any slowdown in
its growth over the coming year. If youre a well-known name and youre
used to work just walking through the door, a downturn is tough, but we
dont have a big brand yet and so we have always had to get off our backsides and find the work. A recession just
means you have to repackage what you offer because clients have different needs. Were on a roll.
Seeley:
On a roll
Undoubtedly
we will have a
more cautious
environment
going forward
JANUARY 2010
|
ACCOUNTANCYMAGAZINE.COM 22
ANALYSIS
|
COVER FEATURE
F
ears that the accountancy profession would be
hit hard by the financial crisis and subsequent
recession have been confirmed by the results of
this years survey of the Top 60 firms in the UK.
According to figures provided by the firms, fee income
grew by just under 1% during the last financial year.
We have conducted the survey six months later than
we have in previous years and for that reason some of
the firms were able to provide more recent fee income
figures as their comparatives. If we directly compare the
fee income reported in Accountancys last Top 60 survey,
published in July 2008 (see p24), the rise in fee income is
a slightly more respectable 6% over 18 months.
Even so, the figures suggest that many firms are
finding the economic conditions tough. The 2008
survey gave an indication of the turning tide, with
a growth rate reported among the Top 60 of 6.4%,
compared with 13.8% the previous year in the height
of the boom. This year, 19 firms in the survey reported
negative or stagnant growth, while many more
reported fee income growth of less than 3%. It is
hardly surprising that one of the best results of the
year was reported by Begbies Traynor, the insolvency
specialist, which saw its fee income surge by almost
25% and in October it warned that the worst for the
UK economy in terms of insolvencies was still ahead
of us. Bad news for UK business, excellent news for the
insolvency specialists.
HOLDING THEIR NERVE
Insolvency specialists aside, the firms are almost
unanimous in saying that trading conditions continue
to be challenging, to say the least. Most, though,
are optimistic about the future and have seen their
revenues from insolvency and restructuring work shore
up the fall in fees earned in other areas, particularly
audit and assurance. There is much talk
by senior partners of holding their nerve
and preparing for the upturn, whenever
it arrives.
NO IMMUNITY
Even the mighty PricewaterhouseCoopers
has not been immune from the downturn.
The UK firm reported a rise in revenues
of just 0.2%, with its assurance and tax
businesses reporting a fall in revenues
of 1% and 4% respectively. On a global
level, PwCs gain from the recession has
been its work for the collapsed Lehman
Brothers, for which it has so far charged
some 154m in fees. Deloitte reported negative growth
for the year, while KPMGs revenues also dropped by
1.6%. The only Big Four firm to buck the trend was Ernst
& Young, which reported a rise in fee income of 7.9%.
FEELING THE SQUEEZE
Firms of all sizes, though, have seen revenue squeezed
during the year. Grant Thornton saw its revenue fall
by 4% after recording a growth rate of 25% for the
year ended 30 June 2008 in the wake of its merger
with Robson Rhodes. The firm warned last year that
the credit crunch was beginning to bite as its pre-tax
profits fell by 5%. The firm has set itself a target of
reaching 500m in fee income in 2010, an aim that is
looking particularly tough in the current climate.
Simon Michaels, managing partner of BDO, spoke
for many when he said that this financial year has
had its moments. BDO recorded a 5% fall in revenues,
which it attributed to lower levels of transactions and
other one-off assignments. Its restructuring business,
however, saw its revenues rise by 50% during the year.
As the economy starts to recover, the year ahead will
almost certainly continue to present us and our clients
with challenges and opportunities, said Michaels. We
are entering the new financial year realistic about the
challenges and excited for the future.
Note: As Accountancy went to press, Tenon announced
a proposed merger with RSM Bentley Jennison.
DESPITE TOUGH TRADING CONDITIONS, THE TOP 60 FIRMS ARE
STILL GROWING, BUT ONLY JUST, WRITES LIZ FISHER
HANGING
IN THERE
IN THIS TOP 60 REPORT
NOTES TO TABLE
1. Partner numbers are as at 01.07.09
2. Partners are fee-earning directors
3. Merger with RSM Bentley Jennison
proposed as Accountancy went to
press
5. Merger with Tenon proposed as
Accountancy went to press
6. Most firms in the group are
partnerships but some are LLPs
or limited companies. Others are
considering conversion
7. Some firms within the group are
LLPs
8. Merging with Morley and Scott
9. Staff and partner figures are as at
03.11.09
10. Statutory year end is 30 June
11. Limited company with a sole
managing director
12. Campbell Dallas Financial
Services (income 2m) not included
as it is no longer a subsidiary of
Campbell Dallas
13. Merging with Menzies
FEE INCOME OF TOP 60
ACCOUNTANCY FIRMS
2005
2006
2007
2008
2010
bn 0 1 2 3 4 5 6 7 8 9 10
6.772bn
7.727bn
8.797bn
9.363bn
9.922bn
ACCOUNTANCYMAGAZINE.COM
|
JANUARY 2010 23
COVER FEATURE
|
ANALYSIS
ACCOUNTANCY TOP 60 LEAGUE TABLE OF UK ACCOUNTANCY FIRMS 2010
Position
(prior
year in
brackets) Firm
Fee income
m
Previous
year m
%
change
UK
offices
Number
of
partners Staff Status
Annual
accounts
published? Auditor
Year
end
1 (1) PricewaterhouseCoopers LLP 2,248 2,244 0.2 41 885 13,765 LLP Yes HCW 30.06.09
2 (2)
Deloitte LLP
1,969 2,010 -2.0 22 758 10,225 LLP Yes Grant Thornton 31.05.09
3 (3) KPMG LLP 1,626 1,652 -1.6 22 569 10,055 LLP Yes Grant Thornton 30.09.09
4 (4) Ernst & Young LLP 1,383 1,282 7.9 21 515 9,097 LLP Yes BDO Stoy Hayward 03.07.09
5 (5)
Grant Thornton UK LLP
1
378.2 394.1 -4.0 35 235 3,940 LLP Yes PKF 30.06.09
6 (6) BDO LLP 335.1 353.1 -5.1 14 232 2,697 LLP Yes PwC 03.07.09
7 (7)
Baker Tilly LLP
204 204 0.0 25 116 1,824 LLP Yes Kingston Smith 31.03.09
2
178.7 170.3 4.9 11 218 1,300 Ltd Yes Grant Thornton 30.04.09
9 (10) Tenon
3
150.8 160.3 -5.9 43 180 1,701 AIM listed Yes PwC 30.06.09
10 (9) PKF (UK) LLP 141.3 143.2 -1.3 23 98 1,680 LLP Yes Kingston Smith 31.03.09
11 (11)
Moore Stephens UK
138.9 126 10.2 37 160 1,389 Network No 31.12.09
12 (13) Mazars 102 101 1.0 18 110 1,002 LLP Yes HCW 31.08.08
13 (12) Vantis plc
4
89.6 92.2 -2.8 20 140 885 AIM listed Yes E&Y 30.04.09
14 (14) RSM Bentley Jennison
5
80.3 72.4 10.9 15 72 982 Part'ship No 31.05.09
15 (18)
Begbies Traynor Group plc
62.1 49.7 24.9 42 80 673 plc Yes Deloitte 30.04.09
6
58.2 60 -3.0 45 96 798 Group No 31.03.09
17 (16) Saffery Champness 51.4 49 4.9 10 58 447 Part'ship No 31.03.09
18 (17) Horwath Clark Whitehill LLP 46.4 46.6 -0.4 8 69 523 LLP Yes Grant Thornton 31.03.09
19 (19) UHY Hacker Young Group
7
45 43.4 3.7 18 88 652 Network Yes Various 30.04.09
20 (20) Kingston Smith LLP 41.6 40.4 3.0 6 56 434 LLP Yes Price Bailey 30.04.09
21 (22) MacIntyre Hudson 30.9 27.1 14.0 9 48 384 LLP Yes Hillier Hopkins 31.03.09
23 (23) Chantrey Vellacott DFK 26.5 24.5 8.2 9 52 295 LLP Yes Grant Thornton 30.06.09
24 (21) Menzies LLP
8
26.2 25.2 4.0 6 31 256 LLP No 28.02.09
25 (25) Johnston Carmichael 24.5 22.6 8.4 10 45 406 Part'ship No 31.05.09
26 (28) Buzzacott LLP 20.8 19.1 8.9 1 20 208 LLP No Hillier Hopkins 30.09.09
27 (26) Armstrong Watson 18.9 19.1 -1.0 15 34 343 Part'ship No 31.03.09
28 (27) Littlejohn 18.5 18.1 2.2 1 28 160 LLP No 31.05.09
29 (29) DTE Group 18 16.8 7.1 7 21 141 Ltd Yes Harold Sharp 30.04.09
31 (33) Streets 16.4 15.1 8.6 8 19 133 LLP No 30.06.09
32 (32) Haysmacintyre 16.2 15.8 2.5 1 24 148 Part'ship No 31.03.09
33 (30) Cooper Parry LLP 15.6 16.6 -6.0 4 23 190 LLP Yes Buzzacott 30.04.09
34 (43) Reeves + Neylan LLP 14.75 12.3 19.9 4 25 206 LLP Yes Clive Owen & Co 31.03.09
35 (35) Duncan & Toplis 14.73 15.1 -2.5 11 27 333 Part'ship No 31.03.09
36 (40) Price Bailey LLP 14.7 13.5 8.9 6 23 204 LLP Yes HCW 31.03.09
37 (38) Haslers
9
14.55 14 3.9 1 13 96 Part'ship No 31.12.08
39 (39) Lovewell Blake 14.1 14 0.7 5 21 208 Part'ship No 30.09.08
40 (33) Target Chartered Accountants 13.7 15.1 -9.3 4 11 180 Ltd Yes Berkeley Hall Marshall 31.03.09
41 (36) Hazlewoods LLP 13.5 14.1 -4.3 3 16 186 LLP Yes Princecroft Willis 30.04.09
43 (41) Scott-Moncrieff 13.1 13.1 0.0 2 18 188 Part'ship No 30.04.09
45 (-)
Anderson Anderson & Brown
LLP & Group 11.7 10.9 7.3 1 12 153 LLP Yes Gregor Clark & Co 31.03.09
46 (48) Barnes Roffe LLP
10
11.5 10.4 10.6 4 15 120 LLP Yes SB Jones & Co 31.12.08
48 (51) Beever and Struthers 10.8 9.6 12.5 4 26 150 Part'ship No 30.09.09
49 (58) SJD Accountancy
11
10.8 9 20.0 7 1 130 Ltd Yes No auditor 31.10.08
50 (47) Bishop Fleming 10.6 10.8 -1.9 6 18 171 Part'ship No 30.05.09
51 (54) Hillier Hopkins LLP 10.5 9 16.7 4 20 121 LLP Yes Price Bailey 31.03.09
52 (50) Rothman Pantall LLP 10.3 10.2 1.0 12 25 159 LLP No 31.03.09
53 (-) Moore and Smalley LLP 10.1 7.9 27.8 4 17 198 LLP Yes Hayes & Co 31.03.09
54 (44) Campbell Dallas LLP
12
10 8.7 14.9 5 17 146 LLP Yes TB Dunn 31.05.09
55 (53) James Cowper LLP 9.9 9.3 6.5 4 13 131 LLP Yes Clive Owen & Co 30.04.09
56 French Duncan LLP 9.5 6.7 41.8 6 23 137 LLP Yes Cook & Co 30.04.09
57 (56) Silver Levene 9.3 9.1 2.2 1 17 85 Part'ship No 31.05.09
58 (-) Thomas Westcott 9.1 7.6 19.7 13 17 176 Part'ship No 30.04.09
59 (55) Barber Harrison & Platt 9.06 9.1 -0.4 2 15 154 Part'ship No 31.12.08
60 (52) Morley and Scott
13
9 9.5 -5.3 4 18 102 Part'ship No 31.03.09
Totals 9,922 9,851 698 5,643 71,677
JANUARY 2010
|
ANALYSIS
|
COVER FEATURE
The merger was part of an ongoing
strategy to provide specialist accountancy
and tax advice to SMEs
NOTES TO TABLE
Information is gathered from
a questionnaire sent out by
Accountancy and completed by
the firms. Wherever possible, we
adhere to the firms description
of their service areas and
structure. This sometimes makes
comparisons within the Top 60
difficult because of the different
structure of firms in terms of
their business divisions. The
emergence of consolidators,
specialist firms and business
advisory companies over recent
years has added to this problem
and has produced results that
some people may disagree with.
Our aim, however, is to
produce consistent information
as far as possible and for this
reason we have not excluded
firms or groups with an
unusual structure, such as
jointly-branded networks.
Our only criterion is to include
any organisation that could
reasonably be described
as an accountancy firm, in
the sense that it competes
with more traditionally-
structured accountancy firms
and its payroll includes a
large proportion of qualified
accountants.
E&Y DEFIES THE GLOOM
Ernst & Young, the smallest of the Big Four, was the firm on
everyones lips last autumn after it revealed that its UK practice
had grown an impressive 7.9% in probably the worst year for
the economy in living memory.
E&Ys revenues leapt to 1.383bn, up from 1.282bn the
previous year, on the back of strong performances by its
advisory (including internal audit) and transaction advisory
(including restructuring) service lines, which grew by 16.3%
and 15.1% respectively.
While the firms still provide fee income information for the
UK, direct comparison among the Big Four firms is becoming
much more difficult thanks to the way the firms organise their
service areas, and the habit of the very large firms of merging
practices from different countries or organising themselves
into broad geographical regions.
E&Y, which itself no longer reports on a country-by-country
basis, revealed its UK turnover figures in a transparency report
on the same day that its global network announced a modest
decline in revenues of 0.2% in local currency.
E&Ys UK managing partner Scott Halliday told Accountancy that growth was aided by the firms structure after
the EMEIA region was formed in July 2008, bringing together 87 practices in Europe, Africa and Asia.
The structure allowed partners and teams to work collaboratively and cross-border, he added. There were also
the benefits of streamlining the internal organisation to take cost out of the system instead of trying to run 87
partnerships with all the infrastructure and back office behind them.
MENZIES MERGES WITH MORLEY AND SCOTT
Menzies LLP, ranked 24th in the Top 60 survey with a fee
income of 26.2m and 31 partners, announced in November
2009 that it would merge with Morley and Scott, ranked 60th
in the survey with a fee income of 9m. The merged firm,
which will be known as Menzies LLP, will create one of the
largest regional accountancy practices in the South East.
Menzies said that the merger was part of an ongoing
strategy to provide specialist accountancy and tax advice to
SMEs and smaller corporate enterprises. Mike Sands, Menzies
senior partner, said the intention was to create a firm that is
big enough to give business owners the specialist accounting,
audit and tax advice they need, while still delivering the strong
partner-led relationship that they expect from their local
accountant. He added that smaller companies were struggling
with red tape and a complex tax regime and should not be
forced to switch to a Top 10 firm just because regulations have
become more complicated.
Dick Watson, managing partner of Morley and Scott, who
joins Menzies management committee, said that while the firm had always guarded its independence carefully,
the merger was an important strategic move for clients, staff and partners. Menzies, he said, shares the same
ambition, culture, values and approach to client service as Morley and Scott. Menzies saw its fee income rise by
4% over the past year, while fee income at Morley and Scott fell by over 5%.
Additional reporting by Sally Percy
Halliday: Reaping
the benefits of
streamlined
organisation
Sands: Helping SMEs to
negotiate a complex
tax regime
|
JANUARY 2010 25
COVER FEATURE
|
ANALYSIS
T
he strongest indication of how the UKs largest accountancy
firms have reacted to the economic conditions is
undoubtedly in overall staff numbers. This years survey
shows that staff employed by the Top 60 fell by 4% from the
2008 survey. Previous years have shown a steady rise in staff numbers,
with numbers increasing by 6% in the 2008 survey.
The figures suggest that firms have cut back on staff during the
recession. The profession as a whole, though, learned a tough lesson
during the previous recession in the early 1990s, when many were
caught short at the recovery and found themselves lacking the
necessary skilled staff to compete effectively. The results of our survey
of the student trainees employed by the Top 60 (see p54), though,
suggests strongly that the firms have also cut back on the number of
trainees they are recruiting during the recession. Perhaps the lessons
have not been learned after all.
It is also interesting to note that while the number of staff below
partner level fell during the year, the number of partners (or partner
equivalents) in the Top 60 rose by 4.6% over the same period.
Last years survey showed that partner numbers in the Top 60 had
remained largely stagnant over the previous 12 months, which we
took to be a warning that the firms were beginning to tighten their
belts as the credit crunch began to bite.
This years rise in partner numbers perhaps indicates that the firms
are wary of losing their most valuable employees during the recession
and have continued to promote to partner level despite the squeeze
on fees. E&Y announced the
appointment of 48 new partners
in the UK and Ireland last
summer, 18 of whom will work
in its financial services division.
The figures also show that
13% of the Top 60 partners are
female, compared with 12.1%
in the 2008 survey. Four firms
in the survey that previously
had no female partners DTE
Group, Hazlewoods, Simmons
Gainsford and Barber Harrison
& Platt have now appointed
at least one. Two firms did
not provide information on
partner gender.
JUNIOR STAFF ARE BEARING
THE BRUNT OF CUTBACKS IN
PERSONNEL, FINDS LIZ FISHER
TOO
MANY
CHIEFS
ACCOUNTANCY TOP 60
PERSONNEL PROFILE
Position
(prior
year in
brackets) Firm
Fee
income
m Partners
Female
partners Staff
Fee/
partner
ratio
000s
1 (1) PricewaterhouseCoopers LLP 2,248 885 114 13,765 2,540
2 (2) Deloitte LLP 1,969 758 109 10,225 2,598
3 (3) KPMG LLP 1,626 569 80 10,055 2,858
4 (4) Ernst & Young LLP 1,383 515 77 9,097 2,685
1
378.2 235 40 3,940 1,609
6 (6) BDO LLP 335.1 232 23 2,697 1,444
7 (7) Baker Tilly LLP 204 116 15 1,824 1,759
2
178.7 218 39 1,300 820
9 (10) Tenon
3
150.8 180 18 1,701 838
10 (9) PKF (UK) LLP 141.3 98 7 1,680 1,442
11 (11) Moore Stephens UK 138.9 160 17 1,389 868
12 (13) Mazars 102 110 12 1,002 927
13 (12) Vantis plc
4
89.6 140 16 885 640
14 (14) RSM Bentley Jennison
5
80.3 72 7 982 1,115
15 (18) Begbies Traynor Group plc 62.1 80 7 673 776
16 (15) Haines Watts Group 58.2 96 9 798 606
17 (16) Saffery Champness 51.4 58 11 447 886
18 (17) Horwath Clark Whitehill LLP 46.4 69 12 523 672
19 (19) UHY Hacker Young Group 45 88 7 652 511
20 (20) Kingston Smith LLP 41.6 56 8 434 743
21 (22) MacIntyre Hudson 30.9 48 6 384 644
22 (24) Wilkins Kennedy 27.4 45 5 360 609
23 (23) Chantrey Vellacott DFK 26.5 52 5 295 510
24 (21) Menzies LLP
6
26.2 31 1 256 845
25 (25) Johnston Carmichael 24.5 45 2 406 544
26 (28) Buzzacott LLP 20.8 20 2 208 1,040
27 (26) Armstrong Watson 18.9 34 6 343 556
28 (27) Littlejohn 18.5 28 5 160 661
29 (29) DTE Group 18 21 2 141 857
30 (31) Francis Clark 16.5 33 3 230 500
31 (33) Streets 16.4 19 3 133 863
32 (32) Haysmacintyre 16.2 24 5 148 675
33 (30) Cooper Parry LLP 15.6 23 1 190 678
34 (43) Reeves + Neylan LLP 14.75 25 2 206 590
35 (35) Duncan & Toplis 14.73 27 1 333 546
36 (40) Price Bailey LLP 14.7 23 1 204 639
37 (38) Haslers
7
14.55 13 4 96 1,119
38 (37) Shipleys LLP 14.3 19 n/a 132 753
39 (39) Lovewell Blake 14.1 21 1 208 671
40 (33) Target Chartered Accountants 13.7 11 n/a 180 1,245
41 (36) Hazlewoods LLP 13.5 16 1 186 844
42 (42) Larking Gowen 13.3 22 2 245 605
43 (41) Scott-Moncrieff 13.1 18 2 188 728
44 (45) Mercer & Hole 12.1 20 6 149 605
45 (-)
Anderson Anderson &
Brown LLP & Group
11.7 12 3 153 975
46 (48) Barnes Roffe LLP 11.5 15 1 120 767
47 (46) Simmons Gainsford LLP 10.9 16 1 94 681
48 (51) Beever and Struthers 10.8 26 5 150 415
8
10.8 see note see note 130 see note
50 (47) Bishop Fleming 10.6 18 3 171 589
51 (54) Hillier Hopkins LLP 10.51 20 2 121 526
52 (50) Rothman Pantall LLP 10.3 25 5 159 412
53 (-) Moore and Smalley LLP 10.1 17 4 198 594
54 (44) Campbell Dallas LLP 10 17 2 146 588
55 (53) James Cowper LLP 9.9 13 3 131 762
56 (-) French Duncan LLP 9.5 23 6 137 413
57 (56) Silver Levene 9.3 17 2 85 547
58 (-) Thomas Westcott 9.1 17 2 176 535
59 (55) Barber Harrison & Platt 9.06 15 2 154 604
60 (52) Morley and Scott
9
9 18 1 102 500
Totals 9,922 5,642 736 71,677
NOTES TO TABLE
1. Partner numbers are as at 01.07.09
3. Merger with RSM Bentley Jennison
proposed as Accountancy went to
press
5. Merger with Tenon proposed as
Accountancy went to press
6. Merging with Morley and Scott
7. Staff and partner figures are as at
03.11.09
8. Company has a single managing
director
9. Merging with Menzies
JANUARY 2010
|
ANALYSIS
|
COVER FEATURE
T
his year 18 firms disclosed details of their pre-
tax profits, compared with 12 firms last survey.
This is perhaps an indication of a greater desire
for transparency within the profession, as more
firms produce annual reports and accounts following their
conversion to limited liability partnerships. The figures
that have been provided
confirm what a tough
year it has been for firms.
PricewaterhouseCoopers
reported an 8% rise in
distributable profits to 682m,
but its figures were one of
the few positive highlights.
Deloittes profits remained
static at 564m, while KPMG
reported a 13% fall in profits
to 389m. Ernst & Young did
not provide its profit figures
this year.
F
our firms have converted to LLP status since Accountancys last Top 60
survey of firms, bringing the total number of firms within the Top 60 that
have limited their liability to 31. James Cowper, Littlejohn and Menzies
all converted since the last survey, with Rothman Pantall the most recent
firm to convert on 1 July 2009.
Other firms are still considering the move. Francis Clark says it will probably
convert to LLP status from next April. Five other firms Johnston Carmichael,
Wilkins Kennedy, Duncan & Toplis, Silver Levene and Morley and Scott (which
has announced its merger with Menzies since the survey was completed) have
also said they are considering conversion at some point.
There are now 10 firms that operate within a structure other than a
partnership or LLP. Aside from the publicly listed companies, a few firms are
choosing more imaginative structures. Moore Stephens and UHY Hacker Young
both operate as a network of firms, while Haines Watts describes itself as a group
of firms, some of which are partnerships and some of which are LLPs.
THE PROFESSION IS BECOMING INCREASINGLY TRANSPARENT,
FINDS LIZ FISHER
OVER HALF OF THE FIRMS IN THE TOP 60 ARE NOW LIMITED
LIABILITY PARTNERSHIPS, SAYS LIZ FISHER
FIRMS MORE OPEN
ABOUT PROFIT
ANOTHER FOUR FIRMS
CONVERT TO LLP
PARTNERSHIP PROFITABILITY
(COMPANIES EXCLUDED)
Fee income Profit before
Rank Firm m tax m Partners
1 PricewaterhouseCoopers LLP 2,248 682 885
2 Deloitte LLP 1,969 564 758
3 KPMG LLP 1,626 389 569
5 Grant Thornton UK LLP 378.2 55.6 235
8 Smith & Williamson 178.7 26.3 218
17 Horwarth Clark Whitehill LLP 46.4 10.7 69
22 MacIntyre Hudson 30.9 8.2 48
38 Shipleys LLP 14.3 5 19
46 Barnes Roffe LLP 11.5 4.5 15
34 Reeves + Neylan LLP 14.8 4 25
45 Anderson Anderson & Brown LLP & Group 11.7 3.5 12
36 Price Bailey LLP 14.7 3.4 23
47 Simmons Gainsford LLP 10.9 3.2 16
33 Cooper Parry LLP 15.6 2.8 23
56 French Duncan LLP 9.5 2.6 23
51 Hillier Hopkins LLP 10.5 2.4 20
57 Silver Levene 9.3 2.3 17
55 James Cowper LLP 9.9 1.7 13
BREAKDOWN OF TOP 60
FIRMS BY ORGANISATIONAL
STRUCTURE
Other 10%
LLP 31%
Partnership 19%
|
JANUARY 2010 27
COVER FEATURE
|
ANALYSIS
W
e have pointed out in
previous years that
comparison between firms
in terms of fee income
split, particularly among the largest firms, is
becoming more difficult every year as the
distinction between service lines becomes
more blurred. To add to the confusion, the
Big Four now organise themselves into
service areas that do not exactly match with
each other, or with smaller firms.
It is no secret that business insolvency
work is the lifeblood of accountancy
firms during a recession and the figures
collected from the Top 60 firms this year
confirm this. According to our previous
survey (see Accountancy, July 2008, p29),
the top 10 firms in terms of fee income
from insolvency work reported a total of
323.2m; this year the income from the 10
highest earning firms in this business line
totals 433.1m, a rise of 50%.
Over the same period, the income earned
by the 20 firms reporting the highest level
of fee income from audit and assurance
work (or its nearest equivalent), rose by
just 4.5% to 3.5bn, up from 3.3bn in the
previous survey. The income earned from
tax work seems to have remained largely
static at 2.4bn reported by the 20 highest-
earning firms in this service area.
The definition of consultancy work is
one of the most fluid service lines in the
profession, which is why it would be
risky to draw too many conclusions from
the 8% rise in fee income earned by the
10 largest firms in this service area since
the last survey. The firms reported a total
fee income from consultancy work of
1.6bn, compared with 1.5bn in our July
2008 survey.
The results do not highlight the move
that some firms are making into new service
lines. BDO, for instance, earned 38m from
forensic accounting services during the year
and 20m from investment management
services. Wealth management services is
another important service line for some key
firms, not least Smith & Williamson, which
earned just over 100m from its speciality
services over the year.
CORPORATE RECOVERY IS, UNSURPRISINGLY, THE PROFESSIONS
BEST-PERFORMING SERVICE LINE, SAYS LIZ FISHER
INSOLVENCY BOOMS,
TAX STANDS STILL
AUDIT AND
ACCOUNTING
INCOME
Rank Firm m
1 (1) PricewaterhouseCoopers LLP 861
2 (2) Ernst & Young LLP
1
702
3 (3) Deloitte & Touche LLP 647
4 (4) KPMG LLP 486
5 (5) Grant Thornton UK LLP 140.7
6 (7) Baker Tilly LLP 102
7 (6) BDO LLP 99
8 (11) Vantis plc
2
65.4
9 (8) Mazars
3
64.6
10 (10) Moore Stephens UK 61.6
11 (9) PKF (UK) LLP 59.5
12 (13) RSM Bentley Jennison 27.1
13 (12) Haines Watts Group 26.7
13 (15) Smith & Williamson 26.7
15 (14) Horwath Clark Whitehill LLP 26.5
16 (17) Kingston Smith LLP 23.3
17 (16) UHY Hacker Young Group 20.7
18 (18) Tenon 18.1
19 (19) Saffery Champness 16.7
20 (20) Wilkins Kennedy 15.6
Notes
1. Assurance and advisory
2. Includes tax compliance
3. Includes corporate finance and consultancy
CORPORATE
RECOVERY
Rank Firm m
1 (1) KPMG LLP 160
3 (3) BDO Stoy Hayward LLP 57
4 (-) Begbies Traynor Group plc 49.7
5 (6) Tenon 43.7
7 (5) Vantis plc 27.8
8 (7) PKF (UK) LLP 15.7
10 (10) Mazars 12.2
CORPORATE
FINANCE
Rank Firm m
1 (1) Deloitte LLP 321
2 (2) Ernst & Young LLP 289
3 (3) KPMG LLP
1
253
4 (4) Grant Thornton UK LLP 44
5 (5) BDO LLP 31
7 (9) Tenon 6.1
8 (7) PKF (UK) LLP 11.2
Note
1. Includes transaction services
CONSULTANCY
Rank Firm m
1 (2) PricewaterhouseCoopers LLP
1
737
2 (3) Deloitte & Touche LLP 478
3 (1) KPMG LLP 352
4 (5) PKF (UK) LLP 22.9
6 (8) Menzies 5.7
7 (-) RSM Bentley Jennison 5
8 (9) Kingston Smith 4.9
10 (-) Wilkins Kennedy 3.4
Note
1. Advisory
TAX
INCOME
Rank Firm m
1 (1) PricewaterhouseCoopers LLP 650
2 (2) Deloitte LLP 523
3 (4) Ernst & Young LLP 392
4 (3) KPMG LLP 375
6 (5) BDO LLP 90
8 (8) Tenon 34.7
10 (10) PKF (UK) LLP 32
11 (13) Mazars 25.2
14 (14) RSM Bentley Jennison 16
15 (15) Saffery Champness 13.2
16 (16) Horwath Clark Whitehill LLP 12.9
17 (17) UHY Hacker Young Group 11.2
18 (19) Buzzacott LLP 9.8
19 (18) Haslers 8.5
20 (20) Chantrey Vellacott DFK 7.3
JANUARY 2011
|
ANALYSIS
|
TOP 60
W
eve waited a long time to see
concrete confirmation of the impact
of the recession on the accountancy
profession, but it has arrived with this
years survey of the UKs Top 60 firms. The largest 60
firms in the country have seen their total fee income
grow by just 0.6% compared with the previous 12
months. Meanwhile, this years Top 60 have combined
revenues of 9.816bn, a 1% fall on last year when the
then 60 biggest firms notched up revenues of 9.922bn.
Last years survey, published in Accountancys January
2010 issue (see p22), showed that the firms reported a
1% increase in fee income over the previous financial
year, and there were already strong signs that many
firms were finding the economic climate tough. In last
years survey, 19 firms reported negative or stagnant
growth over the previous 12 months; this year the
number is 25, and only six firms were able to report
double-digit growth (the majority of which came from
mergers and acquisitions, rather than through organic
growth). One of these firms was Begbies Traynor, the
insolvency specialist, which saw its revenue swell by
11.3% this year and by 25% in last years survey.

