Ernst & Young reported Thursday it achieved a record amount of worldwide revenue in the fiscal year ending June 30, 2018, earning $34.8 billion, the eighth consecutive year of growth for EY.
The Big Four firm’s overall FY 2018 revenues grew by 7.4 percent in terms of local currency and 11 percent in U.S. dollars terms, compared to the previous fiscal year. EY reported strong growth across all of its service: with assurance growing 4.4 percent in local currency terms; advisory growing 10.1 percent; tax increasing 6.4 percent and transaction advisory services gaining 13.9 percent. EY recorded 8.5 percent compound annual growth since launching its Vision 2020 plan in 2013.
“This year more clients turned to EY for support in their digital and transformation strategies, and for our bedrock services across audit and tax,” said EY global chairman and CEO Mark Weinberger in a statement. “Our significant and innovative investments are driving growth and supporting the delivery of high-quality services. Most of all, our success is driven by the contributions of 260,000 EY people around the world.”
Revenue grew across all four geographic areas for EY: 7.4 percent in the Americas; 6.9 percent in the Europe, Middle East, India and Africa region; 10.5 percent in the Asia-Pacific region and 3.1 percent in Japan.
In the U.S., EY reported $14 billion in revenue in FY18, a 7.3 percent increase over the previous fiscal year. EY’s transactions business led the way in growth in the U.S., thanks to a strong M&A market and greater demand for strategic consulting, integration, diligence and other services. EY also saw double-digit growth in advisory practice, driven by cyber services, digital, analytics and technology transformation, while the assurance practice saw a steady flow of new audit engagements, including two Fortune 500 corporations. Germany also achieved strong growth, led by double-digit growth in transaction advisory services and advisory. EY also saw strong growth in Australia, Canada, Italy, the Netherlands and Spain.
Emerging markets saw growth 10 percent in FY 18 (up from 8.9 percent growth in FY17). Greater China recorded its third year of double-digit growth, increasing 11.6 percent, driven by strong growth across all EY service lines. India continued its eighth consecutive year of double-digit growth, up 16.3 percent. Mexico also experienced double-digit growth, of 15.3 percent.
EY also saw revenue growth across different industry sectors, with wealth and asset management and insurance both seeing double-digit growth. Growth in wealth and asset management came from demand for technology and business transformation, customer experience and operational efficiency initiatives. The insurance area achieved double-digit growth, thanks to demand for technology and business transformation services across EY’s advisory and tax practices, as well as providing clients with IFRS 17-related services such as finance, risk and regulatory advice.
Global and U.S. tax reform and legislative-driven demand for transfer pricing and indirect tax services contributed to growth in EY’s tax business. Digital technology also changed how organizations and authorities manage tax reporting and obligations, increasing revenue growth as clients sought digital tax administration services and support with the application of blockchain, robotics and AI in tax operations to manage tax “big data.”
To fill out its digital portfolio, EY acquired the technology assets and related patents for a Crypto-Asset Accounting and Tax (CAAT) tool this past fiscal year to support tax liability calculations for cryptocurrencies and crypto-assets. In addition, demand for EY legal services fueled expansion to more than 2,200 law practitioners in more than 80 countries around the world. Meanwhile, EY People Advisory Services kept growing and as the firm announced a collaboration with Concur on an integrated tax and immigration system for business travelers.
