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Deloitte Touche Tohmatsu Limited (play /dəˈlɔɪt/), commonly referred to as Deloitte, is one of the Big Four professional services firms along with PricewaterhouseCoopers (PwC), Ernst & Young, and KPMG.

Deloitte is the second largest professional services network in the world by revenue and has 193,000 employees in more than 150 countries providing audit, tax, consulting, enterprise risk and financial advisory services.[2] In FY 2012, Deloitte earned a record $31.3 billion USD in revenues.[3]

In 2012, it is reported that in the U. K. Deloitte has the largest number of clients amongst FTSE 250 companies.[4]

Its global headquarters is located in New York City, United States.[5]

History

Early history

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In 1845 William Welch Deloitte opened an office in Basinghall Street in London. Deloitte was the first person to be appointed an independent auditor of a public company.[6] He went on to open an office in New York in 1880.[6]

In 1896 Charles Waldo Haskins and Elijah Watt Sells formed Haskins & Sells in New York.[6]

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.[6] 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.

On March 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 companies.[6]

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.[6] 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 co-founder of Touche Niven, George Touche: the Canadian organization Ross and the British organization George A. Touche.[6] In 1960, the firm was renamed Touche, Ross, Bailey & Smart, becoming Touche Reloitte, Haskins & Sells.[6] 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.[6] In 1972 Robert Trueblood, Chairman of Touche Ross, led the committee responsible for recommending the establishment of the Financial Accounting Standards Board.[6] He led the expansion of Touche Ross in that era.

In 1989 Deloitte Haskins & Sells in the USA merged with Touche Ross in the USA to form Deloitte & Touche. The merged firm was led jointly 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 merge with Price Waterhouse to become PwC).[7] Some member firms of Touche Ross also rejected the merger with Deloitte Haskins & Sells and merged with other firms.[7]

Recent history

File:DeloitteOfficeChicago.jpg

At the time of the US-led mergers to form Deloitte & Touche, the name of the international firm was a problem, because there was no worldwide exclusive access to the names "Deloitte" or "Touche Ross" – key member firms such as Deloitte in UK and Touche Ross in Australia had not joined the merger. The name DRT International was therefore chosen, referring to Deloitte, Ross and Tohmatsu. In 1993 the international firm was renamed Deloitte Touche Tohmatsu to reflect the contribution from the Japanese firm.[6] as well as agreements to use both of the names Deloitte and Touche.

In 1995, the partners of Deloitte & Touche decided to create Deloitte & Touche Consulting Group (now known as Deloitte Consulting).[8]

In 2000, Deloitte acquired Eclipse to add Internet design based solutions to its consulting capabilities. Eclipse was later separated into Deloitte Online and Deloitte Digital.[9]

In 2002, Arthur Andersen's UK practice, the firm's largest practice outside the U. S., agreed to merge with Deloitte's UK practice. Andersen's practices in Spain, the Netherlands, Portugal, Belgium, Mexico, Brazil and Canada also agreed to merge with Deloitte.[10][11] The spin off of Deloitte France's consulting division led to the creation of Ineum Consulting.[12]

In 2009, Deloitte purchased the North American Public Service practice of BearingPoint (formerly KPMG Consulting) after it filed for bankruptcy protection.[13] The firm also took over the UK property consultants Drivers Jonas in January 2010.[14]

In 2011, Deloitte acquired DOMANI Sustainability Consulting and ClearCarbon Consulting in order to expand its sustainability service offerings.[15]

In January of 2012, Deloitte announced the acquisition of Übermind, Inc., an innovative mobile agency.[16] The acquisition is Deloitte's first entrance into the mobile application field [17] In November, Deloitte acquired the various offices of Monitor Group, the strategy consulting firm founded by Harvard Business School professor Michael Porter, out of the latter firm's bankruptcy . [18]

Global structure

File:Deloitte Offices Auckland.jpg

For many years, the organization and its network of member firms were legally organized as a Swiss Verein. As of 31 July 2010, members of the Verein became part of Deloitte Touche Tohmatsu (DTTL), a UK private company, limited by guarantee. Each member firm within its global network remains a separate and independent legal entity, subject to the laws and professional regulations of the particular country or countries in which it operates.[19]

This structure is similar to other professional services networks which seek to limit vicarious liability for acts of other members. As separate and legal entities, member firms and DTTL cannot obligate each other. Professional services continue to be provided by member firms only and not DTTL. With this structure, the members should not be liable for the negligence of other independent members. This structure also allows them to be members of the IFAC Forum of Firms[20] which is network of accounting firm networks.

Name and 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 PwC).[21] 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 organizations.

