Deloitte made $46.2 billion dollars for their 2019 fiscal year ended May 31 2019. Seems like only a year ago that I was wondering which big 4 would hit 40 billion in revenue, and now Deloitte is about to surpass 50 billion. Truly Amazing!!!

They announced their revenue on September 10 2019.

This compares to their revenue of $43.2 billion in 2018. This represents an increase of $3 billion from 2018 versus a $4.4 billion increase in the prior year.

This is an 9.4 percent increase in revenues year over year which is pretty significant. That is measured in local currency.

Last year Deloitte was the highest earning big 4 firm, and this year they are also the highest ranking accounting firm.

Comments about Deloitte’s 2019  Revenue

Deloitte’s CEO Punit Renjen had the following to say about their results.

“At the core of Deloitte’s culture and business model is the fundamental belief that we exist to make a positive impact for clients, our people, and the communities in which we live and work. Our performance in FY2019 is evidence that a purpose-led approach works. Disruption and transformation are shaping business and society today, imposing new and urgent responsibilities on business leaders. Deloitte is meeting the challenges by building an equitable and sustainable business for the long term and holding itself accountable for the triple-bottom line of people, profit, and planet.”

Deloitte has also attributed their growth to the fourth industrial revolution.

Deloitte’s 2019 Revenue By Practice

Deloitte Consulting

Deloitte’s is known for their consulting practice, and there consulting practice performed well. It was their fastest growing practice in 2019. Their consulting practice grew at 15.2% growth. Last year their consulting practice grew at 15.7%.

Deliotte attributes their growth in this area to the growing industry 4.0 – aka the fourth industrial revolution.

The largest region for their consulting growth was Asia which most likely means China. The trade war might impact this in future years.

Deloitte Risk Advisory

This is Deloitte’s cybersecurity practice. Deloitte was ranked number 1 by Gartner for cyber consulting services.

Risk Advisory revenue grew at a rate of 8.4%. In 2018 this practice grew at 12.0%. This practice grew due to Cyber, Financial and Operational risk consulting growth.

Deloitte Tax

Tax & Legal revenue grew at 8.5 percent for the fiscal year 2019. They grew by 8.7% in 2018. There is some slowdown here as well. It is hard for Deloitte to have crazy growth every year as their revenues keep increase.

This is most likely due to tax reform and additional global regulation around taxes.

Deloitte Financial Advisory

Deloitte’s financial advisory practice grew by 8.1% in 2019 vs 8 % in 2018.

This was primarily driven by the desire for Deloitte’s mergers and acquisitions consulting services. Deloitte says that their was a large appetite for the M&A services this year which is evident through their revenue growth in this practice.

Deloitte Audit

Audit & Assurance revenue grew by 3 percent in 2018 vs 7% in 2017. Deloitte attributed this to further investment in audit quality.

They said they have invested $1 billion globally into their audit practice. They are also winning multiple awards for audit innovation tools. Unfortunately, audit practices across the big 4 are slowing down. I would not look for a career in audit unless you really love auditing. Revenues growth is decreasing across the board.

They also mentioned one artificial intelligence investment, Deloitte omnia, which helped them grow their practice and increase audit quality  as it continues to invest in driving quality and consistency across the network and transforming the audit business to deliver smarter and more insightful audits.

They also mentioned other tools such as Cortex. Make sure to keep up to date on all of Deloitte’s innovations to prep for your interview.

Deloitte 2019 Growth by region

In 2019, Deloitte’s Asia region grew the fastest at 11.6 percent.

The second fastest growing market was their Americas region with 10.4 percent growth.

The third fastest growing region was the Europe, Middle East and Africa region with an 8 percent growth rate. This is a huge slowdown for their EMEA region. In prior year, their EMEA region was their largest region. They probably lost several huge audits that led to this decline in growth.

Deloitte’s 2019 Number of Employees

The big 4 love to talk about their addition of talent in their revenue reporting press releases as well.

Deloitte increased their number of employees to a staggering 312,000 in 2019 v 286,200 in 2018 & 263,900 in 2017.

This represents an addition of 25,800 in 2019. In 2018 Deloitte hired 22,000 employees, so they hired a lot more even though they are investing in technology. This is truly insane. The big 4 are obviously dominating professional services if they are willing to hold over 300,000 employees. It will be interesting to see how long this investment in jobs continues.

That’s an 9% increase in the number of employees from 2018 which is consistent with prior year’s growth percentage.

This 9% increase in the number of employees only translated into a 9% increase in revenues. You can tell that the big 4 make money off the billable hour by comparing the growth in employees to growth in revenues. The big 4 accounting firms don’t make money unless they have more bodies based on their current revenue model.

It is also good news for those planning to become future accountants because many people are worried about technology replacing accountants, but it appears that the four big accounting firms are still hiring at historic rates.

Deloitte’s 2019 Revenue – Summary

In conclusion it was a good year for Deloitte as they are getting close to the $50 billion revenue mark.

They were the largest accounting firm in revenue last year, and they are the largest accounting firm again this year.

Additionally, these big accounting firms are truly trying to be professional service firms and not just accounting firms with the number of employees they have. Will there be a point where they employ a large portion of the world’s population? Will they penetrate every market that needs physical employees? It’s just a thought that I have since there appears to be no stopping in their service offerings or the number of employees they hire.

The way to view the big 4 is a pool of employees that can do work whenever necessary. Do you have a restatement, merger, or other issue that requires people with a college degree? Do you need those services backed by a huge insurance policy in case something goes wrong? Don’t look anywhere else other than the big 4. You could go to a consulting firm or a big bank, but they don’t have anywhere near the number of people as the big 4.

Deloitte made $43.2 billion dollars for their 2018 fiscal year ended May 31 2018.

They announced their revenue on September 18 2018.

This compares to their revenue of $38.8 billion in 2018. This represents an increase of $4.4 billion dollars from 2017.

This is an 11 percent increase in revenues year over year which is pretty significant.

Last year Deloitte was the highest earning big 4 firm, and this year they are also the highest ranking accounting firm.

Comments about Deloitte’s 2018  Revenue

Deloitte’s CEO Punit Renjen had the following to say about their results.

“FY2018 was exceptional for Deloitte as we continued to deliver a measurable impact for clients, our people, and society. These results reflect Deloitte’s unrelenting commitment to serving clients with quality and distinction while embracing important public-interest responsibilities. Over the past year, we have increased strategic investments in the capabilities and services most sought-after by clients in the fastest-growing markets in the world. We also have expanded our efforts and investments to drive audit quality and innovation while achieving strong financial results.”

Deloitte has also attributed their growth to the fourth industrial revolution.

Deloitte’s 2018 Revenue By Practice

Deloitte Consulting

Deloitte’s is known for their consulting practice, and there consulting practice performed well. It was their fastest growing practice in 2018. Their consulting practice grew at 15.7% growth.

Deliotte attributes their growth in this area to the growing industry 4.0 – aka the fourth industrial revolution. This represents more than 10 years of double-digit growth for Deloitte’s consulting practice.

