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Ireland’s top accountancy firms roar back to double-digit growth in 2021 Back
The Finance Dublin Annual Accountancy Survey shows a return to robust fee income growth in 2021 for Ireland’s leading accountancy firms, bouncing back strongly from the COVID 19-induced slowdown in 2020. The figures for this year’s survey show Republic of Ireland fee income rose by 12 per cent in 2021, compared with just 1% in 2020.
Following a hiatus to the post financial crisis growth trend in 2020, primarily due to the effects of the COVID 19 pandemic, fee income at Ireland’s leading accountancy firms has jumped in 2021. The fee income for Ireland’s 21 largest firms has grown by 12 per cent, a result that sees Republic of Ireland fee income surpass the €2 billion mark for the first time (see table).
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A major change in the Accountancy Survey this year sees the headline Fee Income Table rank Ireland’s largest firms by their Republic of Ireland fee incomes. In recent years ‘island of Ireland’ figures have been included for all firms when supplied. There are a number of reasons for the switch to happen now but the primary one is the changing nature of the industry due to Brexit - for example, the regulation and oversight of the industry in Northern Ireland compared with Ireland, the EU being the relevant authority there, while the new Audit, Reporting and Governance Authority (ARGA) becoming the regulatory body operating in Northern Ireland. Currency changes also are a factor, and a desire for people to obtain more granular data about the industry being others. The change primarily affects the largest firms on the list with it resulting in the fee income gap amongst the Big 4 firms narrowing sharply in comparison to last year’s survey when all-island fee incomes were included.

This year the fee income table includes revised Republic of Ireland fee income figures going back to the 2017 Survey. The revised table shows a change in the Big Four standings with EY the third largest Republic of Ireland fee income earner since the 2018 survey, ahead of Deloitte in fourth position. Estimated ROI fee income for KPMG places them in second with the firm’s strong 16.1 per cent growth rate, the largest by far amongst the Big Four, narrowing the gap to PwC in first.
Speaking on their businesses in the Managing Partners Forum in this issue (overleaf) it is also clear that growth in Ireland’s leading firms has gone from strength to strength so far in 2022 and this has led to heightened competition for talent. While this is not unique to the accountancy sector, it has become an ever more important focus for leading firms and their clients with Deloitte’s leader in Ireland Harry Goddard commenting ‘The war for talent has reached a new zenith with the impact of the pandemic (the great reset), the high levels of investment (unprecedented employment levels) mixed with the cost of living increases and commensurate rise in cost of talent creating real challenge within businesses.’

KPMG managing partner Seamus Hand said, ‘The biggest challenge for the sector currently is access to the right number and type of resource. This challenge is also being faced by our clients. Attracting and retaining talent is therefore a key focus for our business.’

Part II of the 2022 Accountancy Survey will be published in the next issue of Finance Dublin, focussing on the leading firms talent and recruitment activity.
This is supported by the continued recruitment and investment activity of firms that has continued during the Pandemic and which will be focused on in detail in the September issue of Finance Dublin, in Part II of the 2022 survey.

The Finance Dublin Accountancy Survey 2022 Key Findings:


1. The Republic of Ireland fee income for Ireland’s leading accountancy firms has surpassed €2 billion for the first time.

2. After a hiatus caused by the COVID-19 pandemic fee income growth has rebounded strongly to pre-pandemic levels. Having barely increased in the first year of the pandemic, fee income, according to this year’s figures, has grown by 12 per cent. The top two firms led the way with both recording double digit growth as Ireland’s economy reopened and recovered strongly in 2021. A lag in financial year ends of the other Big Four firms has likely tempered the growth rate in this year’s survey.

3. The strong return to growth has been experienced across all tiers in the survey. The structure of the market, dominated by a Big Four, followed by a middle tier, comprising of Grant Thornton, BDO and Mazars, in that order continues, with a narrowing of the gap amongst the Big Four.

4. Four of the Big 6 firms disclosed standalone Northern Ireland fee income figures, showing a much different competitive structure than in the Republic of Ireland market. PwC’s Northern Ireland fee income of GBP241 million is over 2.5 times larger than Deloitte’s net revenue figure of GBP91.9. EY’s Northern Ireland fee income is just over 10 per cent (GBP26.8 million) of PwC’s, while Grant Thornton had a fee income of GBP12 million.

5. In terms of Republic of Ireland fee income ranking changes, the major change sees EY moving above Deloitte into third place, Deloitte remains the bigger fee income earner on an all-island basis. The big move amongst mid-tier rankings was RSM Ireland moving above IFAC into 8th place. Amongst the smaller firms PKF O’Connor Leddy Holmes and JPA Brenson Lawlor both move up two places (to 14th and 16th, respectively) while Walsh O’Brien Harnett climbs to 18th (from 21st).

6. While the move to Republic of Ireland fee income reporting has seen EY move to third position there are significant differences in the growth rates reported by the Top Four firms in Ireland. This may reflect the difference in financial year ends with the top two firms’ data reflecting more recent business activity (and higher growth rates) than EY and Deloitte whose figures lag by 6 and 7 months respectively on the top two firms. KPMG is the standout performer amongst the Top Four with a fee income growth of 16.1 per cent seeing its all Ireland fee income reach €504 million. Outside the top four Grant Thornton, BDO, Mazars and RSM Ireland all enjoyed double digit growth.

7. Baker Tilly saw growth of 50 per cent in its Republic of Ireland fee income, reaching €10.2 million (up from €6.8 million). Managing partner Neil Hughes said the appointment of three new partners and the addition of a new office in Dundalk were behind the firm’s stellar growth in fee income. PKF O’Connor Leddy Holmes; Walsh O’Brien Harnett; JPA Brenson Lawlor and McInerney Saunders saw large percentage gains in fee income. Only one firm recorded a drop in fee income, HLB Ireland. A change in structure at HLB Ireland resulted in two representative firms leaving the HLB Federation in Ireland. Therefore, the fee income figure this year represents that of only one firm, HLB Sheehan Quinn. Like-for-like growth for HLB Sheehan Quinn was actually 80 per cent in its latest financial year thanks to acquisitions around cyber security and business transformation consulting, as well as a strong firm performance, particularly in tax and corporate finance consulting.

8. In terms of market concentration, the ‘Big Four’ accounted for 76.5 per cent of the total market and with the Top Two, KPMG and PwC accounting for 41.3 per cent. Overall, the top 10 firms listed in the table accounted for 94.2 per cent of the total Republic of Ireland fee income.

9. The rebound in economic activity and demand for accountancy and consulting services has created ‘a war for talent’ with firms adapting to attract and retain talent while they are seeing a rise in client demand for services relating to the restricted labour market.
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