NEW YORK, Nov. 2, 2005 (PRIMEZONE) -- PricewaterhouseCoopers today released its 2005 Global Annual Review, "Perspectives on Value," which provides insights on key issues facing the accounting profession, including:
-- The impact of new regulatory requirements on corporate
reporting and public confidence.
-- The need for further efforts by the profession to raise
audit quality.
-- Whether there is sufficient competition among the Big Four
global networks.
-- The role of advisory services in maintaining the accounting
profession's long-term sustainability.
The 2005 Global Annual Review also reports on the overall performance of the PricewaterhouseCoopers network for the year ended 30 June 2005, with global revenues up nearly 17 percent over the previous year.
"Fiscal 2005 was a year of vibrant growth and real achievement," said Global CEO Samuel A. DiPiazza, Jr. "PricewaterhouseCoopers' aggregate revenue increase was driven by increased demand for our services, by new regulatory requirements in a number of major capital markets and by a favourable global economic climate. The continuing expansion of emerging economies in Asia and South America also fueled overall growth."
Mr. DiPiazza continued, "Equally important, it was a year in which we made significant progress in improving quality, in realigning our businesses to reflect the new regulatory landscape, and in implementing programmes around the world that make PricewaterhouseCoopers an attractive organisation for launching and building a career."
In the Review, Mr. DiPiazza offers his perspectives on the future priorities and direction of the PricewaterhouseCoopers global network and on the pressing issues facing the profession. He notes that new regulatory requirements, particularly in the U.S. and Europe, have led to clear improvements in financial reporting and will help prevent a recurrence of the recent spate of corporate scandals. But, while the new regulatory environment is helping to restore public trust in the capital markets, the bar for audit quality must be set higher to create sustainable value for stakeholders.
Mr. DiPiazza said he expects that the market for assurance, tax and advisory services will remain highly competitive. The sustainability of the profession, he added, will depend on delivering value that is recognized by clients and key stakeholders. Providing advisory services will remain a critical ingredient in attracting and retaining talented people and in maintaining a dynamic and sustainable profession.
"Good progress has been made in enhancing the quality and the oversight of the auditing function and in driving wider improvements in transparency and corporate governance, all of which should help to increase public trust and value creation. However, we still have much to do to ensure that the profession remains sustainable."
The Review also offers insight into PricewaterhouseCoopers' worldwide investments in markets and people over the past 12 months and describes how these investments have strengthened the connections across the PricewaterhouseCoopers global network to build trust and enhance value. Examples include:
-- Over the past twelve years, PricewaterhouseCoopers firms have
invested more than USD200 million in China, with the result that
PwC China now employs 6,500 people and expects this number to
reach 10,000 within five years.
-- In fiscal 2005, PricewaterhouseCoopers firms hired over
13,000 graduates and 10,000 experienced professionals.
-- PricewaterhouseCoopers continues to play a leading role in
the development and promotion of XBRL, a technology that
enables organisations to quickly and simply access and exchange
information across different systems.
-- In fiscal 2005, 17,000 people were trained in two new U.S. Public
Company Accounting Oversight Board standards.
-- Following the Indian Ocean tsunami, PricewaterhouseCoopers donated
8,000 hours of advisory services to assist the United Nation's
Tsunami Flash Appeal.
-- In a 2005 survey, 82 percent of PricewaterhouseCoopers people
said they would recommend their firm as a good place to work.
The Review reports that gross aggregate revenues for PricewaterhouseCoopers firms in fiscal 2005 were US$20.3 billion, an increase of nearly 17 percent as expressed in U.S. dollars and more than 12 percent in local currencies. Excluding expenses reimbursed by clients, net aggregate revenues were US$19 billion. Overall, PricewaterhouseCoopers firms achieved double-digit growth in each major client segment -- top-tier audit clients, non-audit clients and private companies/middle market -- and in every industry sector.
In local currency terms, Advisory Services revenues rose 16.6 percent in fiscal 2005. Demand for Advisory Services, which encompass crisis management, transactions and performance improvement, has grown rapidly, with revenues from advisory work reaching more than USD3.5 billion in fiscal 2005, up 37 percent from fiscal 2003. This growth stemmed from services provided to non-audit clients and private companies, and does not reflect a return to a broad-based consulting practice.