Deloitte Risk Advisory

Risk Advisory revenue grew the second fastest at 12.0%. This practice grew due to Cyber, Financial and Operational risk consulting growth.

This makes sense since hacking and Russian troll farms has been in the news for a while now. I’m sure many CEO’s are worried about risk to their business coming from cyber risk.

Deloitte Tax

Tax & Legal revenue grew at 8.7 percent for the fiscal year 2018. This is much better growth than the 6.6 percent in 2017. This is most likely due to tax reform and additional global regulation around taxes.

Deloitte Financial Advisory

Deloitte’s financial advisory practice grew by 8% in 2018 vs 5.8 % in 2017.

This was primarily driven by the desire for Deloitte’s mergers and acquisitions consulting services. Deloitte says that their was a large appetite for the M&A services this year which is evident through their revenue growth in this practice.

Deloitte Audit

Audit & Assurance revenue grew by 7 percent in 2018 vs just one percent in 2017. Deloitte attributed this to further investment in audit quality.

They said they have invested $1 billion globaly into their audit practice, and I guess it shows in their large increase in revenues in 2018.

They also mentioned one artificial intelligence investment, Deloitte omnia, which helped them grow their practice and increase audit quality.  as it continues to invest in driving quality and consistency across the network and transforming the audit business to deliver smarter and more insightful audits. Deloitte member firms led in overall Fortune Global 500 audit wins in FY2017 and have been recognized globally as leaders in audit innovation, analytics, and artificial intelligence.

Deloitte 2018 Growth by region

In 2018, Deloitte’s Europe Middle East and Africa region grew the fastest at 15.9 percent.

The second fastest growing market was their Asia Pacific region with 13.3 percent growth.

The third fastest growing region was the Americas with an 8 percent growth rate.

Deloitte’s 2018 Number of Employees

The big 4 love to talk about their addition of talent in their revenue reporting press releases as well.

Deloitte increased their number of employees to a staggering 286,200 in 2018 from 263,900 in 2017.

This represents an addition of 22,300 in 2018. In 2017 Deloitte hired 19,500 employees, so they hired a lot more even though they are investing in technology.

That’s an 8.5% increase in the number of employees from 2017 which is consistent with prior year’s growth percentage.

This 8.5% increase in the number of employees only translated into a 11% increase in revenues, so Deloitte was much more successful in converting those employees into revenues. In 2017, they only had 5% revenue growth rate on 8% employee growth.

This might be due to lower salaries or hiring more valuable employees.

It is also good news for those planning to become future accountants because many people are worried about technology replacing accountants, but it appears that the four big accounting firms are still hiring at historic rates.

Deloitte’s 2018 Revenue – Summary

In conclusion it was a good year for Deloitte as they finally surpassed  the $40 billion revenue mark.

They were the largest accounting firm in revenue last year, and they are the largest accounting firm again this year.

Additionally, it appears that Deloitte will have over 300,000 employees soon. These big accounting firms are truly trying to be professional service firms and not just accounting firms. Will there be a point where they employ a large portion of the world’s population? Will they penetrate every market where physical employees that offer professional services are needed? It’s just a thought that I have since there appears to be no stopping in their service offerings or the number of employees they hire.

The big 4 accounting firms have to deal with large accounting scandals every year. It’s hard to keep track of all the accounting scandals, but that’s what the purpose of this page is.

We’ve tracked the largest accounting scandals of 2018 below.

There are different categories of scandals involving the big 4. Some of the general categories are below.

Accounting/Auditing Scandals – Accounting or auditing scandals typically involve a big 4 client that is having financial difficulties or accounting errors. These typically involve in investors suing the big 4 accounting firms. The investors typically allege that they relied on the financial statements of the big 4 client that the big 4 said were good.

Independence scandals – These type of scandals involve situations where big 4 professionals aren’t independent from their clients.

Ethical scandals – this involves big 4 professionals doing unethical things in the workplace including terrible things like sexual harassment. Other things that fall into this category are things like paying women and diverse people less.

KPMG Accounting Scandals 2018

Carillion audit

The Carillion scandal for KPMG was one of the largest scandals of 2018 if not the biggest audit scandal.

Carillion was one of the largest construction companies in the UK before they went under. They experienced financial issues in 2017 and went into bankruptcy in early 2018.

kpmg signed off on financial in march of 2016, so how could the firm have gone of the rails by 2017. Work found to be unacceptable according to UK watchdog in June 2018 as a result of their Carillion Audit.

KPMG PCAOB Leak Scandal

Type of scandal – ethical scandal

The PCAOB is the regulator of the big 4 accounting firms in the United States. It is important that the PCAOB selection process is random so that the big 4 can’t try to change workpapers ahead of the PCAOB audits. In this case, KPMG was given a heads up as to what audits were going to be selected by the PCAOB.

Former kpmg accountants were charged by the sec in January of 2018 for their role in leaking information to fellow KPMGers after leaving the PCAOB.

Gupta scandal

Type of scandal – ethical scandal

the gupta scandal involved government corruption. The gupta family was a family involved in political corruption in south Africa. KPMG was their auditors and was obviously conflicted because the partners on the account were very closely tied with the gupta family. KPMG faced many negative side effects as a result of their association with the scandal. They were investigated by the south African charted accountant organization.

South Africa chartered accountants probe. Kpmg set to audit own staff in april of 2018.

As a result of the Gupta scandal, KPMG lost a lot of clients in South Africa. Barclays Africa was one of these clients. They dropped KPMG as their auditor in May 2018.

Big 4 Foreign Affiliate scandal

Type of scandal – ethical scandal

KPMG Deloitte and BDO are set pay fines over their foreign affiliates trying to circumvent PCAOB probes.

VBS Bank Accounting Scandal

Type of scandal – accounting scandal

VBS Bank audit – vbs bank was placed under curatorship in 2018. KPMG partners turned out to have financial interests in the bank which made it worse for KPMG. Not only did they not spot the fraud, but they turned out to not be independent from the bank. KPMG should have also reported accounting irregularities but they did not.

Kpmg hong kong fraud

Type of scandal – auditing scandal and ethical scandal

China medical technologies defrauded investors of over $400 million. Some of these investors were in the U.S.

This was a case where the U.S. wanted to issue penalties against the U.S. listed subs of China medical technologies. KPMG Hong Kong did not comply with orders to provide workpapers. KPMG has said that they do not have the working papers.

KPMG was later freed from the suit by a judge in Massachusetts.

GE investors try to get rid of KPMG as auditor

Type of scandal – auditing scandal

After a huge write down by GE in 2018 relating to long term care insurance liabilities, investors called for a change of auditors. KPMG has been GE’s auditors for a long time.

Project management advisor to grenfell

Type of scandal – independence issue

Grenfell tower was a large building in London, UK, where a large fire occurred in 2017.  KPMG stepped down from that in january 2018. They stepped down due to a conflice of interest with a contractor that provided flammable material that may have caused the fire. They provided auditing services to Celotex which was the company that provided the potentially flammable material that was used in Grenfell tower.

