Deloitte Consulting

Deloitte, with a large number of offices around the world, in addition to consulting and audit activities, collects any information: internal, institutional, infrastructure, while giving recommendations not only on the impact on the country's business, but also working on schemes to seize direct control over it.

Performance indicators

2018: Deloitte revenue grows for nine consecutive years

For the fiscal year, which ended May 31, 2018, Deloitte's revenue again turned out to be a record, amounting to $43.2 billion. Compared to the previous year, there was an increase of 11.3%. The company's revenue has been growing for nine years in a row.

Deloitte's financial rise was facilitated by various industries, including telecommunications, media and information technology, and financial services; revenue from the provision of services in each of them increased by more than 12% in dollar terms. The most significant contribution was made by the segment of consumer and industrial goods: here revenue increased by $1.3 billion.

Deloitte FY 2018 Performance

In fiscal 2018, Deloitte's revenue in the audio engine services market jumped 7.7%. In the consulting direction, revenue increased by 15.7%. At the same time, growth in each of the key areas of consulting services (technology, strategy and operating activities, human capital) is measured in two digits.

This growth rate in consulting has been maintained for more than a decade and is explained by the company's attention to transformation with the use of digital technologies through the integration of strategy, human resources and technologies designed to help clients navigate the tasks and opportunities associated with the "Fourth Industrial Revolution."

Annual revenue in the financial consulting segment grew by 8% due to the provision of significant services related to both traditional and innovative M&A transactions, new commercial offers and client initiatives. Comprehensive services as part of the conclusion of mergers and acquisitions transactions again helped to provide support for large international transactions, the press release said.

Revenue growth from tax and law consulting services was 8.7%, driven by demand from customers facing increasing tax and legal requirements in the markets in which they operate.^[1]

Business in Russia and Belarus

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History

2023: Plan to lay off 1,200 people

Deloitte will lay off 1,200 people, the Financial Times reported in April 2023.

2022

Buying consultancy The Checkley Group

In early February 2022, Deloitte acquired The Checkley Group. The financial terms of the transaction were not disclosed. Read more here.

Buying consultancy Etain

In mid-February 2022, Deloitte announced the acquisition of Etain. The financial terms of the transaction were not disclosed. Read more here.

2021

Buying consulting company BIAS

In early December 2021, Deloitte announced the acquisition of BIAS. The financial terms of the transaction were not disclosed. Read more here.

Purchase of information security services provider for military and government agencies Sentek Global

At the end of July 2021, Deloitte announced the acquisition of almost all assets of the provider of information security services for military and government agencies Sentek Global, which serves mainly the US Navy. The financial terms of the transaction were not disclosed. Read more here.

CloudQuest Cloud Security Provider Purchase

In early June 2021, Deloitte bought almost all of the assets of the American cloud security provider CloudQuest. The financial terms of the transaction were not disclosed. Read more here.

Sale of Restructuring Services Division

In early May 2021, KPMG agreed to sell its UK restructuring business to HIG Europe. A little earlier, Deloitte sold its restructuring arm to the CVC Capital Partners-backed consultancy Teneo. In both cases, the transaction was aimed at eliminating alleged conflicts of interest, when firms have to audit and advise the same clients, which is fraught with serious violations of the law. Read more here.

Payment of $80 million to the Malaysian authorities due to violation of the audit of the investment fund 1MDB

In early March 2021, Deloitte agreed to pay the Malaysian government 324 million ringgit ($80 million) to settle all claims related to the audit of the 1MDB investment fund and its former SRC International division between 2011 and 2014. The fund was supposed to attract investment in the country, but instead became the center of many investigations into corruption and money laundering.

This marks another success for the Malaysian government, which continues to take measures to compensate parties related to 1MDB, SRC and affiliates, said Tengku Zafrul Abdul Aziz, Finance Minister of the country.

Deloitte will pay $80 million to the authorities due to violation of the audit of the 1MDB investment fund, through which billions were laundered

The 1MDB fund was at the dollars centre of a scandal when it emerged it had illegally pulled several billion out of the country between 2009 and 2014. The scandal led to a major government investigation and the resignation of Malaysian Prime Minister Najib Razak. In 2019, Malaysia imposed the maximum possible fine on Deloitte PLT for violations related to the issue of 1MDB bonds. The British company became the first auditor to be fined as part of the case.

