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Deloitte

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Deloitte Touche Tohmatsu
Company typeSwiss Verein
IndustryProfessional services
FoundedLondon, United Kingdom (1845)
HeadquartersNew York, New York, U.S.
Key people
John Connolly, Chairman
Jim Quigley, CEO
ServicesAudit
Tax
Consulting
Financial advisory
RevenueIncreaseUS$27.4 billion (2008)
Number of employees
165,000 (May 2008)
Websitewww.deloitte.com

Deloitte Touche Tohmatsu (also branded as Deloitte) is the largest professional services firm in the world and one of the Big Four auditors, along with PricewaterhouseCoopers, Ernst & Young, and KPMG.

According to the firm's website as of 2008, Deloitte has approximately 165,000 professionals at work in 142 countries, delivering audit, tax, consulting, and financial advisory services.

Deloitte Touche Tohmatsu is a Swiss Verein, a membership organization under the Swiss Civil Code whereby each member firm is a separate and independent legal entity. Its global headquarters are located in New York City, New York.[1] European headquarters are located in London.

History

Early history

In 1845 William Welch Deloitte opened an office in Basinghall Street in London: he was the first person to be appointed an independent auditor of a public company.[2] He went on to open an office in New York in 1880.[2]

In 1895 Charles Waldo Haskins and Eijah Watt Sells formed Haskins & Sells in New York.[2]

In 1898 George Touche established an office in London and then in 1900 joined John Ballantine Niven in establishing the firm of Touche Niven in the Johnston Building at 30 Broad Street in New York.[2] At the time, there were fewer than 500 CPAs practicing in the United States, but the new era of income taxes was soon to generate enormous demand for accounting professionals.

1930s

See also: Ultramares Corporation v. Touche

On April 1, 1933, Colonel Arthur Hazelton Carter, President of the New York State Society of Certified Public Accountants and Managing Partner of Haskins & Sells, testified before the U.S. Senate Committee on Banking and Currency. Carter helped convince Congress that independent audits should be mandatory for public traded corporations.[2]

1940s

In 1947, Detroit accountant George Bailey, then president of the American Institute of Certified Public Accountants, launched his own organization. The new entity enjoyed such a positive start that in less than a year, the partners merged with Touche Niven and A.R. Smart to form Touche, Niven, Bailey & Smart.[2] Headed by Bailey, the organization grew rapidly, in part by creating a dedicated Management Consulting function. It also forged closer links with organizations established by the cofounder of Touche Niven, George Touche: the Canadian organization Ross, Touche and the British organization George A. Touche.[2] In 1960, the firm was renamed Touche, Ross, Bailey & Smart, becoming Touche Ross in 1969.[2]

The 1950s

In 1952 Deloitte merged with Haskins & Sells to form Deloitte, Haskins & Sells.[2]

The 1960s

In 1968 Nobuzo Tohmatsu formed Tohmatsu Awoki & Co, a firm based in Japan that was to become part of the Touche Ross network in 1975.[2]

The 1970s

In 1972 Robert Trueblood, Chairman of Touche Ross, led the committee responsible for recommending the establishment of the Financial Accounting Standards Board.[2] He led the expansion of Touche Ross in that era.

The 1980s

In 1982, David Moxley and W. Grant Gregory became the leaders at Touche Ross. In 1985, Edward A. Kangas, a management consultant, was appointed managing partner of Touche Ross. In 1984, J. Michael Cook became managing partner of Deloitte, Haskins & Sells.

In 1989 the global firm of Deloitte Haskins & Sells broke up. Led by the US business, some country partnerships of Deloitte Haskins & Sells merged with Touche Ross to form Deloitte & Touche: the merged firm was led by J. Michael Cook and Edward A. Kangas. Led by the UK partnership a smaller number of Deloitte Haskins & Sells member firms rejected the merger with Touche Ross and shortly thereafter merged with Coopers & Lybrand to form Coopers & Lybrand Deloitte (later to become PwC), while some member firms of Touche Ross also rejected the merger with Deloitte Haskins & Sells and merged with other firms.

The 1990s

Deloitte Office Building in Downtown Chicago

In 1993 the international firm was renamed Deloitte Touche Tohmatsu to reflect the contribution from the Japanese firm.[2]

In 1995, the partners of Deloitte & Touche decided to create Deloitte & Touche Consulting Group (later Deloitte Consulting).[3]

The 2000s

Following the demise of Arthur Andersen in 2002, almost half of the Partners and Staff of the UK business of Arthur Andersen joined the Deloitte firm.

Branding

While in 1989, in most countries, Deloitte, Haskins & Sells merged with Touche Ross forming Deloitte & Touche, in the United Kingdom the local firm of Deloitte, Haskins & Sells merged instead with Coopers & Lybrand (which today is PricewaterhouseCoopers).[4] For some years after the merger, the merged UK firm was called Coopers & Lybrand Deloitte and the local firm of Touche Ross kept its original name. In the mid-1990s however, both UK firms changed their names to match those of their respective international organisations.

