The Top 50 2008: Target hits the spot as Top 50 growth halves

One young firm has bucked the trend of slowing revenues by posting 49.5% growth in this year’s Accountancy Age Top 50.

Target Chartered Accountants grew its revenues to £15.1m for the year ending March 2008 at a time when the Top 50 average was 5.7%.

The ten-year-old firm, headed by group MD Keith Seeley and co-founder and director Mark Harman, put its success down to value-added services.

‘We’re doing big private client work: tax consultancy, financial services,’ said Seeley. ‘Most firms are not geared to this.’

The firm has grown partly through acquisition, and Seeley believes that there is more consolidation to come at the top end of the industry.

‘To leverage, you need specialism and staff, and the mass to carry them,’ he said. ‘Smaller firms are also getting their act together, but the big issue is getting the talent.’

Elsewhere the picture has not been so rosy as growth rates of the Top 50 firms halved after two years of double-digit revenue rises.

The Top 50 firms posted an average 5.7% growth rate for total fee income of £9.2bn. Audit and assurance fee income grew by just 4% although other service lines fared better.

Corporate finance grew by 13% with £1.1bn in revenue, and tax revenue was up by 12% at £2.46bn for the total Top 50.

But while the firms expect audit to pick up, corporate finance is tipped for shrinkage. Job cuts at KPMG and the slow-down in M&A activity support this forecast.

Half of the firms outside the Top 25 have no plans for further partner appointments this year.

The biggest firms reported slower growth for their 2007 year-ends, even without taking into account the impact of the credit crunch on their figures. And the Big Four’s share of total Top 50 fee income has fallen over the past ten years from 79% to 73%.

For the first time Accountancy Age has dipped into the 25 firms outside of the Top 50 and found a positive growth rate of 12%, with a collective fee income of £193.8m.

Further Reading

For full coverage of our Top 50 2008 survey, visit our special report