TURBULENT TIMES
The survey shows that firms of all sizes have suffered
under the recession, with only a handful of exceptions.
Ian Powell, chairman of PwC, was undoubtedly not alone
in claiming that the past two years have been the most
challenging of my professional career. Even so, PwC has
performed better than most, and reported the strongest
growth of the Big Four at 3.7%.
Deloitte chief executive John Connolly, who is
due to step down in May, said in his report that the
firm had achieved a strong performance in a tough
environment. The firm reported a small drop in
revenues of just under 1%, and a decent improvement
on revenue from corporate finance work (10.6% up on
the previous year), which prevented what
could have been a worse year.
Even so, the firms remain optimistic
about the future. Connolly said that he
expected to see a general return to growth
in 2011, led by a stronger audit practice,
and the firms information and technology
risk services business. PwCs managing
partner, Richard Collier-Keywood, said there
was a limited prospect of a major economic
turnaround in the next 12 months and that
as a result, growth will mostly come from
increasing market share as opposed to the
size of the market increasing. And Simon
Michaels, the managing partner of BDO,
said that trading conditions in 2009 had been tough but
the figures in 2010 were far more encouraging.
SHOCK COLLAPSE
It has certainly been a turbulent year for the profession,
with perhaps the biggest shock coming with the
collapse of the AIM-listed Vantis, ranked 13th in
Accountancys 2010 survey with a fee income of 89.6m,
over the summer. The company suspended its shares
in June 2010 and entered into administration shortly
afterwards, its demise blamed to a large extent on its ill-
fated work as liquidator of Stanford International Bank.
The companys collapse resulted in a flurry of
acquisition activity, with its advisory services in
London, Epsom and Leicester, as well as its business
recovery services in Marlow and the national financial
management operations, sold to RSM Tenon for 6.8m.
The business recovery services of eight other offices
were sold to a group of former Vantis partners.
Another venture to rise from the ashes of Vantis is
Renaissance Group (ranked 41 in the survey with a fee
income of 13.1m), an alliance of four separate LLPs
formed through management buy-outs of former Vantis
offices, including Rouse Partners LLP in Beaconsfield.
The group is currently in the process of setting up a
more formal operating structure and has been included
in this years survey on that basis.
DTE Group, ranked 29th last year, and Haslers, ranked
37th last year, chose not to participate in our 2011 survey.

