The Top 50 - Ten years on

The business of accountancy is dull, some might argue, but when has the profession ever really been without a notable event?

If you take a decade as the horizon, some startling changes emerge. First, the Top 50 of 1998 contained at least 20 firms that have subsequently either disappeared through merger or acquisition, or failed to keep up and slipped from the hotlist.

The biggest, of course, was Andersen, which became part of Deloitte in 2002. Despite that massive change, Andersen’s disappearance did nothing to dent the biggest firms’ share of the market. In 1998 the Big Five controlled 78.6% of fee income by proportion of the whole of the Top 50; the year after the Enron shock, the figure was still 76%. Slowly but surely, though, that dominance has eroded to 72.7%, which should hearten their rivals.

The next largest firm to disappear, Kidsons, number ten on our list a decade ago, is now part of Baker Tilly. Soloman Hare, once 24th, has been taken over by Smith and Williamson. Levy Gee, formerly 21st, became the core firm for the first consolidator Numerica, which in turn was bought by Vantis.

Vantis, along with Tenon and Numerica, marked the advent of consolidators and the entry of publicly listed companies into the accountancy sector. A PLC accountancy business was little more than a fledgling idea in 1998.

Other firms have survived the decade but rebranded. Pannell Kerr Forster decided to modernise and became PKF, while Neville Russell turned into Mazars Neville Russell after becoming part of a French practice before simply rebadging itself Mazars.

But what about opportunities for advancement among the 50 largest firms? There were around 2,700 partners sharing the spoils from accountancy ten years ago, but that figure has shrunk to 2,495 in 2008.Though small, the fall reduces the opportunity to take equity and gain the big rewards.

Something else has happened, too. The number of professional staff employed has fallen slightly from 61,000 to 60,000. This suggests that firms closely manage staffing levels and do not necessarily rely on more employees to generate more income.