Category: EY

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

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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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EY Australia Clients

by enthusiastEY

EY Australia revenues were AUD 2.13 billion in FY20 which is an increase of 13% from revenues of AUD 1.89 billion. Audit revenues specifically increased by 7%. The below chart shows the growth of EY’s revenues over the past five years. Around 75% of EY’s revenues come from non-audit services performed for non-audit services. The remaining 25% are from audit and non-audit services to audit clients.

Of the 200 Companies in the ASX200 Index EY audits 60 of them. That is a 31% audit market share. EY leads in the number of audit clients among the top 200 companies in Australia. EY has a leading number of clients in the Communication services, Consumer discretionary, Consumer staples, Energy, Healthcare, Information Technology, and Telecommunication services sector. See below for a break-up of EY’s audit clients among the various sectors:

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

CompanySector
CSL LtdHealth Care
National Australia Bank LtdFinancials
Wesfarmers LtdConsumer Discretionary
Telstra Corporation LtdTelecommunication Services
Newcrest Mining LtdMaterials
Woodside Petroleum LtdEnergy
Coles Group LtdConsumer Staples
Ramsay Health Care LtdHealth Care
REA Group LtdCommunication Services
The a2 Milk Company LtdConsumer Staples
Afterpay LtdInformation Technology
Xero LtdInformation Technology
James Hardie Industries PlcMaterials
Santos LtdEnergy
Scentre GroupReal Estate
Origin Energy LtdEnergy
Magellan Financial Group LtdFinancials
Tabcorp Holdings LtdConsumer Discretionary
Crown Resorts LtdConsumer Discretionary
Coca-Cola Amatil LtdConsumer Staples
Vicinity CentresReal Estate
AMP LtdFinancials
Bluescope Steel LtdMaterials
Worley LtdEnergy
Harvey Norman Holdings LtdConsumer Discretionary

Check out the link if you want to read EY’s latest Audit Transparency 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 our 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.

EY PCAOB Inspection Report

by enthusiastEY

PCAOB released its 2019 inspection report for EY in FY 2020. Of the 60 audits reviewed, Part I.A deficiencies were identified in 11 of them (a deficiency rate of 18%). For 2018 and 2017, EY’s deficiency rate were 26% and 31% respectively.

Year201920182017
Total audits reviewed605455
Audits with Part I.A deficiencies111417
Deficiency rate %18%26%31%

Part I.A deficiencies

Part I.A deficiencies break-down

Year201920182017
Both financial statement and ICFR audits51015
Financial statement only411
ICFR audit only231
111417

Deficiencies in financial statement audit include failure to perform sufficient testing related to an account, failure to obtain accuracy and completeness of data used in substantive testing, and failure to evaluate data and assumptions in developing an estimate. Deficiencies in ICFR audit include nonidentification of controls related to significant account, nontesting of design and operating effectiveness of controls, and failure to test the accuracy and completeness of data used in 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 accounts748
Investment securities123
Business combinations263
Long-lived assets210
Allowance for loan losses130

Improvements noted in auditing Business Combinations.

Looking at the break-up by Industry sector, 12 audits were reviewed from the Financial services sector with deficiencies identified in 1 of them (0.08%!). Most of audits reviewed were within the $100 million to $500 million revenue range (11 of them). 3 issuer with revenues exceeding $50 billion were reviewed with 1 deficiency identified.

Part I.B deficiencies

Following Part I.B deficiencies were identified:

Non-ComplianceReviewedDeficiency
AS 1205, Part of the Audit Performed by Other
Independent Auditors		142
AS 2201, An Audit of Internal Control Over Financial Reporting That Is Integrated with An Audit of Financial Statements181
PCAOB Rule 3211, Auditor Reporting of Certain Audit Participants131
PCAOB Rule 3524, Audit Committee Pre-approval of Certain Tax Services101

Looking at EY actions to these deficiencies, its noted, “In connection with our 2019 inspection procedures for two audits, the issuers revised their reports on ICFR, and the firm revised its opinions on the effectiveness of the issuer’s ICFR to express adverse opinions and reissued its reports.“

Overall, improvement by EY!!

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EY Audit Clients in UK

by enthusiastEY
Home » EY » Page 2

EY Fee Income

EY UK had a fee income of 2.6 billion pounds in FY20 which is an increase of 5% from the prior year. For FY19 EY UK had a fee income of 2.4 billion pounds. See below for a breakout of EY fee incomes over the past five years. Fee income grew on an average of 5% 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 6% while non-audit services to audit clients has decreased on an average by 8%. Advisory income has increased on an average by 7% for 5 years. The table below shows the break-down in millions pounds.

