Category: Deloitte

Biggest Big4 clients in Europe (Part-2)

by enthusiastDeloitte / EY / KPMG / PwC

Don’t miss Part-1 of this blog. Continuing from there,

Germany: The breakdown of the 15 top companies in Germany is as follows:

NameAuditorCurrencySum of Total Fees (Reporting Currency)Total Fees (Millions USD)
AdidasKPMGEuro2.503.03
AllianzPwCEuro77.6093.90
BASFKPMGEuro20.8025.17
BayerDeloitteEuro28.0033.88
DaimlerKPMGEuro52.0062.92
Deutsche BoerseKPMGEuro7.709.32
Deutsche PostPwCEuro11.0013.31
Deutsche TelekomPwCEuro17.0020.57
Infineon TechnologiesKPMGEuro4.024.87
LindePwCUSD25.2125.21
Muenchener RueckEYEuro12.4115.02
SAPKPMGEuro14.0016.94
SiemensEYEuro68.6083.01
Volkswagen PrefEYEuro53.0064.13
Vonovia SeKPMGEuro5.406.53
Grand Total399.24477.79

Switzerland: The breakdown of the 14 top companies in Switzerland is as follows:

NameAuditorCurrencySum of Total Fees (Reporting Currency)Total Fees (Millions USD)
ABBKPMGUSD44.1044.10
AlconPwCUSD10.6010.60
Cie Financiere RichemontPwCEuro12.2014.76
Credit Suisse GrpPwCCHF58.1064.49
GivaudanDeloitteCHF3.604.00
HolcimDeloitteCHF12.6013.99
LonzaKPMGCHF13.2714.73
NestleEYCHF45.0049.95
NovartisPwCUSD23.5023.50
Roche Hldg PKPMGCHF23.7026.31
SikaEYCHF6.407.10
Swiss Reinsurance CompanyPwCUSD43.3043.30
UBS GroupEYUSD73.0073.00
Zurich Insurance GroupPwCUSD57.2057.20
Grand Total426.57447.02

The summary for other European countries are provided below:

NameAuditorCurrencySum of Total Fees (Reporting Currency)Total Fees (Millions USD)
Belgium
Anheuser-Busch InbevPwCUSD2020
Total2020
Denmark
Dsv PanalpinaPwCDKK6510
Novo Nordisk BPwCDKK427
OrstedPwCDKK244
Vestas Wind SystemsPwCEuro45
Total13526
Spain
Amadeus It GroupEYEuro34
Bco SantanderPwCEuro104126
IberdrolaKPMGEuro2834
Industria De Diseno Textil SaEYEuro810
Total143173
Finland
Kone BPwCEuro78
NokiaDeloitteEuro2530
Total3138
Ireland
CRHDeloitteUSD1818
Total1818
Italy
EnelKPMGEuro–15
ENIPwCEuro11
Intesa SanpaoloKPMGEuro2024
Total2140
Netherlands
AdyenPwCEuro11
Ahold DelhaizePwCEuro810
ASML HldgKPMGEuro34
ING GrpKPMGEuro2631
Koninklijke DsmKPMGEuro67
PhilipsEYEuro1720
ProsusPwCUSD88
Total6982
Russia
GazpromOOO FBKRubles200
LukoilKPMGRubles2574
NovatekPwCRubles481
SberbankPwCRubles1092
Total4346
Sweden
Atlas Copco AEYSEK9011
Ericsson Lm BDeloitteSEK11414
Investor BDeloitteSEK506
Volvo BDeloitteSEK12415
Total37845

If you like such analysis, subscribe to this blog and do share. If there is any specific country you want me to look at or other similar analysis, drop me a comment.

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Biggest Big4 clients in Europe (Part-1)

by enthusiastDeloitte / EY / KPMG / PwC

This week we’ll look into the top 100 companies in Europe and their auditors. We utilize the iSTOXX European 100 index to identify the companies. iSTOXX European 100 index provides a blue-chip representation of Europe’s largest companies, combining indices from the Eurozone, the UK and Switzerland that include the largest companies from their respective region in terms of free-float market capitalization.

