Ernst & Young

Ernst & Young is one of the largest professional service firms in the world and one of the “Big Four” accounting firms. Other firms in the Big 4 are Deloitte, KPMG, and PwC.

Company Information

• Global organization of member firms in more than 140 countries
• Headquartered in London, United Kindom
• Ranked eighth-largest private company in the United States in 2011 by Forbes magazine
• Employs over 167,000 employees globally
• Founded in 1989 through the merger of many individual components having existence since 1849.

Recent Developments

• In 2006, EY became the only big four to have two member firms in the United States with the inclusion of Mitchell & Titus, LLP, the largest minority-owned accounting firm in the United States
• In 2010, EY acquired Terco, the Brazilian member firm of Grant Thornton

Services

EY has four main service lines (share of revenues in 2011):

• Assurance Services – It accounted for the maximum share of revenue in 2011 to the tune of 46%. The business unit primarily comprised of Financial Audit which was the core assurance and others being Financial Accounting Advisory Services, Fraud Investigation & Dispute Services.
• Tax Services – Taxation services were the second highest contributor to the revenue and have a share of around 26%. The unit included Business Tax Compliance, Human Capital, Customs, Indirect Tax, International Tax Services, Tax Accounting & Risk Advisory Services.
• Advisory Services – Advisory came next with share at 19%. The advisory unit consists of four broad sub-service lines namely Actuarial, IT Risk and Assurance, Risk, and Performance Improvement.
• Transaction Advisory Services – Transaction Advisory Services or TAS as it is called, contributed the least at 9% of the revenue. The unit deals with companies transaction agenda and included companies’ capital agenda which had sub-services like preserving, optimizing, investing and raising capital.

Also Read 9 Interesting Facts about Pricewaterhouse Coopers – The Big 4 Company.

Global Structure

EY is known to be the most globally managed of the Big Four firms. The firm has global standard set for itself and ensures that the member firms operating in the four areas globally caters to those standards and oversee global policy and consistency of service. Client work is being performed by the member firms of EY.

Every country where EY operates is divided globally based on one of the four areas. The four areas are as under:

• EMEIA: Europe, Middle East, India and Africa
• Americas
• Asia-Pacific
• Japan

This physical division ensures that the professional service network is well managed by the firm centrally. Also it ensures to oversee the functioning of all the areas using the globally accepted policies.

All the four areas have the same identical business structure and one management team. The team is led by the Area Managing Partner, who in turn is a part of the Global Executive board which is centrally located. The structure helps the firm increase on its international clientele and also helps in effectively serving the clients.

EY serves the companies operating in different industries like Automotive, CleanTech, Life Science, Oil & Gas, Mining & Metals, Power & Utilities, Real Estate, Private Equity, Financial services and many more.

Financials

The Company is Limited Liability partnership firm, with member firms having different legal structure. The Company generated revenue of USD 24.4 billion in the year 2012. The year saw an improved performance as compared to last year, when the revenue was reported at US$22.9 billion during 2011. The revenues grew 6.7% in US$. Emerging markets saw combined revenue growth of 15.5%. All the service lines of the firm showed growth with Advisory with the maximum growth to the tune of 16.2%, followed by Transactions and Taxation at 9.4% and 7.0% respectively. Assurance showed a growth of 4.1%.

Outlook

The Company is currently focusing on increasing its investment in emerging markets which is good bet at the time of global recession where least can be expected from developed economies like US, UK, etc.