Deloitte Accounting Scandals 2018

Steinhoff accounting Scandal

Type of scandal – auditing scandal

Deloitte was the auditor of Steinhoff. Steinhoff encountered financial troubles. Steinhoff investors sued deloitte in 2018.

Steinhoff audit issues were found by Deloitte in Decmeber of 2017. Investigations started in February2018.

Deloitte was fired as the auditor of Steinhoff in 2018.

Big 4 Affiliate Scandal

Type of scandal – auditing scandal

Fined by the PCAOB for work done by their foreign affiliates. $99k to PCAOB.

Carillion Scandal

Type of scandal – ethical scandal

Deloitte also got involved in the Carillion bankruptcy. They made over 10 million dollars off of Carillion over the years that Carillion was not performing well from a financial perspective, and they were called out for it.

Taylor Bean Scandal Settlement

Type of scandal – auditing scandal

Deloitte paid $150 million over failed mortgage lender. They failed to uncover errors by Taylor Bean. Deloitte was the auditor from 2002 to 2008. Deloitte settled to avoid litigation.

Gender Pay Gap

Type of scandal – ethical scandal

In the UK, the big 4 accounting firms have to disclose pay gaps between men and women. Deloitte Gender pay gap jumps to 43%. This means that women earn 43% less than men in the UK.

Ernst & Young Accounting Scandals 2018

EY Australia Sexual Harassment

Type of scandal – ethical scandal

Australia Sexual harassment allegations were made in February of 2018. Ey’s Senior Managing partner in Australia was accused of sexual harassment.

EY US Sexual Harassment

Type of scandal – ethical scandal

Ey faces sexual harassment complaint in april of 2018. The harassment occurred in a resort in Orlando in 2015. Ey later settled with the female partner who said she was groped.

PwC Accounting Scandals 2018

PwC India Scandal

Type of scandal – auditing scandal

Pwc banned from auditing in India for 2 years. Relates to their audit of Satyam. Satyam was one of India’s leading software providers. The company’s founder overstated profits by $1 billion in 2009. The securities and exchange board of india was the governing body that placed the ban on pwc india.

Colonial Bank Scandal

Type of scandal – auditing scandal

Pwc was found to be liable to the FDIC regarding their audit of Colonial bnak. PwC faced the largest ever accounting malpractice verdict of $625 million

Carillion Scandal

Type of scandal – ethical scandal

Pwc was accused of feasting on the carcass of Carillion. They were one of the big 4 accounting firms that charged Carillion millions of dollars all while Carillion was going down. They earned 21 million pounds all while Carillion was failing.

In September 2018, additional information came out that said PwC was paid 356 pounds per hour for the Carillion scandal.

PwC also managed the insolvency of Carillion and earned 50 million while doing so which also caused controversy.

Gender pay gap scandal

Type of scandal – ethical scandal

PwC had the highest gender pay gap of the big 4 in the Uk of 43.8%

Privatbank audit

Type of scandal – auditing scandal

Pwc was the auditor of Private bank from 2013-2015. Privatbank was nationalized in 2016 due to financial difficulties. They supposedly had many insider loans that weren’t paid back. Privatbank had a capital shortfall of $5.5 billion.

Ukraine Privatbank sued PwC for $3 billion dollars.

BHS Audit

Type of scandal – auditing scandal

PwC was the auditor of BHS.

BHS was a collapsed department store, and the PwC partner on the account faced a 15 year ban. The UK FRC launched an investigation in 2016. PwC was fined 6.5 million pounds as a result of the company’s collapse. They faced a 10 million pound fine, but the fine was reduced after PwC agreed to settle.

Grant Thornton

Type of Scandal – Conflict of Interest

Grant Thornton was also wrapped up in wrongdoing as far as accounting scandals go. They aren’t a big 4 accounting firm but they had to pay the largest fine by a non big 4 firm this year. They had to pay 4 million pounds in the UK in fines. They were fined by the FRC due to conflicts of interest at their audits of Nichols PLC and Univeristy of Stanford.

In early April 2018, Deloitte’s US CEO was featured in a forbes article. The title of it was how her rise to the top was not linear. As you might know Cathy Engelbert is the CEO of Deloitte US.

This article highlights the struggles that Cathy has faced throughout her career and the current causes she’s championing.

It covers the adversity she’s faced, and how she overcame that adversity. Not only did she face adversity though, she also looked out for others on her rise to the top.

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What are some of the adversities that Cathy faced?

Resigned from Deloitte in 1997 5 months pregnant – didn’t have confidence. She thought there was no way she could be a great professional and a mom.

The client she was on offered her a position in the treasury group. Then partners took her out and told her that she had all the potential in the world. At that moment she had a eureka moment in noticing that men have to be part of the conversation in women’s success in corporate America.

I want to take a quick break here. In my view, your success in the big 4 and in any corporate career for that sake is when your boss has interest in your career. When they look out for you. If you are boss only looks out for themselves and only occasionally checks in on you, you will feel very alone.

Another adversity that she faced was when her father passed away in 1987 leaving her the eldest sibling at home to help her mom through the loss. She said it was the range of opportunities at Deloitte that kept her with the firm.

It seems that those opportunities led her down a rough path at Deloitte though. She said she’s had 5 different careers within the firm. This likely refers to her working in multiple industries. She’s been in

1. Financial services,
2. Manufacturing
3. Research
4. Financial investments subject matter expert
5. Pharmaceutical and life sciences

In 2015, she was elected CEO of Deloitte US and since then she was elected as the chair of Catalyst which is a nonprofit that helps women succeed in the workplace. She’s received hundreds of fan mail thanking her for being an inspiration.

Since then she’s been championing women’s causes in the workplace, and she’s also been telling Deloitte employees how to manage their careers.

She tells folks within Deloitte that they have to actively be managing their careers. That they have to go find the mentors and sponsors. If you don’t look for them, you are going to end up leaving.

She also proposed the current 16 week paid leave program that Deloitte US currently has which the article says was a big proposal for her. I am not sure if I buy that because Deloitte came out with that program after the other big 4 already had similar policies in place. I think that was a reactionary move, but I do think it was good of her to see what the other big 4 were doing to recruit talent and pivot towards doing the right thing.

In conclusion, I think this article highlights how the path to the top ranks of the big 4 are not easy. To become partner is hard. You have to navigate tricky political situations and come out ahead. You also have to avoid burnout. It sounds like Cathy got burned out multiple times over her career, but she always had friends and mentors there to support her and pick her back up. She didn’t get there by sitting back though. She had to fight for her success and now that she’s at the top she is trying to motivate other employees as well.

My takeaway for all of you big 4 accountants is to understand that moving up the big 4 ranks is not easy. It might be easy to make senior associate or manager, but making partner isn’t necessarily easy. Moving up into senior leadership is even harder. Cathy makes it apparent that if you don’t have someone supporting that you will likely leave. That was a shocker for me to hear a big 4 CEO admit that. She admits that you will likely burn out if you don’t have a mentor. I encourage all of you current and future big 4 accountants to get a mentor. Obviously, our website and our podcast is a great start, but you also need someone that can look out for you come performance review season. You need someone that is personally invested in your well being and your career.

