New York, NY (PRWEB) January 10, 2013
Big4.com, the premier social networking forum for professionals and alumni of Accenture, Andersen, BearingPoint, Capgemini, Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers PwC announced today the release of the 2012 Big Four Firms Financial Performance Analysis, providing a detailed financial and operating analysis of the performance of the four largest accounting firms in the world. The analysis shows the firms enjoyed solid revenue growth from 2011 to 2012, following strong performance from 2010 to 2011 and after a severe revenue decline in 2009, and stabilization in 2010. This solidifies a rebound arising from the global economic slowdown and reverses an abrupt reversal seen in 2009 after five straight years of double-digit revenue growth.
After a very strong 2011, 2012 fiscal year saw commendable increase in revenues for Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers, with revenues increasing between 1.4% and 7.8% from 2011, as firms built upon their boost from the global recovery, improved equity markets, liquid credit conditions, stricter regulations, globalization and enhanced M&A and IPO activity, all of which spurred client demand, especially for Advisory Services and in Asia. Revenues increased in most developed regions, while growth continued at high levels in emerging markets of Asia and Latin America; and surprisingly in North America. Despite the limited data points that the firms report each year, our exclusive look at nine years of financial performance of these firms shows some very interesting trends and insights across firms, geographies and service lines.
In 2010, Deloitte had surpassed PricewaterhouseCoopers to become the largest Big Four firm, reporting revenues of $26.578 billion and growth of 1.8%, just ahead of PwC’s revenues of $26.569 billion and growth of 1.5%. Deloitte beat PwC by a small but significant margin of only $9 million. In 2011 however, PricewaterhouseCoopers regained its leadership position with revenues of $29.2 billion, up 10.0%, which exceeded Deloitte’s revenues of $28.2 billion, up by 8.4%, by more than $400 million. In 2012, PricewaterhouseCoopers maintained its leadership position with revenues of $31.5 billion, up 7.8%, which exceeded Deloitte’s revenues of $31.3 billion, up by 8.6%, by a slim lead of $200 million.
Ernst & Young posted solid growth and placed third with 2012 revenues of $24.4 billion and its revenues rose at a commendable pace of 6.7% from 2011.
KPMG remained the smallest firm with revenues of $23.0 billion, but posted the smallest rate of growth in all the Big Four firms at 1.4% from 2011 in US dollar terms. This expanded the gap with Ernst & Young to a wide $1.4 billion. KPMG’s modest growth is well out of line with peers due to three key factors: Europe is a larger percentage of global revenues and was negatively impacted by US dollar appreciation versus the Euro, Advisory service line had modest growth and the Audit service line presumably lost some relative market share against key peers.
From 2010 to 2011, combined revenues for all the four firms in US dollar terms rose 9.0% to a historic record of $103 billion, a level which even surpassed the previous high of $101 billion in 2008. In 2012, combined revenues for all the four firms in US dollar terms rose 6.4% to a yet another historic record of $110 billion.
From 2011 to 2012, Audit revenue increased by 2.9%, slowest among the three service lines. Tax revenue was up by a solid 5.6%, and Advisory revenues continued their strong streak, increasing by a remarkable 12.2%.
Americas revenue increased solidly by 9.2% from 2011 to 2012, following 9.9% growth in the previous year. Europe revenue was up by 3.3% due to high volatility in the region, and slowing down from 4.3% in the previous year. Asia revenue growth continued with an outstanding performance of 8.0% from 2011 to 2012, following a spectacular 17.4% growth from 2010 to 2011.
The appreciating U.S. dollar over the reporting period was a headwind for firms who posted generally lower growth numbers in U.S. dollar terms than in local currency terms. This appreciation had the most negative impact on KPMG’s results.
The analysis has further analysis and details on performance by Americas, Europe and Asia, and by Audit, Tax and Advisory service lines, and outlook for 2013 and the future.
This analysis may be reproduced or distributed in parts or whole, but prominent and full attribution should be given at all times to “The 2012 Big Four Firms Performance Analysis by http://www.Big4.com
The full study can be downloaded as Adobe pdf at http://www.big4.com/analysis.
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