It was an offer they couldn't refuse.

Two years ago PricewaterhouseCoopers was poised to sell its consulting unit to Hewlett-Packard for a staggering price tag of nearly $18 billion.

At that time, Ernst & Young had already divested its consulting unit to Cap Gemini for $11 billion. KPMG’s consulting arm was planning a initial public offering in early 2001, while Andersen and Andersen Consulting were coming off a divorce battle so nasty it would have left Judge Judy cowering in the corner.

But, citing "unfriendly" market conditions, including their own slumping stock price, H-P backed off at the 11th hour. No doubt the economic climate was at least part of the reason for the retreat. However, my guess is that Carly Fiorina & Co. were at least contemplating the planned merger with Compaq. So absorbing a unit as massive as PwC’s consulting arm at the time would have probably left H-P feeling a bit like Long John Silver competing in a field goal-kicking contest.

Compounding the problem was what to do with the PwC partners, or specifically figuring out exactly where they would fit on H-P’s organizational chart. That would be a problem I wouldn’t wish on any self-proclaimed management guru.

Earlier this year, PwC said that instead of divesting their consulting unit, they would spin it off in an August IPO. Not only would the consulting arm be independent, it would now be saddled with the unlikely name "Monday," — which would no doubt provide fodder for a week of future Dilbert cartoons.

Enter Big Blue.

Waving its checkbook and more specifically, $3.5 billion in stock and cash, IBM conveniently agreed to take PwC Consulting and integrate it with its own massive consulting arm, IBM Global Services.

Not only does the deal save PwC the headache of sweating out an IPO in a wobbly market [not to mention throwing a little extra into the pot than an IPO would have garnered] but neatly extricates the audit firm from any perceived conflict of interest with respect to cross-selling consulting services.

The landmark accounting reform legislation passed by the House and Senate and subsequently signed by the primary resident of 1600 Pennsylvania Avenue also carries a laundry list of do’s and don’ts with regard to providing consulting services to audit clients. Anyway, many of PwC’s audit clients were backing away from giving the auditor consulting engagements.

Now only Deloitte Consulting remains as the lone consulting arm of a Big Five firm — but not for long. Recently, parent Deloitte Touche Tohmatsu said its consulting unit would become a separate, privately held entity. When that happens, the landscape of the accounting firm of the New Millennium will be noticeably different.

The smaller firms will no doubt reap the rewards of the Big Five abandoning much of its consulting work, while as recompense for lost revenue, audit fees at the Big Five – oops, better make that Big Four —will no doubt rise.

The author Victor Hugo once remarked that the one thing more powerful than any army was an idea whose time had come.

With everything that has impacted the profession over the past year, separating Big Five consulting from auditing was such an idea.

In fact it was probably a bit overdue.

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