A lot happened in March 2018 for the big 4 accounting firms. A few of the biggest news stories are included below.

Top UK watchdog looks into breaking up the big 4

There have been a lot of scandals related to the big 4 accounting firms in the past few years which leads many people to say how can this issue be addressed as the big 4 don’t appear to be regulating themselves.

Many of these issues might be popping up due to improvements in technology and information. As technology increases, issues in the accounting of large companies might be spotted sooner.

As a result of all these issues, Stephen Haddrill has called for an investigation into whether the big 4 accounting firms should be broken up. Stephen is the head of the Financial Reporting Council which is the UK regulator of the big 4 accounting firms.

This comes after a series of scandals that have occurred related to the big 4 over the past couple of years the latest of which is the Carillion scandal. It seems that these large accounting firms should be experts in accounting and business since they are large professional service firms, but it seems that they just care less about learning their clients businesses the bigger they get.

The FRC believes that competition might help the big 4 become more diligent in their work. Since natural competition has not been a problem for the big 4 in more than a decade, the UK is trying to induce some forced competition by potentially breaking the big 4.

In the Carillion scandal, KPMG was the auditor and all the audit firms combined made almost 100 million dollars off carillion in the past year before their downfall.

There is obviously a huge problem when the audit firm can’t catch a problem at one of the Uk’s largest construction companies, but there is no downside into missing an issue because another big 4 benefits form the downfall. KPMG doesn’t care about losing a large audit because they know that one of the big 4 will likely have a scandal at their clients, and then they will be able to pick up an audit off of that.

What makes this worse is mandatory audit rotations. The big 4 just change clients every few years. It’s meant to increase independence and scrutiny, but it does little to increase competition.

Will the big 4 accoutning firms be broken up? Make sure to subscribe to our newsletter to find out.

PwC seen as milking the Carillion administration dry in the UK

In addition to scrutiny that the big 4 are receiving over the Carillion account, PwC is receiving a lot of scrutiny in particular over the Carillion bankruptcy in the UK.

PwC has been charging about 2.5 million pounds a week for the administration of the Carillion bankruptcy. They were accused by government regulators of milking the Carillion cow dry because this company was already going under and government agencies were trying to salvage what was left to provide money for pensions, but pwc says they are experts at being liquidators and need to be paid a hefty fee.

PwC was previously accused of being a bad actor as they used to be the accountants for Carillion and their pension funds. They made millions from that work yet they could not spot that the company was in financial trouble. Carillion is a huge scandal in Europe right now. It has many in Europe questioning whether the Big 4 should be broken up.

Foreign Affiliates of the Big 4 Penalized by SEC

Foreign affiliates of big 4 accounting firms were penalized by the SEC for auditing public companies in the United States without properly registering with the Public Company Accounting Oversight Board. The PCAOB is the regulator of the big 4 accounting firms. They audit the work of any accounting firm that audits public companies. Since the big 4 audit the large majority of the public companies in the United States you can understand how the PCAOB is their main regulator.

• BDO Canada agreed to pay a $50,000 penalty
• KPMG in South Africa agreed to pay $100,000 penalty
• Deloitte in Zimbabwe agreed to pay disgorgement and interest totaling $99,057
• KPMG agreed to pay $141,304 in Zimbabwe

PwC and KPMG release new gender pay gap numbers

The gender pay gap results of the large accounting firms have been trickling out over the past month. PwC and KPMG were the most recent accounting firms to release their numbers.

• PwC reported a mean gender pay gap of 43.8% and a median pay gap of 18.7%.
• KPMG stated that they have a 42% mean pay gap and a 27% median pay gap.

Each firm said that they have work to do in trying to even the playing field for women in the workplace. They all tried to describe factors that contribute to this issue, but they admitted that the current gap was not satisfactory.

Deloitte hires spies to head up their Cybersecurity

Deloitte hired a former UK spy to head up their Europe Cyber intelligence practice. His name is Rob Wainwright and he joinged Deloitte from Europol which is a EU intelligence agency similar to the CIA in the United States. Rob has 28 years of experience working in the MI5 in the Uk which is pretty much the same unit where James Bond worked.

This is a huge hire for Delotite. They are obviously seeing the demand from their corporate clients around cyber intelligence as more and more hacks happen. The latest news is this manipulation of datat from facebook accounts. Obviously facebook and other major corporations would like to pretect their private data and avoid huge headline risks from unknown technologies.

Deloitte plans to add an additional 500 people to its European cyber security practice alone.

Deloitte acquires leading AWS provider in New Zealand

Deloitte acquired a firm by the name of API Talent. API talent is considered and advanced AWS consulting partner. This is no surprise as deloitte continues to gobble up amazon web services providers across the globe. They seem to be the only big 4 firm actively acquiring in this space. Although the other big 4 offer these cloud services, Deloitte is the only one that is actively acquiring them.

Maybe it’s because Deloitte is the largest accounting firm in the world which provides them with enough capital to acquire other companies.

PwC begins utilizing Blockchain to audit

PwC has partnered with Northern trust to begin auditing on the blockchain. Northern trust developed a private blockchain for private equity transactions. This blockchain manages ownership shares. PwC was granted access to the blockchain as a node. They can see transactions happen in real time by participating as a node.

We actually suggested that this would happen in one of our previous blockchain articles. We suggested that the big 4 could not only audit via becoming a node, but they can also offer being a node as a services. These private blockchains need multiple nodes to work, but who can these companies trust? Well theoretically you wouldn’t trust anyone more than your trusty CPA right. Well that’s at least what we think many large companies would see with the big 4. It appears to be happening slowly.

PwC will be able to see the data as read only. This blockchain was developed using Linux Foundation hyperledger fabric.

This doesn’t surprise me because private equity firms are the most active in the blockchain space because they have been using blockchains to track ownership. This is pretty risky depending on who else is on Northern Trusts blockchain. We’ve spoken about this on other podcasts. It would be interesting to see who else is on this blockchain.

KPMG expands its masters of accounting with data and analytics program

As we have previously covered, KPMG offered scholarships to students to get a masters in data and analytics with accounting degree. They launched their pilot program at Ohio State and Villanova University. They have since expanded that to 9 universities

1. Arizona State University
2. Baylor University in Texas
3. Ohio State Max Fish College of Business
4. The University of Georgia’s Terry College of Business
5. University of Mississippi
6. The University of Missouri
7. University of Southern California
8. Villanova School of Business
9. Virginia Tech

KPMG will offer 135 scholarships to qualified students. The focus of the curriculum will focus on technology solutions like data and analytics, robotics, natural language processing, predictive analysis, cognitive capabilities, and workflow automation. All things that we’ve previously covered. KPMG is fully aware that these technologies are the future of accounting so that’s why they are investing in developing these leaders.

