Deloitte partners set for bumper payout as profits rise despite slowdown
Deloitte’s 702 equity partners are set to receive £832,000 each, on average.
Partners at Deloitte are set for a bumper payout this year after the accounting giant logged higher profits despite an economic slowdown and “continued uncertainty”.
Distributable profit for the year to May 31 came in at £584 million after corporation tax was deducted, which Deloitte said marked a 0.5% rise compared to a year earlier.
This means Deloitte’s 702 equity partners are set to receive £832,000 each, on average.
While the figure is lower than the £865,000 logged last year, Deloitte’s switch to reporting average profit on a post-tax rather than pre-tax basis means partners are set for their biggest payout in nine years.
It came as the company logged a 5.9% rise in revenue from £3.38 billion to £3.58 billion for the year.
The UK business alone drew £3 billion in revenue, up 5.1% from a year earlier.
The earnings results account for the company’s UK and Swiss operations, which run as one entity.
The professional services firm’s audit and risk advisory revenues grew at the fastest rate, up 10.2% to £1 billion, while its tax services revenue grew 5.8% to £732 million.
Consulting meanwhile grew only 1.7% to £873 million, while financial advisory services were flat at £459 million.
David Sproul, senior partner and chief executive of Deloitte North West Europe, said the results come despite difficulties across the region.
He said: “This is a good result in a market facing slower economic growth and continued uncertainty.
“Tax revenues have been boosted by demand for M&A, private client and employment-related services work, as well as demand for digital solutions to global compliance obligations, where we are continuing to invest.
“Following the launch of our UK legal services, we are also growing our offering in immigration, employment services, corporate dispute and resolutions, alongside a focus on ‘new law’ services.”
But Deloitte is still facing the threat of an industry wide break-up, alongside its Big Four peers including KPMG, PwC and EY.
The audit profession has faced significant scrutiny in the past year, with concerns raised over quality, conflicts of interest and a lack of choice. David Sproul
The companies have been criticised by the industry regulator for an overall decline in audit inspection results.
They were also savaged by MPs earlier this year for “feasting on the carcass” of Carillion after collecting more than £70 million before its demise.
In the firm’s latest set of results, Mr Sproul said: “The audit profession has faced significant scrutiny in the past year, with concerns raised over quality, conflicts of interest and a lack of choice.
“These are serious concerns and we recognise the need for change.
“We must look at how the audits of the future match the evolving needs of stakeholders and society and address increasing business complexity.”