Profits slide at Grant Thornton

Grant Thornton
has become the first big accounting firm to report a fall in profits in 2008,
blaming the drop on the economic downturn and the cost of its merger with Robson
Rhodes.

The UK’s fifth biggest firm by fee income said pretax profit had fallen 5% to
£72m for the financial year to 30 June 2008, although fee income jumped 25% to
£394.1m, helped by the first contribution from Robson Rhodes after the rival
firms merged in July 2007.

The profit fall is the latest evidence that the accountancy profession faces
a tough 2009 as the UK slides into recession.

Accounting firms including Grant Thornton, Deloitte and PKF have announced
plans to cut hundreds of jobs in expectation of slower revenue growth this year.

Scott Barnes, who formally takes over as Grant Thornton CEO in January, said:
‘I am very pleased with our growth in fee income given that it has been a
challenging year.’

He added that achieving Grant Thornton’s target of £500m in fee income in
2010 would be ‘very tough’ as the economy weakens but said he was confident
about the firm’s strategy.

‘Our aims have not changed, simply the timescale and strategy needed to
address market conditions,’ he said. ‘Given clear focus and the capabilities of
our people, I have great confidence in our direction.’

Grant Thornton’s audit and assurance practice grew by 44%, corporate recovery
by 19%, tax services by 18%, and corporate finance by 12%.