Tax and Human Resource Services, which comprises tax compliance, tax structuring and M&A support, and human resource services, rebounded in fiscal 2005, following two years of declining or flat revenues, to grow by 5.5 percent.
Revenue from assurance services increased 14.6 percent as regulatory changes and investor expectations fuelled increased demand and higher service levels.
PricewaterhouseCoopers' member firms performed well in all major geographic markets. On a regional basis, revenue growth was highest in South America at nearly 22 percent.
"We are planning for further growth, but with appropriate caution," said Mr. DiPiazza. "We will continue to grow at a responsible rate, consistent with our absolute commitment to quality and to selectivity. We believe that this is the best way to create sustainable value for all our stakeholders."
Notes to Editors:
-- For more information on PricewaterhouseCoopers' 2005 Global
Annual Review please visit www.pwc.com/review
-- PricewaterhouseCoopers (www.pwc.com) provides industry-focused
assurance, tax and advisory services for public and private
clients. More than 130,000 people in 148 countries connect their
thinking, experience and solutions to build public trust and
enhance value for clients and their stakeholders.
"PricewaterhouseCoopers" refers to the network of member firms of
PricewaterhouseCoopers International Limited, each of which is a
separate and independent legal entity.
(C) 2005 PricewaterhouseCoopers. All rights reserved.
-- See full 2005 revenue breakdown, by service line and geography,
in following charts.
--------------------------------------------------------------------
Aggregated Revenues of PricewaterhouseCoopers Firms by Service Line
(USD millions)
At FY05 ex. At FY04 ex. At constant
Rates Rates ex. Rates
FY05 FY04 % Change % Change
----------- ----------- --------- -----------
Assurance 10,872 9,154 18.8% 14.6%
---------------- ----------- ----------- --------- -----------
Advisory 3,520 2,890 21.8% 16.6%
---------------- ----------- ----------- --------- -----------
Tax 4,606 4,210 9.4% 5.5%
---------------- ------ ------ ---- ----
Net Revenue from
Continuing
Professional
Services 18,998 16,254 16.9% 12.6%
---------------- ----------- ----------- --------- -----------
Expenses Billed
to Clients 1,259 1,094 15.1% 8.6%
---------------- ----------- ----------- --------- -----------
Total Gross
Revenues 20,257 17,348 16.8% 12.4%
---------------- ----------- ----------- --------- -----------
FY05 revenues are expressed in US dollars at average FY05 exchange
rates. FY04 revenues are shown at average FY04 exchange rates.
FY04 revenues have been restated from USD17, 600 million originally
reported to exclude discontinued operations and standardise expense
and line of service definitions in anticipation of new regulatory
requirements.
Fiscal year ends 30 June.
--------------------------------------------------------------------
Aggregated Revenues of PricewaterhouseCoopers Firms by Geography
(USD millions)
At FY05 ex. At FY04 ex. At constant
Rates Rates ex. Rates
FY05 FY04 % Change % Change
----------- ----------- --------- -----------
Asia 1,753 1,493 17.4% 13.8%
-------------------- ----------- ----------- --------- -----------
Australasia and
Pacific Islands 806 705 14.3% 8.0%
-------------------- ----------- ----------- --------- -----------
Europe 8,583 7,309 17.4% 10.4%
-------------------- ----------- ----------- --------- -----------
Middle East and
Africa 441 371 18.9% 11.6%
-------------------- ----------- ----------- --------- -----------
North America and
the Caribbean 7,047 6,071 16.1% 15.4%
-------------------- ----------- ----------- --------- -----------
South and Central
America 368 305 20.7% 21.9%
-------------------- ----------- ----------- --------- -----------
Net Revenue from
Continuing
Professional
Services 18,998 16,254 16.9% 12.6%
-------------------- ----------- ----------- --------- -----------
Expenses Billed
to Clients 1,259 1,094 15.1% 8.6%
-------------------- ----------- ----------- --------- -----------
Total Gross Revenues 20,257 17,348 16.8% 12.4%
-------------------- ----------- ----------- --------- -----------
FY05 revenues are expressed in US dollars at average FY05 exchange
rates. FY04 revenues are shown at average FY04 exchange rates.
FY04 revenues have been restated from USD17, 600 million originally
reported to exclude discontinued operations and standardise expense
and line of service definitions in anticipation of new regulatory
requirements.
Fiscal year ends 30 June.
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