Immune from Enronitis?

Clients want reassurance, regulators want action and no one wants to see it happen again.

To a certain extent the Top 50 does not reflect those concerns.

Year ends may vary but, for many firms, the figures in the table represent last year’s results: before Enron, before the economic slowdown became a crawl and before the full impact of September 11 was felt. That said, if you look at some of the players whose year ends were as recent as this spring, there is ample evidence that the healthy growth rates of recent years are being maintained.

For the year to March 2002 Baker Tilly saw its fee income rise by 6%.

RSM Robson Rhodes’ rose by 14% for the year to April 2002 while Kingston Smith saw its fees leap by 15% over the same period.

Menzies, Price Bailey and WBS did even better, each growing their revenues by over 25%. Significantly for all three, those figures include around six months of post-September 11th trading.

Two other factors are worthy of comment. The staggering growth rates of the Big Five continue. Only three announce UK results and they read: Deloittes 19 %, KMPG 18% and Ernst & Young 15%.

Meanwhile the number of true consolidators in the table has trebled over the last 12 months: last year’s one (Tenon) has become three, with Numerica and Vantis joining the fray. All are in the top 30. Tenon moves up from 16 last year to an impressive ninth this year.

So far consolidation has had little effect on Numerica, placed at number 16 this year. It too is new in name but Levy Gee, its previous guise, was placed at number 18 last year. Like Tenon, it might be its second year of trading that sees it really climb. Earlier this month the Accountancy Age/Robert Half careers survey showed that accountants fear for their futures in the post-Enron world: one in ten said their career prospects had been harmed at least in the short-term by events in Houston.

In contrast if the Top 50 shows anything it’s that they shouldn’t fear for their businesses – yet. We should probably reserve judgement on that until after publication of next year’s league table.

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