Every accountant is familiar with the challenge of choosing the best accounting firm to enter. The first firms to come to mind are, of course, the big 4 accounting firms. Before we get into the details, you need some background information on the leading accounting firms and what you can learn to grow your own firm in the US, the UK, or Australia.
The Big 4
The big four accounting firms are the largest in the world, both in physical size (as they have huge amounts of offices and employees around the world) and revenue. The reason why these four are separated from the rest is because of the huge disparity between the 4th and 5th. It has come to the point that all existing accounting firms today are believed to have zero chance of reaching such heights. It used to be the 8 big accounting firms, but due to a few mergers and the Enron scandal, the number has come down to 4.
Standing at the number one spot, Deloitte had almost 250,000 employees in recent years. The firm went through multiple mergers, most notably company owner, William Deloitte, and his partnership with Charles Haskins, Elijah Sells, and George Touche. It was known as Deloitte & Touche for a while, but it is now simply Deloitte with four subsidiaries.
This accounting firm began as a merge between Holyland and Waterhouse, and then a second one in 1998 with Coopers & Lybrand to become the firm we know today. With an employee base of around 220,000 and offices in 157 countries, it’s easy to see why this is in the second spot.
3. Ernst & Young
Third in the top accounting firms in the world comes from the merger of two companies in 1989: Arthur Young & Co. and Ernst & Ernst. With around 700 offices in more than 150 countries, the firm continues to grow to this day at a 5.8% annual rate.
4. Klynveld Peat Marwick Goerdeler
KPMG is the last of the big four, but still boasts 670 offices in 150 countries. The firm started out as Peat Marwick, a merger between William Barclay Peat & Co. and Marwick Mitchell & Co. In 1987, another merger happened with KMG and became today’s KPMG.
What are the benefits?
After reading that (and everything else you’ve heard concerning the four), you might think that the answer is obvious. While the benefits of working in the Big 4 speak for themselves, you should remain open to another option open to you. Namely, working or owning your very own accounting firm. While foregoing some of the benefits of the above big four, you gain:
In a big firm, there are expectations, best practices, and policies that hinder you from doing what you want to do. Whether it be your schedule, service packages, or even payment rates, owning an accounting firm means you have complete reign over it.
2. Stronger camaraderie and client-relations
With such a huge size, you’ll probably never meet anyone outside of your office and maybe even those around you. Clients, colleagues, and superiors are usually so distant simply because of how impossible it would be for any kind of genuine relationship to develop.
3. More exposure
In small firms, you trade quality for quantity. While losing out on the exposure gained from the big 4 with their top clients, you gain more of it simply because of the small size of your firm and not being another face among two hundred thousand others.
With those in mind, it should be easier for you to make your decision. Success can mean different things to different people, but that shouldn’t stop you from pursuing yours.
If you chose to open up your own firm, we may help you achieve that success you’re looking for. Click the link below to get a copy of our whitepaper, Solutions For Start Ups, to get a head start on your business.