Malaysia's finance ministry noted that the agreement with Deloitte would speed up the payment of cash over 1MDB and SRC's outstanding obligations, which would otherwise have been delayed due to long and costly litigation.

The settlement of claims against the auditor does not affect allegations against individuals, such as runaway businessman Low Taek Jho. However, the Malaysian government intends to ensure that appropriate action is taken against all individuals and companies that have been directly or indirectly involved in the 1MDB fraudulent scheme.^[2]

2020

Penalty for errors in Autonomy audit

On July 9, 2020, it became known about the decision of the British Financial Reporting Council (FRC) to impose a record fine, the amount of which reaches £15 million ($19 million at the rate at the time of the verdict) on the consulting company Deloitte. She is accused of repeatedly making serious mistakes during an audit of Autonomy.

The decision to impose a multi-million fine for violating the assessment of software developer Autonomy was made following a meeting of the FRC disciplinary court. According to its representatives, Deloitte, along with its ex-partners, Nigel Mercer and Richard Knights, did not fulfill their obligations, losing objectivity and deliberately overestimating Autonomy's financial performance between 2009 and 2011.

The FRC insists that Deloitte pay a fine of £15 million, in general, in 2019 the company in the UK received revenue of £617 million. In addition, the Council wants to deprive Knights of the right to engage in accounting for the next seven years and fine him £500 thousand, and Marcer £250 thousand.

Deloitte to pay tens of millions for errors in report of IT company bought by HP for $8.8 billion

Deloitte recognizes the seriousness of the violations and requires fines to be about half of the amounts recommended by the FRC. The company also noted that Knights, who left the company in 2017, is committed to not signing the audit report again.

This is the toughest punishment since the FRC fined PwC £10m in 2018 for audit violations against BHS. Then the company received a severe reprimand, the obligation over the next three years to monitor the activities of its audit office in Leeds, as well as draw up detailed reports in the FRC. Former PwC partner Steve Denison then received a fine of £500,000, as well as a ban on auditing for 15 years and exclusion from the register of auditors.^[3]

2500 job cuts

At the end of May 2020, Deloitte announced mass layoffs, which indicate that the COVID-19 coronavirus pandemic has also affected those industries in which remote work is actively practiced.

The reduction of about 5% of the staff on a conference call on the publication of financial statements was announced by the CEO and Chairman of the Board of Directors of Deloitte Consulting Dan Helfrich. Considering that the company employs about 50 thousand people, about 2,500 employees will fall under dismissal. Personnel reorganization will begin in the coming weeks, Helfrich said on May 29, 2020.

Deloitte fires 2,500 people

The company did not specify which employees would be laid off. According to Bloomberg, citing knowledgeable sources, the cuts will not be made evenly in the groups led by Helfrich. At the same time, it is known for sure that the bulk of the personnel purge will affect the American offices of Deloitte.

According to one of the interlocutors of the news agency, among some consultants who have stopped working in projects with clients, they are worried that they may be the first to lose their jobs.

At the same time, there are other data on layoffs. CRN sources say that Deloitte is cutting 5% of the state in the United States, where 106 thousand people work, so 5300 employees can suffer from layoffs.

Responding to questions from Bloomberg journalists about the layoffs, Deloitte spokesman Jonathan Gandal said he was "optimising his resources with the growing needs of our customers" as part of the financial year performance review process. He added that demand for Deloitte's services "continues to be strong and the company is doing everything it can to minimise the impact on customers in this unprecedented environment."^[4]

Deloitte and EY cut payments to partners by 20%

On April 15, 2020, Deloitte announced a 20% reduction in payments to its partners to support jobs during the crisis caused by the spread of the COVID-19 coronavirus.

Deloitte is starting to save on payments in several countries, including Britain. According to The New York Times, the professional services that Deloitte specializes in almost ceased to be provided after the pandemic painfully hit world markets and froze all transactions to enter the stock exchange, as well as mergers and acquisitions.

Deloitte announced a 20% reduction in payments to its partners to support jobs during the crisis caused by the spread of the coronavirus COVID-19

According to the chief executive of Deloitte's UK representative office, Richard Houston, the employees with the highest salaries should take on most of the financial problems, and they should increase the sustainability of the company in the long term. There will be no annual increase in salaries, bonuses will be cut and postponed to a later date in 2020, he said.

