Wednesday, September 30, 2009

Ernst & Young: External Challenges Drive Flat Revenue From FY 2008 To FY 2009

Ernst & Young just reported its combined worldwide results for the year ending 30 June 2009 (FY09), the first Big4 firm to report its global results.

Combined global firm revenues of US$21.4 billion for the fiscal year ended 30 June 2009 (FY09) decreased a modest 0.2% in local currency terms from the comparable period in FY 2008. In FY 2008, E&Y reported US$23.0 billion in global revenues, and in US dollar terms, the revenue actually declined 6.8% from 2008 to 2009. This shows the dramatic effect of the appreciation of the US dollar in this period against foreign currencies. In other words, one unit of foreign currency translated to much fewer US dollars in the FY 2009 fiscal year compared to the FY 2008 fiscal year. We have highlighted growth in both local currency and US$ terms in our analysis.

Tuesday, September 29, 2009

Police Raid Ernst & Young HK Office in Akai Case

We highlight a breaking news story happening on the other side of the world, in Hong Kong the police yesterday raided the offices of Ernst & Young, the erstwhile auditors of Akai. Akai was the largest corporate collapse in Hong Kong, with similarities to the Enron case in the United States. This story is making current headlines in the small city state, making the first page of the influential South China Morning Post and also reported on Bloomberg Asia and’s home page today. 

Tuesday, September 22, 2009

KPMG: Tax Authorities, Looking For Cash, May Push Transfer Pricing To Front Burner

Transfer Pricing (TP), or the setting of intercompany prices of goods and services transported across country borders by the same company is typically an esoteric tax issue which garners little attention under normal conditions. But as KPMG recently points out in its recently released Global Transfer Pricing Review, the tough economic environment is leading many governments to seek out new sources of tax by extending and tightening controls over cross-border transactions between companies within the same group.

We’ve moved. Click here to go the full post at the new Big Four Blog at!

Monday, September 21, 2009

Deloitte Predicts Flat 2009 US Holiday Retail Sales, And A Lonely Mall Santa

Though there are many signs of economic rebound as we have seen from many recent Big4 firm surveys which are indicating consumer confidence, business recovery and overall growth. But there are equally troublesome spots which are looming on the horizon which say that the recovery is not going to be robust or as smart as everyone would like it to be.

Here’s a somewhat somber forecast from Deloitte on 2009 US holiday sales which is getting a lot of media play.

Thursday, September 17, 2009

Ernst and Young: Glamour and Secrecy in Upcoming 2009 Emmy Awards

We have blogged earlier about PricewaterhouseCoopers’ auditing of the Oscar Movie Academy Awards, which the firm has been solely handling for 75 years in complete secrecy with undisclosed locations, strict controls and tight personnel regulations.

Thursday, September 10, 2009

Deloitte UK and PwC UK Revenues Flat, Showing Tough External Conditions

PricewaterhouseCoopers LLP UK just reported its annual results for the year ending June 30, 2009 and with Deloitte LLP UK reporting its annual results for the year ending May 31, 2009, we have now two data points to understand better how the mid-2008 to mid-2009 period is shaping up for the Big Four firms. Please note that the UK firms are not representative of the entire firms, but they are certainly indicative and the data does arrive close to their year ends, while the Big Four firms seem to have the latitude, as private partnerships, to report their annual results months after the year is closed at a timing of their choice.

Big Four Firms Are Best Places To Launch A Career, Again

BusinessWeek just released its 2009 rankings of its much-anticipated “2009 Best Places To Launch A Career” list and for a second year, Big Four firms completely dominate the list, capturing the top four spots in the rankings. This year, only 69 companies made the list compared to 119 in 2008 due to more stringent criteria, making the 2009 list “both more exclusive and more competitive.” Thus, this year, there was more relative competition to make the list and this year’s rankings are at least 40% tougher than the previous year.

Tuesday, September 01, 2009

Deloitte, First To Report In 2008, But Apparent Delays in 2009

Last year on July 23, 2008, we blogged the below about Deloitte’s 2008 results for the year July 1, 2007 to June 30, 2008. We’re already in September 2009, and we scoured the Deloitte Global and Deloitte US sites for results for the year July 1, 2008 to June 30, 2009...

We've moved. Click here to go to the full post at the new Big Four Blog at!

PricewaterhouseCoopers UK: Total Lehman Europe Claims May Exceed $100 Billion

PricewaterhouseCoopers UK issued this official PwC statement on their PwC UK website updating their efforts in the administration of Lehman Brothers International (Europe)

"The parent company, Lehman Brothers Holding Inc, and its various USA subsidiaries that are in Chapter 11, have all established a deadline for claims to be submitted in the next few weeks. We're dealing with a large number of entities and therefore the claims could be as much as $100 billion. These claims are exceptionally complex and we anticipate a large amount of further work in dealing with these claims. This is a normal part of the bankruptcy claims formulation and submission process. A significant number of claims arise as a result of guarantees issued by the parent company to its subsidiaries globally.

"We have invested a significant amount of time helping administrators in other affiliates understand the Lehman accounting systems so that we can all agree a standard approach to the reconciliation of inter company balances. If this can be achieved then it should reduce the likelihood of affiliates suing each other in pursuit of amounts that are owed between the different Lehman estates."

$100 Billion! That is an enormous number, and close to the 2008 GDP of the country of Kuwait. In bankruptcy though claimants likely only get cents on the dollar so in effect the actual monies coming back may be much more moderate.

Once you get past this shock, the second paragraph is also interesting. In effect, is PwC saying – affiliates, please get behind us in coming up with a common approach, else you will end up bickering and cross-suing each other to get any dollars back from a cleaned-out Lehman US entity??

Big Four Firms Provide Excellent Resources On IFRS Conversion

Many of our readers in the professional accounting, reporting, tax and corporate finance fields are already familiar with the impending adoption of IFRS rules in the US and many countries all over the world. We thought we would write a bit about the current situation and how it is being handled at the Big Four accounting firms, given that it is going to be a critical issue for them in terms of public auditing, financial statement reporting as public company clients either converge GAAP to IFRS or convert fully to IFRS in the next few years and require hand-holding, guidance and advice from the Big Four firms...

Accenture Finally Moves Incorporation From Bermuda to Ireland

01 September 2009

After announcing earlier this year that it will switch its place of incorporation from Bermuda to Ireland, its official as of today September 1, 2009. After gaining required approval from the Supreme Court of Bermuda. Accenture today completed the change in its place of incorporation to Ireland from Bermuda. The company will continue to be registered with the U.S. Securities and Exchange Commission (SEC) and to be subject to SEC reporting requirements. And Accenture shares will continue to trade on the New York Stock Exchange under the ticker symbol “ACN.”..