A comprehensive set of data on the Russian audit industry was
released on the Russian Ministry of Finance website earlier this
year. The documents list information such as age and gender split
among auditors, and revenue and staff averages from audit
The accuracy of some of the information was, however, called
into question by the recent survey of the Russian industry in
TA’s sister publication International Accounting Bulletin
(see issue 416).
According to the ministry information, the combined income flow
from all audit firms for 2006 was RUB32.78 billion ($1.3 billion).
It also claimed the Big Four made up 31 percent of the total.
However, PricewaterhouseCoopers Russia disclosed to IAB that its
fee income for the year ended December 2006 was RUB5.56 billion. If
the ministry’s figures are correct, that leaves an average of
RUB1.53 billion for the remainder of the Big Four, positioning them
well behind BDO Unicom, which recorded fee income of RUB2.2
billion. The sources IAB consulted suggested this was
The contradiction in information was mirrored by a general lack of
transparency in the upper echelons of the Russian accounting
profession. The Russian PwC firm was alone among the Big Four in
disclosing fee income and an estimate of staff numbers. Senior
industry figures who spoke to IAB said this was not unusual. They
agreed PwC was the largest of the Big Four, but could hazard only
rough guesses on the ranking of the remaining three.
The ministry data stated that as of 1 January 2007, 36,700 people
had been issued with auditor’s qualification certificates. A vast
majority – 77.4 percent – were women. Of the audit qualifications
awarded, 34,300 were in general audit, 1,000 were in bank audit,
800 were in the audit of stock exchanges, off-budget funds and
investment institutions, and 600 were in audit of insurance
The ministry provided a break-down in age categories among
auditors. The 25- to 34-years age bracket was the most highly
represented with 36.7 percent, 35- to 44-years was 30.6 percent,
45- to 54-years was 23.9 percent, 55- to 60-years was 5.1 percent,
over-60s were 2.7 percent and under-25s were 1 percent.
The ministry also provided data on the geographic distribution of
auditors and audit firms, divided into eight districts. The data
showed that Moscow had the highest concentration of both auditors
and firms, with 29.2 and 36.6 percent, respectively.
The Central district, excluding Moscow, had the second-highest
concentration of auditors, with 18.5 percent, yet only the equal
fourth-highest concentration of firms at 9.9 percent. The district
with the second-highest concentration of audit firms was Volga,
with 14.1 percent. The Volga district also had a high concentration
– 14.8 percent – of firms. The district with the lowest
concentration of both auditors and firms was the Far East, with 3.1
and 2.8 percent, respectively.
According to the ministry, 72,283 statutory audits were conducted
in 2006. The audit opinions issued included 57.6 percent that were
unconditionally positive, 40.9 percent had certain limitations, 1.1
percent were negative and 0.4 percent refused to express an
In terms of the reasons for conducting the audits, 47.5 percent
were conducted for organisations whose financial performance
measures exceed the minimum value, 26 percent were on the grounds
that the organisations were public corporations, 9.9 percent were
unitary enterprises, 2.1 percent were lending agencies, 1.6 percent
were stock exchanges and investment funds, 1.4 percent were
insurance companies and fund associations and 11.5 percent were
other cases proscribed by law.
According to the data, the average number of employees at each of
the Big Four firms was 1009. This figure was also contradicted by
the IAB survey. Of the 1009, 92 were said to be auditors. The
average number of audit clients for the Big Four firms was