Houston called these measures correct and conducive to "protecting [Deloitte's] jobs and businesses for the foreseeable future."

The company also offered employees options for reducing working hours while maintaining most of their salaries.

Deloitte's competitors have also begun cutting payments to partners. EY cut them by the same 20% in order to provide "additional flexibility and financial stability during a pandemic." Also, these steps should contribute to the long-term success of the company, they said.

EY claims that they did not reduce the number of personnel in Britain, where about 17 thousand people work. Salaries to employees also decided not to reduce.

KPMG said the company had "frank conversations" with its partners about what actions it needs to take during the pandemic. Details on this matter were not disclosed.^[5]

2018: Firing 20 partners due to sexual harassment and aggression

In December 2018, it became known about the dismissal of about 20 British partners Deloitte in the four previous years. The company got rid of them due to inappropriate behavior, including for sexual harassment and manifestation of aggression.

We will fire people for any inappropriate behavior. No one has protection, says Deloitte CEO David Sproul. - Unfortunately, there were numerous partners dismissed for inappropriate conduct of a sexual or violent nature. I'd like to say they weren't, but they were.

According to Sproul, some of the dismissed employees, who received more than £800,000 a year, "saw nothing wrong with making obscene offers to younger colleagues while drinking with them in a bar."

British consulting and auditing company Deloitte fired about 20 of its British partners due to inappropriate behavior

Deloitte has about 1,000 partners in Britain. Company management said it had tightened internal conduct guidelines for employees.

As noted by the Financial Times, Deloitte became the first audit company of the Big Four to publish data on the dismissal of managers due to unacceptable behavior. Following Deloitte, this information was also disclosed by a competitor - KPMG. This company announced the dismissal or departure at its own request of seven employees of the British representative office. Their inappropriate behavior was expressed in humiliation of colleagues, sexual harassment, etc.

According to Anna Perches, head of the personnel department at KPMG, the company's policy "categorically prohibits all kinds of harassment, bullying and treting."

When our employees are victims of behavior that is contrary to this policy, or see its manifestations in relation to others, we support if they inform us about it, "she noted.

According to David Sproul, a few years before the start of the# MeToo movement condemning sexual violence and harassment, Deloitte introduced several initiatives to combat harassment and discrimination. In particular, staff were trained on "respect and help to adapt to work" and helplines started running to allow staff to speak anonymously about issues.^[6]

Famous actresses who spoke about sexual harassment joined the# MeToo anti-sexual violence movement

About 10 of our employees agreed to speak anonymously about how they were treated. It wasn't the most egregious behaviour and they were explaining their feelings to that effect. Perhaps this was one of the strongest things we did, because it made people realize the following: what seems to some to be a harmless joke can be extremely unpleasant for others, "Sproul said.

Deloitte is committed to creating an enabling work environment in which there is no place for harassment and aggression not only from its employees, but also from customers. The existence of such a problem is recognized in several of the largest audit companies in Britain working with Deloitte.

David Sproul is urging other companies in the market to tackle the bad behavior of customers themselves without replacing a worker who has faced attacks.

In the event of a problem, we give it a move from the client and say that it is unacceptable. Because it makes no sense to remove an employee "A," when there is a risk that a person will do the same with members of the female team "B," "C" or "D," - said the head of Deloitte.

  Laura Empson, a professor at the City, University of London, specializing in the management of professional services, called Deloitte's openness to this problem "fantastic." This signals a change, because audit companies are usually very careful in their actions, she added.

In December 2018, it became known that  PricewaterhouseCoopers (PwC) over the past three years got rid of five partners who behaved incorrectly in certain situations.

2017

Record revenue of $38.8 billion; 7.1% growth

In September 2017, Deloitte released its annual financial report. The company's revenue continued to grow due to demand for digitalization and artificial intelligence.

For the 12-month reporting period, which ended on May 31, 2017, Deloitte's revenue reached a record $38.8 billion, which is 7.1% more than a year ago. The rise has been observed for seven years in a row, during two of which the company's business volume increased at double-digit rates (by more than 10%).