Sonoma Partners Joins Ernst and Young

Sonoma partners merged with E&Y in early march. Sonoma partners is a leading consulting firm that specializes in Microsoft Dynamics CRM and Salesforce CRM solutions. CRM stands for client relationship management. The transaction builds on EY’s high quality CRM offerings.

This will help EY build out their digital transformation offerings.

E&Y hires 400 people in charlotte North Carolina

EY is opening another wavespace center and this time they are opening it in Charlotte North Carolina. They will add 375 jobs over the next five years. The wavespace centers focus on new technologies in accounting like artificial intelligence and data & analytics.

EY will receive a 3.2 million tax incentive as part of the deal that will be spread over 12 years. E&Y is set to invest 8.2 million over the life of the project.

EY will pay an average of 75,000 per wavespace job. EY has wavespace centers in NY, San Francisco and Seattle.

In Summary

It is an exciting time in the big 4 as they invest heavily in technology. We’ve seen Deloitte acquire amazon and salesforce consultancies and we’ve seen pwc begin auditing blockchains. EY & KPMG are also investing heavily in tech jobs. EY opening a new innovation center in charlotte north Carolina and KPMG providing scholarships for data & analytics accountants. If you want to work for the big 4, it is extremely apparent that you need to learn about the new technologies that they are using.

It is also important that we don’t skim over the recent scandals and threats to the big 4 accounting firms existence.

It is essential that these scandals are highlighted and prevented in the future. How can they be prevented? I think they can be prevented by new technologies, but I also think big 4 partners and leadership need to be held accountable. I’m not going after the big 4 accounting firms because I am bitter. I am criticizing certain parts of the big 4 accounting firms because they can be great places to work, but the bad apples that work at the big 4 jeopardize their future. If big 4 partners on large accounts are not held more accountable, then regulators will ban the big 4 in certain countries like they have in India or they will break them up and force competition. Unfortunately, the big 4 aren’t really holding their partners accountable right now. All they do is release materials saying they are focusing on audit quality, but it those materials don’t seem to be making their way to leadership at the accounting firms.

It’s not just accountin scandals either. It’s gender pay gaps as can be seen in the latest pay gap releases from PwC and KPMG. Top executives at the big 4 need to be held accountable across the board as it relates to scandals, discrimination and equal pay.

If you want to help our push to keep the big 4 accounting firms accountable, forward this article on to a friend or colleague and start raising awareness on the need for change and need for accountability from top professionals in the big 4. For many of you, your futures will take place at these firms. Make sure that they are great places to work and start raising awareness today. Thanks for reading. Feel free to let us know your thoughts in the comments below.

Deloitte university was just a thought back in 2006 when the CEO of Deloitte was just thinking of the idea. Who knew that it would be shaping the future of Deloitte. Many partners were opposed to having such a large fixed cost because they wanted the ability to cut costs in the time of a recession.

Deloitte decided to build Deloitte university because they found that 70% of learning occurs informally. This is what Deloitte University is built around. It is built around informal learning. There are classrooms, but Deloitte wants their people to learn by interacting with each other in the social areas all around the campus.

1. $300 million to build Deloitte University
2. The first Deloitte university opened on October 19, 2011
3. Another $113 million was spent on training
4. 800 room resort
5. 750,000 sq ft facility
6. 107 acres of land
7. Deloitte University Houses an interactive media wall
8. Houses a 20,000 sq ft ballroom
9. A 12,000 sq ft fitness center
10. 500 permanent workers
11. 50,000 professionals make there way through Deloitte University in Dallas each year
12. Food is free, alcohol is not
13. There are courses for clients held at Deloitte University
14. The idea was first developed my Barry Salzberg, Deloitte’s former chief executive officer at the firms 2006 partners meeting
15. There is no pool, hot tub or sauna
16. There are 35 high tech classrooms
17. 33 team rooms
18. 176 seat Amphitheatre
19. Ranch style decor
20. Has a story wall in the lobby
21. Has an associate finder to allow anyone to find someone else in the facility
22. SWA group did the landscaping architecture for Deloitte

As stated above there are several courses for clients to take at the center. There is a CFO academy for people being groomed to be CFO’s . There is even a CIO academy now.

The market is the main dining area in the Deloitte University located in Dallas. They feature buffet style food. They serve 3 meals a day. There are no two seater tables.

375 bistro offers coffee and snacks. All the tables are meant to get people to socialize together.

There are no pay per views in the room.

After 5:30 people are encouraged to head over to the Barn. The barn is the sports bar type of area for all the Deloitte folks to mingle. This is where all the happy hours take place.

The Deloitte university facility in Westlake Texas also houses a 12,000 square foot gym. There is personal training at the gym. There are also athletic fields and a two mile trail for running and walking.

The architect of the building was Gensler. The builder was Turner Construction.

Many people acknowledge that the development of Deloitte University has boosted recruiting efforts.

In Conclusion

Should you join Deloitte just because they have an awesome facility like Deloitte University? No, you shouldn’t but it definitely is a plus in the benefit column. There have been studies that facilities like these boost morale and recruiting in the short term, but the long term effects don’t last because people just end up doing work in the hallways and lobbies of these facilities. They don’t see the value in going to huge hotels to get their learn on.

Let us know your thoughts on Deloitte University in the comments.

There were a number of positive news stories about the Big Four accounting firms in second week of March 2018. The big 4 gained significant positive recognition and introduced new programs for community-building and social development, a complete turnaround from the criticisms thrown their way the week prior.

Deloitte and KPMG Recognized by Junior Achievement USA

Deloitte was among the 57 organizations recently recognized by the Junior Achievement USA (JA) for their continued support and invaluable contribution to JA’s community-building and education work for students across the United States. Deloitte received a gold level 2016-2017 US President’s Volunteer Service Award for totaling some 15,000 employee volunteer hours and for helping local JA offices teach students about entrepreneurship, financial literacy, and work preparedness. Deloitte Consulting LLP’s principal, Ainar D. Aijala, Jr., who received the award on behalf of the firm, proudly noted that their employees have regularly volunteered to work with JA and that the company itself donated over $1 million in 2003 to support the development of an ethics curriculum for grade 4 to 12 students.

KPMG was conferred the gold level status for the US President’s Volunteer Service Award for doing more than 15,000 hours of volunteer work to support the entrepreneurship and financial literacy program of the JA. This is the same award given to the Deloitte and their employee volunteers. Rob Arning, KPMG Foundation Chairman, described their employees as “extraordinary people” and reaffirmed the company’s commitment to curb illiteracy and unemployment by engaging middle and high school students.

Deloitte Wins In the Middle East

Next up we are going to discuss some significant investments and wins that Deloitte has made in the middle east.

Deloitte Helps Dubai’s Department of Finance

As part of its expansion program in the Middle East, Deloitte entered into a partnership agreement with Dubai government’s Department of Finance (DOF) to assist in the implementation phase of the International Public Sector Accounting Standards (IPSAS). The partnership hopes to improve the quality of financial reporting of government agencies, with the end view of strengthening transparency, reliability and accountability. Abdulrahman Saleh Al-Saleh, Director General, represented the DOF, while Maher Al-Khalil, who sits on the Board of Deloitte Middle East and is the Managing Partner of the firm’s Consulting Operations services, signed the agreement on behalf of Deloitte. This move is a testament to the government’s commitment to financial effectiveness by upholding high-quality international standards of financial reporting in the government and public sector.