See also the Top 60 trainees survey, p52
THE EFFECTS OF THE RECESSION ON THE UKS TOP 60
ACCOUNTANCY FIRMS CAN BE CLEARLY SEEN, WRITES LIZ FISHER
FEELING
THE PAIN
IN THIS TOP 60 REPORT
Profitability 31
NOTES TO TABLE
1. Info based on draft accounts
2.LLP and limited company structure
3. Fee income does not include historic
acquired turnover of 60m following
merger with RSM Bentley Jennison
4. Partners are fee-earning directors.
5. Network of independent firms, some
of which are LLPs
6. Mainly partnerships, but some
companies and some LLPs
7. Previously Horwath Clark Whitehill
8. Network of firms, five of which
are LLPs. Some firms publish annual
accounts, which are audited
9. Status under review
10. Considering converting to LLP
11. Firm provided figures for 2009
12. Each franchisee operates as a sole
trader, partnership or ltd company, and
franchisees have different year ends.
Fee income is to 31.12 09. Partners are
franchisees
13. Recently converted to LLP. Will
publish accounts next year
14. Part of the business operates as an
LLP and publishes annual accounts
15. Previously Reeves & Neylan, merged
with FW Stephens on 01.06.10. Fee
income is for year ended 31.05.10.
Staff and partner numbers are the
most recent available and include FW
Stephens. Rebranded on 22.9.10
16. Group of separate LLPs
17. Not all firms in the group are LLPs
18. Previous year total excludes 2m
from Campbell Dallas Financial Services,
which is no longer a subsidiary
19. Previously Rothman Pantall
FEE INCOME OF TOP 60
ACCOUNTANCY FIRMS
2006
2007
2008
2010
2011
bn 0 1 2 3 4 5 6 7 8 9 10
7.727bn
8.797bn
9.363bn
9.922bn
9.816bn
|
JANUARY 2011 27
TOP 60
|
ANALYSIS
ACCOUNTANCY TOP 60 LEAGUE TABLE OF UK ACCOUNTANCY FIRMS 2011
Position
(prior
year in
brackets) Firm
Fee income
m
Previous
year m
%
change
UK
offices
Number
of
partners Staff Status
Annual
accounts
published? Auditor
Year
end
1 (1) PwC 2,331 2,248 3.7 40 845 16,533 LLP Yes Crowe Clark Whitehill 30.06.10
2 (2) Deloitte 1,953 1,969 -0.8 21 681 11.413 LLP Yes Grant Thornton 31.05.10
3 (3) KPMG 1,602 1,604 -0.1 22 545 10,499 LLP Yes Grant Thornton 30.09.10
4 (4) Ernst & Young LLP 1,356 1,383 -2 21 533 8414 LLP Yes BDO Stoy Hayward 02.07.10
5 (5) Grant Thornton (UK) LLP
1
379.7 378.2 0.4 31 228 3686 LLP Yes PKF 30.06.10
6 (6) BDO LLP 312.2 335.1 -6.8 14 203 2538 LLP Yes PwC 02.07.10
7 (7) Baker Tilly
2
191 204 -6.4 28 117 1609 LLP Yes Kingston Smith 31.03.10
8 (9) RSM Tenon
3
190.4 150.8 26.3 50 306 2878 plc Yes PwC 30.06.10
4
169.4 178.7 -5.2 10 214 1234 Ltd Yes Grant Thornton 30.04.10
10 (10) PKF (UK) LLP 140.4 141.3 -0.6 23 94 1533 LLP Yes Kingston Smith 31.03.10
5
138.2 138.8 -0.4 37 156 1404 Network No 31.12.10
12 (12) Mazars 103.8 102 1.8 15 108 1060 LLP Yes Crowe Clarke Whitehill 31.08.10
13 (15) Begbies Traynor Group plc 69.1 62.1 11.3 46 103 712 plc Yes Deloitte 30.04.10
6
55.7 58.2 -4.3 49 103 766 Group No 31.03.10
15 (17) Saffery Champness 52.1 51.4 1.4 10 61 452 Part'ship No 31.03.10
16 (18) Crowe Clark Whitehill LLP
7
47 46.4 1.3 8 74 531 LLP Yes Grant Thornton 31.03.10
17 (19) UHY Hacker Young Group
8
45.4 45 0.9 19 92 586 Network Some 30.04.10
18 (20) Kingston Smith LLP 42.7 41.5 2.9 6 59 460 LLP Yes Price Bailey 30.04.10
19 (21) MacIntyre Hudson LLP 31.2 30.9 1 10 39 387 LLP Yes Hillier Hopkins 31.03.10
20 (24) Menzies LLP 27.7 25.3 9.5 7 34 335 LLP Yes Princecroft Willis LLP 30.06.10
21 (23) Chantrey Vellacott DFK 27.6 26.5 4.2 9 49 299 LLP Yes Grant Thornton 30.06.10
22 (22) Wilkins Kennedy
9
27.5 27.4 0.4 11 48 373 Part'ship No 30.04.10
23 (25)
Johnston Carmichael Chartered Accountants &
Business Advisers
10
26.9 24.5 9.8 10 46 413 Part'ship No 31.05.10
24 HW Fisher & Company
11
22.9 22.4 2.2 2 28 202 Part'ship No 30.04.09
25 (26) Buzzacott LLP 22.1 20.8 6.3 1 23 210 LLP Yes Hillier Hopkins 30.09.10
26 (28) Littlejohn 17.8 18.3 -2.7 1 29 147 LLP Yes Price Bailey 31.05.10
27 (27) Armstrong Watson 17.3 18.9 -8.5 9 27 340 Part'ship No 31.03.10
28 TaxAssist Accountants
12
16.9 14.1 19.9 197 189 550 Franchise No 31.12.09
29 (30) Francis Clark
13
16.87 16.5 2.2 8 33 248 LLP No 31.03.10
30 (31) Streets
14
16.4 16.4 0 9 20 118 Part LLP Partly None 30.06.10
32 (32) Haysmacintyre 15.7 16.2 -3.1 1 23 146 Part'ship No 31.03.10
33 (36) Price Bailey LLP 15.7 14.7 6.8 6 23 216 LLP Yes Crowe Clark Whitehill 31.03.10
34 Frank Hirth plc 15 11.9 26.05 1 13 154 plc Yes Manningtons 30.06.10
35 (33) Cooper Parry LLP 14.9 15.6 -4.5 4 23 180 LLP Yes Buzzacott 30.04.10
36 (34) Reeves & Co LLP
15
14.8 14.8 0 4 43 271 LLP Yes Clive Owen & Co 31.05.10
37 (38) Shipleys LLP 14.3 14.3 0 4 19 132 LLP Yes Steele Robertson Goddard 30.04.09
38 (41) Hazlewoods 14.2 13.5 5.2 3 17 194 LLP Yes Princecroft Willis LLP 30.04.10
40 (39) Lovewell Blake 13.4 14.1 -5 5 21 208 LLP No 30.09.10
41 Renaissance Group
16
13.1 14.1 -7.1 6 35 155 Group No 30.04.10
42 (40) Target Chartered Accountants 13 13.7 -5.1 4 11 185 Ltd Yes Berkeley Hall Marshall 31.03.10
43 (43) Scott-Moncrieff 12.6 12.6 0 2 17 163 Part'ship No 30.04.10
44 (44) Mercer & Hole 12.1 12.1 0 4 19 134 Part'ship No 31.03.10
45 (49) SJD Accountancy 12 10.9 10.1 7 1 150 Ltd No 31.10.09
46 (45) Anderson Anderson & Brown LLP and Group
17
11.8 11.7 0.9 1 12 148 LLP Yes Gregor Clark & Co 31.03.10
47 (46) Barnes Roffe LLP 11.3 10.9 3.7 4 17 102 LLP Yes HW Leicester LLP 30.06.10
48 (48) Beever and Struthers 11.3 10.8 4.6 3 26 180 Part'ship No 30.09.10
49 (47) Simmons Gainsford LLP 11 10.9 0.9 2 17 71 LLP Yes Sopher & Co 31.03.10
50 (50) Bishop Fleming 10.6 10.6 0 5 18 170 Part'ship No 31.05.10
51 (51) Hillier Hopkins LLP 10.5 10.8 -2.8 4 21 104 LLP No Price Bailey 31.03.10
52 Henderson Loggie 10.4 10.1 3 4 20 194 Part'ship No 30.11.09
53 (53) Moore and Smalley LLP 10.2 10.1 1 5 17 203 LLP Yes Hayes & Co 31.03.10
54 (55) James Cowper LLP 10.1 10 1 5 14 135 LLP Yes Clive Owen 30.04.10
55 (54) Campbell Dallas LLP
18
10 10 0 5 19 145 LLP Yes TB Dunn 31.05.10
56 Montpelier Chartered Accountants 9.7 8.6 12.8 9 19 195 Ltd No 31.12.09
57 (52) Rothmans
19
9.61 9.8 -1.9 12 19 141 LLP Yes Mazars 31.03.10
58 Cowgill Holloway LLP 9.6 8.7 10.3 4 16 144 LLP Yes Champion & Co 31.05.10
59 (57) Silver Levene LLP 9.6 9.4 2.1 1 17 94 LLP No 31.05.10
60 (58) Thomas Westcott 9.3 9.1 2.2 13 17 173 Part'ship No 30.04.10
Totals 9,816 9,758 872 5,670 63,537
JANUARY 2011
|
ANALYSIS
|
TOP 60
Were
representative
of many firms in
that a lot of the
high advisory
work has
diminished
during the
recession
HOW WE
COMPILE THE
TOP 60
Information is gathered from
Accountancy and completed by
the firms. Wherever possible, we
adhere to the firms description
of their service areas and
structure. This sometimes
makes comparisons within the
Top 60 difficult because of the
different structure of firms in
terms of their business divisions.
Our aim is to produce consistent
information as far as possible
and for this reason we have
not excluded firms or groups
with an unusual structure, such
as jointly-branded networks.
Our only criterion is to include
any organisation that could
reasonably be described
as an accountancy firm, in
the sense that it competes
with more traditionally-
structured accountancy firms
and its payroll includes a
large proportion of qualified
accountants.
RSM TENON FLIES HIGH
One of the firms to buck the trend of declining revenues this year and doing
it in some style is RSM Tenon. The listed company reported an impressive
26.3% increase in fee income for the year to June 2010, up from 150.8m to
190.4m. The 2010 figure does not include 60m of historic revenues from its
recent acquisition of RSM Bentley Jennison.
Andy Raynor, the firms chief executive, said that 2010 has been a defining
period in the history of RSM Tenon, a time of positive transformation and
growth. There certainly seems to be little stopping the company, as it
completed its substantial merger with Bentley Jennison, the 14th largest
firm in the UK, according to our 2010 survey, with annual fee income of
80.3m, in December 2009 and moved to the main market of the London
Stock Exchange in May. Over the summer, Tenon also picked up part of the
business of its ill-fated rival, Vantis, for 6.8m, which effectively doubled the
size of its operations in London.
MONTPELIER RIDES OUT THE STORM
Montpelier Group is not only a newcomer to the Top 60 but a newcomer
in every sense it is just five years old. Robert Jackson, its CEO, says its
strategy from the outset has been to create something akin to a Swiss bank,
albeit on a smaller scale, where all services are provided under one roof.
The companys revenue figures (for the 2009 financial year) of 9.7m cover
only its business that is directly related to accountancy. Its other divisions
include a SIPP business, financial services, trust work and a tax consultancy,
a business that in total turns over between 25m and 30m a year. With
the company back on the acquisition trail in 2011, it will be one to watch in
future surveys.
In the meantime, Montpelier has worked hard to ride out the storm during
its first few years. Were representative of many firms in that a lot of the high
advisory work has diminished during the recession, says Jackson, but we
were fortunate in that we have a strong compliance base. The company,
which has offices in Manchester, Preston, Carlisle, London, Leeds, Sheffield
and Scotland, concentrates exclusively on SMEs and owner-managed
businesses. And Jackson says that, with the exception of niches such as UK
holiday parks and the booming media sector in Manchester, where the BBC will soon relocate, many of its clients
are finding the conditions tough. That said, there has been nothing like the number of liquidations of previous
recessions, he adds. People seem to have had more wool on their back to survive.
MERCER TRIUMPHS OVER THE BLACK HOLE
Howard Wilkinson, senior partner of Mercer & Hole, acknowledges
that it has been a difficult couple of years for the profession. We
made the decision to concentrate on our bottom line, rather than the
top line, at the outset and so we have been happy to hold revenues
at the same level as last year, he said. While the firm, which has
offices in London, St Albans, Milton Keynes and Northampton, has
shed staff, its profits have held up and Wilkinson says that in some
respects, the recession was not as bad as many had expected.
We did expect to see some clients go under during the recession
but that has not been as bad as we feared, he says. Part of that is
because while the banks have been reluctant to lend to new people,
they have also been supportive of their existing customers. He adds
that he has seen a noticeable change over the seven months since
the end of the firms financial year. Companies are coming back
into profit, and where some had been reluctant to ask for our advice
during the recession, and have stuck mainly with compliance work,
our clients are beginning to ask for our advice again. It will take time,
but the feeling is reasonably buoyant.
Raynor: A time
of positive
transformation
and growth
Jackson: Top 60
newcomer
Wilkinson: A difficult
couple of years
|
JANUARY 2011 29
TOP 60
|
ANALYSIS
T
he habit of the Big Four
to draw their service
lines along slightly
different borders has
made comparison between the firms
almost impossible. In most cases,
the differences go far deeper than
labelling, as different functions fall
within different divisions in most of
the firms. As a result, it is difficult to
pin down where some of the revenue
and growth is emanating from.
PwCs advisory business, for instance,
which encompasses corporate finance,
corporate recovery and consultancy,
saw revenues increase by 9% over the
previous year and the firm said it plans to
expand other services within the business
where it sees potential long-term growth,
including human resource services, risk
assurance and forensics.
E&Ys advisory business, on the other
hand, is described as including advice
on business risk, IT and performance
improvement. The firm announced in
November that it planned to recruit an
additional 1,000 people to its advisory arm
in response to growing client demand.
The firm said demand is being driven by
its clients desire to find ways to optimise
their performance as they emerge from
recession.
Elsewhere, audit seems to have been the
bedrock of the profession throughout the
recession, with many firms describing their
audit business as a solid base from which
they plan to grow again in the future.
A strong performer for many firms
has been corporate finance work, as
transactional activity begins to return. BDO
was among the best performers with a 14%
increase in its corporate finance revenue.
As the profession enters 2011 and with
the market still uncertain, it is clear that
many firms are looking for revenue gains
from niche services, particularly
in the areas of risk management,
wealth management and personal
finance services. BDO, for instance,
formed a strategic partnership with the
private equity firm Oakley Capital, a
long-standing client of the firm, in
November 2010.
FIRMS ARE RELYING ON THEIR BREAD-AND-BUTTER WORK, BUT
CORPORATE FINANCE IS BOUNCING BACK, WRITES LIZ FISHER
AUDIT IS THE BEDROCK
HOW THE BIG FOUR ORGANISE THEIR BUSINESSES
Firm Audit &
accounting m
Assurance
m
Tax
m
Advisory
m
Transaction
advisory m
Corporate
recovery &
corporate
nance m
Consultancy
m
PwC 893 634 804
Deloitte 628 511 355 459
KPMG 458 350 168 397 229
Ernst & Young 403 360 309 284
AUDIT AND
ACCOUNTING
*
Rank ** Firm m
1(5) Grant Thornton (UK) LLP 135.5
2(6) Baker Tilly 94
3(7) BDO LLP 91.7
4(9) Mazars 68.9
5(10) Moore Stephens UK 61.1
6(11) PKF (UK) LLP 59
7(18) RSM Tenon 52.7
8(15) Crowe Clark Whitehill LLP 28.3
9(13) Haines Watts Group 26.6
10(16) Kingston Smith LLP 23.4
11(17) UHY Hacker Young Group 22.2
12(13) Smith & Williamson 21.9
13(19) Saffery Champness 17.5
14(20) Wilkins Kennedy 15.8
15(-) Menzies 12.7
16(-) Littlejohn 10.2
CORPORATE
RECOVERY
*
Rank ** Firm m
2(4) Begbies Traynor Group plc 58.9
3(3) BDO LLP 52.6
4(5) RSM Tenon 51
5(6) Baker Tilly 32
6(8) PKF (UK) LLP 15.2
7(10) Mazars 13.6
9(-) Smith & Williamson 10
CORPORATE
FINANCE
*
Rank ** Firm m
2(5) BDO LLP 35.3
3(6) Baker Tilly 12
4(8) PKF (UK) LLP 9.2
5(7) RSM Tenon 7.3
6(10) Smith & Williamson 5
* Due to the way they report on their service lines,
the Big Four firms have been excluded from this
table in 2011 see separate table for breakdown of
Big Four firms by service lines. Note: Big Four firms
were included in these tables in 2010
** Prior year in brackets
CONSULTANCY
*
Rank ** Firm m
1(4) PKF (UK) LLP 23.3
2(5) Moore Stephens UK 12
3(8) Kingston Smith LLP 6.1
4(6) Menzies LLP 5
5(-) Duncan & Toplis 3.6
6(10) Wilkins Kennedy 3.3
7(-) Cooper Parry 2.9
TAX
INCOME
Rank ** Firm m
1(1) PwC 634
2(2) Deloitte 511
3(3) Ernst & Young LLP 360
4(4) KPMG 350
5(5) Grant Thornton (UK) LLP 93
6(6) BDO LLP 83.2
7(7) Baker Tilly 53
8(8) RSM Tenon 48.6
9(10) PKF (UK) LLP 33.7
10(9) Smith & Williamson 32.4
12(11) Mazars 21.3
14(-) Frank Hirth plc 14
15(15) Saffery Champness 13.5
16(16) Crowe Clark Whitehill 12.9
17(-) SJD Accountancy 12
18(18) Buzzacott LLP 11.1
19(17) UHY Hacker Young Group 10
20(20) Chantrey Vellacott DFK 7.8
JANUARY 2011
|
ANALYSIS
|
