Big Four Audit Companies: PricewaterhouseCoopers, Deloitte, Ernst & Young, KPMG. Audit and consulting services

Why are the Big Four audit firms known worldwide? What are they? We will answer these questions in the article as detailed as possible. The Big Four are four companies that provide audit and consulting services. They are considered the largest in the world and have the following names:

• KPMG;
• Ernst & young
• Deloitte;
• PricewaterhouseCoopers.

Below is the revenue of the Big Four, according to the latest information, and the number of employees:

Conversions

How did the Big Four audit firms come about? The largest enterprises were once eight, and together they were called the "Big Eight." The merger of Touche Ross and Deloitte, Sells and Haskins took place in 1989 (the combined company was named Deloitte & Touche). Arthur Young and Ernst & Whinney joined together (new name - Ernst & Young). As a result, the G8 transformed into the Six. The number of huge firms has declined again after the merger of Coopers & Lybrand and Price Waterhouse in 1998 (PricewaterhouseCoopers appeared). Finally, the Five was transformed into the Four after the general departure of customers from Arthur Andersen and the subsequent liquidation of the company in 2002.

International network

Now consider the audit teams of the Big Four. PricewaterhouseCoopers is an international network of companies offering professional consulting and audit services. It consists of companies that are part of PricewaterhouseCoopers International Limited, a global network of enterprises, each of which is a legally independent entity. This organization is a member of the Big Four audit firms and has existed for over 160 years. The headquarters of the network is located in London.

History of PwC

Are you curious to know what the Big Four audit companies are doing? So, PwC was established in London in 1849, and in 1998, as a result of the merger of Coopers & Lybrand and Price Waterhouse, it received its current name.

In 2011, in April, the PricewaterhouseCoopers authorities pleaded guilty to the company for carrying out a hackney audit of the Indian corporation Satyam Computer Services (specialists did not find a fraudulent scheme by which the company’s management caused enormous damage to the owner). PwC has agreed to pay a $ 7.5 million fine to US regulators and $ 18 million to pay damages to the owner of the Indian company.

PwC Management and Owners

In America, PwC is a limited liability partnership and is the country's third-largest private enterprise in terms of revenue. Its main manager is Moritz Robert.

PwC Corporate Culture

PricewaterhouseCoopers is ranked among America's Top 100 Outstanding Employers, which is published annually by Fortune. In the ranking of 2013, she won 81 places.

This organization has sponsorship programs. So, in the framework of a project involving partners, partners, starting with the main ones, become mentors of fifteen employees of the company. They establish personal and professional contacts, get acquainted with families, find out what employees strive for and what they are interested in. Once a quarter, wards meet with their bosses to discuss their strengths and weaknesses, ways to correct the former and strengthen the latter.

PwC Activities

770 PwC offices are located in 158 countries. In 2006, her clients were 425 enterprises from the FT Global 500 world ranking.

PwC employs more than 168 thousand specialists. The proceeds of this enterprise amounted to $ 29.2 billion in 2011.

PwC in the Russian Federation

PwC in Russia first began operations in 1913. The Moscow office of this company is located on Butyrsky Val. It also has offices in Kazan, Yekaterinburg, St. Petersburg, Voronezh, Vladikavkaz, Yuzhno-Sakhalinsk, Novosibirsk, Krasnodar and Rostov-on-Don. The Togliatti office was closed in 2009 due to a lack of customers in the region. As of 2009, approximately 2,300 employees worked in PwC's Russian subsidiaries.

This organization, together with the Interethnic Finance Department of the Finacademy in 2009, launched the Master's project “World Capitals”, in which disciplines studying income were taught in English.

In 2012, PwC won first place in the ranking of the largest consulting and auditing companies, from there it replaced KPMG, but since 2013 it has again moved to the second position.

The managing partner of this enterprise in Russia is Igor Lotakov.

Deloitte

What is Deloitte Touche Tohmatsu Limited? This is a global network of consulting and audit support companies. She is a member of the Big Four. This is the largest network by the number of employees (244,400 specialists).

Chronicle of Deloitte

The first Deloitte Touche office was created by Deloitte William Welch in London in 1849. In 1990, Touche George and his partner registered Touche, Niven & Co. in New York. In 1968, Tohmatsu Awoki & Co., an accounting company, began its work in Tokyo. Deloitte & Touche appeared in 1990 as a result of integration, and in 1993 the company got its current name.

