Globally, EY reported annual revenues of US$31.4b for its financial year ending 30 June 2017. This represents a 7.8% increase over financial year 2016 revenues in local currency.
East highlights
The performance of EY’s 400-strong East practice was in line with the UK firm’s strong growth. Regional highlights from the Cambridge and Luton offices over the last financial year and more recently include:
- EY employs over 400 people across its two offices in Cambridge and Luton.
- Anup Sodhi recently appointed Office Managing Partner in Luton, taking over from Andy Clewer.
- Promotion of two Directors in Cambridge and four Directors in Luton to strengthen local teams and the support EY offers to mid-market firms across the East.
- Recruited 34 university graduates and 12 apprentices on EY’s Business Apprenticeship programme in Cambridge and Luton offices, which offers young people an alternative to university.
- The 11th year of the EY Charity Quiz in Cambridge, which has raised over £50,000 for Cancer Research and Arthur Rank Hospice since 2006.
Nick Gomer, Managing Partner at EY in the East (pictured): “The East remains an important market for EY and this has been reflected by the firm’s continued investment in our Cambridge and Luton offices. We’re continuing to grow our regional business by investing in our people and recruiting to meet the demands of our clients, strengthening our focus on the impact of new technologies and supporting market-leading insights focused on the region’s economic activity.”
Strong performance says EY’s UK Chairman
Steve Varley, EY’s UK Chairman, says: “This is a strong performance, particularly in an environment where Brexit and other geopolitical events have added a new dimension to doing business in the UK. We’ve seen growth across all of our service lines, sectors and our main offices across the UK.
“Our success this year is the result of a long-term global strategy. We have invested in new technologies and our people, as clients turn to us for more innovative products and services and adapt to domestic and global economic trends. At a time of global flux clients have also particularly valued our ability to draw on EY’s operations across 150 countries as they seek to navigate new trading opportunities with countries such as the USA, Australia, China and India. We are also helping our clients outside of the UK to access opportunities here.”
UK business performance
In the UK, EY saw significant growth across all of its four service lines in 2017. Transaction Advisory Services (TAS) was the fastest growing service line with growth of 15.1% to £396m. EY’s TAS business continues to be a leading practice in the UK for capital and transaction strategy, and the execution advice that it offers to organisations.
Assurance grew by 11.3% to £689m, driven by increased revenues from prior year audit wins and accounting advice provided to clients either undertaking transactions or contemplating future changes to accounting standards. Audit quality continues to be a priority for EY and the positive results of the Financial Reporting Council’s (FRC) annual audit quality inspection report reflect the ongoing level of investment EY has made in this area. We are now not subject to any investigations by the FRC.
Tax grew by 9.1% to £634m due to a strong performance in its M&A practice and its Global Compliance and Reporting team, significantly increasing market share. The Advisory business grew by 3.8% to £629m, supported by growth across sectors and services and the adoption of disruptive business models and technologies to help clients.
EY’s largest industry sector, Financial Services, grew by more than 8% in the UK, bringing total revenue growth over three years to 30%. Whilst growth was delivered across all areas, it was an outstanding year for the Capital Markets, Transactions Advisory Services and Technology businesses in the sector, which all delivered more than 20% revenue growth. EY provided market leading support to the broader financial ecosystem as organisations continue to prepare for Brexit. Financial Services Assurance grew 12% on the back of previous years' audit wins, and EY was proud to be selected as auditor to Schroders.
Distributable profits before tax increased by 2.7% from £452m to £464m. Average distributable profit per Partner increased by 2.3% to £677,000, compared to £662,000 in 2016.
Strategic technological investments
EY has made strategic investments – both in the UK and globally – which have driven growth. These include new technologies such as the Capital Allowance Automatic Review Tool (CAART) which uses machine learning to accurately establish the correct tax code and can do 35 hours work in 15 minutes – improving efficiency by 99%. EY has also invested in EY Absolute, a cloud based tool, which delivers book-keeping, accounting and tax services to clients. EY has continued to innovate in other areas too, building out robotics, data and analytics, FinTech, cyber, Artificial Intelligence, audit technologies and blockchain solutions for its clients, which have been well received in the market.
Alongside EYX – created last year as EY’s UK innovation hub using key disruptive technologies – the firm has also launched EY Wavespace, a new global network of innovation centres. EY Wavespace provides a collaborative and creative working environment for EY’s clients. It brings together companies from different sectors and disciplines to help clients discover the next big breakthrough that could shake up their industries.
The EY Foundation celebrates its third year
The EY Foundation celebrated its third year as an independent UK charity. The EY Foundation helps disadvantaged young people overcome barriers in the labour market, education, employment and enterprise and plays a significant role in EY’s global purpose to build a better working world. By the end of financial year 2017, the charity had supported 1500 young people and social entrepreneurs in 15 locations across the UK through its Our Future, Smart Futures and Accelerate programmes. More than 4,500 EY volunteers made the charity’s work possible. The Foundation also recently launched the School to Work Campaign to give every young person in the UK the chance to access the skills and information necessary to thrive in the workplace and fulfil their career ambitions. The campaign has already gained significant traction with employers, young people and representatives from the education and social sectors across the UK.
Investing in our people and real estate
EY recruited nearly 4,000 people across the country, including 1,500 student places and 130 apprenticeships. EY also had 63 new equity Partners join the UK Partnership this year, building on the 62 equity Partners admitted last year. EY also promoted over 4000 of its people and has further invested in improving its real estate.
As part of the firm’s commitment to opening up the doors to the profession to a wide spectrum of talent, EY has introduced a new Digital Apprenticeship programme with ADA College. This initiative is in addition to EY’s existing Business Apprenticeship programme, which offers young people an alternative to university. Since launching in 2012, EY’s Business Apprenticeship programme has quadrupled in size with 200 further places offered this year.