Big Four Overview: The Big Four (also written Big 4) public accounting firms (audit firms) dominate the sector and are major developers of talent within the financial services industry. Despite their size, they are organized as partnerships rather than as corporations.
The Big Four are orders of magnitude larger than the next biggest competitors, in terms of employees, revenues, and numbers of Fortune 500 clients. They are the result of consolidation in the public accounting sector. The Big Four include:
The Big Eight: Through the 1980s public accounting boasted a Big Eight collection of dominant firms. It was reduced to a Big Four after:
- Deloitte Haskins & Sells merged with Touche Ross Tohmatsu
- Arthur Young merged with Ernst & Whinney
- Price Waterhouse merged with Coopers & Lybrand
- Arthur Andersen was forced out of business by expensive lawsuits alleging audit malfeasance, notably in the Enron and WorldComm scandals of 2002.
Big Four Services: The Big Four offer a variety of services, including, but not limited to:
- Corporate audit
- Corporate tax services
- Business consulting services
- Tax preparation for wealthy individuals
- Family office services
While the Big Four have a long history of offering consulting as an ancillary service, consulting is now the fast-growing part of these firms, contributing between 16% and 33% of total revenues as of 2010.
Bottom Line for Financial Careers: Even if you do not pursue a career within public accounting, a period of service in the Big Four (including an internship) can be a valuable enhancement to your resume, whatever your future career path, given the prestige of these firms.
Best Companies Lists: Also note that the Big Four regularly appear on lists of the Best Companies to Work For and the Best Companies for Working Moms. Regarding the working moms ranking, the Big Four are cited for offering flexible hours and telecommuting options.
For More Information: Follow the links below for more detail on the members of the Big Four and key topics related to their work.