The breakout of the top100 companies by region is as follows:

Country# of Companies
UK23
France18
Germany15
Switzerland14
Netherlands7
Denmark4
Spain4
Russia4
Swedwn4
Italy3
Finland2
Belgium1
Ireland1
100

Interesting to note that France has a joint audit requirement. Joint Audits were mandated in 1966 to promote a sustainable French audit system. For the interested folks, here is a research paper assessing if two heads are better than one when it comes to audit.

Here is the number of clients and the audit fees big4 gets from these 100 companies:

Audit Firms# of Audits PerformedTotal Fees (Millions USD)
Deloitte13301
EY16479
KPMG25537
PwC28780
Deloitte & PwC & KPMG126
Deloitte & EY260
Deloitte & PwC & Mazars172
EY & KPMG165
EY & Mazars365
KPMG & Deloitte222
PwC & Deloitte124
PwC & EY369
PwC & GT14
PwC & Mazars272
OOO FBK10
Grand Total1002,577

The joint audits we see on the list above are French companies. Excluding that, PwC audits 28 of the top 100 companies and is a joint auditor for another 9 of them (37%). KPMG comes in next with 25 companies and is a joint auditor for 4 of them (29%). EY and Deloitte is a sole auditor for 16 and 13 companies respectively.

United Kingdom: The breakdown of the 23 top companies in UK is as follows:

NameAuditorReporting CurrencyTotal Fees (per reporting currency)Total Fees (Millions USD)
HSBCPwCUSD130130
BarclaysKPMGEuro5971
Royal Dutch Shell AEYUSD5858
BPDeloitteUSD5454
GlaxosmithklineDeloitteGBP3042
Lloyds Banking GrpPwCGBP2941
British American TobaccoKPMGGBP2840
Vodafone GrpEYEuro2834
Unilever PlcKPMGEuro2631
Glencore PlcDeloitteUSD2828
National GridDeloitteEuro2024
AstrazenecaPwCUSD2020
Rio TintoKPMGUSD2020
TescoDeloitteGBP1318
Reckitt Benckiser GrpKPMGGBP1318
DiageoPwCGBP1217
BHP Group Plc.EYUSD1717
PrudentialKPMGUSD1616
Relx PlcEYEuro911
London Stock ExchangeEYGBP57
ExperianKPMGUSD66
Anglo AmericanPwCUSD33
Compass GrpKPMGGBP12
Grand Total625709

France: The breakdown of the 18 top companies in France is as follows:

NameAuditorTotal Fees (Millions USD)
Air LiquidePwC & EY16
AirbusEY15
AXAPwC & Mazars51
BNP ParibasDeloitte & PwC & Mazars72
DanonePwC & EY14
EngieDeloitte & EY39
EssilorluxotticaPwC & Mazars21
Hermes InternationalPwC & GT4
KeringKPMG & Deloitte11
L’OrealPwC & Deloitte24
Lvmh Moet HennessyEY & Mazars28
Pernod RicardKPMG & Deloitte11
SafranEY & Mazars11
SanofiPwC & EY39
Schneider ElectricEY & Mazars26
Total EnergiesEY & KPMG65
VinciDeloitte & PwC & KPMG26
VivendiDeloitte & EY21
Grand Total495

Look out for Part-2 of this blog post to see the companies from other European Nations.

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Deloitte Australia Clients

by enthusiastDeloitte

Deloitte Australia is led by Adam Powick. For FY21, Deloitte recorded a revenue of AUD 2.31 billion vs. AUD 2.45 billion in FY20. Certainly the pandemic has taken a toll on the business leading to a 2% decline in revenues. However, Deloitte’s annual report mentions that profitability improved by 8%.