Deloitte office in Spain

Deloitte's revenue growth is driven by two main factors, says company CEO Punit Renje . - Firstly, this is our model of multifunctional activity, which continues to be a source of our competitive advantages. Secondly, these are our customers who are increasingly choosing Deloitte as a partner that helps them carry out the necessary changes and rethink their activities in an ever-evolving global business environment.

Deloitte's profit for the year remained practically unchanged, remaining at about $800 million.

The largest growth was shown by revenue from the provision of risk management consulting services - by 12.9%, which the company associates with a growing awareness of the strategic role of risk management as a factor in improving operational efficiency and focusing on targeted acquisitions in rapidly developing areas, as well as the development of innovative solutions in the field of automation of robotic processes, identification of risks and intelligent analytics.

Deloitte's consulting revenue rose 10.2%, driven by increased demand for consulting services while building strategic alliances and making strategic acquisitions and investments in areas such as artificial intelligence, robotics, cognitive technology, creative digital consulting, cloud-based data processing and the Internet of Things.

Revenue growth from tax and law advisory services was 6.6%, partly due to demand for services in the area of ​ ​ the "global tax reset" related to activities carried out as part of the OECD initiative to prevent the erosion of the taxable base and derive profits from taxation, the company said.^[7]

Alliance with HP Inc.

HP Inc. and Deloitte on August 31, 2017 announced the creation of an alliance designed to accelerate the transition of industrial companies worldwide to digital technologies. Specifically, HP and Deloitte will collaborate on the implementation of 3D printing systems to help enterprises accelerate product development and launch, create more flexible supply chains, and optimize efficiency throughout the production cycle.

The alliance brings together HP JetFusion 3D Printing solutions and tools, a partner ecosystem and digital manufacturing transformation methods. Deloitte's global customer reach and strong business relationships, digital operations expertise are expected to help the alliance transform the operations of global companies.

The HP-Deloitte alliance will begin its work in the United States and eventually cover other regions. Read more about the alliance of companies here.

2015

Deloitte presented in September 2016 data on the total revenues of companies in its network for the financial year ended May 31, 2016. At the end of the year, total revenue amounted to 36.8 billion, providing dollars USA the network with 9.5% growth, taking into account the calculation in local currency.

• The biggest increase was in revenue from risk management consulting services - up 22.5% - attributed to strong demand for cyber risk management and regulatory services.
• Consulting revenue grew by 10.8%, driven by increased demand for integrated services to support large-scale digital transformation projects, system implementations, HR transformation and strategy development.
• In fiscal 2016, revenue growth from tax and law consulting services was 10%, the highest since 2008. This is partly because for the sixth year in a row, growth in the legal services segment is measured in double digits.

In fiscal 2016, Deloitte increased the number of employees of its international network by all geographical regions and areas of work. Headcount rose 8.5%, the most significant increase in three years. Over the past fiscal year, 72 thousand new specialists came to Deloitte, while the total number of employees around the world amounted to 244,400 people.

Plans:

• Invest over US $650 million since 2008 to improve the quality, consistency and significance of audits. Investments in this area include the automation of typical tasks, as well as the use of analytics tools that provide a deeper and more informative study of data.
• Expand the range of technology tools and assets used in the provision of financial services, including through the Financial Services Blockchain Lab in Ireland, so that Deloitte can quickly move from concept development to prototype, taking into account the individual needs of each client. Similarly, the establishment of the Deloitte Financial Crime Strategy & Response Network helps financial institutions take strategic action in response to growing threats, such as legalization of criminal money, cybercrime, fraud and corruption.
• Create a network of Cyber ​ ​ Intelligence Centers around the world, offering comprehensive and customizable solutions to meet each customer's needs, allowing organizations to protect themselves, as well as anticipate and counter new, more complex threats.
• To support M&A transactions, leverage data visualization technology that enhances the ability of customers to analyze pre-investment data from businesses.
• Launch a crowdsourcing application for enterprises that allows them to attract external private investors and access special knowledge, cooperate in the development of new products and ideas, design, create and test new digital assets.
• Invest in the development of new technologies and assets, taking into account the specifics of individual industries. For example, companies in the health and life sciences sector can use the data in new ways to quickly introduce medical discoveries into clinical practice, improve patient outcomes, manage the health of different populations, and improve the quality of cost management.