While the full name of the UK private company is Deloitte Touche Tohmatsu Limited, in 1989 it initially branded itself DRT International. In 2003 the rebranding campaign was commissioned by Bill Parrett, the then CEO of DTT, and led by Jerry Leamon, the global Clients and Markets leader.[22]

According to the company website, Deloitte now refers to the brand under which independent firms throughout the world collaborate to provide audit, consulting, financial advisory, risk management, and tax services to selected clients.[23]

In 2008, Deloitte adopted its new “Always One Step Ahead” (AOSA) brand positioning platform to support the existing Deloitte vision: “To be the Standard of Excellence”. AOSA represents the global organization’s value proposition, and is never used as a tagline. The recent launch of the Green Dot ad campaign also aligns with Deloitte’s brand strategy and positioning framework.[24]

Services

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Deloitte member firms offer services in the following functions, with country-specific variations on their legal implementation (i. e. all operating within a single company or through separate legal entities operating as subsidiaries of an umbrella legal entity for the country).[25]

Staff

File:DeloitteToronto.JPG
File:Deloitte skyline offices in Nicosia capital of Republic of Cyprus 8.jpg

Deloitte offers its staff a variety of career models to choose from based on their preferences, geographic location and business need. These career models also vary for each function. Traditional titles for Consulting are "analyst" through "principal", FAS has "associate" through "partner", and the delivery-focused track features "specialist" through "specialist leader".

Deloitte hires entry-level personnel to client-facing functions through their graduate recruitment programs at selected universities.

The organization is consistently rated by Fortune as one of their "100 Best Companies To Work For".[32]

In 2007 and 2009, Deloitte was rated the number one place to launch your career by BusinessWeek.[33][34]

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.[35]
  • Guangdong Kelon Electrical Holdings Company Limited – Investors have claimed that there was a failure to alert them to the company's poor financial position.[36]
  • Haringey Council Refresh Project – A local government IT project in the UK, in which costs rose from £9 million to £24.6 million. Deloitte were consultants on the project, despite being employed at the same time as the council's auditors.[37]
  • Los Angeles Unified School District (LAUSD) – The firm implemented the SAP HR system for LAUSD for $95 million and because of faults in the system, some teachers were underpaid, overpaid, or not paid at all.[38] As of December 31, 2007 LAUSD had incurred a total of $140 million in payments to Deloitte to get the system working properly.[39] In 2008 there was some evidence that the payroll issues had started to stabilize with errors below 1% according to LAUSD's chief operating officer.[40]
  • State of California Courts System – The firm has been working on a statewide case management system which originally had a budget of around $260 million. Almost $500 million has already been spent and costs are expected to run as high as $2 billion. No single court is yet fully operational.[41] California's Judicial Council terminated the project in 2012 citing actual deployment costs associated with the project and California's budget concerns.[42]
  • Australian Tobacco Industry – In 2011 Deloitte was commissioned by the tobacco industry to compile a report on illicit tobacco. The Australian Customs and Border Protection Service officials called the report "potentially misleading" and raised concerns about the "reliability and accuracy" of the data.[43] When a second Deloitte report focusing on counterfeit cigarettes was released, Home Affairs Minister Brendan O'Connor described the second report as "baseless and deceptive" and "bogus. "[44] Public health officials criticised Deloitte's decision to conduct the research, as it added credibility to the tobacco industry's effort to undermine the Government's plain cigarette packaging legislation.[45]
  • Canadian Bar Association – In September 2003, Deloitte reported to the CBA that motor vehicle accident insurance claims for bodily injury had been declining since 1999, which refuted the government's and industry's argument that general damages for soft-tissue injury had to be capped at $4,000. Within hours of release, the report was withdrawn due to pressure from the Insurance Bureau of Canada. The Institute of Chartered Accountants of Alberta found Deloitte guilty of professional misconduct and fined the firm $64,000.[46]
  • Standard Chartered Iranian Money Laundering – In August 2012, Deloitte was forced to publicly deny that as the official internal auditors for Standard Chartered, it helped the bank cover up suspected money laundering operations which were earning the bank significant profits by "intentionally ommiting critical information".[47]
  • Hewlett Packard acquisition of Autonomy - In August 2011 KPMG conducted due diligence on Hewlett Packard's $11.1 billion acquisition of the British software company Autonomy Corporation, whose accounts had previously been audited by Deloitte. In November 2012 HP announced a $8.8 billion write off due to "serious accounting improprieties" committed by Autonomy management prior to the acquisition.[48][49]

Sponsorship

The U. K. member firm of Deloitte is a sponsor of the London 2012 Olympics[50] and the Royal Opera House.[51] The Canadian member firm was also the official professional services supplier for the 2010 Vancouver Winter Olympic Games[52] and 2010 Winter Paralympic Games.[53] The US member firm of Deloitte is a sponsor of the United States Olympic Committee.[54] In Asia, the Singapore member firm of Deloitte was a sponsor of the 2010 Summer Youth Olympics.[55]