The break-out of Deloitte’s revenues across the various service lines are as follows:

Below is an interesting data point on Deloitte’s revenues in Australia. Audit revenues grew mid single-digits over the past 5 years. Majority of the growth was attributed to non-audit services to non-audit clients which grew on an average 15% y-o-y.

Deloitte has 9,550 employees in Australia of which 900 are partners. There are 281 women partners (31%) of the total 900 partners.

Looking at Deloitte’s audit clients, among companies in the ASX 200 Index, Deloitte leads other big4 firms in the utilities sector. Refer to the earlier posts on the distribution of audit clients among the other three firms.

Top 25 Deloitte audit clients in the order of the clients market capitalization are as follows:

CompanySector
Woolworths Group LtdConsumer Staples
APA GroupUtilities
Northern Star Resources LtdMaterials
AGL Energy LtdUtilities
Cimic Group LtdIndustrials
Oil Search LtdEnergy
Seven Group Holdings LtdIndustrials
Domino's PIZZA Enterprises LtdConsumer Discretionary
Idp Education LtdConsumer Discretionary
JB Hi-Fi LtdConsumer Discretionary
Incitec Pivot LtdMaterials
Spark Infrastructure GroupUtilities
Shopping Centres Australasia Property GroupReal Estate
Cromwell Property GroupReal Estate
CSR LtdMaterials
Iress LtdInformation Technology
Netwealth Group LtdFinancials
AP Eagers LtdConsumer Discretionary
Bingo Industries LtdIndustrials
IPH LtdIndustrials
Sims LtdMaterials
Webjet LtdConsumer Discretionary
Blackmores LtdConsumer Staples
EML Payments LtdInformation Technology
Austal LtdIndustrials
Deloitte clients

Check out the link if you want to read Deloitte’s annual report. We are starting a new blogpost to collect the salary data to help all current and prospective employees of accounting firms. So if interested, update the form and results will be published soon.

Do read the other blog posts.

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Top Australian Companies and their auditors

by enthusiastDeloitte / EY / KPMG / PwC

Focusing our attention to Australia. We previously looked into the S&P 500 US auditors. We also examined FTSE 350 UK auditors in our previous posts.

Audit market share

ASX200 Index has the 200 largest companies in Australia by float adjusted market capitalization. We’ll now look at these 200 Companies to identify their auditors. EY leads with 60 audit clients followed by PwC with 57 clients. KPMG comes in third with 41 clients and Deloitte with 29 clients. Non big-4 firms collectively audit 11 companies.

Audit market share by sectors

Next looking at the break-down of the 200 companies by the various sectors and their auditors. All big-4 firms have share in all sectors except for utilities where Deloitte audits 3 of the 4 clients.

Big4 revenues

The revenues of the big4 audit firms across five years are provided below. PwC leads in total revenues followed by Deloitte, EY, and KPMG. PwC revenues for 2020 was AUD 2.6 billion while KPMG revenues for 2020 was AUD 1.9 billion. A difference of AUD 700 million between the top and last ranked firm.

Audit revenues of big4 firms

Looking at just the audit revenues for the big4 firms for FY20, PwC brings in audit fees of AUD 475 million. EY follows with AUD 417 million. KPMG brings in AUD 363 million. Deloitte brings in AUD 305 million.

Audit Revenue (AUD millions)PwCEYKPMGDeloitte
2020475417363305
2019443390356288
Growth7%7%2%6%

ASIC Inspection firms

Looking into the Audit Inspection reports by ASIC (Australian Securities & Investments Commission) for FY20, EY has the least number of findings among the big4 firms. Only 14% of the areas reviewed for EY had findings while 35% of the areas reviewed for Deloitte had findings. Based on review of 55 financial reports of listed and public interest entities audited by EY, only 2 entities made material changes to their financial statements. The findings for other big4 firms are summarized in the table below.