TOP 60
T
he full effect of the recession can be seen starkly in the
personnel statistics of the Top 60 firms, and confirm
persistent rumours that firms have cut back sharply on
headcount over the past year. By far the biggest casualties,
though, have been salaried staff.
The figures show that the Top 60 firms employ around 11% fewer
staff in total than employed by the Top 60 this time last year. In last
years survey we highlighted a 4% fall in overall staff numbers on the
previous year. During healthier times, the Top 60 firms combined
tended to increase total staff numbers by around 5% a year.
At the same time, however, partner numbers have remained almost
constant, increasing by 0.5% to
5,669 perhaps reflecting the
view that it is a cheaper option
to lay off salaried staff than it
is to cull equity partners. That
said, PwC, Deloitte and KPMG
have moved against the trend,
reducing their partner numbers
(by 4.5%, 10.1% and 4%
respectively), while continuing
to increase their staff numbers.
It appears, though, that the
reduction in partner numbers
at these firms has largely been
down to natural turnover as
partners reach retirement age,
as opposed to a wholesale
MORE JUNIOR STAFF HAVE
BORNE THE BRUNT OF
REDUNDANCIES, SAYS LIZ FISHER
PARTNERS
SURVIVE
THE CULL
ACCOUNTANCY TOP 60
PERSONNEL PROFILE
Position
(prior
year in
brackets)
Firm Fee
income
m
Partners Female
partners
Staff Fee/
partner
ratio
000s
1 (1) PwC 2,331 845 118 16,533 2,758
2 (2) Deloitte 1,953 681 95 11.413 2,868
3 KPMG 1,602 545 76 10,499 2,939
4 (4) Ernst & Young LLP 1,356 533 91 8414 2,544
5 (5) Grant Thornton (UK) LLP 379.7 228 36 3686 1,665
6 (6) BDO LLP 312.2 203 22 2538 1,538
7 (7) Baker Tilly 191 117 16 1609 1,632
8 (9) RSM Tenon 190.4 306 34 2878 622
1
169.4 214 35 1234 792
10 (10) PKF (UK) LLP 140.4 94 7 1533 1,494
11 (11) Moore Stephens UK 138.2 156 17 1404 886
12 (12) Mazars 103.8 108 0 1060 961
13 (15) Begbies Traynor Group plc 69.1 103 8 712 671
14 (16) Haines Watts Group 55.7 103 11 766 541
15 (17) Saffery Champness 52.1 61 13 452 854
16 (18) Crowe Clark Whitehill LLP 47 74 14 531 635
17 (19) UHY Hacker Young Group 45.4 92 9 586 493
18 (20) Kingston Smith LLP 42.7 59 10 460 724
19 (21) MacIntyre Hudson LLP 31.2 39 2 387 800
20 (24) Menzies LLP 27.7 34 2 335 815
21 (23) Chantrey Vellacott DFK 27.6 49 5 299 563
22 (22) Wilkins Kennedy 27.5 48 6 373 573
23 (25) Johnston Carmichael Chartered
Accountants & Business
Advisers
26.9 46 2 413 585
24 HW Fisher & Company
2
22.9 28 1 202 818
25 (26) Buzzacott LLP 22.1 23 3 210 961
26 (28) Littlejohn 17.8 29 5 147 614
27 (27) Armstrong Watson 17.3 27 4 340 641
28 TaxAssist Accountants
3
16.9 189 27 550 89
29 (30) Francis Clark 16.87 33 4 248 511
30 (31) Streets 16.4 20 3 118 820
31 (35) Duncan & Toplis 16.3 28 1 318 582
32 (32) Haysmacintyre 15.7 23 5 146 683
33 (36) Price Bailey LLP 15.7 23 0 216 683
34 Frank Hirth plc
4
15 13 4 154 1,154
35 (33) Cooper Parry LLP 14.9 23 1 180 648
36 (34) Reeves & Co LLP
5
14.8 43 4 271 344
37 (38) Shipleys LLP
6
14.3 19 n/d 132 753
38 (41) Hazlewoods 14.2 17 2 194 835
39 (42) Larking Gowen 13.6 21 2 204 648
40 (39) Lovewell Blake 13.4 21 1 208 638
41 Renaissance Group 13.1 35 8 155 374
42 (40) Target Chartered Accountants 13 11 n/d 185 1,182
43 (43) Scott-Moncrieff 12.6 17 2 163 741
44 (44) Mercer & Hole 12.1 19 6 134 637
7
12 see note see note 150 see note
46 (45) Anderson Anderson & Brown
LLP and Group
11.8 12 3 148 983
47 (46) Barnes Roffe LLP 11.3 17 1 102 665
48 (48) Beever and Struthers 11.3 26 5 180 435
49 (47) Simmons Gainsford LLP 11 17 1 71 647
50 (50) Bishop Fleming 10.6 18 3 170 589
51 (51) Hillier Hopkins LLP 10.5 21 2 104 500
52 Henderson Loggie 10.4 20 4 194 520
53 (53) Moore and Smalley LLP 10.2 17 5 203 600
54 (55) James Cowper LLP 10.1 14 3 135 721
55 (54) Campbell Dallas LLP 10 19 3 145 526
56 Montpelier Chartered
Accountants
9.7 19 5 195 511
57 (52) Rothmans 9.61 19 2 141 506
58 Cowgill Holloway LLP 9.6 16 3 144 600
59 (57) Silver Levene LLP 9.6 17 1 94 565
60 (58) Thomas Westcott 9.3 17 3 173 547
Totals 9,816 5,669 756 63,537 51,224
NOTES TO TABLE
2. Firm provided figures for 2009
3. Partners are franchisees
4. Average staff for year ended June
2010
5. Previously Reeves & Neylan,
merged with FW Stephens on
1.6.10. Fee income is for year ended
31.05.10. Staff and partner numbers
are most recent and include FW
Stephens. Rebranded on 22.9.10
6. Two female principals out of 21,
according to its website
7. Company has a single managing
director
|
JANUARY 2011 31
TOP 60
|
ANALYSIS
T
his year, 25 firms chose to disclose their pre-tax
profits, compared with 18 firms in last years
survey. With well over half of the Top 60 now
producing published annual accounts, and only
14 partnerships remaining in the Top 60 (compared with 34
LLPs), we expect the trend for greater financial disclosure
to continue.
PwCs pre-tax profits were down on the previous year by
2.5%, while Deloitte reported a 4.6% increase in its pre-tax
profits, up from 564m last year to 590m. Ernst & Youngs
bottom-line profits on an equity basis were up 4.5% from
313m in 2009. Meanwhile, KPMG reported an impressive 10%
increase in its pre-tax profits to 428m while Grant Thorntons
pre-tax profits soared 40% to 77.6m. Further down the table
there were mixed fortunes, with Smith & Williamson reporting
a fall in its profits of 9.5% but the renamed Crowe Clark
Whitehill reporting a leap in its profits of 26%.
AS MORE FIRMS CONVERT TO LLP STATUS, THE TREND TOWARDS
BETTER FINANCIAL DISCLOSURE CONTINUES, SAYS LIZ FISHER
A CLEARER VIEW
OF PROFIT
clearing out of senior staff through redundancy. Most
of the larger firms have continued to appoint partners
during the recession, perhaps mindful of the need to
maintain continuity of leadership. PwC pointed out in its
annual review that it admitted 19 direct-entry partners
during 2010 and promoted a further 38 to partner level
from within the firm over the summer.
While it is clear that the firms have trimmed
headcount during the recession, generally the
profession has not repeated the mistake of the previous
recession during the 1990s, when many firms cut
back sharply on middle-ranking staff and on graduate
training, only to find that they were struggling to find
well trained staff once the conditions improved.
Instead, many firms attempted to ride out the
downturn this time without resorting to large-scale
redundancies. Cost cutting and a focus on reducing
overheads, particularly around travel and other
expenses, has been an ongoing feature of the past few
years, and some firms have turned to more imaginative
solutions. Back in 2009, KPMG announced that it had
asked its partners to voluntarily take a three-month
sabbatical or work a four-day week, which resulted in
more than 80% of its partners applying for the scheme.
Other firms offered a similar scheme, albeit on a far
smaller scale.
As we have seen from the wider fee income results,
many firms have found the past two years very hard-
going and have had to fight hard for revenue and
profits. One of the indications that firms have worked
hard to maintain their staffing levels as far as they can
during the recession can be seen in the level of fees per
partner. Overall, 24 of the Top 60 firms reported a lower
fee-per-partner ratio than last year, with a further two
reporting an unchanged fee/partner ratio.
PARTNERSHIP PROFITABILITY
(COMPANIES EXCLUDED)
Fee income Profit before
Rank Firm m tax m Partners
1 PwC 2,331 665 845
2 Deloitte 1,953 590 681
3 KPMG 1,602 428 545
4 Ernst & Young LLP 1,356 327 533
5 Grant Thornton (UK) LLP 379.7 77.6 228
6 BDO LLP 312.2 62.6 203
8 RSM Tenon 190.4 24.1 306
9 Smith & Williamson 169.4 23.8 214
13 Begbies Traynor Group plc 69.1 8.7 103
16 Crowe Clark Whitehill LLP 47 13.5 74
19 MacIntyre Hudson LLP 31.2 8.6 39
20 Menzies LLP 27.74 8.1 34
26 Littlejohn 17.8 4.4 29
32 Price Bailey LLP 15.7 3.8 23
34 Frank Hirth plc 15 1.2 13
35 Cooper Parry LLP 14.9 4.3 23
36 Reeves & Co LLP 14.8 4.1 43
37 Shipleys LLP 14.3 5 19
45 SJD Accountancy 12 5 1
47 Barnes Roffe LLP 11.3 4.4 17
49 Simmons Gainsford LLP 10.9 3.1 17
51 Hillier Hopkins LLP 10.5 2.9 21
54 James Cowper LLP 10.1 1.7 14
56 Montpelier Chartered Accountants 9.7 0.7 19
57 Rothmans 9.6 2.7 19
STAFF AND PARTNER NUMBERS AT
THE TOP 60 FIRMS
2010 survey 2011 survey
Partners 5,642 5,669
Female partners 736 756
Staff 71,677 63,537
n top 60 survey BRIEFING
12
www.accountancylive.com
january 2012 accountancy
12
12
12
12
12
L
ast year, Accountancy reported that the
UKs 60 largest accountancy rms had
seen a 1% fall in their total fee income,
the rst time this had happened since
the recession of the 1990s.
This year, the Top 60 has bounced back
strongly, with a 6.5% increase in total fee income
compared to last years survey and the same
rms report a 4.1% rise in fee income in their
most recent results.
A look behind the headline growth gure,
though, reveals a more complicated picture.
A few rms have seen improved results due
to mergers and acquisition activity such as
Reeves & Co, which merged with FW Stephens
in June 2010 and RSM Tenon in the wake of its
merger last year with Bentley Jennison. Organic
growth remains difcult to nd, though, and
more rms than last year (26 compared with 19
in the 2011 survey) reported negative or stagnant
growth during the year, an indication that the
market remains challenging to say the least.
The fortunes of the Top 60 vary according to
the size of rm. The Big Four have generally had
a good year and reported healthy increases in
revenue in their most recent results, in spite of
what Ian Powell, chairman of PwC, described
in the rms annual report as a difcult market
(KPMG recently changed its nancial year end
and is due to report latest revenue gures to 31
October 2011 on 9 January 2012).
CLIENT FEES SQUEEZED
There is no doubt, though, that the market remains
depressed and unpredictable. The latest shock
to hit the profession was the news that Target
Consulting Group and Target Consulting, ranked at
40 in the survey, had called in PwC administrators
to help with the sale of parts of the company. The
London practice of Target Accountants remains
unaffected and its hoped that other ofces will be
sold to their management.
Anecdotal evidence, particularly among
the mid-tier and smaller rms, suggests they
have found themselves unable (or unwilling) to
increase client fees over the past two years and
so nd themselves working harder to produce
the same level of fee income.
We have been steadily winning business,
perhaps not at the same rate as before the
recession, but still at a signicant level, said
Michael Snyder, senior partner of Kingston
Smith. The difference is that one-off and
additional work has reduced and Id be very
surprised if that isnt replicated in other rms.
He said the pressure on fees has been
intense and will remain so: Theres a lot of
lowballing going on, so much that it makes you
wonder how some rms can do the work for
the price. Clients are more difcult to win and
they dont necessarily concentrate on the range
of value added rather than price. The sensible
businesses realise that you get what you pay
for. Id expect to see smaller rms struggling
a lot because they are more vulnerable to fee
pressure and to losing clients and a lot of
people are after their clients.
Many rms have concentrated on specialist
services and clients in an effort to protect their
revenue. Crowe Clark Whitehill falls into this
category and moved up one place in the
SIZE DICTATES
GROWTH
Income rose at the top
60 rms but margins and
partner fee ratios were
under pressure as clients
reduced their spend,
reports Liz Fisher
14
12
TOP 60
STAFFING LEVELS
Theres a lot of
lowballing going
on, so much that
it makes you
wonder how some
rms can do the
work for the price
Michael Snyder, senior
partner, Kingston Smith
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Partners
2009 2011
4906 4913
5098
736 756
862
13%
13.3%
14.4%
50,000
60,000
70,000
80,000
90,000
Staff
Male partners
2010
Female partners Staff
87% 86.7% 85.6%
14
14
14
14
14
14
The largest mid-tier rms Grant Thornton and
BDO both saw corporate nance fees fall over
the past year as transactions stalled.
Insolvency, usually a welcome source of
revenue during a recession, has also proved a
disappointment. Begbies Traynor highlighted the
unprecedented level of monetary support
provided to the UK economy, and particularly
table to 15th, leapfrogging Saffery Champness,
after reporting an 11% increase in fee income
during the year.
Andrew Pianca, chief executive of Crowe
Clark Whitehill, said that 3% of the growth could
be attributed to acquisitions, but the remainder
was the result of organic growth.
We were quite low key on the corporate
services side, so weve taken a number of steps
to sell ourselves, including setting up specialist
teams, covering the media, nancial services,
manufacturing and other sectors, who have
been very effective in championing our services,
he said.
We also set up an outsourcing sales
ofce in California and we manage the back
ofce operations for a number of Californian
companies they feel very comfortable with UK
outsourcing operators. And we have been very
successful in southeast Asia, picking up clients
who are looking to invest inwardly to the UK.
DOMESTIC BUSINESS SQUEEZE
In the UK, though, business remains hard to nd,
particularly away from the southeast of England.
The further away you are from London, the
worse it gets, says Pianca.
In terms of service lines, some areas have
been hit harder than others. A number of rms
say that changes in tax rules have affected their
income stream from clients, and insolvency and
corporate nance work are at lower levels than in
the past.
The climate has led some rms to divest the
less protable parts of their business Begbies
Traynor, for instance, recently completed the sale
of its tax practice to Smith & Williamson Holdings,
and will now concentrate solely on its corporate
recovery and restructuring work.
The two biggest disappointments in terms
of service lines over the past year have been
corporate nance work and insolvency.
There were hopes last year that many rms
would see an improvement in fees earned
through corporate nance work, but this has not
materialised and most rms are blaming the lack
of available bank funding for the drought.
14
INCOME BY SERVICE LINE
AUDIT AND ACCOUNTING
-40
-20
0
20
40
1
2
19
18
17
16
15
14
13
12
11
10
8=
8=
7
6
5
4
3
1 PwC 909 893 +1.8
2 Deloitte 652 628 +3.8
3 KPMG
1
456 458 -2.6
4 Ernst & Young 444 403 +10.2
5 Grant Thornton UK 134.4 135.5 -0.8
6 BDO 91.1 91.7 -0.7
7 Baker Tilly 84 94 -10.7
8= Mazars
2
70 68.9 +1.6
8= RSM Tenon Group 70 52.7 32.8
10 Moore Stephens UK 60.6 61.1 -0.8
11 PKF 57.8 59 -2
12 Crowe Clark Whitehill 30.6 28.3 +8.1
13 Haines Watts Group 29.2 26.6 +9.8
14 Kingston Smith 22.7 23.4 -3
15 UHY Hacker Young Group 22.4 22.2 +1
16 Smith & Williamson 21.9 21.9
n
0
17 Saffery Champness 17.2 17.5 -1.7
18 Wilkins Kennedy 15.9 15.8 +0.6
19 Chantrey Vellacott DFK 11.7 12 -2.5
20 MHA MacIntyre Hudson 10.1 n/a n/a
Total 3,210.6 3,122.6 2.82
RANK FIRM m
2011
m
2010
% of
change
Footnotes:
1
KPMG 2010/11 gures published 9/1/2012.

