The Big 4 of Deloitte, PwC, EY, KPMG Announce ESG Reporting Standards

Probably the most significant merger, happened in 1989 between Ernst & Whinney and Arthur Young. At that time, these two companies were the 4th and 5th largest accounting firms in the world. Each Big Four company has a diverse staff armed with varying levels of expertise to meet their client’s needs.

At the time, this merger represented the formation of the fourth-largest accounting firm in the world. Its name stands for Klynveld Peat Marwick Goerdeler, the surnames of the founders of the predecessor companies, which date back to 1897 in one case. The current form of the company originated when KMG merged with Peat Marwick in 1987, which was considered to be the first “mega-merger” of large accounting firms. KPMG employs 265,000 people and produced almost $35 billion in revenue in 2022. There were several mergers between firms like Whinney Smith & Whinney, Ernst & Ernst, Arthur Young & Co, and Broads Paterson & Co to form the fourth largest accounting firm in 1979.

  • Auditors can serve a variety of roles, but generally an auditor’s objective is to determine whether a company’s financial records are accurate.
  • The big 4 accountancy firms together earned over $160 billion in 2021.
  • There were several mergers between firms like Whinney Smith & Whinney, Ernst & Ernst, Arthur Young & Co, and Broads Paterson & Co to form the fourth largest accounting firm in 1979.
  • As an auditor, you’ll be spending a lot of time examining internal records, speaking with clients, and preparing reports to summarize findings.
  • Perrigo is fighting the I.R.S. over fines the agency assessed because of the tax maneuver.

Today, PwC is the result of a merger in 1998 between Price Waterhouse and Coopers & Lybrand. However, the company is rooted in a commitment of integrity that spans back to the Industrial Era in England. The blended history of these two firms tells a story of determination and resilience over the course of significant social and technological change. Of all its service streams, consulting generates the most revenue for Deloitte.

Understanding what public accounting is

After they are fully trained and graduate college, they become full time team members. During the 1990s PwC grew rapidly and became one of the industry standards in the United States. They also acquired 490 west end ave in upper west side many of Arthur Andersen’s Chinese client base after their collapse. Today, PwC has been consistently ranked among the top 100 companies to work for by Fortune Magazine for the last 11 years.

  • Although growth has been slow for some, the fact remains that they are continuously growing.
  • Later in 1993 the company renamed itself Deloitte Touche Tohmatsu because of yet another merger.
  • In the aftermath of the collapse, the company was found guilty of criminal charges relating to its business practices.

Additionally, by working at one of the Big 4, accountants are exposed to a wide swath of industries and companies. These opportunities often help accountancy professionals determine their next career move. Each of the big 4 accounting firms was created by a series of mergers. In the list below we’ve included the earliest start date of the member firms of each big 4 firm, and we’ve also included the last date of significant merger for each top accounting firm.

In fact, in many instances, working at any of the firms in the same city will be more similar than working for the same firm in a different city. For instance, working at Deloitte NY will likely be more similar to working at PwC NY as compared to working at Deloitte LA. In July 1998, the Big Six became the Big Five when Price Waterhouse merged with Coopers & Lybrand to form PricewaterhouseCoopers. CPAPA is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. A long-awaited legislative overhaul of the U.K.’s audit industry is still needed, said EY UK Chair Hywel Ball.

Tax avoidance

However, each firm is actually a network of independent corporations who have agreed to meet a professional standard and share a common name. With this structure, the subsidiaries in each firm are more agile in their decision making and maintain unique cultures. In the 1980s the Big Eight, each with global branding, adopted modern marketing and grew rapidly. In 1987, Peat Marwick merged with the Klynveld Main Goerdeler group to become KPMG Peat Marwick, later known simply as KPMG.

Big 4 Accounting Firms Rankings 2022

During fiscal year 2021, Ernst & Young reported roughly $40 billion of company-wide revenue, an increase of 7.3% from the year prior. EY has recorded 7.3% compound annual growth over the past seven years. Through industry consolidation that began in 1989, what used to be the Big Eight has become the Big Four today. The eight, in alphabetical order, were Arthur Andersen, Arthur Young, Coopers & Lybrand, Deloitte Haskin & Sells, Ernst & Whinney, Peat Marwick Mitchell, Price Waterhouse, and Touche Ross—all U.S. or U.K. As the only Big 4 firm that can be called a true consulting firm, Deloitte has a proven history of being able to pivot effectively. This entrepreneurial spirit pervades Deloitte’s culture and the company is known as the fastest moving of the Big 4.

The path toward the company that exists today began in the early 1900s, when two aspiring accountants started firms at a similar time. In 1903, Alwin C. Ernst began an accounting firm with his brother in Cleveland, Ohio. Just three years later in 1906, Arthur Young started his firm, Arthur Young & Co., in nearby Chicago, Illinois. The two firms found themselves allied with British accounting firms within a few short decades, allowing them both to grow and prosper. Not long after Price established his firm in London, William Cooper created his own accounting firm in 1854, which would be known as Cooper Brothers within a few years.


The company was formed in 1987 through the merger of Peat Marwick International and Klynveld Main Goerdeler. Like other professional service organizations, KMPG places great value on its people and quality of service. Like the big four firms, EY saw growth and expansion in the 1990s and early 2000s in their consulting and advisory businesses. This drew concerns from the SEC and other regulators at the true independence of the big 4 public accounting firms and their clients. EY took a big step in 2000 when they were the first firm to officially and formally separate their consulting side from their assurance side.

What Are the Big Four Accounting Firms?

Now that you know what the Big 4 firms do, you must be asking yourself – what’s the difference amongst these large professional service conglomerates? Documents published in June 2010 show that some UK companies’ banking covenants required them to use one of the Big Four. This approach from the lender prevents firms in the next tier from competing for audit work for such companies. The British Bankers’ Association said that such clauses are rare.[36] Current discussions in the UK consider outlawing such clauses. The PwC tax scandal is one example where PwC sold advice to clients on tax avoidance, and did so using information derived from the company’s government consulting arm.

However, AI can help maintain compliance with both general regulations and industry-specific standards. This goes for academics, extra circular actives, and professional experience. Remember, these firms know how good they are and know that thousands of people are fighting to work for them.

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With $45.1 billion revenues in 2021, PwC is the second largest accounting firm in terms of revenue. It employs more than 295,000 professionals in 157 countries around the world. The company was formed by the merger of two large accounting firms – Price Waterhouse, and Coopers & Lybrand. The two decided to merge in 1998 and dedicated themselves to provide services of value while establishing and maintaining good customer relations. Behind Deloitte is PricewaterhouseCoopers, globally known as the second-largest professional services network.

Understanding the career roadmap and salary progression at the Big 4 could be instrumental in setting your career goals and charting your professional growth. With all of this averaged out, you should be able to make it to a Senior Partner position as soon as 15 years and have a healthy salary of $400,000 – $450,000. Obviously, these are just estimates and your location and position can vary, but needless to say you will be well taken care of if you choose to go into big four public accounting. It’s no wonder why firms hire more than 80 percent of their interns. As long as you work hard and don’t screw up the internship, you’re a shoe in to the big four accounting profession.

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