Global Deloitte Structure

Why is Deloitte good? Each of its representative offices is legally independent and separate and is subject to the laws of the country in whose territory it operates.

For many years, the Deloitte international network of enterprises was a Swiss association, but in 2010, July 31, members of this organization became part of the private company Deloitte Touche Tohmatsu Limited with the responsibility of participants in the borders they established, established in England.

In this structure, the cooperative provides support only to its member enterprises. It is similar to other global networks that provide high-quality services. In their turn, participating companies provide assistance to the end consumer. Management tries to limit the responsibility of each independent member. The general director of this company is Renge Punit.

Activities Deloitte

Deloitte provides assistance in the field of consulting, taxation, audit and corporate finance to private and state enterprises operating in various economic sectors.

By the end of 2015, Deloitte was already operating in more than 150 countries. Its equity holders in 2015 reported receiving a combined record revenue of $ 35.2 billion.

Deloitte in the CIS countries

Deloitte opened its first residence in Moscow in 1990. She is one of the first among the famous consulting and auditing companies appeared on the market of the CIS countries.

In Russia, this company is represented in five large cities: St. Petersburg, Moscow, Ufa, Yekaterinburg and Yuzhno-Sakhalinsk, where about 2,000 specialists work.

In Russia, Deloitte is part of Deloitte CIS Holdings Limited, which is part of Deloitte Touche Tohmatsu Limited, a member of the Deloitte international association of firms.

The organization’s offices are open in 11 CIS countries, as well as Ukraine and Georgia. They employ more than 2,500 employees. This company provides the following services:

• corporate finance;
• taxation and law;
• consulting services.

Ernst young

Have you ever heard of Ernst Young? This is a British consulting and auditing company, one of the largest in the world (part of the "Big Four" of auditing firms). Under the trademark EY, which is the abbreviation for the name of the company, has been operating since 2013. Its headquarters is located in London.

History of Ernst Young

Ernst Young was founded in 1989 by integrating American auditing companies: Ernst & Whinney, created by Ernst Alvin in 1903, and AC Young, formed by Young Arthur in 1906.

EY is a British audit and consulting company that provided assistance to Lehman Brothers, which went bankrupt in September 2008. This collapse marked the transition of the global economic crisis of the late 2000s to an intensive phase. Ernst & Young then said that Lehman went broke due to a series of negative unprecedented events in the financial markets, and the management, not the auditor, is responsible for the bank's debt.

The Chairman and CEO of EY is Mark Weinberger. Its main office is in Sydney (Australia). In general, this company has opened 728 offices in 150 countries of the world, employing more than 230 thousand specialists.

In Russia, the company owns offices located in St. Petersburg, Moscow, Krasnodar, Kazan, Yekaterinburg, Tolyatti, Yuzhno-Sakhalinsk, Novosibirsk, Rostov-on-Don and Vladivostok.

Activities Ernst Young

BusinessWeek's magazine ranked EY first in the annual list of “Selected Places to Start Your Career”. And in the Fortune list of “100 Selected Firms for Labor” in 2009, this organization took 44th place and the highest among the “Big Four”.

Great Place to Work University (USA) in 2012 included EY in the list of the most outstanding employers among international enterprises. It is known that this inventory is already the second year. It includes 25 world leading companies in this field.

EY in 2013 was recognized as the best employer among firms providing qualified services, and won second place in the international ranking Universum 50 World's Most Attractive Employers.

In 2015, she was also rated as the most optimal employer among professional assistance firms, and she was in eighth place in the Universum 50 World's Most Attractive Employers rating of the Russian Federation.

Kpmg

What is KPMG famous for? This is one of the largest qualification support networks in the world. She is part of the Big Four. Its international headquarters is located in the Netherlands (Amstelveen).

The company employs more than 162,000 employees. KPMG provides three types of services: tax, audit and advisory (restructuring with business management, managerial and risk clarification).

KPMG History

KPMG was established in 1870 when Pete William Barkley registered an accounting company in London. In 1911, Willari Barclay Peat & Co merged with Marwick Mitchell & Co at Peat Marwick Mitchell & Co, later known as Peat Marwick.