2
Mazars gures includes corporate nance/consulting
Ian Powell, chairman, PwC
We also see strong growth
potential in serving the needs of
entrepreneurs, mid cap and private
companies, and in the Middle East
TOP 60
TOTAL INCOME OF TOP 60 FIRMS
6
7
8
9
10
11
12
2007 2011 2010 2009 2008
10.33bn
8.8bn
9.36bn
9.92bn
9.82bn
BRIEFING top 60 survey n
15
accountancy january 2012
15
15
15
15
15
the low base interest rate, which has resulted
in a declining level of corporate insolvencies.
Many distressed businesses that would have
otherwise gone to the wall have survived as a
result, but this is of little comfort to insolvency
practitioners at a time when analysts estimate
that revenues in the sector are 15% lower than
they would expect during a recession.
The decline in insolvency business has
had an impact on many of the rms in the
Top 60. RSM Tenon, for example, despite
a strong overall performance, reported a
smaller increase in protability down to
12% compared with 13.8% last year. The
companys nal results statement said that
margins had been adversely affected by the
external trading environment, especially the
decline in the level of corporate and personal
insolvencies at a time when we invested in
growth in this division.
The rms merger with Bentley Jennison in
December 2009 is reected for the rst time in
this years survey, as well as the contribution of
some of the London-based business of Vantis,
which it acquired in the same year. This resulted
in a 31% increase in turnover at the company.
The answer for many rms has been to
concentrate on niche services or specialist
consultancy offerings. When Powell announced
PwCs results he said that long-term growth
would come from specialist services such as
consulting, human resource services and risk
assurance, and from its work with specic
sectors, particularly nancial services. We
also see strong growth potential in serving the
needs of entrepreneurs, mid cap and private
companies, and in the Middle East, he added.
TALENT MANAGEMENT
In spite of the difculties, the Top 60 as a whole
has continued to invest in human capital. After
seeing a sharp fall in total staff numbers in last
years survey as many rms cut back heavily on
employee numbers as the recession took hold,
the Top 60 has bounced back in 2011 with a
19% increase in staff numbers.
Last years survey showed clearly that salaried
staff were the biggest casualty during the
recession as rms cut back on costs. The 2011
survey showed a 4% fall in total staff numbers,
excluding partners, to 63,537 from 71,677 the
previous year. Over the same period, though, the
number of partners (or partner equivalent) in the
Top 60 increased slightly from 5,642 to 5,669.
Firms have frequently said over the past two
years that they have been careful to continue to
invest for the future during the recession. Many
were caught out during the sharp recession of
the 1990s when they cut back on staff numbers,
and particularly on student trainees, but then
found themselves struggling to recruit to ll the
gaps during the recovery.
Pianca said that his rm had continued to
recruit new partners because when you nd
someone you need, you take them on 16
15
TAX
-40
-20
0
20
40
1
2
20
18
19
16
15
14
13
12
11
10
9
8
7
6
5
4
3
1 PwC 645 634 +1.7
2 Deloitte 534 511 +4.5
3 KPMG
1
392 350 +12
4 Ernst & Young 372 360 +3.3
5 Grant Thornton UK 91.7 93 -1.4
6 BDO 80.5 83.2 -3.2
7 RSM Tenon Group 57 48.6 17.3
8 Baker Tilly 51 53 -3.8
9 PKF 35.4 33.7 +5
10 Smith & Williamson 31.8 32.4 -1.9
11 Mazars 25.1 21.3 +17.8
12 Moore Stephens 24.2 24.3 -0.4
13 Haines Watts Group 18.9 20.6 -8.3
14 Crowe Clark Whitehill 13.2 12.9 +2.3
15 Saffery Champness 12.4 13.5 -8.1
16 Buzzacott 11.3 11.1 +1.8
17 MHA MacIntyre Hudson 10.1 n/a n/a
18 UHY Hacker Young Group 9.4 10 -6
19 Chantrey Vellacott DFK 7.8 7.8
n
0
20 Menzies 7.6 6.6 +15.2
Total 2,430.4 2,327 +4.4
RANK FIRM m
2011
m
2010
% of
change
BIG FOUR
PRE-TAX PROFIT AND PARTNERS
1000
1500
2000
2500
3000
Pre-tax proft m Partners
2,717
2,010m
1,948m
2,598
-3.0% +4.6%
2010
2011
Footnote:
1
KPMG 2010/11 results published 9/1/2012
For analysis of the
latest trends in training
and investment levels,
see trainee survey, p66
Investing in the future
66
16
16
16
16
16
16
irrespective of the economic climate, and added
that the rm had taken on more students this
year than it had since 2001, simply because it
needed the additional headcount to cope with its
increased turnover.
Overall, this years survey shows a 5.7%
increase in the number of partners in the Top 60
rms over last year.
The Big Four rms bucked the trend during
2010 by reducing partner numbers by between
4% and 10%, largely through natural turnover
as partners reached retirement age, but this year
PwC, Deloitte and KPMG have all increased their
partner headcount (by 7.1%, 3.7% and 12.3%
respectively), while E&Ys remained level.
Powell said the rms approach had been
to hold our nerve and invest for growth. PwC
16
PARTNER VALUE
INCOME AND PROFIT 2011 (2010)
1 (1) PwC 2,461 (2,331) 667 (665) 905 (845) 2,719 (2,758)
2 (2) Deloitte 2,098 (1,953) 535 (590) 706 (681) 2,972 (2,868)
3 (3) KPMG
1
1,707 (1,602) 396 (416) 579 (545) 2,950 (2,618)
4 (4) Ernst & Young 1,465 (1,356) 350 (327) 527 (533) 2,780 (2,544)
5 (5) Grant Thornton 377 (379.7) 75.2 (77.6) 211 (228) 1,787 (1,665)
6 (6) BDO 284.7 (312.2) 62.2 (62.6) 196 (203) 1,437 (1,538)
7 (8) RSM Tenon Group 249 (190.4) 27 (24.1) 279 (306) 892 (622)
9 (9) Smith & Williamson 171.4 (169.4) 21.6 (23.8) 227 (214) 755 (792)
13 (13) Begbies Traynor Group 61.5 (69.1) 8.5 (8.7) 87 (103) 707 (671)
15 (16) Crowe Clark Whitehill 52.1 (47) 14 (13.5) 80 (74) 651 (635)
19 (19) MHA MacIntyre Hudson 32.4 (31.2) 10 (8.6) 42 (39) 771 (683)
20 (20) Menzies 28.7 (27.74) 7.7 (8.1) 35 (34) 820 (815)
25 (36) Reeves & Co 20.1 (14.8) 6.2 (4.1) 41 (43) 595 (344)
27 (34) Frank Hirth 17.1 (15) 1.3 (1.2) 16 (13) 1,069 (1,154)
29 (29) Francis Clark 16.9 (16.87) 5.3 (n/a) 33 (33) 512 (511)
30 (32) Price Bailey 16.6 (15.7) 3.8 (3.8) 22 (23) 754 (683)
36 (35) Cooper Parry 14.3 (14.9) 4.1 (4.3) 24 (23) 596 (648)
37 (45) SJD Accountancy 14 (12) 6.5 (5) 1 (1) n/a (n/a)
39 (37) Shipleys 13.6 (14.3) 5.3 (5) 23 (19) 591 (753)
46 (47) Barnes Roffe 11.4 (11.3) 5 (4.4) 18 (17) 633 (665)
49 (49) Simmons Gainsford 10.7 (10.9) 2.3 (3.1) 14 (17) 764 (647)
55 (51) Hillier Hopkins 10.2 (10.5) 3.4 (2.9) 22 (21) 463 (500)
55 (54) James Cowper 10.2 (10.1) 2.1 (1.7) 14 (14) 728 (721)
58 (57) Rothman Pantall 9.4 (9.6) 2.6 (2.7) 20 (19) 470 (506)
Total 9,292 8,625 2,222 2,263 4,219 4,048
Average 372 360 89 95 169 169
RANK FIRM Fee income
m
Partners Fee/partner
ratio 000s
Pre-tax prot
m
hired more than 3,200 staff over the past year,
and added 72 new partners. Our strategy was
designed to make sure that we come out of any
downturn stronger than we went into it, he said.
KPMG announced the appointment of 29 new
partners and 88 new directors from within the
rm at the beginning of its latest nancial year.
While some rms have seen a slight
improvement in business over the past three
months, the general expectation is that things are
likely to remain tough for some time to come.
Paul Tutin, chairman of Streets, said that
revenues were still at despite the rm picking
up new clients in the rst half of 2011. The
apparent willingness of many businesses to
avoid asking their advisers for help in an effort
to reduce costs, he added, was an ongoing
concern. Im expecting 2012 to be a harder year
for accountants than 2011, but overall its not as
bad as the media portray, he said. Primarily its
about condence and the availability of credit
for business. Business condence is the key, as
many accountancy rms are leaner and more
protable than they were those that arent
will struggle to survive. I always say that if the
media stopped the news output about doom and
gloom, condence will rise, he said.
Paul Tutin, chairman of Streets
Business condence is the key as
many rms are leaner and more
protable than they were those
that arent will struggle to survive
18
BIG FOUR
FEES BY SERVICE
LINE 2011 (2010)
(
8
9
3
)
9
0
9
PwC
Deloitte
KPMG
Ernst & Young
9
0
7
645
(634)
(
8
0
4
)
6
5
2
5
1
7
534
(511)
(
4
5
9
)
(
6
2
8
)
392
(350)
4
8
1
(
3
9
7
)
(
4
5
8
)
4
5
6
372
(360)
(
3
0
9
)
3
7
0
(
4
0
3
)
4
4
4
Inner circle 2011
Outer circle 2010
Audit and
assurance (m)
Tax (m)
Consulting and
advisory (m)
Footnotes: Published gures relates only to rms reporting pre-tax prot.
1
KPMG 2010/11 gures published 9/1/2012
18
18
18
18
18
18
20
1 (1) PwC 2,461 2,331 5.5 2,719 40 905 14,973 LLP Yes Crowe Clark Whitehill 30.06.11
2 (2) Deloitte 2,098 1,953 7.4 2,972 38 706 13,075 LLP Yes Grant Thornton 31.05.11
3 (3) KPMG
1
1,707 1,602 7 2,950 22 579 10,150 LLP Yes Grant Thornton
4 (4) Ernst & Young LLP 1,465 1,356 8 2,780 23 527 9,239 LLP Yes BDO 30.06.11
5 (5) Grant Thornton UK LLP 377 379.7 -0.7 1,787 30 211 3,685 LLP Yes PKF (UK) LLP 30.06.11
6 (6) BDO LLP
2
284.7 294.6 -3.4 1,437 14 198 2,419 LLP Yes PwC 01.07.11
7 (8) RSM Tenon Group 249 190 31 892 40 279 2,858 plc Yes PwC 30.06.11
8 (7) Baker Tilly 182 191 -4.7 1,555 28 117 1,678 LLP/Ltd Yes Kingston Smith 31.03.11
3
171.4 169 1.4 755 10 227 1,250 Ltd Yes Grant Thornton 30.04.11
10 (10) PKF (UK) LLP 140 140.4 -0.3 1,443 23 97 1,537 LLP Yes Kingston Smith 31.03.11
4
138.3 138.2 0 886 34 156 1,324 N/Ltd No 31.12.11
12 (12) Mazars 109 102.5 6.3 932 15 117 1,100 LLP Yes Crowe Clark Whitehill 31.08.11
13 (13) Begbies Traynor Group 61.5 62.8 -2.1 707 38 87 524 plc Yes Deloitte 30.04.11
14 (14) Haines Watts Group 57.8 55.7 3.8 521 51 111 764 Group No 31.03.11
15 (16) Crowe Clark Whitehill LLP 52.1 47 10.8 651 9 80 549 LLP Yes Grant Thornton 31.03.11
16 (15) Saffery Champness 51.3 52.1 -1.5 841 10 61 468 P No 31.03.11
17 (17) UHY Hacker Young Group 45 45.3 -0.7 479 19 94 566 N No 30.04.11
18 (18) Kingston Smith LLP 41.1 42.7 -3.7 642 6 64 413 LLP Yes Price Bailey 30.04.11
19 (19) MHA MacIntyre Hudson 32.4 31.2 3.8 771 10 42 400 LLP Yes Hillier Hopkins 31.03.11
20 (20) Menzies LLP 28.7 27.9 2.9 820 6 35 308 LLP Yes Princecroft Willis 30.06.11
21 (21) Chantrey Vellacott DFK LLP 28.55 27.9 2.3 595 10 48 299 LLP Yes Grant Thornton 30.06.11
5
28.1 27.4 2.5 502 11 56 388 P No 30.04.11
6
27.9 26.9 3.7 606 10 46 412 LLP No 31.05.11
24 (25) Buzzacott LLP 23.7 22.1 7.2 1,030 1 23 214 LLP Yes Hillier Hopkins 30.09.11
25 (36) Reeves & Co LLP 20.1 14.8 35.8 490 4 41 243 LLP Yes Clive Owen & Co 31.05.11
26 (28) TaxAssist Accountants
7
18.9 16.9 11.8 n/a 205 175 555 No No 31.12.10
27 (34) Frank Hirth plc 17.1 15 14 1,069 2 16 164 P Yes Manningtons 30.06.11
28 (27) Armstrong Watson 17 17.3 -1.7 654 8 26 328 P No 31.03.11
29 (29) Francis Clark LLP 16.9 16.9 0 512 6 33 342 LLP Yes Price Bailey 31.03.11
30 (31) Duncan & Toplis 16.6 16.3 1.8 593 10 28 301 P No 31.03.11
30 (32) Price Bailey LLP 16.6 15.7 5.7 754 7 22 250 LLP Yes Crowe Clark Whitehill 31.03.11
32 (32) Haysmacintyre 16.4 15.7 4.4 713 1 23 153 P No 31.03.11
32 (-) Littlejohn LLP 16.4 17.7 -7.3 586 1 28 136 LLP Yes Price Bailey 31.05.11
34 (30) Streets
8
15.9 16.4 -3 636 10 25 125 Various No 30.06.11
35 (38) Hazlewoods 15.2 14.2 7 844 3 18 195 LLP Yes Princecroft Willis 30.04.11
36 (35) Cooper Parry LLP 14.3 14.9 -4 596 4 24 173 LLP Yes Buzzacott 30.04.11
37 (45) SJD Accountancy 14 12 16.7 n/a 8 1 153 Ltd Yes Kingston Smith 31.10.10
38 (40) Lovewell Blake LLP 13.9 13.4 3.7 662 5 21 213 LLP Yes Crowe Clark Whitehill 30.09.11
39 (37) Shipleys LLP 13.6 13.7 -0.7 591 4 23 104 LLP Yes SRG 30.04.11
40 (46) Anderson Anderson & Brown LLP 13.5 11.8 14.4 1,125 1 12 166 LLP Yes Gregor Clark & Co 31.03.11
40 (42) Target Chartered Accountants 13.5 12.8 5.5 1,350 5 10 185 Ltd Yes Berkeley Hall Marshall 30.06.11
42 (43) Scott-Moncrieff
9
13.4 12.6 6.3 788 2 17 175 P No 30.04.11
43 (39) Larking Gowen 13.3 13.3 0 700 9 19 247 P No 31.03.11
44 (-) AIMS Accountants for Business
10
12.5 12.1 3.3 n/a 239 243 n/a plc No 30.04.11
45 (44) Mercer & Hole 11.7 12.1 -3.3 616 3 19 130 P No 30.09.11
46 (47) Barnes Roffe LLP 11.4 11.3 0.9 446 3 18 105 LLP Yes Haines Watts 30.06.11
47 (52) Henderson Loggie 11.2 10.4 7.7 633 4 23 184 P No 30.11.11
48 (56) Montpelier Professional 11.6 9.7 19.6 487 12 26 180 Ltd Yes Wilson Henry 31.12.10
49 (53) Moore and Smalley LLP 10.7 10.2 4.9 594 6 18 190 P Yes Hayes & Co 31.03.11
49 (58) Silver Levene LLP 10.7 10.3 3.9 629 1 17 100 LLP No 31.05.11
49 (49) Simmons Gainsford LLP 10.7 11 -2.7 764 2 14 92 LLP Yes Sopher & Co 31.03.11
52 (47) Beever and Struthers 10.6 11.3 -6.2 442 3 24 155 P No 30.09.11
53 (50) Bishop Fleming 10.5 10.5 0 552 5 19 180 P No 31.05.11
54 (-) Haslers
11
10.4 11.7 -11.1 800 1 13 86 Ltd No 31.12.10
55 (51) Hillier Hopkins LLP 10.2 10.5 -2.8 463 4 22 107 LLP Yes Price Bailey 31.03.11
55 (54) James Cowper LLP 10.2 9.7 5.1 728 6 14 125 LLP Yes Monahans 30.04.11
57 (-) Barber Harrison & Platt 9.9 9.2 7.6 761 4 13 171 P No 31.12.10
58 (57) Rothman Pantall LLP 9.4 9.6 -2.1 470 12 20 146 LLP Yes Mazars 31.03.11
59 (58) Cowgill Holloway LLP 9.2 9.6 -4.2 575 4 16 139 LLP Yes Champion & Co 31.05.11
60 (-) Forrester Boyd 9.1 9.1 0 700 4 13 162 P No 31.03.11
Total 10,337 9,763 1,106 5,960 75,053
RANK FIRM
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TOP 60 FIRMS
SURVEY: UK ACCOUNTANCY FIRMS LEAGUE TABLE
Footnotes:
1
KPMG 2010/11 gures published 9/1/2012. *Annual accounts published. N: network, P: partnership (see additional notes on p20)
20
20
20
20
20
20
1 (1) PwC 905 (845) 125 (118) 14,973 (16,533) 2,461 (2,331) 2,719 (2,758)
2 (2) Deloitte 706 (681) 99 (95) 13,075 (11.413) 2,098 (1,953) 2,972 (2,868)
3 (3) KPMG
1
579 (545) 86 (76) 10,150 (9,464) 1,707 (1,602) 2,950 (2,618)
4 (4) Ernst & Young LLP 527 (533) 95 (91) 9,239 (8414) 1,465 (1,356) 2,780 (2,544)
5 (5) Grant Thornton UK LLP 211 (228) 35 (36) 3,685 (3686) 377 (379.7) 1,787 (1,665)
6 (6) BDO LLP
2
198 (203) 21 (22) 2,419 (2538) 284.7 (312.2) 1,437 (1,538)
7 (8) RSM Tenon Group 279 (306) 36 (34) 2,858 (2878) 249 (190.4) 892 (622)
8 (7) Baker Tilly 117 (117) 36 (16) 1,678 (1609) 182 (191) 1,555 (1,632)
3
227 (214) 43 (35) 1,250 (1234) 171.4 (169.4) 755 (792)
10 (10) PKF 97 (94) 7 (7) 1,537 (1533) 140 (140.4) 1,443 (1,494)
4
156 (156) 22 (17) 1,324 (1404) 138.3 (138.2) 886 (886)
12 (12) Mazars 117 (108) 13 (0) 1,100 (1060) 109 (103.8) 932 (961)
13 (13) Begbies Traynor Group 87 (103) 10 (8) 524 (712) 61.5 (69.1) 707 (671)
14 (14) Haines Watts Group 111 (103) 12 (11) 764 (766) 57.8 (55.7) 521 (541)
15 (16) Crowe Clark Whitehill LLP 80 (74) 15 (14) 549 (531) 52.1 (47) 651 (635)
16 (15) Saffery Champness 61 (61) 14 (13) 468 (452) 51.3 (52.1) 841 (854)
17 (17) UHY Hacker Young Group 94 (92) 11 (9) 566 (586) 45 (45.4) 479 (493)
18 (18) Kingston Smith LLP 64 (59) 12 (10) 413 (460) 41.1 (42.7) 642 (724)
19 (19) MHA MacIntyre Hudson 42 (39) 5 (2) 400 (387) 32.4 (31.2) 771 (800)
20 (20) Menzies LLP 35 (34) 5 (2) 308 (335) 28.7 (27.7) 820 (815)
21 (21) Chantrey Vellacott DFK LLP 48 (49) 6 (5) 299 (299) 28.55 (27.6) 595 (563)
5
56 (48) 7 (6) 388 (373) 28.1 (27.5) 502 (573)
6
46 (46) 3 (2) 412 (413) 27.9 (26.9) 606 (585)
24 (25) Buzzacott LLP 23 (23) 3 (3) 214 (210) 23.7 (22.1) 1,030 (961)
25 (36) Reeves & Co LLP 41 (43) 5 (4) 243 (271) 20.1 (14.8) 490 (344)
7
175 (189) 24 (27) 555 (550) 18.9 (16.9) n/a (89)
27 (34) Frank Hirth 16 (13) 6 (4) 164 (154) 17.1 (15) 1,069 (1,154)
28 (27) Armstrong Watson 26 (27) 4 (4) 328 (340) 17 (17.3) 654 (641)
29 (29) Francis Clark LLP 33 (33) 4 (4) 342 (248) 16.9 (16.9) 512 (511)
30 (31) Duncan & Toplis 28 (28) 1 (1) 301 (318) 16.6 (16.3) 593 (582)
30 (32) Price Bailey LLP 22 (23) 0 (0) 250 (216) 16.6 (15.7) 754 (683)
32 (32) haysmacintyre 23 (23) 5 (0) 153 (146) 16.4 (15.7) 713 (683)
32 (-) Littlejohn LLP 28 (29) 5 (5) 136 (147) 16.4 (17.8) 586 (614)
34 (30) Streets
8
25 (20) 3 (3) 125 (118) 15.9 (16.4) 636 (820)
35 (38) Hazlewoods 18 (17) 2 (2) 195 (194) 15.2 (14.2) 844 (835)
36 (35) Cooper Parry LLP 24 (23) 1 (1) 173 (180) 14.3 (14.9) 596 (648)
37 (45) SJD Accountancy 1 (0) 0 (0) 153 (150) 14 (12) n/a (n/a)
38 (40) Lovewell Blake LLP 21 (21) 1 (1) 213 (208) 13.9 (13.4) 662 (638)
39 (37) Shipleys LLP 23 (19) 3 (n/d) 104 (132) 13.6 (14.3) 591 (753)
40 (46) Anderson Anderson & Brown LLP 12 (12) 3 (3) 166 (148) 13.5 (11.8) 1,125 (983)
40 (42) Target Chartered Accountants 10 (11) 2 (n/d) 185 (185) 13.5 (13) 1,350 (1,182)
9
17 (17) 2 (2) 175 (163) 13.4 (12.6) 788 (741)
43 (39) Larking Gowen 19 (21) 2 (2) 247 (204) 13.3 (13.6) 700 (648)
44 (-) AIMS Accountants for Business
10
243 20 12.5
45 (44) Mercer & Hole 19 (19) 6 (6) 130 (134) 11.7 (12.1) 616 (637)
46 (56) Montpelier Professional 26 (19) 6 (5) 180 (195) 11.4 (9.7) 446 (511)
47 (47) Barnes Roffe LLP 18 (17) 1 (1) 105 (102) 11.2 (11.3) 633 (665)
48 (52) Henderson Loggie 23 (20) 5 (4) 184 (194) 11.6 (10.4) 487 (520)
49 (53) Moore and Smalley LLP 18 (17) 5 (5) 190 (203) 10.7 (10.2) 594 (600)
49 (58) Silver Levene LLP 17 (17) 1 (1) 100 (94) 10.7 (9.6) 629 (565)
49 (49) Simmons Gainsford LLP 14 (17) 1 (1) 92 (71) 10.7 (11) 764 (647)
52 (47) Beever and Struthers 24 (26) 5 (5) 155 (180) 10.6 (11.3) 442 (435)
53 (50) Bishop Fleming 19 (18) 3 (3) 180 (170) 10.5 (10.6) 552 (589)
54 (-) Haslers
11
13 (n/a) 4 86 10.4 800
55 (51) Hillier Hopkins LLP 22 (21) 2 (2) 107 (104) 10.2 (10.5) 463 (500)
55 (54) James Cowper LLP 14 (14) 3 (3) 125 (135) 10.2 (10.1) 728 (721)
57 (-) Barber Harrison & Platt 13 (n/a) 2 171 9.9 761
58 (57) Rothman Pantall LLP 20 (19) 2 (2) 146 (141) 9.4 (9.61) 470 (506)
59 (58) Cowgill Holloway LLP 16 (16) 2 (3) 139 (144) 9.2 (9.6) 575 (600)
60 (-) Forrester Boyd 13 (n/a) 0 162 9.1 700
Total 5,960 809 862 109 75,053 5,939 10,337 419
RANK FIRM
P
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s