EY Quality Report

EY’s UK 2020 audit quality report mentions that of the FTSE 350 audits, 78% of the audits have been graded good or limited improvements needed. This is an improvement from the 40% score noted in 2014.

The Financial Reporting Council (FRC) published its latest inspection reports on EY in July 2020. Of the 14 audits reviewed, 10 (71%) were graded as good or requiring limited improvements. 3 (22%) and 1 (7%) audits were graded as improvements required and significant improvements required respectively. For FTSE 350 audits, of the 10 audits reviewed, 7 (78%) were graded as good or requiring limited improvements. 1 (11%) and 1 (11%) audits were graded as improvements required and significant improvements required respectively. The summary of EY’s inspection results for the past five years is noted below. In 2015, 85% of audits were graded as good vs. 71% in 2019.

EY FTSE 350 Clients

EY audits 68 of the FTSE 350 companies bringing in a total revenue of 225 million pounds. Shell is the biggest audit client of EY which brings in total revenue of 41 million pounds i.e. 18% of the total FTSE 350 audit fees. The top 5 audit clients collectively brings in 55% of the total audit fee revenue (a pretty significant concentration!). All 68 EY clients and their audit fee is included in the below graphic.

The top 25 FTSE 350 audit clients of EY in UK in the order of audit fee revenues are as follows:

CompanyAuditorTotal ('000) GBP
Royal Dutch Shell PlcEY40,754
Royal Bank of Scotland Group plcEY34,500
Vodafone Group plcEY22,858
CRH plcEY16,085
RELX plcEY8,900
Associated British Foods plcEY8,800
Imperial Brands GroupEY7,200
International Consolidated Airlines Group SAEY6,070
InterContinental Hotels Group plcEY5,887
Investec PlcEY5,646
Schroders plcEY5,600
London Stock Exchange Group plcEY5,000
Sage Group plcEY5,000
Sainsbury (J) plcEY4,000
Virgin Money UK plcEY3,980
IMI plcEY3,100
Evraz plcEY3,019
PetrofacEY3,019
Tate & Lyle plcEY2,600
3i Group PlcEY2,500
SSE plcEY2,180
Phoenix Group Holdings PlcEY1,970
Beazley plcEY1,811
UDG Healthcare plcEY1,699
FresnilloEY1,545

Post a comment on any other metric you would like to know about EY UK or if you need this dataset. Look into our other blog posts on PwC, KPMG, and Deloitte 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.

Do read our other blog posts.

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Top UK Companies and their Auditors

by enthusiastDeloitte / EY / KPMG / PwC
Home » EY » 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 EY’s largest clients?

by enthusiastEY
Home » EY » Page 2

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

Here is the list of top 25 clients of EY in terms of total fees in millions. The communication services and information technology sectors are the major contributor in terms of audit fees for EY. These 25 clients together contribute $757 million in audit fees for EY. EY total audit revenue from their US Operations is $4.4 Billion.

CompanyAudit FeesAudit related feesTaxOther FeesTotal fees
AT&T Inc.52.105.509.50067.10
Verizon Communications39.008.003.90050.90
Coca-Cola Company29.702.096.290.2738.35
Danaher Corp.25.460.329.91035.68
FedEx Corporation30.811.582.750.5235.66
State Street Corp.14.2015.205.80035.20
CVS Health25.116.172.190.0833.54
Oracle Corp.26.522.123.81032.45
Abbott Laboratories23.961.036.670.1531.81
General Motors22.005.003.00030.00
Alphabet Inc. (Class A)20.117.191.940.6129.85
Eaton Corporation19.006.104.30029.40
Walmart25.921.100.700.0327.75
Genuine Parts15.604.706.20026.50
U.S. Bancorp12.606.206.800.8026.40
Amazon.com Inc.22.492.9700.1825.63
Lockheed Martin Corp.22.780.182.30.0225.27
Fortive Corp11.476.585.90023.95
Archer-Daniels-Midland Co17.152.572.450.3222.49
Facebook, Inc.13.270.588.480.0122.34
News Corp. Class A18.060.483.210.3822.13
Apple Inc.17.210.943.020.1221.28
HP Inc.15.902.402.90021.20
Becton Dickinson19.430.411.290.0121.14
WestRock16.550.034.56021.13

Do read our posts on EY’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.

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