Top 50+50: UK fee income breaches £17bn as firms navigate pandemic

There is no denying that 2020 has been one of – if not the most – challenging years for businesses in recent history. The full effects of the pandemic on the economy are yet to be seen but data from this year’s Top 50 + 50 report shows that UK accountancy firms have responded to hurdles. However, it hasn’t been clean sailing for everyone, with a number of established players struggling to keep pace.

The rankings, which collate the top 100 accountancy firms in the UK, reveals total UK fee income continues to increase year-on-year, rising 7.98 percent since last the list was compiled.

Having rebranded earlier this year, Azets, previously Cogital Group, found itself in the top 10.

Showing continuous year-on-year growth, Quantuma Advisory comes in at number 35 having risen 29 places since 2018.

Jumping 12 spots, Dow Schofield Watts reported an increase of 37.03 percent on total fee income in the last year putting the firm in the top 60.

While we will be breaking down the data and analysing trends in future articles, here are some of the main takeaways from the report:

• UK fee income breaches £17bn for the first time
• 16 firms reported no growth or a reduction in fee income over the past year
• Consultancy fee income showed a faster revenue increase than other accountancy services
• Over £73m invested in technology this year with 27 respondents investing more than £100,000 each
• Average fee per partner at £900,000; average partner’s remuneration is £228,000
• Heads of firms still predominantly male, though dropping from 87 percent to 76 percent; 20.99 percent of partners female
• Almost three quarters of firms reported having a corporate social responsibility programme in place

Looking to the future

With many firms still working remotely and the threat of a second lockdown becoming an increasing possibility, it is unsurprising that more respondents than usual forecast limited growth for 2021.

Around a third expect revenue growth to be lower in the year ahead, compared to last year when two thirds of firms predicted a rise in income.

Almost one third (29 percent) expect partnership profits for 2020 – 2021 to decrease but 37 firms are optimistic that they will increase UK partner numbers in the next year.

Movement within the marketplace is ongoing with 27 percent of firms reporting that parts of their firm had been bought or sold in the past year.

Another positive takeaway from the report is that income streams have been stable with corporate finance, forensic, and payroll fee revenues all displaying healthy growth in 2020. Other areas have stuttered for growth – more of which we’ll discuss in future analysis.

Over the course of 2021 we may see growth in a number of areas, with sustained investment in technology and additional services as firms recognise the importance of innovation to capture a greater share of the market.

To view the Top 50 + 50, click here.