This optimism, it would appear, is based on talks with partners, staff, clients and, most recently, on an overwhelming vote of confidence by the shareholders at package holiday giant Airtours to retain the firm as its auditor.
But one assumes the firm has also faced some difficult questions behind closed doors from its clients. ‘Once we talk to them they begin to understand we are the same people who were serving them last year, the same team, and are privately sympathetic and supportive.
‘We are jolly pleased with the Airtours position and feel there will be plenty of others that will go the same way. Hopefully, over the coming weeks other companies will be following suit.’
Loss of audit work
However, just as likely is the fact that the firm may lose some audit work in the UK, as a result of the Enron affair. This is something Ormerod is not happy to accept as inevitable.
‘All we are asking them [clients] to do is look at what we have done for them, judge us on the facts. The events that are causing anxiety are, quite frankly, happening in North America. They are not happening here.’
But there must also be a danger that partners will be queuing up to leave the firm, especially as it witnessed the untimely departure of three partners to Deloitte & Touche last week.
‘The resources and people we had in Cambridge and how we were organising that branch, perhaps wasn’t the most responsive to the marketplace. That was the issue. The departures were not Enron related. The reality is during the current year, the joiners and leavers are no different to last year. Nor do we expect it to be,’ he adds.
Losing ground on the Big Five
But while the spectre of Enron hangs over the firm, there must be a danger the firm will lose ground on the rest of the Big Five.
Ormerod disagrees. ‘There are real opportunities out there for us at the moment. We have clients to serve, opportunities to pursue, business to do. We are not paralysed by this affair but actually looking for the opportunities.
‘This is not an Enron opportunity. But the turbulence in the marketplace as these issues are played out gives us an opportunity, it gives us a challenge, we are not in a corner with nowhere to go – there is still a lot of interesting work for us to do.’
The firm is attempting to keep all its ‘people’ in touch with events and is doing this through mediums such as an internal helpline, and an FAQ section on its internal portal.
But as far as Ormerod and his boss, Andersen global chief Joe Berardino, are concerned the firm is getting on with business, rather than letting the Enron affair take up too much of its time.
‘We are in touch as often as need be, but as little as possible. He has his plate full with clients. If I have spoken to him more than two or three times over the last two or three weeks, I would be surprised.’
And it is this line that Ormerod sticks to when the issue of Enron’s behaviour and passing of the buck is brought to the fore.
Credibility is the issue
‘People when under attack have a number of ways of dealing with it. For us, if you are an auditor, the fundamental of your business is credibility. How others deal with it is up to them.’
He adds: ‘There is no doubt Enron is a serious issue for lots of people, and it has raised a lot of questions about our firm. The quickest way to restore confidence, is to be open and honest. I hope that people that deal with us don’t feel that we are shifty.’
But with Enron likely to change the face of accountancy forever, how does the Andersen chief see UK regulation altering?
‘The financial services, including accountants and auditors, have to look at how they can contribute to the efficient operation of capital markets. There is a danger that in the need to respond, there will be a knee-jerk reaction.
‘While I accept that just saying that we have some things better in the UK than the US, which I think is utterly demonstrable and undeniably true, I don’t think that is enough and I accept that is the case.
Communication is key
‘We all need to think about how do we measure and communicate what matters to help investors understand what is happening and to judge risk. I think there is a danger people will think out of all this that they will have a risk guarantee programme, and that is not the case.’
Despite the fact there are no claims against the UK firm, claims against the US firm are a very real threat. And Ormerod is confident UK partners remain safe from harm.
‘It really is an issue over there, not over here. Whatever the outcome in the US it will not, I am confident, jeopardise the UK business.
‘We’ve got 5,995 people out there (in the UK) doing valuable work with our clients. We’ve got new assignments coming in (from current clients) – being totally honest, we are not seeing a vast number of new clients – but existing clients are coming back with additional work.
‘We have ability to withstand an onslaught in the US. I don’t think it is going to challenge our financial viability, and I have no reason to think this is going to be unmanageable for us,’ he adds.
Changes to the tax system is urged to support the growth of entrepreneurs, found a report from the Grant Thornton UK, the Institute of Directors, and the Prelude Group
Six new partners have been revealed by top ten firm Mazars
Investment in people, tech and businesses impacts on EY's profit per partner figure
RSM has appointed Kevin Edwards as a tax partner in its Nottingham office