Audit FirmsDeloitteKPMGPwCEY
Key audit areas reviewed26393535
Findings identified91085
2020 (%)35%26%12%14%
2019 (%)32%33%18%22%
Financial reports reviewed45473655
Material changes based on inquiries4121
(%)9%2%6%2%

The link to the reports for Deloitte, KPMG, EY, and PwC is provided in this link.

Look into our blog posts for additional information on the audit clients for the big4 firms:

Deloitte Australia clients

KPMG Australia clients

EY Australia clients

PwC Australia clients

Subscribe this blog and stay updated on the latest happenings in the big4 audit space. If there is any specific items you want us to look into, please drop in a comment.

Do read into the other published blogs.

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PCAOB Inspection reports

by enthusiastDeloitte / EY / KPMG / PwC

Consistent improvement by Deloitte, EY, and KPMG in their deficiency rate. However, an increasing deficiency rate noticed for PwC. Deloitte has the lowest deficiency rate of 10% for 2019 followed by EY and KPMG. PwC had the highest deficiency rate among the Big4 firms. We’ll have a post soon on the performance of other firms.

PCAOB inspection deficiency rates
Year201920182017
PwC30%25%24%
Deloitte10%12%20%
EY18%26%31%
KPMG29%37%50%

Interesting to note that PwC revised reports for three audits the most among big 4 firms. Probably shows the extent of influence they have over the clients. Check out the inspection report details for each of these firms in subsequent posts.

Do read our individual blogs on the Inspection reports for PwC, EY, KPMG, and Deloitte.

Deloitte PCAOB Inspection Report

by enthusiastDeloitte

PCAOB released its 2019 inspection report for Deloitte in FY20. Of the 58 audits reviewed, Part I.A deficiencies were identified in 6 of them (a deficiency rate of 10%!!). For 2018 and 2017, Deloitte’s deficiency rate were 12% and 20% respectively. I guess there is no scope for improvement here :). This is the lowest deficiency rate seen to date! (Looking forward to the PwC inspection report for next year. Rumor is its less than 1%).

Year201920182017
Total audits reviewed585255
Audits with Part I.A deficiencies6611
Deficiency rate %10%12%20%

Part I.A deficiencies

Part I.A deficiencies break-down

Year201920182017
Both financial statement and ICFR audits422
Financial statement only213
ICFR audit only036
6611

Financial statement audit deficiencies include failure to perform sufficient testing related to an account, failure to obtain sufficient evidence due to overreliance on controls, and failure to evaluate data and assumptions in developing an estimate. Deficiencies in ICFR audit include nonidentification of controls related to significant account and non-testing of design and operating effectiveness of controls. No deficiencies were identified with respect to the completeness and accuracy of the data used for controls.

Following are the audit areas with frequent Part I.A deficiencies. These are also some of the audit areas most frequently reviewed.

Audit area201920182017
Revenue and related accounts216
Investment securities111
Inventory202
Goodwill and intangible assets101
Insurance-related assets & liabilities031

Improvements noted in auditing Insurance-related assets & liabilities and revenue accounts.

Looking at the break-up by Industry sector, 12 audits were reviewed from the Information Technology sector with deficiencies identified in 1 of them (0.08%!). Most of audits reviewed were within the $1 billion to $2.5 billion revenue range (11 of them). 4 issuers with revenues exceeding $50 billion were reviewed with no deficiency identified in them.

Part I.B deficiencies

Non-ComplianceReviewedDeficiency
AS 1205, Part of the Audit Performed by Other
Independent Auditors		143
AS 1215, Audit Documentation557

Deloitte keeps improving each year. Looking forward to the next year where we might have a 0% deficiency! maybe!

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Deloitte UK Audit Clients

by enthusiastDeloitte
Home » Deloitte » Page 2

Deloitte Fee Income

Deloitte UK had a fee income of 3.7 billion pounds in FY20 which is an increase of 8% from the prior year. For FY19, Deloitte UK had a fee income of 3.4 billion pounds. See below for a breakout of Deloitte’s fee incomes over the past five years. Fee income grew on an average of 8.6% over the past five years.

