DAVID SPROUL has been re-anointed as senior partner and chief executive by his fellow Deloitte partners in a move that will see him sit astride the Big Four’s growing empire for another four years.
Since his election in June 2011, sales at the firm have increased by more than 20% to £2.5bn, while employee and partner numbers have risen by 10% to 14,000. Sproul, a fomer partner at Enron auditors Arthur Andersen, has vowed to double the firm’s annual investment budget to over £80m, equivalent to more than 10% of current profits.
“I am incredibly proud to be elected as chief executive of Deloitte for a second term and of the successes the firm has enjoyed during my first four years in this role. I am equally excited and energised by the opportunities and challenges which lie ahead,” he said.
Nevertheless, Sproul will have to steer the firm through the reputational damage that will linger from last week’s decision to uphold five charges by the FRC of misconduct over its role at doomed car maker MG Rover, which collapsed in 2005 and left 6,000 people without a job.
While the firm successfully appealed eight charges levied against it and now retired partner Magshoud Einollahi – who was cleared of eight counts of deliberate professional misconduct – and claims that it acted against the public interest, it is still awaiting the appeal tribunal panel’s decision on what will happen to the £14m fine slapped on it by the profession’s watchdog.
Other headaches that Sproul has had to contend with include a spat with Lloyds Banking Group over the running of a call centre dealing with payment protection insurance complaints, and defending audit work carried out at Autonomy following allegations of accounting misrepresentations at the UK tech outfit prior to its acquisition by Hewlett Packard.
And in July 2014, business secretary Vince Cable referred three senior Deloitte insolvency practitioners to the ICAEW over reports there was a conflict of interest when they accepted the role of administrators, given that they had previously advised the company. Deloitte has robustly disputed that there is a conflict of interest.
Sproul’s tenure leading the firm also encompassed a radical overhaul to how the auditing profession operates, following a probe into the Big Four’s dominance of the large-listed audit market. Under EU rules, listed companies must change their auditors every ten years, with the option of extending the period by a further ten years if tenders are carried out, and by 14 years if the company being audited appoints more than one firm to carry out the audit.
In 2013, the firm underlined its commitment to audit quality and business transparency by publishing the UK’s first extended audit for Vodafone.
Sproul, a 12 year veteran of the firm, oversaw the recent creation of Deloitte Digital, the rapid expansion of the firm’s Swiss operations and is an evangelical proponent of its Social Innovation Pioneers programme, pumping more than £2.5m into 58 socially innovative businesses.
Sproul said: “I want Deloitte to be recognised as the stand out firm in our market, admired for the impact we have on our clients’ success and reputation. I want the firm to be known for out-thinking the strategy consulting houses, out-innovating the technology services giants and outperforming our Big Four competitors.
“Deloitte is uniquely positioned to do this, with the deepest relationships and the broadest range of services in the market, combining our expertise across audit, tax, consulting and corporate finance.”
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