Arthur Andersen continued its strong march up the UK accountancy firm league table last year, the latest fee income figures for the big six for the period to 31 March 1995 showed yesterday.
Reporting a 9 per cent jump to pounds 540m, Andersen moved to second place among leading UK companies from third place the previous year. It was sixth three years ago. Most of the growth came from Andersen Consulting.
All firms stressed the extremely competitive environment in accounting, with pressure on prices taking much of the steam out of any increase in volumes.
The most disappointing performance came from Price Waterhouse, which saw fee income drop by 0.4 per cent to pounds 383m. "The economic environment remains difficult," Ian Brindle, senior partner of Price Waterhouse in the UK, said. "Slow recovery out of recession continues to have an impact. Prospects for significant improvement are not much in evidence."
Coopers & Lybrand maintains its seemingly unassailable position at the head of the big six table, with a 3 per cent rise in fee income to pounds 575m. "Despite reductions in capacity in our market, competition is as fierce as ever. It is going to stay that way," Peter Smith, chairman of Coopers, said.
All results reflect the drop in insolvency work over 1994 and into the early months of this year as the recovery gathered pace. Corporate failures over this period dropped by half, Coopers reported, although it said it managed to hold its drop in fee income in this sector to only 14 per cent.
As insolvency work has dropped, management consultancy has taken the baton in terms of earnings for the big accountancy firms. Coopers saw a 10 per cent growth in income in this sector. Income at Andersen Consulting jumped by 12 per cent.
Colin Sharman, senior partner at KPMG, said: "Across the board, clients are coming out of recession and the 20 per cent growth in management consultancy indicates healthy growth is returning."
The big six firms have come under increasing fire for predatory pricing from smaller accountancy businesses. Commenting on the "lowballing" row, Peter Smith of Coopers said: "This is a tough business from which we all have to earn a living. We price competitively but not at levels where the quality of our work suffers or becomes unprofitable."Reuse content