Deloitte builds state of the art facility in Saudi Arabia

Meanwhile, in the Kingdom of Saudi Arabia (KSA), Deloitte will invest in building the Deloitte Digital Center (DDC) in Riyadh to support the Ministry of Communication and Information Technology (MCIT)’s thrust for digital skills development. Through this state-of-the-art facility, Deloitte not only hopes to educate the young people about digital technologies, but more importantly, “contribute to building a thriving economy and vibrant innovative society with new job opportunities for many Saudi citizens,” as Deloitte Global CEO Punit Renjen puts it.

Deloitte builds social development accelerator in the Middle East

Deloitte also intends to support the Middle East’s social development agenda by launching the Deloitte Accelerator for Social Innovation (DASI), a program in collaboration with Ashoka Arab World and Communication Design that will provide technical assistance valued at over $100,000 to organizations that adopt a viable and scalable social development and environmental protection strategy, and ideally have women in leadership roles. Two social enterprises will be chosen from the 14 countries in the Middle East and receive expert advice and training from Deloitte. Winners will also enjoy other learning and networking opportunities to further develop their plans. Deloitte Middle East Chief Executive Omar Fahoum explained that “DASI is an exemplification of Deloitte’s corporate responsibility, where we aim to positively impact the greatest number of people in the Middle East communities through our core expertise and our global Deloitte WorldClass initiative that aims to empower 50 million futures by 2030”.

These developments in the Middle East just go to show what sets the big 4 accounting firms apart from their mid tier counterparts.

KPMG Earns Record Audit Fee from General Electric (GE)

In other news, KPMG received a $142.9 million in fees from General Electric Co. (GE), the biggest so far in their more than 100 years of working together. This news came out from GE’s latest financials and proxy statement.

GE decided to stick with KPMG as their auditor for at least another year because of the firm’s institutional knowledge of the company and their accounting issues with the federal securities regulators. The amount GE paid KPMG in 2017 increased by 59 percent compared to the previous year, primarily due to the GE-Baker Hughes merger. Despite questions from a small percentage of the shareholders, GE Chief Financial Officer Jamie Miller continued to show confidence in KPMG and said that while there are no plans to let go of the firm this year, it is a discussion they have to make on a yearly basis.

KPMG Wins Carluccio’s

KPMG was also brought in by Carluccio’s, an Italian restaurant chain with 102 outlets in the UK, Turkey and UAE, to be their financial advisor amidst poor sales and performance, as well as leadership transition. Carluccio’s pre-tax profits significantly dropped from £5.2 million to only £0.98 million, which led to the closing of their restaurants in various locations.

EY ventures into robotics in Canada

EY launched their robotic services facility in Halifax – the first of its kind in Canada – in response to growing interest in digital transformation. Said facility is part of the EY Global Centers of Excellence which boasts of having completed Robotic Process Automation (RPA) projects in over 20 countries worldwide. It looks to deliver more RPA-based digital services to back office functions of Canadian companies.

The decision to build the facility in Halifax was made because it is known to be a “hub for talent and innovation” and because of its “access to a well-educated and diverse workforce, accessible airport, and a relatively affordable cost of living, per Jad Shimaly, EY Canada Advisory Services managing partner. Through this centre, EY hopes to contribute to the growth of the city and the region as a technology expert.

PwC tests tool to track cryptocurrencies

To help companies trace their digital tokens after their initial coin offering (ICO), PwC is testing a blockchain analytics tool developed by over 80 technology experts. This tool is more than a ledger. It is intended to complement the blockchain technology by enabling the user to not only track the transaction amounts, but also to locate digital coins and know how these cryptocurrencies are being used. This way, companies can lessen the risks associated with misuse and theft post-issuance, and better anticipate the potential circulations of digital tokens. PwC is looking to offer this tool to companies planning to launch ICOs.

It was a week full of damage control for the world’s leading accounting firms as they try to save their reputation and keep their clientele engaged amidst allegations of employee misconduct and large gender pay gaps.

Ernst & Young faces harassment controversy & UK gender pay gap

Take for instance, Ernst and Young’s (EY) office managing partner in South Australia, Don Manifold, who recently left his post at the firm’s Adelaide office because he was found guilty of violating their code of conduct.

After a rigid six-week investigation following sexual harassment allegations, the firm revealed that there was, indeed, a breach of workplace policies involving Mr. Manifold and a female colleague whose name was left out of the investigation report. However, the firm was quick to clarify that the sexual harassment claims against Mr. Manifold were not corroborated.

As a sign of transparency and commitment to clean their ranks of such unacceptable behaviors, Tony Johnson, Ernst and Young’s Australian chief executive, notified EY Australia employees via email about the investigation report and stressed the firm’s stance on bullying and harassment. Mr. Johnson likewise urged employees to report such cases and assured them that each report will be taken seriously and in confidence. “My ask of all staff and partners is to recognize and reward positive behaviors and to call-out unacceptable behavior whenever you see it; whether in the workplace or out of the workplace,” he said.

Mr. Manifold will be replaced by Mark Phelps, a senior auditor of the firm’s Adelaide office and is associated with several reputable organizations such as the Adelaide Football Club, Catherine House, Access2Place, and United Way SA in various capacities.

Other names were also announced to support Mr. Phelps’ new leadership team, including Linzi Carr as people partner, Mark Stewart and Craig Whiteman as service line leaders, and Ben Bishop as transaction advisory services partner.

On the heels of this controversy EY released their gender pay gap numbers in the UK. EY reported

• a mean gender pay gap of 38.1%
• and a median pay gap of 19.5%

Not only do women working at EY face harassment, but it seems like you have to earn less than the men harassing you. EY stated that they are invested in transparency around this issue, and they are also invested in over 20 initiatives to reduce the gender pay gap.

KPMG faces harassment controversy as well

It wasn’t just Ernst and Young that was all over the news last week because of a ‘scandal’. In fact, KPMG had to do damage control themselves when Adrian Lanzilli, their South Australian partner, was involved in a sexual harassment case. He, too, tendered his resignation, but without even waiting for the investigation to begin. And, yes, it doesn’t just end in Australia as KPMG’s reputation has been tarnished in the United States, United Kingdom, and in South Africa due to serious allegations of misconduct and questionable work quality.

KPMG and Big 4 Benefit Globally But Keep Scandals Local

To make matters worse, KPMG along with the rest of the Big Four accounting firms have been called out because of the way they manage controversies – either related to their employees or the actual audit work they produce – in their local partner offices. Critics say that the very nature of the organization’s structure is to blame the lack of accountability on the firms’ headquarters. Critics claim that while the firms’ global offices uphold a strong brand and reputation, and provide strategic guidance and oversight, they have little to no control over what their local employees are doing and how they are executing their work. The critics also assert the the Big Four’s global offices actually prefer it that way to keep their risk low. They want their affiliates’ issues to be resolved locally, as if putting up a firewall, so that the local noise won’t get escalated to the global level and make the firms lose their major clients. “The only time you hear ‘Well, we’re not all KPMG’ is when they get sued”, quipped Steven W. Thomas, a lawyer handling cases against accounting firms.