At the same time, the Thomson McLintock accounting office was established in Glasgow in 1877. Kleinveld Pete opened an accounting company in Amsterdam in 1917. A little later, he entered into an alliance with Klynveld Kraayenhof & Co with Craienhof. In 1979, Deutsche Treuhandgesellschaft (Germany), Klynveld Kraayenhof & Co (Netherlands) and McLintock Main Lafrentz (USA) created a union of national independent firms KMG to create a powerful international European company. Then, in 1987, Peat Marwick and KMG made the first major integration of accounting enterprises and created an organization called KPMG, with the exception of the English - Peat Marwick McLintock.

Further, KPMG underwent various changes, and in October 2007 its member firms from Germany, Switzerland, Great Britain and Liechtenstein integrated into the partnership of KPMG Europe. After it, member firms from Belgium, the CIS, Spain, the Netherlands, Luxembourg, Saudi Arabia, Turkey and Norway joined.

In December 2008, it became known that $ 2.37 billion from the two funds of the Tremont group, which was a client of KPMG, were transferred to the Madoff pyramid.

KPMG structure

KPMG audit carries out at the highest level. She is in the ranking of 100 selected US employers, which is published annually by Fortune. She took 63rd place in the ranking of 2014, leaving behind all the other fours. Each international office of this company is an independent legal entity - a member of the cooperative KPMG International (a Swiss company registered in the canton of Zug).

In 2003, KPMG International transformed its legal structure from a Swiss company to a cooperative society under Swiss law.

Such a structure, in which the cooperative only supports its member companies, is similar to other networks that provide qualified assistance. Similarly, participating firms provide services to the end consumer. The aim is to limit the responsibilities of independent members.

Andrew Michael, a former Australian KPMG chairman, took over as the international chairman in September 2011. Today he works in Hong Kong. For the first time in history, the world head of an accounting firm from the Big Four began to be based in the Pacific-Asian region.

KPMG in the CIS

KPMG provides audit and consulting services in the CIS countries. It has its branches in Azerbaijan, Russia, Ukraine, Kyrgyzstan, Kazakhstan, Armenia, Georgia. Its divisions employ more than 3,800 employees.

The company opened its office in Moscow, its regional centers are located in Novosibirsk, Yekaterinburg, Perm, St. Petersburg, Krasnoyarsk, Kazan, Rostov-on-Don, Nizhny Novgorod. The largest Russian organizations are its customers. In fiscal year 2011, the revenue of KPMG units in Russia amounted to 10.5 billion rubles.

The Expert RA institution established that KPMG's audit business is the largest in the Russian Federation since 2009. In 2011, KPMG was the largest consulting and auditing firm in this country, but PwC came in first place with the same result next year.

Expertise

The Big Four conducts an excellent audit. But what is it? An audit refers to the branch of economic activity and the academic discipline studied at institutes. According to the legislation of the Russian Federation, audit means only operations to verify financial (accounting) reports and accounting data, as well as displaying, based on its results, an independent motivated opinion of the auditor on the authenticity of the statements in the form of a written expert opinion.

In essence and in accordance with the traditions of business vocabulary and turnover, an audit is a procedure for evaluating and independently verifying accounting data, evaluating the statements and activities of an enterprise, as well as a process, system, product or project. Most often, this term is applied to the audit of accounting records of firms with the aim of expressing opinions about their reliability.

In business practice, the concepts of “technical audit”, “operational”, “quality”, “environmental” and other audit variations are used. However, these processes and concepts do not have the (legal) formulation specified in the law. Some types of expertise are similar in certification and importance. It is necessary to distinguish these types of audit, inspection and control activities from the audit of financial statements.

Counseling

Now let's find out what consulting is. This is the work associated with advising managers, managers on issues in the field of technological, commercial, expert, financial, legal, technical activities. The purpose of this discipline is to help management (management system) in achieving the objectives.

Consulting enterprises are typified in separate areas of practice (for example, personnel, financial, strategic, organizational).

Consulting is designed to analyze and justify the prospects for the application and development of scientific, technical and economic-organizational solutions, taking into account the problems of the client and the subject area.

Counseling is necessary in the following cases:

• The company needs new ideas.
• The firm needs knowledge and experience.
• The enterprise management does not agree on an important issue, and an external opinion is required to get an objective recommendation.
• A firm needs support to complete a project.
• Due to the shortcomings of the company’s internal dialogue, a professional is needed who can turn into a link between departments and levels.