Looking at the break-down of fee income among audit clients and non-audit clients we notice that direct audit fees has increased on an average by 4% while non-audit services to audit clients has increased on an average by 6%. Deloitte is probably the only big4 firm where non-audit services to audit clients is showing an increasing trend. Advisory income has increased on an average by 10% for 5 years. The table below shows the break-down in millions pounds.

Deloitte Quality Report

Deloitte’s UK 2020 transparency report mentions that of the total audits, 76% of the audits have been graded good or limited improvements needed.

The Financial Reporting Council (FRC) published its latest inspection reports on Deloitte in July 2020. Of the 17 audits reviewed, 13 (76%) were graded as good or requiring limited improvements. 3 (18%) and 1 (6%) audits were graded as improvements required and significant improvements required respectively. For FTSE 350 audits, of the 10 audits reviewed, 9 (90%) were graded as good or requiring limited improvements and 1 (10%) audit was graded as improvements required. The summary of Deloitte’s inspection results for the past five years is noted below. In 2015, 82% of audits were graded as good vs. 76% in 2020.

Deloitte FTSE 350 Clients

Deloitte audits 79 of the 350 FTSE companies bringing in a total revenue of 309 million pounds. WPP plc is the biggest client which brings in revenue of 43 million pounds, i.e. 14% of the total FTSE 350 audit fees. BP is the next biggest audit client which brings in 37 million pounds. The top 5 audit clients brings in 49% of the total revenue. All 79 Deloitte audit clients and their audit fee is included in the graphic below:

The top 25 audit clients of Deloitte in UK in the order of audit fee revenues are as follows:

CompanyAuditorTotal ('000) GBP
WPP plcDeloitte42,700
BP PlcDeloitte36,980
GlaxoSmithKline plcDeloitte30,400
Glencore plcDeloitte22,641
National GridDeloitte18,000
BAE Systems plcDeloitte10,815
Melrose Industries plcDeloitte9,700
Tesco plcDeloitte9,700
Anglo AmericanDeloitte9,509
Centrica plcDeloitte8,600
TP ICAP plcDeloitte8,059
Airtel Africa plcDeloitte6,380
Ferguson plcDeloitte5,811
TUI AGDeloitte4,600
Helios Towers plcDeloitte4,377
FirstGroup plcDeloitte4,100
Inchcape plcDeloitte3,800
Informa plcDeloitte3,700
ConvaTec Group PlcDeloitte3,094
Man Group plcDeloitte2,703
Marks & Spencer Group plcDeloitte2,700
Signature Aviation plcDeloitte2,700
Unite GroupDeloitte2,500
OneSavings Bank plcDeloitte2,444
KingfisherDeloitte2,400

Post a comment on any other metric you would like to know about Deloitte UK or if you need this dataset. Look into our other blog posts on PwC, KPMG, and EY UK. We are starting a new blogpost to collect the salary data to help all current and prospective employees of accounting firms. So if interested, update the form and results will be published soon.

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Top UK Companies and their Auditors

by enthusiastDeloitte / EY / KPMG / PwC
Home » Deloitte » Page 2

In this blogpost we’ll look at the top Companies in UK and their auditors. To identify the top companies in UK we’ll use the FTSE350. FTSE 350 is made up of companies of FTSE 100 and FTSE 250 index companies which have their primary listing on the London Stock Exchange.

On analysis of the auditors for the top UK companies for FY20, PwC leads in number of audit clients. KPMG leads in total revenue. PwC audits 95 of the 350 UK companies bringing in total revenue of $336 million pounds. KPMG audits 88 of the 350 UK companies bringing in total revenue of $347 million pounds.

Below is a high level summary of audit clients and total revenue (audit and non-related fees).

