Concentration of accounting firm revenue, 2015 version

The Accounting Today magazine that arrived yesterday had a supplement with info on the 100 largest CPA firms. It is available on line here with subscription and explicit permission for vendors to contact you.

Look at the revenue info for the ten largest firms:

  • $14,908M – Deloitte
  • $11,724M – PwC
  • $ 9,900M – Ernst & Young
  • $ 6,870M – KPMG
  • $ 1,471M – McGladrey
  • $ 1,383M – Grant Thornton
  • $    833M – BDO
  • $    687M – Crowe Horwath
  • $    600M – CBIZ
  • $    598M – CliftonLarsonAllen

Concentration

The concentration continues to amaze me.

To have another firm just a bit smaller than as KPMG would require the 5th through 12th firms to merge. To get back to a Big 5 would require a combined Grant Thornton, BDO, Crowe Horwath, CBIZ / Mayer Hoffman McCann, CliftonLarsonAllen, CohnReznick, AND Baker Tilly Virchow Krause.

Or, starting from the 100th largest firm, the 85 firms in 100th through 16th in terms of size could merge, which would produce a firm at $6,905M, just a bit larger than KPMG.

If the 5th through 100th firm were to all merge, they would still be about $60M smaller than Deloitte.

How about growth, perhaps someone in the second tier growing into a member of Big 5? Not likely. Growth in the Big 4 is creating more distance.

If the growth of the Big 4 had been in a separate company ($3.2B), it would drop into the list at #5, slightly less than the McGladrey, Grant, and BDO combined ($3.7B).

Here’s another way to look at growth – if the growth of each of the Big 4 were a separate firm by itself, that would create the 5th, 6th, 7th, and 10th largest firms, displacing four other firms from the top 10.

Revenue for the Big 4 is $43.4B with the next 96 having combined revenue of $14.8B, according to my calc.

Staffing

Here’s my calculation of the staffing for the 100 largest firms:

    partner staff combined
Big 4                  10,234                129,799          167,557
next 96                     7,535                 54,464            75,532
total                   17,769               184,263         243,089

Staffing pressure

An article in the supplement says that it is getting more difficult to recruit and retain staff in the three to five year range.

If you want to make a change, looks like the times are getting better to do so.

If you are a partner, might be a good time to start treating your staff well.

Previous discussions on concentration

I discussed the concentration and staffing numbers back in 2011 here and here.

3 thoughts on “Concentration of accounting firm revenue, 2015 version”

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