To address this problem, the Public Company Accounting Oversight Board (PCAOB) required accounting firms to disclose if they are working with local affiliates in conducting an audit. This move, which started last year, hopes to tighten global controls over local affiliates and protect US-based firms and their clientele. Ultimately, scandalous local offices may have to be dissociated from the global network to maintain the firm’s credibility. PCAOB Chairman William Duhnke, however, acknowledges that this might be a bit challenging given that the local affiliates are also protected by their country’s policies on licensing and ownership, and will thus be difficult to open an investigation if needed.

Deloitte Reports Huge Pay Gap in the UK

Meanwhile, Deloitte is faced with a somewhat different yet still workplace-related issue. Their UK branch is being slammed by critics for paying their female employees 43.2 percent lower compared to their male counterparts. The gap represents a wide disparity between the opportunities available to male and female workers, particularly at the senior management level. This was supported by the statement made by Emma Codd, Deloitte UK’s managing partner for talent. She said, “These calculations again serve as a stark reminder that we don’t have enough women in senior roles – this is not about unequal pay, but the shape of our firm.”

Deloitte UK revealed this information in response to the requirement imposed by the UK government to companies with over 250 staff.

Last year, Deloitte UK reported that the mean salary gap is only at 18.2 percent because they deliberately excluded highly-paid executives and partners from the equation. Political groups harshly criticized the accounting firm, as well as other global companies like Ernst and Young and Barclays for inaccurately reporting their pay gap. Lawmaker Nicky Morgan even accused them of exploiting a technical and legal loophole through their selective computations.

However, Deloitte wanted to make things right and revised their report. We “listened to the calls for firms such as ours to do more in how we report gender pay data. We are firmly committed to transparency and achieving consistency in gender pay reporting standards,” explained David Sproul, Deloitte UK’s senior executive.

Needless to say, issues like this can have a huge and lasting impact on the reputation of accounting firms and other global brands. If left unresolved, they may lead to less clients or may even throw a company to a downward spiral pretty quickly. Deloitte, partly because of controversies in their local affiliates, has actually lost six clients, which in turn, made them slide from the top to third place of the FTSE 250 auditor rankings.

PwC Moves to First Place in FTSE 250 Auditor Rankings

On a more positive note, PricewaterhouseCoopers (PwC)  added six new clients in the first quarter of 2018 shooting them to the top of the FTSE 250 auditor rankings.

• This means that PwC audits the most companies listed in the FTSE 250. They now audit 69 clients in the FTSE 250.
• KPMG took on the second spot as they audit 66 clients in the FTSE 250.
• Deloitte dropped from first to third place in the rankings after dropping 6 clients in Q1 2018. This takes them down to 63 clients in the top 250.
• EY landed in fourth as it dropped two clients and is now at 42 clients in the FTSE 250

In a move to even widen its lead, PwC created the role of a Chief Experience Officer and handpicked Roger Gagnon to be the first executive to fill up this important post. With this, PwC looks to carry out its new consulting strategy of “combining business, experience and technology to help clients accelerate their business transformations.” This role will help PwC expand their growth into marketing and design as this role will focus on user design in the technology industry.

Mr. Gagnon’s credentials, with over 15 years of working in this field across the globe, make him perfect for the job.

Deloitte has made a lot of investment in blockchain. This post discusses all the investments that Deloitte has made in 2017. Deloitte’s blockchain team stands at about 800 professionals working in 20 countries. Some of that team was built out in 2017.

#1 – New York City Blockchain Lab (January 2017)

Deloitte opened their Americas blockchain lab in New York City in January of 2017. The location of the blockchain lab will be at 140 Broadway in New York City. This is in downtown New York City. This is the second formal blockchain lab for Deloitte.

There will be a dedicated team of more than 20 blockchain developers and designers in this New York lab. They will be focusing on developing strategic blockchain capabilities and proofs of concept into functioning prototypes. The team will work alongside other specialists in the world to come up with their solutions.

The primary focus of the New York blockchain team will be to build solutions for Deloitte’s financial services clients. Deloitte currently has 30 blockchain related prototypes at the time of the New York lab’s opening.

#2 – Deloitte also launched a Blockchain lab in Dublin Ireland (January 2017)

Deloitte announced in January of 2017 that they will open a new blockchain lab in Dublin, Ireland. The lab will be located in Dublin’s silicon docks district. The reason they are called the silicon docks is because big tech giants like google and facebook are already located there.

The focus of this blockchain lab is to help financial services clients in Europe and the Middle East. The lab will be staffed by 25 people. Deloitte also said that they hope to have a total of 50 blockchain exclusive engineers by the end of 2017.

#3 – Deloitte added a Mercury blockchain prototype (May 2017)

Deloitte Mercury is a solution that was unveiled in May 2017. The solution was made specifically as a trade finance solution. Deloitte is working with the Hong Kong Monetary Authority on this solution. It will leverage Blockchain technology to drive efficiencies, reduce cost and open up new opportunities in the trade finance industry. It is supposed to digitize paper-intensive processes by utilizing smart contracts that have made blockchain famous. There were 5 large trade finance banks that were also central in helping Deloitte come up with this prototype.

#4 – Deloitte Luxembourg developed a blockchain solution to perform customer onboarding (May 2017)

In May of 2017, Deloitte Luxembourg announced a new blockchain solution called KYCstart for their financial services clients. It helps financial services clients with their customer onboarding process. KYCstart creates digital identities for new customers that can be used across multiple platforms.

This will help many financial service companies because large financial institutions have to deal with Know-Your-Customer provisions and that can be a lengthy process. That lengthy process involves a lot of paperwork and data storage. The blockchain can digitize that process and make it more efficient.

#5 – Waves partners with Deloitte on tokenization (August 2017)

In August of 2017, it was announced that Deloitte would partner with Waves on their blockchain platform. Waves provides a self-regulatory body that will provide regulatory, legal, tax, accounting and Know your counterparty solution to clients to around initial coin offerings and blockchain solutions.

Deloitte likely will use the Waves platform as they use cryptocurrencies in their blockchain solutions for their clients. Deloitte can help clients get a peace of mind by saying they have a platform that will conduct the due diligence on blockchain tokenization.

#6 – Deloitte partners with DNV GL to use blockchain to advance certification industry (September 2017)

In September of 2017, Deloitte partnered with DNV GL to issue certificates for offshore structures and ships. The solution was created in Deloitte’s EMEA blockchain lab. These certificates are used to certify that that ships and offshore structures are safe and meet certain environmental standards. Unfortunately, they can be easily forged. Now that they can be verified in a distributed ledger on a blockchain, there is hope that this fraud can be reduced. This is one of the first instances of Deloitte coming up with a blockchain outside of the financial services arena.

