EY partners to vote on major split

Dhe international auditing and consulting network EY has now officially announced its plan to separate the two business areas of auditing and management consulting. EY’s global leadership decided to propose to the partners to split into two distinct multidisciplinary organizations. EY announced this on Thursday.

EY is one of the four leading international providers of auditing and management consulting – alongside PWC, KPMG and Deloitte. Of the four industry giants, EY is the first to intend to conduct an international demerger. The project is justified by the fact that auditing and management consulting could grow much more independently of each other. If a provider is responsible for the annual audit of a company’s annual financial statements, he must not also advise the client extensively at the same time. This limits the possibilities of multidisciplinary organizations like EY, which offer many different services related to auditing, tax advice, management consulting or legal advice.

struggle for skilled workers

Growth is important for audit and consulting firms because it attracts the talent and skills that all vendors are desperately looking for. In the light of the Wirecard scandal, however, EY’s demerger plan can also be seen as a way of limiting the risk of claims for damages and damage to reputation.

EY now wants to inform its partners comprehensively about the demerger plan. The coordination in the partnerships in the different countries should then begin at the end of 2022 and beginning of 2023. The plan envisages bundling the business with management consulting in a separate and internationally active company. The consulting company would then – unlike EY before – no longer be organized as a network, but as an independent legal form and could be listed on the stock exchange in this form at some point. It is said to be active in more than 75 countries and to offer consulting services related to digitization, sustainability and taxes. The focus will be on transformations and corporate transactions.

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