Moreover, Deloitte sponsors many university sports teams, such as Edinburgh University Hockey Club.[56]

Notable current and former employees

Business

Politics and public service

See also

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References

  1. Leadership
  2. Deloitte announces revenue results of US$31.1 billion Deloitte. Retrieved on September 19, 2012.
  3. Deloitte revenues reach $31.3 billion on Asia growth
  4. Rachael Singh (May 29, 2012). Deloitte overtakes PwC as FTSE 250 auditor. Accountancy Age.
  5. "Contact Us. " Deloitte. Retrieved on December 7, 2009.
  6. 6.00 6.01 6.02 6.03 6.04 6.05 6.06 6.07 6.08 6.09 6.10 Deloitte history
  7. 7.0 7.1 Deloitte Touche merger done The New York Times
  8. Deloitte Consulting, Page 6
  9. Deloitte buys Eclipse, ARN, 16 February 2000
  10. Suzanne Kapner (2002-04-11). "ENRON'S MANY STRANDS: THE ACCOUNTANTS; British Unit Of Andersen Is Defecting To Deloitte". New York Times. http://www.nytimes.com/2002/04/11/business/enron-s-many-strands-accountants-british-unit-andersen-defecting-deloitte.html?scp=14&sq=arthur%20andersen%20deloitte&st=Search. Retrieved 2010-02-24. 
  11. "Canadian Unit To Join Deloitte". New York Times. 2002-04-13. http://www.nytimes.com/2002/04/13/business/international-business-canadian-unit-to-join-deloitte.html?pagewanted=1. Retrieved 2010-02-24. 
  12. Ineum Consulting at Oracle.com, August 2008
  13. BearingPoint to sell business units to Deloitte, PwC, Washington Business Journal, March 24, 2009
  14. Deloitte acquires Drivers Jonas, Financial Times, 21 January 2010
  15. Deloitte Expands Sustainability Offerings, Acquires ClearCarbon, DOMANI Envirinmental leader, 13 December 2010
  16. Deloitte Acquires Ubermind; Establishes Lead in the Mobile Revolution at prnewswire.com, 4 January 2012
  17. Confirmed: Deloitte buys Ubermind, looking to play a bigger role in mobile apps
  18. Monitor Company Group LP Files for Bankruptcy in Delaware
  19. Andrew Clark (20 September 2010). "Deloitte Touche Tohmatsu quits Swiss system to make UK its new legal home". The Guardian. http://www.guardian.co.uk/business/2010/sep/20/deloitte-touche-tohmatsu-legal-registration-london. Retrieved 20 September 2010. 
  20. IFAC Forum of Firms
  21. PWC: History and milestones
  22. Ernst & Young launches rebrand plan (refers to Deloitte rebranding in 2003)
  23. virat Deloitte
  24. 170,000 brand managers step ahead, as one
  25. Deloitte: Services offered
  26. Assurance & Advisory services
  27. Deloitte: Financial Advisory services
  28. Deloitte: Discovery
  29. Deloitte: Tax services
  30. Local businesses in Calgary, Canada
  31. State of Colorado
  32. Fortune: 100 best companies to work for
  33. Businessweek 2007
  34. Businessweek 2009
  35. Deloitte settles in Adelphia scandal
  36. Deloitte faces double trouble in China
  37. How a London council's visionary IT plan became a project management nightmare
  38. Teachers. Start. Boycott-2995901.shtml LAUSD teachers start boycott
  39. Los Angeles school district SAP implementation still broken
  40. Update: LAUSD payroll problems stabilized
  41. California court officials, judges spar over costly computer system
  42. California Scraps Massive Courts Software Project
  43. Australian Customs and Border Protection response to Media Watch ABC, 10 June 2011
  44. Joe Hildebrand News.com.au, 12 July 2011
  45. Professor Simon Chapman ABC Online, 6 July 2011
  46. Accountant penalized for info leak. Retrieved on 15 September 2011.
  47. Standard Chartered: Deloitte rejects US claims The Telegraph, 7 August 2012
  48. KPMG conducted due diligence of Deloitte audit at Autonomy
  49. Hewlett’s Loss: A Folly Unfolds, by the Numbers
  50. Deloitte becomes first London 2012 tier two sponsor
  51. Deloitte Ignite
  52. Vancouver 2010 Paralympic Winter Games
  53. Deloitte named Official Professional Services Provider to Vancouver 2010 Winter Games
  54. Deloitte Announces Sponsorship of U. S. Olympic Committee and U. S. Olympic and Paralympic Teams
  55. Deloitte was official partner of inaugural YOG in 2010
  56. Deloitte – Official Sponsor of EUMHC

External links


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