Clients leave as Deloitte merges consultancies

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,a href=”/News/1134142″>Consulting clients set to ditch Deloitte

Deloitte & Touche is to rationalise two consultancy practices into a single unit, following its controversial decision not to hive off its consulting arm like every other Big Four firm.

Deloitte’s internal Business Consulting unit will now become part of Deloitte Consulting which will remain part of the main firm following a decision taken last April.

Accountancy firms in general have been under pressure to separate from consulting practices because of corporate governance concerns in the wake of the Enron and WorldCom scandals.

This week, a Deloitte spokesman told Accountancy Age that the firm’s internal consulting group – its human capital group and its insurance management consulting arm – would merge with Deloitte Consulting.

The integrated consulting group will be divided into five ‘competencies’: strategy operations, technology, enterprise operations, human capital and outsourcing.

The u-turn on separation has already worried some of the firm’s clients.

In the US, a number have already dropped the firm for fear of conflicts of interest.

General Motors announced it would cease its consulting projects with the firm, and one of the largest vehicle retailers in the US, AutoNation, said it would no longer use the firm as auditor.

In an announcement to the SEC, it said: ‘AutoNations’s audit committee made the decision due to the recent announcement by Deloitte & Touche that it had ended efforts to separate Deloitte Consulting, which provides services to AutoNation.’

The Deloitte spokesman said the firm had already taken steps to separate its consulting and audit clients before the decision.