Following the release of the World Survey 2020 in International Accounting Bulletin’s February 2020 edition, we have now launched a free digital supplement covering some highlights of the table which can be viewed here
The IAB World Survey is an annual ranking of the top networks and associations by both fee income and staff numbers. This includes data on global revenue, regional breakdowns and information on the various service lines.
The supplement provides a high level overview of some of the findings from the World Survey, including charts showing how the relative strengths of the various service lines have evolved across the industry and geographies since 2008.
Findings suggest, there will be continued growth in advisory services due to trends in demand coming from digital expansion in firms’ operations and client businesses, coupled with the need for tax, transaction, compliance and cross-border advice, impacting the increase in fee revenue.
As reported by GlobalData’s IAB figures in 2019, the fee income for advisory services drawn by the Top 10 Networks and Associations totalled around $US 72bn and $US 4 bn respectively.
In fact, for the Big Four, advisory services take the lion’s share of fee income now totalling 40% of all revenue. As advisory services climb, fee generation from audit and accounting services is left trailing, only generating 34% of the Big Fours’ total income for 2019. This is a marked difference from 2008, when audit and accounting service constituted 52% of total fee income and advisory a mere 24%.
Overall, Deloitte had the greatest share of its fee income generated by its advisory practice, with it making up a staggering 60% of its total global revenue. KPMG also generated more revenue from advisory services (40%) compared to its audit practice (38%).
PwC and EY still had more fee income come from their audit practices, but that gap is narrowing slowly.
While the audit and accounting service line and the advisory service line have almost switched places in terms of fee income, tax has remained fairly consistent. In 2008, tax made up 24% of total fee income, and then in 2014 and 2019 it remained steady at 23%.
However, for the mid-tier networks, audit is still the major fee earner, with audit and accounting services still making up 49% of fee income, compared to 25% from tax, and 19% from advisory services. The services line breakdown has seen little change since 2008 when audit and accounting made up 53% of their total fee income.
We hope you enjoy reading this digital edition and to view the World Survey in full please click here.