Growth rates for global accounting networks will likely be in the single digits in the year ahead, and most firms will look for creative ways to re-assign staff to avoid layoffs, according to Arvind Hickman, editor of the International Accounting Bulletin (IAB).
Combined 2008 fee income for major networks was $130.2 billion, up 16 percent from 2007, while association total revenues rose 15 percent to $22.6 billion, IAB says.
However, since many accounting firms use a mid-year date as their year end, the economic downturn had not yet hit when results were reported.
“What we’ve been hearing from global leaders and from leaders in the U.S. is there is definitely a slow down in certain areas affected by the credit crisis and an increase in other areas. That traditionally occurs when economic downturns happen,” Hickman says.
What's ahead? “You will see a lot more emphasis on restructuring and business recovery services while corporate finance work will continue to decline. There will also be a further investment into the emerging markets, especially India and China,” he says.
As firms look at different ways to manage their staff, we could see more initiatives like the United Kingdom KPMG’s four-day work week offer, or Singapore KPMG’s 5 percent to 7.5 percent pay cuts for middle and top management, Hickman adds.
In comparing revenues, IAB says PricewaterhouseCoopers (PwC) was still the largest network, with 2008 fee income of $28.2 billion, followed by Deloitte at $27.4 billion. Deloitte’s consulting business was particularly robust. It grew 22 percent and contributed $6.3 billion to the company’s bottom line, IAB says. E&Y posted $24.5 billion in fee income, and KPMG generated $22.7.
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