Grant Thornton lags the Big Four
GRANT THORNTON saw turnover fall four per cent over the past financial year as profit per partner dived nearly 20 per cent on costs related to its troublesome merger with rival Robson Rhodes.
The fifth-biggest accountancy partnership said revenue fell 4.1 per cent to £378.2m in the year to 30 June.
Chief executive Scott Barnes said it was a good performance given the economic backdrop but the result suggests Grant Thornton has lost ground to the so-called “big four” accountancy firms, KPMG, Deloitte, PwC and Ernst & Young.
Profit fell 19.1 per cent to £201,000 per partner. The company chose to account for the entire cost of its 2007 merger in the 2008/09 year in a bid to draw a line under the merger, which was criticised by some as too ambitious.
Excluding the merger costs, profit per partner would have come in at £253,000.
As part of the restructuring, Grant Thornton reduced partner numbers from 286 to 235 and around 200 staff left the firm during the period.
Barnes said: “We are unique in the profession in having restructured our business during this recession following a major merger and we have chosen to account for those costs up front so that we can draw a line under the restructure.
“Our focus is on retaining and engaging our talent, so although we had 200 staff leave, we worked hard to redeploy about 150 people around the business rather than lose them. This should mean that we are ready for the upturn when it comes,” he added.
Barnes said his goal was to double profitability over the next three years.
Revenue at Grant Thornton’s largest area, audit, grew by 3.4 per cent to £121.2m, while recovery and reorganisation grew by 11 per cent to £75.4m.
Amid a dearth of deals since the credit crunch, corporate finance fell 33 per cent to £44m, which had a knock-on effect in transactional tax services leading to a 4.9 per cent drop in revenues to its tax division.