Deloitte has closed to within a fraction of PricewaterhouseCoopers (PwC) as the largest accounting network in the world, with revenue of $26.1 billion in the year to 31 May 2009.
Although the network’s combined revenue contracted 4.9 percent in US dollar terms, this was enough for it to almost tie with the market leader PwC, which revealed fee income of $26.2 billion, following a 7 percent revenue decline in US dollar terms.
Deloitte global chief executive Jim Quigley told the International Accounting Bulletin that Deloitte’s culture and a decision to retain and build its consulting arm were the main reasons the network was able to close the gap on its traditional rival.
“We’re pleased we’ve eliminated the gap between ourselves and them, and I believe it’s a tribute to the business model we have,” Quigley said.
Deloitte’s consulting line was the best performing service line, growing 2 percent in US dollar terms and 7.3 percent in local currencies to $6.5 billion.
“Our consulting capability is deep and broad, and I’m delighted with the decision we made to retain it,” Quigley said. “I think it actually helps us broadly in our ability to deliver high-quality audits to our audit clients just because we’ve got some competencies inside the enterprise that are enormously valuable in that regard.”
Audit and tax remained flat in local currency terms compared with the previous year. Financial advisory services revenue decreased by 6.1 percent, primarily due to substantially decreased merger and acquisition activity across the world’s capital markets.
“That’s a business that’s going to come back as there is significant liquidity in the marketplace,” Quigley explained.
“Not only strategic buyers but private equity players have significant resource pools that they have yet to invest. Our teams are being deployed, the deals are not yet publicly announced or closed but we are seeing that activity pick up.”
Although advisory as a whole has dropped, the network’s public sector advisory practice was among Deloitte’s fastest growing service areas and was buoyed by the acquisition of BearingPoint public sector businesses in the US.
On a firm by firm basis, Deloitte’s star performers were the Indian, Japanese and Australian firms, which experienced local currency growth of 29.9 percent, 11.5 percent, and 11.3 percent, respectively.
Broadly speaking, the Asia-Pacific region had a stellar year, growing 7.6 percent in local currency terms – the fifth consecutive year it has led growth among Deloitte’s three global regions.
A closer geographical look reveals that Africa led the pack with local currency fee income growth of 21 percent, the Middle East increased revenue 16 percent, and Latin America increased 14 percent.
North America (-2.5 percent) and Europe (0.9 percent) performed worst due to the severity of the economic downturn in these regions.
During the 2009 fiscal year, the network hired more than 40,000 professionals. The workforce now stands at approximately 169,000 people globally, representing a 4.5 percent increase from 2008.