Along with Deloitte and KPMG, EY and PwC are collectively referred to as the Big Four; that is the four largest accounting firms, as measured by revenue. In this article EY and PwC will be paired against each other; we will briefly take a look at some important aspects that make up each of the firms.
What is in the Name: EY v PWC
Ernst & Young Global Limited or better known as EY is a global leader in assurance, tax, transaction and advisory services that was established in 1989. EY operates under a network of member firms structured as separate legal entities in a partnership. The network is divided into three; the three subdivisions that take care of every region in the world are the Americas, EMEIA and the Asia Pacific. EY’s London office serves as its headquarters and it has over 300,000 employees in over 700 offices in over 150 countries.
PricewaterhouseCoopers, better known as PwC (it shortened its name to PwC in 2010) is also a global professional services firm that was created in 1998 as a result of the merger between Price Waterhouse and Coopers & Lybrand. One of the constituents of this entity has traced its history as far back as 1849. Just like EY, London also serves as its headquarters. It employs over 295,000 staff in 156 countries and has about 800 functioning offices. PwC also provides tax, assurance, human resources management, transactions, performance improvement, crisis management and advisory services.
The Business: EY v PWC
EY’s – sometimes seen as the smallest of the Big Four but is the third-largest – specialties are split into four segments: Consulting, Assurance, Tax and Strategy & Transaction. The tax group offers connected services across all tax disciplines including business tax, international tax, transaction tax and so on to their clients. The Assurance group delivers high-quality, analytics-focused audits with independence, integrity, objectivity and professional scepticism to their clients. EY Canvas is its integrated audit platform which it uses for audits. With their Strategy & Transaction professionals, clients get help with matters concerning M&A and strategy advice. Just like the other Big Four players, EY is pushing strongly into digital transformation consulting. EY employs over 44,000 technologists and 20,000 data specialists globally.
PwC which provided its services to 84% of the Global Fortune 500 companies for the year ending in 2021 is often seen as the most prestigious of the Big Four (and by extension, more prestigious than EY) and focuses on three main segments: assurance (which includes audit), tax & legal and advisory. PwC’s audits for each of its clients are done considering the risks that the client’s businesses face, the way the risks are managed by the management team of the client and the transparency of the client’s company reporting to stakeholders. PwC has a team of nearly 100,000 auditors and a global audit platform, Aura, which it employs in every audit it performs. Their tax & legal groups deliver deep technical expertise to their clients while designing first-class integrated tax and legal strategies for the clients’ businesses. Their advisory practice which includes consulting and deals helps make PwC the partner of choice for global & local clients and governments because of their ability to help clients design, manage and execute fundamental change.
Show Me the Money: EY v PWC
EY’s financial year ends in June and for the year 2021, the firm reported that its global revenue was $40 billion (the dollar referred to in this article is the US dollar), a 7.3% increase from the previous year. Its Assurance services brought it the most revenue with $13.5 billion being reported; a 5.8% increase from the $12.8 billion recorded in 2020. The Consulting, Tax and Strategy & Transactions lines of business brought in the remaining revenue with $11.1 billion, $10.4 billion and $4.7 billion respectively.
Just like EY, PwC’s financial year also ends in June. For the year ending in 2021, PwC announced global revenues of $45 billion. Their Assurance (audit) operation remains the cornerstone of their business and was their most rewarding sector as it brought in $17.1 billion, a 1.2% increase from the 2020 figure of $16.4 billion. The Advisory sector’s figure was in close pursuit of their Assurance operation as it brought in $17 billion. The revenue that their tax, legal and people operations brought in was reported to be $11 billion.
Into the Future: EY v PWC
In its quest to attract the best talent, EY has put in place a three-year expansion plan and a combined investment of $10 billion between the financial years 2022 and 2024. This is in addition to the NextWave Strategy they launched in 2020. The objectives of these strategies are the expansion of their capabilities to help their clients, their people, and the communities in which they operate.
Meanwhile, PwC’s global strategy for the future is known as The New Equation. The strategy aims to help PwC build trust with its stakeholders and deliver sustained outcomes. The combined investment in the plan is $12 billion over the next 5 years and the creation of over 100,000 net new jobs.
Charles is a writer, practising lawyer and personal trainer who loves learning and developing himself. He graduated from Middlesex University, London with eight first-class grades in the second and third years of his law degree, and received a postgraduate offer from Cambridge University. He loves strength training, boxing and encouraging people to succeed in their pursuits (legal ones)
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