Smith & Williamson,
partners fee-earning
directors, staff numbers
approx. SJD
Accountancy: single
MD; Franchises: AIMS
Accountants for
Business, TaxAssist
Accountants; Larking
Gowen includes Larking
Gowen Ltd/Corporate
Finance Ltd.
1
KPMG 2010/11
gures published
9 Jan 2012.
2
BDO:
Fee income excludes
BDO Investment
Management, sold
Nov 2010. Prior year
restated to exclude
BDO IM.
3
Smith &
Williamson: partners
fee-earning directors.
4
Moore Stephens UK:
Network, fee income
estimated.
5
Wilkins
Kennedy: converting
to LLP Apr 2012.
6
Johnston Carmichael:
Converted to LLP
June 2011.
7
TaxAssist
Accountants: Franchise.
8
Streets: Part
partnership/LLP, and
part limited/unlimited
company.
9
Scott-
Moncrieff: Fee income
inc Scott-Moncrieff
Wealth Management
turnover of 2.1m.
10
AIMS Accountants for
Business: association
of practices operating
under licence by
AIMS Partnership plc.
11
Haslers: Converted to
LLP January 2012
Information is collected
via an Accountancy
questionnaire
completed by rms
individually. Wherever
possible, we adhere to
the rms description of
service lines and
structure, and rely on
the integrity of
information provided to
produce consistent
information. We have
not excluded rms or
groups with an unusual
structure, although
question of whether
some are rms in the
traditional sense
remains open to debate.
Notes: Top 60
talent table, p20
Notes: Top 60
rms table, p18
TOP 60 FIRMS
TALENT: PARTNERS AND STAFF LEVELS 2011 (2010)
Compiling the
Top 60 survey
top 60 survey BRIEFING
8
8
8
8
8
I
t was quite a ride for the UKs top 60
accountancy rms in 2012. Mergers,
collapses and redundancies gured large
in the headlines, but so did revenue
growth, rising protability and the
enticing prospect of increased competition.
The headline gure is straightforward in
2012, the 60 largest accountancy rms by fee
income saw their combined revenue almost
push through the 11bn barrier after growing
7.9% compared to their 2011 revenues.
Of course, the lions share of fee income
resides in the four largest rms PwC,
Deloitte, KPMG and Ernst & Young. Between
them they earned 8.35bn in fees during
2012, an increase of 9.6% on the previous
year. Contrast this with the next six in the
league table, the largest mid-tier rms
Grant Thornton, BDO, RSM Tenon, Smith &
Williamson, Baker Tilly and Moore Stephens.
Collectively, they saw barely any increase to
reach a combined fee income of 1.39bn.
The next 10 rms, ranked 11 to 20, fared
marginally better taken together, these rms
saw their revenue increase by 3.8% to hit 608m.
In this pack that completes the UKs top 20 rms,
there were however, some standout performances
Crowe Clark Whitehill experienced 14%
growth while Saffery Champness witnessed
a near 10% jump in fee income, helped
by 15% growth in its tax business.
But, against the backdrop of continuing
competition investigations, the year will
perhaps be best remembered by two events
the troubles at RSM Tenon at the beginning
of the year, and the merger between BDO
and PKF conrmed in December 2012.
RSM Tenon lost both its chairman Bob
Morton and chief executive Andy Raynor
in January after the rm said it would need
to restate its accounts, an adjustment that
ultimately reduced the previous years pre-tax
prot by 12.1m. Chris Merry came on board
last February as the rms new chief executive
to steady the ship he set about cutting 20m
in annual costs and sold the rms personal
insolvency division to Grant Thornton.
At the time, new chairman Tim Ingram
said, somewhat understatedly: The last year
has been a really tough one for everyone at
RSM Tenon. By the end of 2012, Merry was
able to say that the rm continued to make
progress in returning to protability, but there
can be little doubt that the troubles of the
past year have been a humbling experience
for the only accountancy rm listed on the
main market of the London Stock Exchange.
MERGERS AND ACQUISITIONS
But while RSM Tenon was going through its very
public traumas, two other rms were privately
looking to come together. Rumours surfaced
in the summer that BDO and PKF were set to
tie the knot, a move conrmed by both sides
in November. The merger of the two rms
effectively creates a near 400m turnover rm
under the banner of the larger partner BDO.
The PKF name will go as a result in the UK.
BOOM AND BUST
Despite a
troubled
year for
clients, total
fee income
is up and a
number of
M&As are
beginning to
reshape the
mid-tier. By
Philip Smith
Just bulking up with smaller audit clients
doesnt feel particularly attractive to us
Scott Barnes, managing partner,
Grant Thornton
We are not in the position where

