Four months after a management shakeup at Chicago-based accounting firm BDO Seidman LLP, about 30 of 280 partners have been let go.
The reductions in the tax, audit and consulting business lines follow a restructuring in which five board directors were replaced and Chief Executive Denis M. Field took an indefinite leave of absence.
Spokesman Jerry Walsh told the Chicago Tribune that the firm decides every year whether changes should be made in its partnership ranks. "These decisions can be related to economics, performance or a change in demand in a particular service area. Given the previously announced firm restructuring, which is still ongoing, it isn't surprising that this year's reduction is slightly higher than normal," he said.
The reduction in the number of partners is partly due to flat revenue growth and less demand for tax consulting services, the Tribune reported. New regulations and a slow economy caused business to stagnate last year.
BDO Seidman, part of the second tier of the nation’s accounting firms after the Big Four, has also been dealing with investigations into aggressive tax shelters by the Department of Justice and the Internal Revenue Service. The firm has said it did not promote abusive tax shelters to its clients, but the scrutiny and criticism has hurt BDO Seidman’s business.
In fiscal 2002, revenue fell 16 percent, to $353 million from $420 million the year before. The tax group saw the biggest reductions, as revenue fell 26.6 percent, to $144.9 million.
The firm is focusing on more traditional audit and tax-compliance services in this new regulatory climate. With the shift in strategy came a new chairman, Jack Weisbaum, 63, who came out of retirement to lead the firm.