The Big Four

Accounting Firms

Brief Introduction• E&Y , Deloitte , PWC , KPMG• 4 largest Accounting Firms• Alternatively the 4 largest professional service

network. • What do they offer – Audit , Assurance ,

Actuarial , Advisory , Consulting , Corporate Finance , Legal Services and Tax

• They handle vast majority of Audits for Public and Private Companies.

Brief History

• Big 4 used to be known as Big 8• It was after a series of mergers and dissolutions that

brought about the elite 4• (Ernst & Whinney) + (Arthur Young) = E&Y in 1989• (Deloitte , Haskins and sells) + ( Touche Ross) = Deloitte

Touche in 1989• (Price Waterhouse ) +(Coopers & Lybrand ) = PWC in 1998• In 2002 Arthur Anderson fell due to its involvement in

Enron Scandal• 4 largest existing accounting firms have been known as BIG 4

KPMG KPMG is a professional service company seated in Amsterdam. KPMG employs 174,000 people and has three lines of services: Audit, tax, and advisory. Its tax and advisory services are further divided into various service groups. The name "KPMG" was chosen when KMG (Klynveld Main Goerdeler) merged with Peat Marwick.

KPMG INDIAKPMG was established in India in September 1993.Services- 1. Actuarial 2. Assurance 3. Financial / Legal / Tax advice 4. Management consulting

The Indian Accounting Standards (Ind AS) largely converged

with the International Financial Reporting Standards (IFRS) are

bringing about a paradigm shift in financial reporting in India.

KPMG focuses on two key areas of impact:

1. Revenue recognition and the consideration of embedded

leases and explains the new accounting requirements in these

areas.

2. The expected challenges that are likely to be faced by the

sector.

Different from the rest

• Something that sets KPMG apart is that it has a full-time team dedicated to helping

employees gain qualifications – the Professional Qualifications Team (PQT).

• Pass rates for successful completion of various qualification papers are significantly

higher than the industry standard.

• What is KPMG investing in?

In July 2014, KPMG and Imperial College London announced the launch of a major new

partnership to create the ‘KPMG Centre for Advanced Business Analytics’. KPMG will

invest over £20m, with the aim of putting the UK at the forefront of data science.

Revenue- US$ 24.44 billion (2015) . In 2013 they reported an annual revenue of $23.42 billion, and a growth rate of 1.4%. These numbers are down from 2012 when

their growth rate was 2.1%.

PricewaterhouseCoopers(PwC) PwC ranked number two accounting firm in world. It was founded by Samuel Lowell Price in Londan,1849. Its headquarters are in London,UK.

At the time of formation its name was “Price Waterhouse” and “PricewaterhouseCoopers” name was formed by merger of Price Waterhouse and Coopers& Lybrand in 1998. It has a network of firms in 157 countries, 756 locations and with around 208100 people.PwC provides professional services all around the world.

Services Provided by PwC•Audit and assurance •Consulting •IFRS reporting•Tax services

PwC Training Opportunities

PwC provide training to its current and prospective

employees.

PwC training programs are available online to public

and they are free of cost. These programs benefits to

those who want earn Continuing Professional

Education(CPE) and they can do it on PwC open

university website.

PwC RevenuePwC has maintained a steady growth in revenue over 10 past years. In 2006 its revenue was 22.1 billion us dollars and it increased to 26.57 in 2010 and 33.95 in 2014.

- William Deloitte- Charles Haskins- Elijah Sells- George Touche

SERVICES

AuditInternal auditAssurance Audit committee role guide

Consulting Financial advisoryTax services

Revenue – 35.2 billion (Growth rate 8%)600 offices in more than 150 countriesAverage package – $70.698Best employer to work by fortune magazine80% of Fortune 500

Ernst & Young (trading as EY) is a multinational professional services firm headquartered in London, United Kingdom. It is one of the "Big Four" audit firms and is the third largest professional services firm in the world by aggregated revenue in 2014, after PwC and Deloitte.

 It provides assurance (including financial audit), tax, consulting and advisory services to companies.

EY is the most globally managed of the Big Four firms. EY Global sets global standards and oversees global policy and consistency of service,

with client work performed by its member firms.Each EY member country is organized as part of one of four areas. This is

different from other professional services networks, which are more centrally managed.The four areas are:

EMEIA: Europe, Middle East, India and AfricaAmericas

Asia-PacificJapan

Each area has an identical business structure and a management team, which is led by an Area Managing Partner who is part of the Global

Executive board. The aim of this structure is to effectively cater for an increasingly global clientele, who have multinational interests.

EY has four main service lines and share of revenues in 2014:• Assurance(41%): comprises Financial Audit (core assurance), Financial

Accounting Advisory Services, Fraud Investigation & Dispute Services, and Climate Change & Sustainability Services.

• Tax (26%): includes Transfer Pricing, International Tax Services, Business Tax Compliance, Human Capital, Customs, Indirect Tax, Tax Accounting & Risk Advisory Services, Transaction Tax

• Advisory (24%): consisting of four sub service lines: Actuarial, IT Risk and Assurance, Risk, and Performance Improvement.

Transaction Advisory Services (TAS) (9%): deals with companies' capital agenda – preserving, optimizing, investing and raising capital.