#7 – Deloitte publishes six principles for blockchain (October 2017)

In October 2017, Deloitte published a comprehensive guide that established 6 principles for creating a blockchain. This was published by the Deloitte EMEA blockchain lab in collaboration with Deloitte Hong Kong and Deloitte US

Those six principles were

1. Best practice – standards for blockchain development
2. Interoperability and system integration controls
3. Audit Rules
4. Cybersecurity Controls
5. Enhancement of Traditional ICT Controls
6. Business Continuity Planning

Deloitte made some key acquisitions in 2017. Those key acquisitions are summarized below.

Red Planet (Innovation Consulting)

In Early 2017, Deloitte acquired a firm by the name of Red Planet in Ireland. Red planet was a innovation consultancy firm based out of Dublin, Ireland. Red planet seeks to bring an innovation mindset to start ups and corporate clients. This is a unique area for a big 4 accounting firm to get involved in as the big 4 are used to being seen as sleepy old companies. The big 4 also aren’t good at adopting new trends. They usually do things the way they’ve always been done in accounting, but acquiring an innovation consulting firm is a huge step for a big 4 firm.

Day 1 Solutions (Cloud consulting firm)

In March of 2017, Deloitte acquired a firm by the name of Day 1 solutions. Day 1 solutions was a cloud consulting firm. This means that they helped clients implement cloud solutions. The cloud consulting expertise that Day 1 has will help Deloitte enhance their brand as a digital transformation expert in the marketplace. With the acquisition, Deloitte will add 3,000 engineering jobs to their headcount. This acquisition was made out of the Deloitte US firm. Day 1 solutions is based out of McLean, Virginia.

Web Decisions LLC (Data Analysis)

In May of 2017, Deloitte announced that they were acquiring Web Decisions LLC. Web Decisions LLC was a company that used data to provide actionable insights to their clients. Web decisions LLC will become part of Deloitte Digital and more specifically will help enhance Deloitte’s CXV branding. Deloitte’s CXV solution helps marketers target key touchpoints for companies to interact with their customers.

Strut Digital (AWS Cloud Consulting Firm)

In May of 2017, Deloitte acquired a cloud consulting firm by the name of Strut Digital in Australia. Strut was a 25 person and will join the Deloitte Sydney office. Strut specializes in helping clients implement AWS Cloud services which is a growing business for the big 4 firms. Deloitte has acquired quite a few AWS firms to help with their alliance with Amazon Web Services.

Market Gravity (Innovative Solutions Consulting Firm)

Deloitte announced the acquisition of UK consulting firm, Market Gravity, in June of 2017. Market gravity helped their clients come up with innovative products and solutions for their customers. They helped clients in multiple sectors such as financial services, retail, energy, telecom and automobiles.

The team includes consultants, designers, marketers, insight specialists and entrepreneurs. This will really help Deloitte bolster their position as a lead consulting firm in the world.

Market Gravity has office locations in London, Edinburgh, New York and Toronto. In conjunction with Deloitte’s acquisition of Red Planet, you can see that Deloitte is really investing in innovation consulting firms across the world.

Innowake (Automated Consulting)

In June of 2017, Deloitte announced their acquisition of technology firm Innowake. Innowake is a German-based consulting firm. They try to help clients replace old code in their technology systems with automated solutions. This will become part of Deloitte’s Application Modernization service offering for clients.

Deloitte’s Application Modernization service seeks to update clients legacy technologies and IT infrastructure.

This is a really unique area for Deloitte to enter because it isn’t traditional consulting or accounting. Helping clients update IT infrastructure through automation is not a typical area for accounting firms to enter. Large accounting firms typically like to win engagements that require a large amount of man hours. If this firm does their job right, they won’t need many people. They will just run a program that helps Deloitte’s clients update their old code. I’m interested in seeing if Deloitte and the other big 4 firms continue to invest in this area.

BMR Advisors (Tax Merger)

In July of 2017, Deloitte announced that BMR Advisors would be merging with their Deloitte partnership in India. As part of the deal Deloitte will get more than 20 partners and 350 tax professionals. This was a big deal because all of the large accounting firms were bidding on BMR advisors.

BMR Advisors was the one of the top tax accounting firms in India. They were formed by some former Arthur Andersen partners after the collapse of Enron/Arthur Andersen in the early 2000’s, so the partners are no strangers to working in large accounting firms. This will help Deloitte build their market share in India especially after PwC has been banned from auditing in India for 2 years.

Innowake (Automated Consulting)

In June of 2017, Deloitte announced their acquisition of technology firm Innowake. Innowake is a German-based consulting firm. They try to help clients replace old code in their technology systems with automated solutions. This will become part of Deloitte’s Application Modernization service offering for clients.

Deloitte’s Application Modernization service seeks to update clients legacy technologies and IT infrastructure.

This is a really unique area for Deloitte to enter because it isn’t traditional consulting or accounting. Helping clients update IT infrastructure through automation is not a typical area for accounting firms to enter. Large accounting firms typically like to win engagements that require a large amount of man hours. If this firm does their job right, they won’t need many people. They will just run a program that helps Deloitte’s clients update their old code. I’m interested in seeing if Deloitte and the other big 4 firms continue to invest in this area.

Acne (Creative Ad agency)

In August of 2017, Deloitte acquired creative firm Acne. Acne is a European based firm and was founded in 1996. They offer creative, strategic, digital, film and photography services for many clients. Some clients they have served in the past include big names like IKEA, Telenor, Max, H&M and Spotify.

This is similar to Deloitte’s acquisition of Deloitte Heat in the U.S. As we’ve previously mentioned on our podcast and website, the big 4 accounting firms are large professional service firms which means that they are entering all kinds of fields that are tailored to corporate clients. Marketing and advertising are a huge part of corporation’s value chains these days as social media continues to take off. I would expect the acquisition of marketing and advertising firms to continue for Deloitte and the big 4.

Blab (Social Media Insights)

In August 2017, Deloitte announced acquisition of certain assets of Blab. The most interesting platform they acquired involves Blab’s social media intelligence platform. This is expected to help clients with understanding potential threats to their brand on social media. These threats include threats to a company’s brand or reputation.

It’s interesting to see an accounting firm tread into social media consulting. This is an interesting trend to keep an eye on, and it also goes to show that the big 4 have lots of opportunities for careers.

Well Placed Cactus (Virtual Reality Firm)

In December of 2017, Deloitte announced an acquisition of an Australian firm by the name of Well Placed Cactus. Well placed cactus is a pretty unique firm in that they provide immersive experiences and games for their clients. These include experiences that are in virtual reality and augmented reality. Well placed cactus includes a team of about 11 people that are technology based employees. They will be joining Deloitte Digital in Australia.

It is interesting to see the big 4 acquiring virtual reality and augmented reality firms. My guess is that Deloitte will utilize this firm to build solutions for clients to sell products, or Deloitte will use this to sell products to their clients. Think of attending a meeting in virtual reality as opposed to sitting in a boring conference room.