Accountants face changing market

THE top-performing UK accounting firms are Price Waterhouse, Arthur Andersen and KPMG Peat Marwick, according to a survey by Datamonitor, the strategic consultants.

Criteria used included total staff levels, revenues per partner and number of listed clients. The listing diverges sharply from the ranking by fee income alone, which puts Coopers & Lybrand, Britain's largest accounting firm, at the top, followed by KPMG and Price Waterhouse. Arthur Andersen is the smallest of the big six firms by fee income.

Increasing competition will force firms to move away from traditional bases of audit and general accounting, the study suggests.

Arthur Andersen, with a strong information technology consultancy, has shown the greatest level of diversification, with more than three-quarters of fee income coming from non-audit work. Price Waterhouse is the next most diversified, followed by Coopers & Lybrand, Ernst & Young, Touche Ross and KPMG.

Competitive pressures are likely to be most intense in the middle-tier firms just below the big six, the report says.

The overall audit/accounting market - worth pounds 1.44bn for the top 26 UK firms in the year ended 31 March - is still the largest area of business.

But management consultancy is the most attractive in terms of profitability and growth, Datamonitor found.

----------------------------------------------------------------- ACCOUNTANTS RANKED BY PERFORMANCE ----------------------------------------------------------------- Big six, 1992 1 Price Waterhouse 2 Arthur Andersen 3 KPMG Peat 4 Touche Ross 5 Coopers & Lybrand 6 Ernst & Young Middle tier 7 Stoy Hayward 8 BDO Binder Hamlyn 9 Pannell Kerr Forster 10 Robson Rhodes 11 Grant Thornton 12 Haines Watts 13 Kidsons Impey 14 Neville Russell 15 Saffery Champness 16 Baker Tilly ----------------------------------------------------------------- Source: Datamonitor -----------------------------------------------------------------