Deloitte partners feel the squeeze despite increase in revenues
It is the second straight year partners have seen a decline
Partners at the UK arm of Deloitte have taken home less money for the second year in a row, as the Big Four accountant suffered a slowdown in growth.
Average profit per partner dropped to £750,000 for the year to the end of May, according to Deloitte UK’s annual figures released today, down from £772,000 for the previous 12 months as the profit pool fell to £554m from £571m.
It is the second straight year partners have seen a decline, having received an average of £789,000 for the 12 months to May 2012, and comes as Deloitte UK posted annual revenues of £2.55bn, an increase of 1.4 per cent.
That is the fourth consecutive year of rising sales, but they grew at the slowest pace for that period, which the firm’s chief executive David Sproul blamed on “the uncertainty that has existed”.
However, he struck an upbeat tone for the future, saying he was expecting “better economic conditions [to] result in significant improvements across our markets”.
Growth at the start of the current financial year “has increased”, he added, noting “a renewed confidence and optimism in our clients to make investment decisions”.
However, Mr Sproul did warn that business activity may be dampened this year by “political uncertainty”. A survey by Deloitte released last month found next year’s general election and the possibility of a UK referendum on Europe were worrying finance officers of major UK firms more than economic issues.
Deloitte UK’s results revealed a drop in revenues at its audit division, to £706m from £719m over the previous year.
The figures come ahead of the introduction later this year of new rules from the UK Competition and Markets Authority forcing all companies in the FTSE 100 and FTSE 250 to put their audit out to tender every decade.
Meanwhile, in April the European Union approved even tougher rules forcing listed companies to switch their auditor every 20 years.
Figures released earlier this month by Deloitte’s rival PwC showed that of the 350 top listed firms in Britain, there were likely to be 56 firms putting out their audits to tender this year – compared to 30 tenders in 2013 and 18 in 2012.
However the Big Four – which also include EY and KPMG – still dominate the UK’s biggest companies.
Deloitte UK also said its tax practice saw a tiny dip in revenues, to £562m from £563m, while corporate finance rose 4.7 per cent to £424m.
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