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November 25, 2009

Large Canadian mid-tier firms realign global affiliations

Canada’s mid-tier reshuffled this month
with Baker Tilly International and the Praxity Global Alliance
securing top 10 accountancy organisations.

The market’s seventh-largest firm, Meyers
Norris Penny (MNP), joined the Praxity Global Alliance only days
after it was revealed the national association of firms Collins
Barrow departed Praxity for Baker Tilly International.

It is the third global accountancy group MNP
has been a member of in two years. MNP decided to join Crowe
Horwath International from Baker Tilly International in 2008 when a
significant Toronto merger meant the firm had to choose between
both networks.

MNP chief executive Daryl Ritchie said Crowe
Horwath International was a great network but the network model in
general did not appeal to the proudly independent Canadian
firm.

“Praxity, whether you want to call them a
network or whether you want to call them an association, work
together but they are more of an association of like minded firms
rather than trying to become so much of one,” he said. “When we
were looking a year ago we believed Praxity was the best fit for us
then. With the recent changes, the opportunity is there for us to
move to Praxity now.

“We want to have our brand and we don’t want
to be caught doing some of the things you need to do within
networks. That doesn’t make them wrong, but we want to maintain a
higher degree of independence than some of the [network] models are
moving to.”

Another sweetener was the fact that Praxity
member firms Moss Adams and Plante & Moran are two very large
US firms with strongholds in areas bordering Canada.

MNP has 45 offices across Canada and reported
fee income of C$280 million ($261 million) in the year to 31 May
2009. Projected revenue for the current fiscal year is C$325
million.

Collins Barrow is an association of firms with
combined annual revenue of about C$126 in the year to 30 December
2008.

Collins Barrow chairman Lionel Goldman said
the group decided to join Baker Tilly International because it was
impressed with the network’s global branding strategy and the role
the firm could play within the group. Collins Barrow secured the
exclusive rights to use the Baker Tilly name in the country.

“Collins Barrow gives Baker Tilly
International coast to coast coverage in Canada while Baker Tilly
International provides Collins Barrow with access to firms with
complimentary business cultures, similar client bases and the same
commitment to professional excellence,” Goldman said.

The move to Baker Tilly International follows
a recent merger between Collins Barrow Toronto and existing Baker
Tilly International member Smith Nixon.

CANADA

Top 10 accounting firms,
2009

Firm/International
Affiliate

Revenue (C$m)

Professional staff

Partners

Year-end

Deloitte & Touche

1,419.0

5,411

546

May 08

KPMG

1,122.0

3,551

437

Dec 08

PricewaterhouseCoopers

1,062.2

3,535

423

Jun 08

Ernst & Young

856.0

2,576

318

Jun 08

Grant Thornton Canada

425.8

2,300

416

Dec 08

BDO Dunwoody

339.6

1,543

327

Dec 08

Meyers Norris Penny/Praxity

280.0

557

189

Dec 08

Collins Barrow/Baker Tilly

126.1

454

153

Dec 08

RSM Richter

115.3

329

88

Dec 08

PKF Canadian Firms

110.8

527

102

Dec 08

Source: International Accounting
Bulletin

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