BDO profits hit as its makes 'long-term investments'

by Kevin Reed

More from this author

19 Dec 2012

  • Comments
simon michaels bdo

BDO WILL CONTINUE to invest and position itself for the long term, even if that affects short-term profits, according to its managing partner Simon Michaels (pictured).

Announcing a 12% dip in profits for the year ending 29 June 2012, to £51.2m, and with its merger process with PKF likely to kick off by March 2013, the firm will not take short-term decisions to boost profits.

Speaking to Accountancy Age, Michaels believes the firm has become more attractive through its investment in key client areas, such as financial services audit and forensic accounting. Its merger announcement has also driven both partners and anon-partners to enquire about joining the business.

"There are opportunities to grow in specialist areas and invest in them for long-term profits. People are looking to join us as they see us investing and going places. I don't think we'll have an issue retaining and winning talent," he said.

"We don't make as much as the Big Four, but people can be themselves with us, and work with ambitious entrepreneurs."

However, he admitted that investing while integrating with PKF would be a "fair challenge". Communication about the firm's strategy would take place upon completion of the deal – likely to be in March.

Its 2011/12 fee income was static, at £283m. Audit income climbed 5% to £96m, while tax suffered due to a lack of corporate transactions, down 2.9% to £80m.

A lack of transactional work also hit its advisory division – fee income down 4.5% to £107.1m.

Michaels warned that tough market conditions would see continued pressure on driving down compliance-related fees, "which will stay around for some time".

Visitor comments

blog comments powered by Disqus

Add your comment

We won't publish your address

By submitting a comment you agree to abide by our Terms & Conditions

Your comment will be moderated before publication


Charterhouse Accountants

Finance Officer

Charterhouse Accountants, Beaconsfield, Permanent, Full Time, £ Competitive




Get the latest financial news sent directly to your inbox

  • Best Practice
  • Business
  • Daily Newsletter
  • Essentials


Search for jobs
Click to search our database of all the latest accountancy roles

Create a profile
Click to set up your profile and let the best recruiters find you

Jobs by email
Sign up to receive regular updates with the latest roles suitable for you



Why budgeting fails: One management system is not enough

If budgeting is to have any value at all, it needs a radical overhaul. In today's dynamic marketplace, budgeting can no longer serve as a company's only management system; it must integrate with and support dedicated strategy management systems, process improvement systems, and the like. In this paper, Professor Peter Horvath and Dr Ralf Sauter present what's wrong with the current approach to budgeting and how to fix it.


iXBRL: Taking stock. Looking forward

In this white paper CCH provide checklists to help accountants and finance professionals both in practice and in business examine these issues and make plans. Also includes a case study of a large commercial organisation working through the first year of mandatory iXBRL filing.