By and large, it was not a great year for tax firms. Two of the three biggest tax prep chains, H&R Block and Jackson Hewitt, reported noteworthy declines in revenue, citing problems with refund anticipation loans and sustained unemployment among their core client bases. (That said, the other major chain, Liberty Tax, continued its relentless growth, and surpassed Jackson Hewitt for the first time to become the No. 2 chain in the country.) For firms that provide a wider range of tax services, the results were mixed, a combination of mostly minor declines in revenue and the odd slight uptick with the notable exception of Texas-based tax services firm Ryan, which managed growth of over 10 percent, aided, in part, by its expertise in international tax issues.
The largest tax prep chain in the country, H&R Block, based in Kansas City, Mo., earned over $2.9 billion in revenue from tax prep last year, according to public company reports. The total revenue includes revenue from Block's RSM McGladrey division, with the tax fee split reported as a dollar amount. The percentage of Block's revenue from tax work is about 77 percent. The company's total revenue is $3.87 billion. Revenue declined last year by 5.23 percent. The company, headed by CEO Alan Bennett, has over 11,000 offices.
PricewaterhouseCoopers, based in New York City, earned $2.41 billion in gross revenue from taxes last year. The firm earned about 30 percent of its revenue from taxes, with total revenue at $8.034 billion. However, PwC saw a revenue decline of about 2.27 percent in that area. The firm, headed by chairman Robert Moritz, has 73 offices and total staff of 29,546.
Deloitte, headquartered in New York City, earned about $2.296 billion in gross revenue from taxes last year. That translated into 21 percent of the firm's total revenue of about $10.938 billion. Deloitte, headed by CEO Barry Salzberg, saw a 2.01 percent increase in tax revenue last year across its 100 offices. The firm has total staff of 45,730.
Ernst & Young earned $2.272 billion in gross revenue from tax last year. The New York City-based firm, under CEO James Turley, received 32 percent of its $7.1 billion in total annual revenue from tax. E&Y saw a decline last year of 6.82 percent in tax revenue. The firm has 77 offices and 24,600 staff nationwide.
KPMG LLP, based in New York City, earned $1.271 billion in gross revenue from its tax practice, or 26 percent of its total annual revenue of $4.889 billion. The firm saw a 3.68 percent decrease in tax revenue. The firm, under chairman John Veihmeyer, has 87 offices and 21,285 staff.
McGladrey, based in Bloomington, Minn., saw $475.51 million in revenue last year from taxes. The firm, under president C.E. Andrews and managing partner Dave Scudder, earned 35 percent of its total revenue of $1.378 billion from tax. It saw a 5.60 percent decrease from last year in tax revenue. The firm has 88 offices and 7,130 staff.
Liberty Tax Service, based in Virginia Beach, Va., realized $291.69 million in revenue from tax. The company earns 100 percent of its revenue from tax. Liberty, under CEO John Hewitt, achieved a 20.29 percent increase in revenue over the previous year. The tax prep chain has 3,359 offices.
Ryan, based in Dallas and under the leadership of CEO G. Brint Ryan, achieved $216.5 million in revenue from tax. Tax counts for 100 percent of the firm's revenue. The firm experienced a 9.07 percent increase in tax revenue compared to the previous year. Ryan has 42 offices and 792 staff.
Jackson Hewitt, based in Parsippany, N.J., saw $213.8 million in revenue from taxes last year. Tax makes up 100 percent of the tax prep chain's revenue. The company experienced a 13.9 percent drop in revenue last year. Jackson Hewitt, under the leadership of CEO Philip Sanford, has 6,407 offices.
To view the full report on the Top 100 Firms and the Regional Leaders, visit http://www.accountingtoday.com/papers/-57548-1.html