Speaking before 500 new partners, the chief executive of Deloitte Touche Tohmatsu announced that the firm’s global revenues would top $20 billion for the 2006 fiscal year, growth of 11.5 percent over the previous year.William G. Parrett said that financial services industry, consumer business, and manufacturing were the strongest industry sectors for member firms around the world, increasing 21 percent, 19.8 percent and 15.8 percent, respectively. Parrett also noted that 2006 was the fourth consecutive year of double-digit revenue and the 13th consecutive year of growth for the firm.

Each Deloitte region grew its revenues by at least 10 percent, before the effect of currency exchange. North American firm’s aggregate revenues increased by 12.5 percent, while Central and South American revenues increased 24.1 percent. In Europe, aggregate member firm revenues grew by 10 percent, while revenues in the Commonwealth of Independent States (the former Soviet Union) grew by 63 percent. Revenues for the Asia Pacific-Japan region increased just over 11 percent. Dollar figures were not provided for individual regions.

In a statement, the firm said that “considerable” revenue improvements were recorded for tax services in 2006, after a weak 2005 year. Other service offerings by member firms, such as forensic and dispute services, were cited for having had a particularly strong year.

Parrett also said that he expects to see consolidation continue among small and midsized firms, driven again by client demand, the same influence that drove consolidation among the biggest firms over the past couple of decades. Ultimately, he expects that trend to be good for audit quality. He also dismissed arguments that the Big Four firms should be broken up, suggesting ways to enhance competition among the largest firms including:

  • Changing independence rules that can act as inhibitors;
  • Promoting principles-based accounting, reporting, auditing and oversight systems;
  • Ensuring a reasonable level of security for audit firms; and,
  • Fostering career development for auditors by maintaining multiple service offerings by firms.

For 2007, the firm is projecting aggregate member firms’ revenues to exceed 12.5 percent. Member firm services -- including financial advisory, consulting and tax -- are exceeding targets already, growing at approximately 20 percent, 17 percent and 12 percent, respectively.The complete “Deloitte Touche Tohmatsu Worldwide Member Firms 2006 Review,” is available at www.deloitte.com/annualreview2006.

The U.S. member firm of Deloitte & Touche ranked No. 1 on Accounting Today's 2006 list of Top 100 Firms, with revenues of $7.8 billion.

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