2013

Record revenue of $34.2 billion

Deloitte's member firms announced in September 2014 that they had received a record total revenue of 34.2 billion dollars USA for the fiscal year ended May 31, 2014. This year, the fifth in a series of years of economic growth, was marked by increased demand for the company's services in all regions of the world.

The total revenue of the network of companies increased by 6.5% in local currency, which is equivalent to 5.7%. The list was headed by consulting, where growth indicators reached double-digit values ​ ​ (10.3% in local currency), in second place - services in the field of taxation and law (7.7%). Corporate finance and risk management also saw significant growth (6.8% and 4.2%, respectively). The increase in revenue from audit services amounted to 2.5%, i.e. positive growth is noted even taking into account the significant investments of the network in ensuring the quality control of audit services.

Acquisition of Vigilant, an IT security monitoring service provider

Deloitte announced on June 4, 2013, the acquisition of most of the assets of Vigilant, an expert in security monitoring and information security threat analysis. Now Deloitte owned Vigilant assets have to be combined. The new brand name is Vigilant by Deloitte. The amount of the transaction was not disclosed.

Vigilant's cyber threat management services are expected to complement Deloitte's information security consulting services, allowing the company to expand its offering and introduce security solutions tailored to a range of industries, including financial services, aerospace and military, retail, manufacturing, technology, communications, power and pharmaceuticals.

Vigilant by Deloitte will be headed by Edward Powers, Chief of Security & Privacy at Deloitte & Touche LLP, a division of Deloitte LLP.

Vigilant businesses are mutually complementary, which will significantly expand our ability to provide customers with personalized cyber threat management services," said Edward Powers.

2012

Deloitte's total income for the fiscal year ended May 31, 2013 was 32.4 billion. dollars USA The Deloitte network has increased growth indicators in the local currency of all business functions in all regions. This growth is due to the increased demand for our company's services due to the fact that customers often face difficulties and instability during the period of investment in increasing production capacity. The strengthening dollar of the US position towards the end of the fiscal year means that Deloitte's 3.5% profit growth was higher in local currency at 5.6%.

• Growth in the American regions was 6.3% in local currency, with Chile (18.1%) and Latin America and the Caribbean (14.3%) the most significant growth. Especially rapid growth was noted in the United States,. Its share in the total profit amounted to 80%. Profits in most advisory and technology services reached double-digit percentage rates.
• Earnings for the EBBA region increased by 5.6%, with Deloitte in the UK recording a substantial growth of 8% despite the difficult economic situation. The profits of firms in the Middle East and Turkey reached double-digit interest rates mainly due to the tax and consulting function. Firms in South and East Africa recorded significant profit growth - by 8.3%.
• Growth in Asia-Pacific was 3.1% in local currency, reaching 6.5% in India, Mauritius, Southeast Asia, Korea and Japan.

• In all regions, there was a noticeable increase in consulting services for fiscal year 2013, amounting to 8.7% in local currency. This growth indicates the readiness of companies to explore and invest in promising areas of activity. In the consulting sector, the demand for services related to personnel capital, strategy and operating activities turned out to be the most significant.
• The growth in the provision of financial consulting services was 6.7%. Market demand led to steady growth in financial investigation and restructuring services, while almost all regions made investments in strategic acquisitions.
• Audit and risk management services for enterprises as a whole grew by 2.9%. The enterprise risk management function achieved a two-digit percentage increase in Asia-Pacific earnings and a significant rise in the EBBA and America.
• Profits from tax and legal advice increased by 5.6%, achieving significant performance in each region and division. Serious growth was noted in most firms in the Asia-Pacific region - especially in Japan, Mauritius and Korea. In FY2014, Deloitte plans to increase its growth rate by investing in high-tech services, international integrated market offerings and services that enable customers to address the challenges posed by rapid changes in globalization, technology development and corporate regulation.
• Industries. With regard to the service function of the biomedical and pharmaceutical industries, there is an increase of 12.9%. It is followed by the service function of government agencies (growth - 7.7%) and the service function of industrial enterprises (growth - 5.5%). The service function of enterprises in the energy and mining sectors has also expanded significantly - by 5.1%.

Notes