While the full name of the firm is Deloitte Touche Tohmatsu, in 1989 it initially branded itself Deloitte & Touche and then simply Deloitte. In 2003 the rebranding campaign was commissioned by Bill Parrett, the then CEO of DTT, and led by Jerry Lehman, the global Clients and Markets leader.[5]

Services

Deloitte & Touche LLP in the UK offers all four of the following service lines, all operating within a single company sometimes with professionals from different areas working alongside each other:[6]

  • Audit
  • Tax
  • Consulting
  • Financial Advisory (or Corporate Finance)

As a function-specific subsidiary within the Tax practice of Deloitte & Touche LLP, the Deloitte Private Client Services Limited department specialises in helping clients increase their net asset value and minimise their tax liabilities.

In comparison, Deloitte & Touche USA LLP (the US member firm) is composed of several function-specific subsidiaries, each of which is a separate legal entity but a wholly owned subsidiary. Some countries' member firms are organized differently.

  • Deloitte Consulting LLP: Provides consulting services to various clients in Financial Services, Consumer & Industrial Products, Health Care & Life Sciences, Public Sector, and other industries and subcategories. The specific consulting capabilities are organized into Service Areas: Enterprise Applications, Technology Integration, Strategy & Operations, Human Capital, and Extended Business Services (XBS), which are further broken down into relevant subcategories. They concentrate on providing more solid and defined business processes for companies which previously lacked them.[7]
  • Deloitte & Touche LLP: This function is known internally as Audit & Enterprise Risk Services, and provides the firm's traditional accounting and audit services, as well as offerings in risk management, security, data quality & integrity and IT control assurance.[8]
  • Deloitte Tax LLP: This function provides traditional tax advisory services to clients, as well as offerings in tax systems and advisory of tax implications on various parts of the business: mergers & acquisitions, ERP package implementation, etc.[9]
  • Deloitte Financial Advisory Services LLP: This function provides financial advisory services to clients, including dispute, forensics, and valuation.[10]
  • Deloitte Services LP: While not a client-facing subsidiary, this vital function comprises people that operate the firm itself, such as finance, human resources, marketing, Strategy, Research & Innovation (SR&I), mail and printing services, technology support, and administrative assistants.

Staff

The firm is rated by Fortune as one of the 100 best companies for which to work.[11]

In 2007, Deloitte was rated the number one place to launch your career by Business Week.[12]

Criticisms

Disputes involving Deloitte include:

  • Adelphia Communications Corporation - The Securities and Exchange Commission announced on April 26, 2005 that Deloitte had agreed to pay $50 million to settle charges relating to Adelphia's 2000 financial statements[13]
  • Guangdong Kelon Electrical Holdings - Investors have claimed that there was a failure to alert them to the company's poor financial position[14]
  • Haringey Council Refresh Project - A local government IT project in the UK, in which costs rose from £9m to £24.6m. Deloitte were consultants on the project, despite being employed at the same time as the council's auditors.[15]
  • Irish Health Service Executive - Poor consulting support of health accounts system software in 2005 led to major cost overruns and the Irish Health Service Executive pulling the plug on the computer system entirely after substantial cash outlays[16]
  • Los Angeles Unified School District ('LAUSD') - The firm sold the system to LAUSD for US$95m and because of faults in the system the schoolteachers were underpaid, overpaid or not paid at all.[17] As at 31 December 2007 LAUSD had incurred a total of US$140m in payments to Deloitte to get the system working properly.[18] However in January 2008 there was some evidence that that the payroll issues had started to stabilize with errors below 1% according to LAUSD's chief operating officer.[19]

Notable current and former employees

Business

Politics and public service

Other

Clients

Major clients include (note that not all of these are audit clients):

See also

References

  1. ^ Deloitte Head Office
  2. ^ a b c d e f g h i j k l Deloitte history
  3. ^ Deloitte & Touche Consulting Group take more than 30 organisations live with SAP
  4. ^ PWC: History and milestones
  5. ^ Ernst & Young launches rebrand plan (refers to Deloitte rebranding in 2003)
  6. ^ Deloitte: Services offered
  7. ^ Deloitte: Consulting services
  8. ^ Assurance & Advisory services
  9. ^ Deloitte: Tax services
  10. ^ Deloitte: Financial Advisory services
  11. ^ Fortune: 100 best companies to work for
  12. ^ Businessweek
  13. ^ Deloitte settles in Adelphia scandal
  14. ^ Deloitte faces double trouble in China
  15. ^ How a London council's visionary IT plan became a project management nightmare
  16. ^ E-Health Insider :: Ireland suspends two national health IT projects
  17. ^ LAUSD teachers start boycott
  18. ^ Los Angeles school district SAP implementation still broken
  19. ^ Update: LAUSD payroll problems stabilized


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