Deloitte sees consolidation to meet SME needs
(17 October 2006 – Global) The global chief executive of Deloitte Touche Tohmatsu has forecast continuing consolidation among the professional services industry in response to the growth of the SME segment worldwide.
William G. Parrett said consolidation was likely as mid sized firms strengthened their capability and capacity in order to grow their base of "globalising" clients.
He said this would be driven by client demand – the same market influence that drove consolidation among the biggest firms over the past couple of decades.
"As small to medium sized businesses, as well as national enterprises, continue to regionalise and globalise, the medium sized professional services firms, and this includes the largest of these, will find ways to build their capability," Parrett said.
"This means more consolidation, which will be good for audit quality and the reliability of financial information."
Parrett made the remarks whilst announcing US$20 billion aggregate member firm revenues for fiscal year 2006, an increase of 11.5 percent in local currencies.
He said much of this was driven by tax, which "rebounded" from the previous year.
"Other service offerings by member firms, like forensic and dispute services, had a particularly strong year," he said.
He said this would be driven by client demand – the same market influence that drove consolidation among the biggest firms over the past couple of decades.
"As small to medium sized businesses, as well as national enterprises, continue to regionalise and globalise, the medium sized professional services firms, and this includes the largest of these, will find ways to build their capability," Parrett said.
"This means more consolidation, which will be good for audit quality and the reliability of financial information."
Parrett made the remarks whilst announcing US$20 billion aggregate member firm revenues for fiscal year 2006, an increase of 11.5 percent in local currencies.
He said much of this was driven by tax, which "rebounded" from the previous year.
"Other service offerings by member firms, like forensic and dispute services, had a particularly strong year," he said.
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