The top 25 audit clients of big4 firms within FTSE 350 are below:

CompanyAuditorTotal Fees '000 (GBP)
HSBC Holdings plcPwC110,700
Barclays plcKPMG56,000
WPP plcDeloitte42,700
Royal Dutch Shell PlcEY40,754
BP PlcDeloitte36,980
Royal Bank of Scotland Group plcEY34,500
GlaxoSmithKline plcDeloitte30,400
Lloyds Banking Group plcPwC26,900
British American Tobacco plcKPMG25,200
Prudential plcKPMG22,943
Vodafone Group plcEY22,858
Glencore plcDeloitte22,641
Aviva plcPwC21,900
Standard Chartered plcKPMG20,150
BT Group plcKPMG19,752
National GridDeloitte18,000
CRH plcEY16,085
Micro Focus International plcKPMG15,396
Reckitt Benckiser Group PlcKPMG14,500
Rio Tinto plcPwC14,490
Unilever plcKPMG14,392
Diageo plcPwC12,100
AstraZeneca plcPwC11,245
Rolls Royce Holdings PlcPwC11,000
BHP Group PlcKPMG10,964

Look into our subsequent posts for an analysis of the respective clients of KPMG, PwC, EY, and Deloitte. Subscribe to our posts for information on Big4 firms. If there is some data point that you would like us to analyze, just drop in a comment.

Do read our other blog posts.

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Who are Deloitte’s largest clients?

by enthusiastDeloitte
Home » Deloitte » Page 2

The most frequently searched question for all Big4s are who are their largest audit clients. In the previous blog we looked into how Deloitte stacks in regard to audit clients versus the total S&P 500 Companies. Below is a scatterplot showing the audit fee distribution of Deloitte clients in the US.

Here is the list of top 25 clients of Deloitte in terms of total fees in millions. The financials and information technology sectors are the major contributors in terms of fees for Deloitte. These 25 clients together contribute $778 million in audit fees for Deloitte. Total revenue for Deloitte US from Audit and Enterprise Risk Solutions for FY 2020 was $6.3 billion. Deloitte’s biggest audit client in the US is MetLife Inc. which pays an audit fee of $83.20 million. Microsoft Corp. and Morgan Stanley are the second and third biggest client of Deloitte audit respectively.

CompanyAudit FeesAudit relatedTaxOther FeesTotal fees
MetLife Inc.63.408.303.108.4083.20
Microsoft Corp.41.4414.452.240.1558.28
Morgan Stanley50.604.800.90056.30
Berkshire Hathaway46.701.900.40049.00
DXC Technology27.0017.002.001.0047.00
Dow Inc.25.144.442.78032.36
Boeing Company31.100.5000.1031.70
Procter & Gamble28.451.80.460.3831.1
Comcast Corp.28.001.500.700.1030.30
Bristol-Myers Squibb16.702.2010.000.1029.00
McKesson Corp.19.105.140.272.0026.51
United Health Group Inc.20.243.262.410.1026.00
International Paper15.773.675.540.0825.06
Marsh & McLennan20.052.052.440.0124.54
BlackRock18.363.891.430.7724.45
Honeywell Int'l Inc.17.885.640023.52
Deere & Co.20.051.031.06022.13
Walgreens Boots Alliance12.840.68.10.5822.11
Ingersoll Rand4.356.843.477.0421.69
Coty, Inc11.570.389.590.0521.58
Loews Corp.20.010.730.030.0220.79
United Parcel Service16.461.270.63018.36
Northrop Grumman17.8900.47018.36
Willis Towers Watson15.821.600.260.0617.74
Southern Company15.082.0700.0717.23

Do read our posts on Deloitte’s audit clients across the various US States and their corresponding Audit Fees. Subscribe to our posts for information on Big4 firms. If there is some data point that you would like us to analyze, just drop in a comment. We are starting a new blogpost to collect the salary data to help all current and prospective employees of accounting firms. So if interested, update the form and results will be published soon.

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