It is too early to blame RSM Tenon’s
business model for a 10% profit slump, according to a consultant to
the firm.

Jeremy Newman, former CEO of BDO
International, has been drafted in to help provide strategic advice
and stabilise RSM Tenon after it issued a profit warning and CEO
Andy Raynor and chairman Bob Morton stepped down.

RSM Tenon’s share prices tumbled 27%
to a five-year low and analysts have warned the company would have
to trim some of its poorer-performing divisions.

There have been suggestions RSM Tenon
came unstuck because it failed to integrate recent acquisitions
Bentley Jennison and certain assets of Vantis, another failed

Consolidators often aggressively grow
by acquisition in order to achieve profits, but in recent years
have come unstuck by taking on too many new businesses too soon.
High-profile collapses include Vantis and Numerica.

Another media theory for RSM Tenon’s
troubles is poor management.

Newman dismissed media conjecture as
“speculation” and said it was too early to blame its business model
or any other theories for RSM Tenon’s problems.

“Had this business been a partnership
or a public company it would still be facing the same challenges,”
Newman said, adding that he could not comment on specifics at the

“I don’t think the RSM Tenon case does
not mean that the listed company model doesn’t work. It is because
they are a public company that this information must be made
public, but any other accounting firm on a partnership model could
have the same challenges.

“There are a lot of partnerships that
go out of business but they are not blaming the business model.
There was once a Big Eight but there is now a Big Four, why?”

Public companies are legally required
to make public announcements about the state of their business
while partnerships are able to keep sensitive business information
under lock and key.

RSM Tenon, a listed entity on the
London Stock Exchange, reported a 10% decrease in profits in the
six months to 31 December 2011 compared to the corresponding period
in the previous year.

RSM Tenon said half of its revenue
decline is the result of pricing and similar underlying trading

This is a dramatic turnaround to a
firm that posted 31% growth to £249m ($394m) in the year to 30 June

RSM Tenon deputy chairman and senior
independent non-executive director Adrian Martin has been appointed
executive chairman while a new chief executive is sought.

“The company’s performance is clearly
disappointing and my immediate priority is to instigate and execute
the necessary actions to improve profitability and cash
generation,” Martin said.

Newman stepped down from the BDO
International post in September 2011 to pursue a career outside of
professional services.

He said the consultant’s role is not a
sign he would like to remain in the profession.

“I am still keeping to my plan of
looking to work for the non-for-profit sector and consulting RSM
Tenon does not mean I will stay in professional services,” Newman