Fraud work boosts Ernst & Young’s revenue

ACCOUNTANCY firm Ernst & Young saw annual revenues rise by 8 per cent after a year boosted by work on fraud investigations and banking reform.

The practice was also employed in handling the collapses of retailers Focus DIY and TJ Hughes towards the end of the period, although the tough market for company deals still clipped revenues in the corporate finance arm.

Overall, revenues in the UK for the year to June rose to £1.47 billion, helping average profits per partner lift slightly from £629,000 a year ago, even though the UK arm added 42 partners during the year to take the total to 527.

It said it was also helped by assisting clients in a global push into the emerging markets of India, Russia, Brazil, China and the Middle East.

Tax revenues were largely flat, but there was double-digit growth in financial services as uncertain conditions led to a raft of new and proposed regulations on solvency and capital for banks, insurers and other financial firms.

The fraud work, which included more investigations and disputes, boosted its audit division, while the consultancy arm surged by a fifth with demand strong across all of its sectors.

In terms of corporate restructuring, most of TJ Hughes' stores were closed after it went into administration in June, though some were sold to Lewis’s Home Retail. Focus DIY went into administration in May and the majority of its stores closed, though 31 were sold to B&Q-owner Kingfisher.

Steve Varley, E&Y UK managing partner, said: "We made the decision several years ago to increase significantly our investment in the business and once again this year's growth demonstrates that taking a longer-term view pays off."

The UK arm employs more than 750 staff at its Scottish offices in Aberdeen, Edinburgh, Glasgow and Inverness but no regional breakdown on the financial results were provided. Global revenues for the year to June rose by 8 per cent to £14.8bn.