Deloitte Touche Tohmatsu global CEO Barry Salzberg led his firm to record revenues of $28.8 billion this past year.
The New York-based firm reported its revenue Thursday for the fiscal year ending May 31, with aggregate revenues at Deloitte’s member firms around the world growing 8.4 percent over last year in U.S. dollars, despite the stagnant worldwide economy.The firm ranked in first place on Accounting Today's 2011 list of the Top 100 Firms.
Deloitte’s financial advisory and consulting services helped the firm achieve the most growth, with financial advisory services posting 15.1 percent growth and consulting revenue growing 14.9 percent. Meanwhile, tax revenue grew by 5.2 percent, and audit and enterprise risk services revenue grew by 4.7 percent.
“Clearly the growth in our advisory and consulting business contributed significantly to our growth,” Salzberg said in an interview Friday. “Some of the key reasons for the growth overall would include our multidisciplinary services model. The depth and breadth throughout our model give us the unique opportunity to develop innovative solutions and integrated market offerings.”
Revenue growth was particularly keen in the Asia Pacific region, especially in India and Australia. Asia Pacific revenues grew 15.8 percent, making it the fastest-growing region for the firm for the seventh year in a row. Deloitte’s member firms in Australia and India achieved growth in excess of 25 percent, while Deloitte China grew 8.3 percent. Almost all the member firms in the region experienced double-digit growth.
Growth in the Americas region was also high at 10.4 percent, particularly in Brazil and Chile, both of which grew over 20 percent. Member firms in Canada and the United States also posted growth, despite the challenging business conditions.
“We made a good number of investments in the Asia Pacific,” said Salzberg. “It’s been a focus for us for a number of years, particularly in emerging markets like China and India, and developed markets like Australia. Over the last few years we’ve been able to reap the benefits of these investments.”
He noted that in India, consulting has grown the fastest of all of the firm’s businesses.
The firm also did more hiring as part of its goal to increase its global workforce to 250,000 professionals by fiscal year 2015. This past year, Deloitte added 49,000 professionals, although with reductions, it was actually an addition of 12,000 net new jobs to its global workforce.
Deloitte’s growth has occurred in part organically and through acquisitions. The firm’s acquisition in 2009 of BearingPoint’s North American public services practice helped the firm’s growth two years ago, but the firm went on to make further acquisitions in the past year in areas such as analytics, sustainability and real estate consulting.
“We made a number of acquisitions of companies as well as hired a number of partners from other firms that also contributed to our growth,” said Salzberg. “We hired talent, and that talent was a big contributor to some of our growth.”
He estimated that Deloitte made over 50 acquisitions over the past two to three years.
The firm is also grooming its talent by building a training facility in Dallas known as Deloitte University. The physical facility is now in its pilot phase and Salzberg said the U.S. member firm, Deloitte LLP, is now beginning to use it for training. Salzberg used to be CEO of the U.S. firm before he was promoted to global CEO earlier this year, succeeding James Quigley.
“Our people are now beginning to reap the benefits from a talent perspective,” Salzberg said of the training facility. “Our people have recognized the commitment we have made and that is working out extremely well. It’s in the early stages of its operation, but the feedback we’ve gotten from our people and recruits and clients has been extraordinary, and it’s validating the strategy we had in the first place. We’re looking to get the concept throughout the member firms.”
The firm’s audit unit, Deloitte Audit, has also been developing a new audit approach and technology. “We’re changing the methodology of how we deliver an audit, and that investment is in the $300 million range so far,” said Salzberg. “We expect to be able to roll out this approach very, very soon. It’s a significant investment in an important business that serves the public interest. It is designed to improve our audit quality and provide greater insights for our clients and the foundation for ongoing innovation. We’re very excited about it. It’s an enterprise-wide foundation that includes firm analytics and bumps up our ability to deliver on our commitments to our clients in this very challenging market environment.”
Salzberg acknowledged that Deloitte’s network of firms is facing an uncertain economy and a difficult environment globally in the year ahead. “Our expectation is that our performance in the fiscal year that we just started will mirror the performance we had in the last year,” he said. “We will continue to make investments and continue to hire a robust number of people.”