we need to merge to survive; we
are looking for opportunities to
grow our business through hires,
mergers, acquisitions
Nick Bennett, managing partner,
Scott-Moncrief
There are undoubtedly

a lot of unsettled,
talented people who
are uncertain of their
rms strategies
Peter Gillman,
managing partner,
Price Bailey
BRIEFING top 60 survey

9
accountancy january 2013
9
9
9
9
9
BDO managing partner Simon Michaels
boldly claims this will be the start of a long-
overdue period of consolidation in the mid-tier
market. We were both keen to lead the way, he
says, and do it from a position of strength. This
will give us rst mover advantage and a degree
of momentum that other mid-tier rms wont
be able to achieve other than by acquisition.
The move has prompted speculation that
other rms will get together. Scott Barnes,
managing partner for Grant Thornton, says
there could be other mergers, but we are
not looking at anything right now, though
if something attractive presented itself we
would look at it. However, Barnes adds
that his rm would probably be looking
for smaller boutique advisory rms. Just
bulking up with smaller audit clients doesnt
feel particularly attractive to us, he says.
That is not to say there have not been some
tentative conversations taking place among
the rms. As Andrew Pianca, managing partner
for Crowe Clark Whitehill says: Partners and
chief executives do talk to each other from
time to time, but I certainly have no rms of
any size that Im having any discussion with
at the moment, nor any plans to do so.
However, Pianca does believe there will be
two or three more mergers in the not-too-distant
future, stressing that while his rm continues to
maintain double-digit growth, there is no need
to seek a merger partner, though he accepts
that such growth does make the rm attractive
to others. Ive certainly had a few phone
calls, he says, but nothing Im following up.
Certainly, there has been some merger
activity further down the table for instance,
Scotland-based Johnston Carmichael (ranked
21st, 29.6m) recently combined with Aberdeen-
based Ritson Smith to signicantly bolster
Fee income:
Audit and assurance
Tax
Consulting and corporate finance
0
500
1,000
1,500
2,000
2,500
m
PwC Deloitte KPMG Ernst & Young
2,331
2,461
2,621
1,598
1,703
2,118
1,205
1,329
1,774
1,072
1,186
1,631
2010 2011 2012 2010 2011 2012 2010 2011 2012 2010 2011 2012
This will give us rst

mover advantage and a
degree of momentum that
other mid-tier rms wont
be able to achieve other
than by acquisition
Simon Michaels,
managing partner, BDO
This is the highest [growth]
rate for six years, and we are
really pleased about that,
especially in these tough
economic times
Steve Varley, UK managing
partner, Ernst & Young
We have emphasised the

importance of doing more than
just being a tax accountant to
our clients. This has supported
a growth in our retention gures
Simon Dolan, managing
director, SJD Accountancy
I certainly have no rms of

