PracticeAuditDeloitte to build £2bn revenue in two years

Deloitte to build £2bn revenue in two years

John Connolly declares Big Four firm will grow by £650m

Deloitte is aiming to build revenues to the record figure of £2bn over the
next two years, a move that could see it challenge PricewaterhouseCoopers for
the position of biggest firm in the country.

Speaking exclusively to Accountancy Age John Connolly, chief
executive of the firm, said that the £2bn was just one of many growth targets
that Deloitte was working on, along with the appointment of up to 80 news
partners in the current year.

‘We have a range of ambitions and have always set ourselves challenging
targets – delivering £2bn in two years is just one of our targets. Clearly,
achieving this particular ambition will be dependent on continuing to deliver
quality work to great clients and maintaining Deloitte culture – high
performance in a totally supportive and consultative environment.’

He added: ‘Deloitte is seen as an attractive proposition for senior people
outside. In the current year we will promote 40 new partners from within and
hire a similar number outside.’

Deloitte would have to grow annual revenues from the current £1.35bn by £650m
to reach the £2bn target. In December the firm revealed growth of 15% for the
half year to November 2005, and is expected to book a similar figure for the
year as a whole.

Deloitte became news in March when Mike Rake, the outgoing senior partner of
KPMG, said that his firm, currently at number three, would soon overhaul
Deloitte’s revenue.

‘I never thought I would see the day when KPMG announced that their goal was
to pass my firm, so I enjoyed that,’ said Connolly.

‘Of course KPMG is a good competitor. In the years to 30 September our
profits were 43% higher and revenues 10% higher. They still have some way to go.

‘Size is not the issue, but we like to win. But here we have a very clear
focus which is high quality profitable growth.’

Rake also expressed regret that KPMG had not managed to acquire the UK office
of Andersen during the meltdown of the firm that followed the Enron crisis. He
said the legal advice the firm received ‘proved to be wrong’.

Instead Deloitte managed to pull off a deal employing Andersen staff rather
than trying to acquire the firm. It was the deal that took Deloitte to the
number two position in the country above KPMG.

‘We recognised that securing a transaction with Andersen partners could,
along with our decision to stay in consulting, be transforming developments.

‘We were naturally extremely careful to structure the transaction in a way
which would ensure Deloitte was not exposed to prior Andersen actual, or
prospective, liabilities. We moved extremely quickly and in a matter of days the
deal was agreed,’ Connolly said.

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