any size that Im having any
discussion with at the moment,
nor any plans to do so
Andrew Pianca, managing
partner, Crowe Clark Whitehill
BIG FOUR
FEES BY SERVICE LINE
10
Total fee
income for the
Top 60 in 2011/12
was 10.9bn; recording
7% annual growth
10.97bn
10
10
10
10
10
claiming that there was not a great degree
of overlap between the two organisations.
And indeed, across the sector, it would
appear that despite the current economic
difculties faced by many clients, the Top 60 has
actually grown the number of staff employed.
More than 38,000 people are now employed
by these 60 rms, up from last years 36,300,
with 3,820 partners, up from last years 3,687.
The number of trainees is also on the
up now more than 13,000 individuals are
being trained by the rms, compared to
around 12,300 last year. In this respect, the
sector is looking remarkably healthy.
UNDERLYING GROWTH
So what is driving this underlying growth in
fees and people? Steve Varley, UK managing
partner at E&Y, has seen the rms fee income
grow more than 11% over the past year, with
its presence in the north east of Scotland.
The move will almost certainly see Johnston
Carmichael move into the top 20 in 2013,
with more than 500 staff in 12 locations.
Peter Gillman, managing partner at Price
Bailey (29th, 19.3m) puts about 50% of his
rms recent growth down to acquisition,
the most recent of which was a practice in
Mayfair, London, which furthered the reach
of the East Anglian practice. But Gillman
also sees opportunities to attract disaffected
partners and staff from other rms. There
are undoubtedly a lot of unsettled, talented
people in other rms and I am constantly
having informal meetings with people who
are uncertain of their rms strategies.
It is a similar story at Edinburgh and
Glasgow-based Scott-Moncrief (47th,
11.3m) managing partner Nick Bennett
believes there will be more consolidation
in the sector, but notes that often such
mergers are driven from London.
People in the smaller ofces could feel
disgruntled, and there could well be some
disgruntled clients as well, Bennett says. We
are not in the position where we need to merge
to survive; we are looking for opportunities
to grow our business through hires, mergers
[and] acquisitions of good quality smaller
practices, but we will only do it if the opportunity
is going to be benecial to all parties.
EMPLOYMENT PROSPECTS
Job losses are a constant fear in the sector
RSM Tenon cut staff numbers as a result of
its difculties during the year, but other rms
such as KPMG and Mazars have also appeared
in the redundancy spotlight. KPMG reduced
its non-partner headcount by 3% in 2012,
with 275 individuals losing their jobs across
the rm, while Mazars made around 5% of
its workforce redundant, including a limited
number of partners, towards the end of 2012.
In the case of the BDO/PKF merger, both
Michaels and Martin Goodchild, managing
partner at PKF, maintained that there would
be no redundancies as a result of their merger,
AUDIT AND ACCOUNTING
TOP 60
TOTAL INCOME OF TOP 60 FIRMS
6
7
8
9
10
11
bn
2007 2011 2010 2009 2008
10.33
8.80
9.36
9.92
9.82
10.97
2012
top 60 survey BRIEFING january 2013 accountancy
The majority
of fee income is
earnt by the Big Four,
with 8.35bn in revenues,
accounting for 76% of
annual earnings across
the Top 60 rms
8.35bn
-12
-9
-6
-3
0
3
6
9
12
15
1 2 3 4
5
6
7 8 9 10
11 12 13 14 15 16 17 18 19 20
Rank
2012 (2011)
Firm m
2012
m
2011
%
change
1 (1) PwC 963.0 909.0 5.94
2 (2) Deloitte
1
663.0 652.0 1.69
3 (4) Ernst & Young 478.0 444.0 7.66
4 (3) KPMG
2
469.0 456.0 2.85
3
120.0 134.4 -10.71
6 (6) BDO
4
96.0 91.1 5.38
7 (7) Baker Tilly 77.2 84.0 -8.10
8 (8=) Mazars
7
68.8 70.0 -1.71
9 (8=) RSM Tenon
5
62.0 70.0 -11.43
10 (10) Moore Stephens UK 57.0 60.6 -5.94
11 (11) PKF (UK)
8
45.7 45.6 0.22
12 (12) Crowe Clark Whitehill
10
33.1 30.6 8.17
9
31.5 29.2 7.88
11
25.7 22.4 14.51
15 (14) Kingston Smith 23.5 22.7 3.52
6
22.2 21.9 1.37
17 (17) Saffery Champness 17.4 17.2 1.22
18 (18) Wilkins Kennedy 16.7 15.9 5.03
19 (19) Chantrey Vellacott DFK 12.0 11.7 2.56
20 (20) MHA MacIntyre Hudson 11.0 10.1 8.91
Total 3,292.8 3,198.4 2.95
Footnotes: see page 14
% change
11
11
11
11
11
11
growth across the board. This is the highest
rate for six years, and we are really pleased
about that, especially in these tough economic
times. He puts a large amount of it down to
the rms international work, recounting how,
in the space of two weeks he travelled to New
York, back to London and then on to several
cities in China with his top management team
for meetings with clients and the government.
In the UK, we are making sure that our
clients dont view us as a domestic rm,
Varley adds. We spend a good deal of
time thinking through how we can help, for
instance, British companies wanting to break
into India, and we will provide workshops
on culture, tax issues, employment law.
At a sector level, Varley points to
nancial services, oil and gas, and
consumer products as particularly vibrant
areas for the rm, the latter again in part
driven by the need for the rms clients to
do business with emerging markets.
The 8% growth in the rms audit and
accounting services covers the increasing
workload in fraud investigation and disputes
work, but Varley maintains that the core audit
service is still going well. We are seeing
a ight to quality, he says. This has come
despite questions raised over the quality of
the Big Fours work, with the ever-present
spectre of litigation and regulatory intervention
by UK competition authorities and the EU.
Grant Thornton, which has seen its fee
income grow nearly 11% as well over the
last year, experienced a dip in its audit fee
income, but saw signicant growth in corporate
restructuring and corporate nance.
The core audit and tax business was
broadly the same as last year, which in this
market is a good result, but the growth
has really come from certain elements of
the corporate recovery practice, especially
the IVA [Individual Voluntary Arrangement]
business as well as the complex insolvency
business which also had a good year, Barnes
says. The rms corporate nance business
has also grown, in part helped by a few big
deals and it has also invested heavily in its
nancial services advisory business. It can
be quite a volatile part of the business.
Barnes expects this growth to continue
into the new nancial year, saying that
the rms rst quarter gures suggest
a good result for the top line.
The bottom line is looking healthy for
many rms as well, though some have seen
a notable dip in prots. RSM Tenon is the
obvious example of the latter, which saw
its prot gures fall into negative territory,
while fellow listed accountancy rm Begbies
Traynor, also saw a dip in prots.
During 2012, Begbies disposed of its tax,
offshore and red ag corporate warning
businesses while attacking its cost base. In
a trading statement in October, Ric Traynor,
executive chairman of Begbies, said: Having
successfully reshaped the group over 12
TAX
BIG FOUR
PRE-TAX PROFIT AND PARTNERS
1,000
1,500
2,000
2,500
3,000
Pre-tax proft m Partners
3,029
2,231
1,948
2,717
+4.8% +0.9%
2,598
2,010
+4.6% -3.0%
2010
2011
2012
BRIEFING top 60 survey accountancy january 2013
-40
-35
-30
-25
-20
-15
-10
-5
0
5
10
15
20
1
2
3
4
5
6 7 8
9
10
11
12 13
14 15 16
17
18 19 20
Rank
2012 (2011)
Firm m
2012
m
2011
%
change
1 (1) PwC 659.0 645.0 2.17
2 (2) Deloitte
1
529.0 534.0 -0.94
3 (4) Ernst & Young 431.0 372.0 15.86
4 (3) KPMG
2
380.0 392.0 -3.06
3
91.9 91.7 0.22
6 (6) BDO
4
80.0 80.5 -0.62
7 (8) Baker Tilly 46.0 51.0 -9.80
8 (7) RSM Tenon
5
35.0 57.0 -38.60
6
34.0 31.8 6.92
10 (9) PKF (UK)
8
21.7 22.4 -3.13
9
21.0 18.9 11.11
12 (12) Moore Stephens UK 20.5 24.2 -15.29
13 (11) Mazars
7
19.5 25.1 -22.31
14 (15) Saffery Champness 14.2 12.4 14.68
10
14.0 13.2 6.06
11
10.2 9.4 7.98
17 (17) MHA MacIntyre Hudson 9.6 10.1 -4.65
18 (19) Chantrey Vellacott DFK 7.8 7.8
0.00
19 (-) Wilkins Kennedy
12
5.9 5.6 5.36
20 (-) Kingston Smith 5.4 5.0 8.00
Total 2435.7 2409.1 1.10
% change
12
12
12
12
12
the last year, we remain committed to growing
our cash-generative and protable business,
both organically and through carefully targeted
acquisitions which enhance this core business.
But for every rm that saw a fall in prots
there were others that experienced a rise. SJD
Accountancy, a rm that specialises in advising
contractors and freelance professionals,
continues to report increasing prots, perhaps
beneting from the ever-increasing number of
self-employed people in the UK economy.
Managing director Simon Dolan puts the
success down to growing the number of clients
while retaining existing ones. Weve refocused
our efforts on what our clients want, he says,
adding that research suggested their clients
wanted someone they could not only talk to
about their tax situation but also someone who
could review business plans and objectives.
Weve always provided dedicated
accountants but for the last year and a half
we have emphasised internally within SJD
the importance of doing more than just
being a tax accountant to our clients, Dolan
says. This has worked well and hopefully
supported a growth in our retention gures.
Gillman echoes this view. You need to keep
the clients you have got, he says, adding:
Client care is at the top of the agenda.
Of course, the elephant in the room that
has cast a shadow over the sector during
2012, especially at the top end, has been
the Competition Commissions review
of the audit market, together with the
legislative battle taking place in Brussels.
This issue is set to rumble on in 2013, and
the rms, outwardly at least, are starting
to sound sanguine on the debate.
We are looking forward to getting back
to client focus, says Varley, while Barnes
says he continues to watch with interest.
There is mood music around change, says
Barnes, predicting a particular shift in advisory
work in the direction of the mid-tier rms.
In that capacity, we are now working for
39 of the FTSE 100 companies, he says.
Barnes has seen an increase in the
number of audits coming up for tender,
particularly among FTSE 250 companies.
Once there is a tipping point, then we
may see some real change, he says.
Watch out for the Top 60 rms trainees
survey in Accountancy, February 2013
PARTNER VALUE
INCOME AND PROFIT 2012 (2011)
Rank Firm Fees (m) Pre-tax prot
(m)
Partners Fee/partner
ratio (000s)
1 (1) PwC 2,621.0 (2,461.0) 727.0 (667.0) 872 (905) 3,006 (2,719)
2 (2) Deloitte
1
2,329.0 (2,098.0) 560.0 (535.0) 991 (953) 2,350 (2,972)
3 (3) KPMG
2
1,774.0 (1,707.0) 349.0 (396.0) 617 (579) 2,888 (2,950)
4 (4) Ernst & Young 1,631.0 (1,465.0) 358.0 (350.0) 549 (527) 2,971 (2,780)
3
417.1 (377.0) 76.0 (75.2) 202 (211) 2,065 (1,787)
6 (6) BDO
4
283.0 (284.7) 51.2 (62.2) 196 (198) 1,444 (1,437)
7 (7) RSM Tenon
5
208.0 (228.0) -9.0 (27.0) 225 (279) 924 (892)
6
179.1 (170.4) 27.9 (21.6) 254 (227) 705 (755)
10
59.3 (52.1) 15.1 (14.0) 72 (80) 824 (651)
15 (13) Begbies Traynor Group 57.7 (60.6) 6.9 (8.5) 81 (87) 713 (707)
19 (19) MHA MacIntyre Hudson 35.2 (32.4) 9.8 (10.0) 42 (42) 838 (771)
23 (20) Menzies 28.5 (28.6) 8.5 (7.7) 34 (35) 839 (820)
25 (29) Francis Clark 22.1 (17.20 7.5 (5.3) 44 (33) 502 (512)
28 (25) Reeves & Co 20.3 (20.1) 5.9 (6.2) 39 (41) 521 (595)
29 (30) Price Bailey 19.3 (16.4) 4.2 (3.8) 22 (22) 877 (754)
30 (27) Frank Hirth 19.0 (17.1) n/a (1.3) 17 (16) 1,116 (1,069)
32 (37) SJD Accountancy 17.6 (14.0) 7.6 (6.5) 1 (1) n/a (n/a)
38 (36) Cooper Parry 15.8 (14.5) 5.2 (4.1) 22 (24) 716 (596)
41 (39) Shipleys 13.6 (13.6) 5.2 (5.3) 16 (23) 850 (591)
46 (46) Barnes Roffe 12.3 (11.4) 5.4 (5.0) 19 (18) 647 (633)
49 (55) James Cowper 10.9 (10.2) 2.2 (2.1) 14 (14) 801 (728)
51 (55) Hillier Hopkins 10.8 (10.2) 3.6 (3.4) 22 (22) 489 (463)
53 (49) Simmons Gainsford 10.1 (10.7) 2.2 (2.3) 14 (14) 718 (764)
56 (58) Rothmans 9.7 (9.4) 1.9 (2.6) 20 (20) 483 (470)
Total 9,804.4 (9,129.5) 2,231.3 (2,222.1) 4,385 (4,371)
Average 1,186 1,148
Male partners
Female partners
Other staff
66,035
57,868
69,639
73,768
4,906
736
4,913
5,098
5,408
2009
2010
2011
2012
756
862
892
TOP 60
STAFFING LEVELS
HOW THE TOP 60
IS COMPILED
Information is collected through
Accountancy and completed
by rms. Wherever possible,
we adhere to rms description
of service lines and structure,
and rely on the integrity of
the information provided. The
aim is to produce consistent
information as far as possible
and for this reason we have not
excluded rms or groups with an
unusual structure, although the
question of whether some in the
list are rms in the traditional
sense remains open to debate.
*
13
13
13
13
13
Rank Firm
Fees 2012 (m)
Fees 2011 (m)
Fee
Fee/
partner
ratio
(000s)
Staff LLP? Auditor Year end
1 (1) PwC 2,621.0 2,461.0 6.5 3,006 34 872 16,700 LLP Yes Crowe Clark Whitehill 30/06/12
2 (2) Deloitte
1
2,329.0 2,098.0 11.0 2,350 27 991 13,754 LLP Yes Grant Thornton 31/05/12
3 (3) KPMG
2
1,774.0 1,707.0 3.9 2,888 22 617 11,612 LLP Yes Grant Thornton 30/09/12
4 (4) Ernst & Young 1,631.0 1,465.0 11.3 2,971 19 549 10,500 LLP Yes BDO 30/06/12
3
417.1 377.0 10.6 2,065 26 202 3,665 LLP Yes PKF 30/06/12
6 (6) BDO
4
283.0 284.7 -0.6 1,444 14 196 2,337 LLP Yes PwC 29/06/12
7 (7) RSM Tenon
5
208.0 228.0 -8.8 924 36 225 2,574 Listed PLC Yes PwC 30/06/12
6
179.1 170.4 5.1 705 11 254 1,227 Ltd Yes Grant Thornton 30/04/12
9 (8) Baker Tilly 170.5 182.0 -6.3 745 28 229 1,831 LLP/Ltd Yes Kingston Smith 31/03/12
10 (11) Moore Stephens UK 135.9 138.3 -1.7 894 35 152 1,348 Network/Ltd No n/a 31/12/12
11 (12) Mazars
7
115.3 109.0 5.8 1,003 17 115 1,200 LLP Yes Crowe Clark Whitehill 31/08/12
12 (10) PKF (UK)
8
103.3 108.4 -4.7 1,476 23 70 1,209 LLP Yes Kingston Smith 31/03/12
9
61.7 57.8 6.7 527 51 117 789 See note No n/a 31/03/12
10
59.3 52.1 13.8 824 9 72 564 LLP Yes Grant Thornton 31/03/12
15 (13) Begbies Traynor Group plc 57.7 60.6 -4.6 713 34 81 462 Listed PLC Yes Deloitte 30/04/12
16 (16) Saffery Champness 56.1 51.3 9.2 951 10 59 470 Partnership No n/a 31/03/12
11
48.8 45.0 8.5 588 23 83 649 - - See note 30/04/12
18 (18) Kingston Smith 40.5 41.0 -1.2 653 6 62 407 LLP Yes Price Bailey 30/04/12
19 (19) MHA MacIntyre Hudson 35.2 32.4 8.5 838 10 42 496 LLP Yes Hillier Hopkins 31/03/12
12
30.2 28.1 7.5 512 11 59 414 LLP - n/a 30/04/12
13
29.6 27.9 6.2 658 11 45 440 LLP Yes Price Bailey 31/05/12
22 (21) Chantrey Vellacott DFK 29.0 28.6 1.6 659 10 44 303 LLP Yes Grant Thornton 30/06/12
23 (20) Menzies 28.5 28.6 -0.2 839 6 34 314 LLP Yes Princecroft Willis 30/06/12
24 (24) Buzzacott 25.4 23.6 7.2 1,014 1 25 233 LLP Yes Hillier Hopkins 30/09/12
25 (29) Francis Clark 22.1 17.2 28.5 502 7 44 384 LLP Yes Price Bailey 31/03/12
14
21.8 18.9 15.4 119 225 183 676 Partnership - n/a 31/12/11
27 (-) FRP Advisory
15
21.3 17.2 23.8 761 9 28 149 LLP Yes BDO 30/04/12
28 (25) Reeves & Co 20.3 20.1 1.0 521 4 39 260 LLP Yes Clive Owen & Co 31/05/12
29 (30) Price Bailey 19.3 16.4 17.7 877 8 22 280 LLP Yes Crowe Clark Whitehill 31/03/12
30 (27) Frank Hirth 19.0 17.1 11.2 1,116 2 17 172 Unlisted PLC Yes Manningtons 30/06/12
31 (28) Armstrong Watson 18.1 17.0 6.5 670 8 27 342 Partnership No n/a 31/03/12
32 (37) SJD Accountancy 17.6 14.0 25.7 17,600 8 1 170 Ltd Yes Kingston Smith 31/10/11
33 (32) Haysmacintyre 17.4 16.4 6.1 696 1 25 160 Partnership No n/a 31/03/12
34 (35) Hazlewoods 17.1 15.2 12.6 901 5 19 198 LLP Yes Princecroft Willis 30/04/12
35 (30) Duncan & Toplis
16
17.1 16.6 3.0 633 10 27 292 Partnership No n/a 31/03/12
36 (34) Streets
17
16.9 15.9 6.3 845 10 20 109 - - n/a 30/06/12
37 (32) Littlejohn 16.3 16.4 -0.6 526 1 31 127 LLP Yes Price Bailey 31/05/12
38 (36) Cooper Parry 15.8 14.5 8.8 716 4 22 170 LLP Yes Buzzacott 30/04/12
39 (38) Lovewell Blake
18
15.5 13.9 11.5 596 6 26 230 LLP Yes Crowe Clark Whitehill 30/09/12
40 (40) Anderson Anderson & Brown 14.3 13.5 5.9 1,192 1 12 168 LLP Yes Gregor Clark 31/03/12
41 (39) Shipleys 13.6 13.6 0.0 850 2 16 94 LLP Yes Steele Robertson Goddard 30/04/12
42 (43) Larking Gowen 13.5 13.3 1.5 675 9 20 245 Partnership No n/a 31/03/12
43 (53) Bishop Fleming
19
13.2 10.5 25.7 528 7 25 267 Partnership No n/a 31/05/12
44 (44) AIMS 13.0 12.5 4.0 55 233 238 n/a Partnership No n/a 30/04/12
45 (45) Mercer & Hole 12.5 11.7 7.0 658 3 19 130 Partnership No n/a 30/09/12
46 (46) Barnes Roffe 12.3 11.4 7.9 647 3 19 109 LLP Yes HW Leicester 30/06/12
20
11.3 13.4 -15.7 753 3 15 165 Partnership No n/a 30/04/12
48 (47) Henderson Loggie 11.3 11.2 0.4 489 4 23 189 No No n/a 30/11/11
49 (55) James Cowper 10.9 10.2 6.9 801 6 14 144 LLP Yes Monahans 30/04/12
50 (49) Silver Levene 10.9 10.7 1.9 727 1 15 90 LLP No n/a 31/05/12
51 (55) Hillier Hopkins 10.8 10.2 5.7 489 4 22 105 LLP No Price Bailey 31/03/12
52 (52) Beever & Struthers 10.3 10.6 -2.8 448 3 23 139 Partnership No n/a 30/09/12
53 (49) Simmons Gainsford 10.1 10.7 -6.1 718 2 14 81 LLP Yes Sopher & Co 31/03/12
54 (57) Barber Harrison & Platt 10.0 9.9 1.0 667 4 15 186 Partnership No n/a 31/12/11
55 (60) Forrester Boyd 9.7 9.1 6.6 746 5 13 164 Partnership No n/a 31/03/12
56 (58) Rothmans 9.7 9.4 2.4 483 13 20 151 LLP Yes Mazars 31/03/12
57 (-) SRLV 9.2 8.4 9.5 1,022 1 9 90 Partnership No n/a 30/06/12
58 (-) Thomas Westcott 8.7 8.7 -0.9 541 12 16 156 Partnership No n/a 30/04/12
59 (-) Dains
21
8.3 6.5 27.7 415 6 20 127 LLP Yes Price Bailey 31/03/12
60 (-) RGL Forensics 8.2 7.8 5.1 1,367 2 6 51 LLP Yes CBHC 31/03/12
Total 10,976.4 10,275.9 1,106 6,330 79,618
14
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TOP 60 FIRMS
SURVEY: UK ACCOUNTANCY FIRMS LEAGUE TABLE
BRIEFING top 60 survey accountancy january 2013
14
14
14
14
14
Rank Firm Staff
Staff
(2011)
Fees
2012
(m)
Fees
2011
(m)
Ratio
of fees
per
partner
Ratio of
fees per
partner
(000s)
2011
1 (1) PwC 872 905 127 125 16,700 14,973 2,621.0 2,461.0 3,006 2,719
2 (2) Deloitte
1
991 953 140 133 13,754 13,075 2,329.0 2,098.0 2,350 2,972
3 (3) KPMG
2
617 579 91 86 11,612 10,150 1,774.0 1,707.0 2,888 2,950
4 (4) Ernst & Young 549 527 93 95 10,500 9,239 1,631.0 1,465.0 2,971 2,780
3
202 211 26 35 3,665 3,685 417.1 377.0 2,065 1,787
6 (6) BDO
4
196 198 23 21 2,337 2,419 283.0 284.7 1,444 1,437
7 (7) RSM Tenon
5
225 279 30 36 2,574 2,858 208.0 228.0 924 892
6
254 227 48 43 1,227 1,250 179.1 170.4 705 755
9 (8) Baker Tilly 229 117 36 36 1,831 1,935 170.5 182.0 745 1,555
10 (11) Moore Stephens UK 152 156 22 22 1,348 1,324 135.9 138.3 894 886
11 (12) Mazars
7
115 117 11 13 1,200 1,100 115.3 109.0 1,003 932
12 (10) PKF (UK)
8
70 97 7 7 1,209 1,537 103.3 108.4 1,476 1,443
9
117 111 12 12 789 764 61.7 57.8 527 521
10
72 80 12 15 564 549 59.3 52.1 824 651
15 (13) Begbies Traynor Group plc 81 87 11 10 462 524 57.7 60.6 713 707
16 (16) Saffery Champness 59 61 14 14 470 468 56.1 51.3 951 841
11
83 94 13 11 649 566 48.8 45.0 588 479
18 (18) Kingston Smith 62 64 13 12 407 413 40.5 41.0 653 642
19 (19) MHA MacIntyre Hudson 42 42 9 5 496 400 35.2 32.4 838 771
12
59 56 8 7 414 388 30.2 28.1 512 502
13
45 46 3 3 440 412 29.6 27.9 658 606
22 (21) Chantrey Vellacott DFK 44 48 7 6 303 299 29.0 28.6 659 595
23 (20) Menzies 34 35 2 5 314 308 28.5 28.6 839 820
24 (24) Buzzacott 25 23 3 3 233 214 25.4 23.6 1,014 1,030
25 (29) Francis Clark 44 33 5 4 384 342 22.1 17.2 502 512
14
183 175 39 24 676 555 21.8 18.9 119 n/a
27 (-) FRP Advisory
15
28 - 0 - 149 - 21.3 17.2 761 n/a
28 (25) Reeves & Co 39 41 8 5 260 243 20.3 20.1 521 490
29 (30) Price Bailey 22 22 0 0 280 250 19.3 16.4 877 754
30 (27) Frank Hirth 17 16 6 6 172 164 19.0 17.1 1,116 1,069
31 (28) Armstrong Watson 27 26 4 4 342 328 18.1 17.0 670 654
32 (37) SJD Accountancy 1 1 0 0 170 153 17.6 14.0 17,600 n/a
33 (32) Haysmacintyre 25 23 6 5 160 153 17.4 16.4 696 713
34 (35) Hazlewoods 19 18 2 2 198 195 17.1 15.2 901 844
35 (30) Duncan & Toplis
16
27 28 1 1 292 301 17.1 16.6 633 593
36 (34) Streets
17
20 25 3 3 109 125 16.9 15.9 845 636
37 (32) Littlejohn 31 28 5 5 127 136 16.3 16.4 526 586
38 (36) Cooper Parry 22 24 1 1 170 173 15.8 14.5 716 596
39 (38) Lovewell Blake
18
26 21 2 1 230 213 15.5 13.9 596 662
40 (40) Anderson Anderson & Brown 12 12 3 3 168 166 14.3 13.5 1,192 1,125
41 (39) Shipleys 16 23 2 3 94 104 13.6 13.6 850 591
42 (43) Larking Gowen 20 19 2 2 245 247 13.5 13.3 675 700
43 (53) Bishop Fleming
19
25 19 3 3 267 180 13.2 10.5 528 552
44 (44) AIMS 238 243 n/a 20 n/a 13.0 12.5 55 n/a
45 (45) Mercer & Hole 19 19 6 6 130 130 12.5 11.7 658 616
46 (46) Barnes Roffe 19 18 1 1 109 105 12.3 11.4 647 633
20
15 17 2 2 165 175 11.3 13.4 753 788
48 (47) Henderson Loggie 23 23 6 5 189 184 11.3 11.2 489 487
49 (55) James Cowper 14 14 3 3 144 125 10.9 10.2 801 728
50 (49) Silver Levene 15 17 1 1 90 100 10.9 10.7 727 629
51 (55) Hillier Hopkins 22 22 2 2 105 107 10.8 10.2 489 463
52 (52) Beever & Struthers 23 24 5 5 139 155 10.3 10.6 448 442
53 (49) Simmons Gainsford 14 14 1 1 81 92 10.1 10.7 718 764
54 (57) Barber Harrison & Platt 15 13 3 2 186 171 10.0 9.9 667 761
55 (60) Forrester Boyd 13 13 0 0 164 162 9.7 9.1 746 700
56 (58) Rothmans 20 20 2 2 151 146 9.7 9.4 483 470
57 (-) SRLV 9 - 0 - 90 - 9.2 8.4 1,022 -
58 (-) Thomas Westcott 16 - 3 - 156 - 8.7 8.7 541 -
59 (-) Dains
21
20 - 3 - 127 - 8.3 6.5 415 -
60 (-) RGL Forensics 6 - 1 - 51 - 8.2 7.8 1,367 -
Total 6,300 6,124 892 877 80,068 74,530 10,909 10,276
Rank Firm
P
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r
t
n
e
r
s
F
e
e

i
n
c
o
m
e

m
F
e
m
a
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e

p
a
r
t
n
e
r
s
T
o
t
a
l

s
t
a
f
f
F
e
e
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p
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e
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2012 2011 2012 2011 2012 2011 2012 2011 2012 2011
TOP 60 FIRMS
TALENT: PARTNERS AND STAFF LEVELS 2012 (2011)
1 Fee income includes
211m from
Switzerland.
2 Corporate nance inc
transactions and
restructuring.
3 Consulting inc
corporate recovery
112.9m, forensic
investigations 17.9m,
other 31.5m.
4 UK fee income (Q2 to
6) subject to nal audit
for year end 29 June
2012. Restated last
years prot to 58.3m
5 Fee income for 2012
and 2011 represents
continuing operations.
6 Ofces inc Ireland.
Smith & Williamson
Holdings Ltd overall
holding business.
7 Audit & accounting inc
some corporate nance
and consulting fees.
Consulting fees inc
18m in insolvency
and forensic
accounting fees.
8 2010/11 gures are
restated on the same
basis as 2011/12. Both
years based on
accounts of PKF (UK)
LLP only.
9 Some practices are
LLPs.
10 Inc consultancy 1.1m,
insolvency 1m,
personal nance
3.1m, forensics
4.1m, pensions
0.3m.
11 Group of independent
rms, produce
accounts individually.
12 Converted to LLP May
2012.
13 Merged with Ritson
Smith October 2012.
14 Franchisees operate as
sole trader, part of
partnership or limited
company. Franchisees
report management
information monthly.
15 All income relates to
business recovery,
restructuring, interim
management and asset
nance. 2011 gures
10 months to
30/04/11.
16 LLP status under
review.
17 Firm made up of legal
entities, limited and
unlimited companies,
some but not all
accounts published.
18 Consulting income
included.
19 LLP status under
review.
20 Fee income inc 2.1m
turnover for Scott-
Moncrieff Wealth
Management which
was sold in 2011.
21 Inc revenue attributable
to ongoing activities
(Stoke-on-Trent
business acquired from
RSM Tenon).
Notes

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