Marketplace Starts Reacting to Deloitte’s Consulting Decision

Deloitte’s decision last week not to separate its consulting arm is beginning to show its affects in the marketplace.

Because of perceived independence issues, General Motors Corporation has announced that it will pull all of its consulting work from Deloitte, a move that amounts to a loss to the accounting firm of about $80 million worth of work.

Last week, Clorox and Auto Nation – who are both audit and consulting clients of Deloitte - announced that they would begin shopping for a new auditor.

Despite all of the recent scrutiny on the perceptions of independence and the moves by all of the other big accounting firms to split the audit from the consulting business, last week, to many people’s surprise, Deloitte Touche Tohmatsu scrapped its plans to separate its audit and consulting business.

"We are in the process of absorbing change; and change is a challenge," James Quigley, who becomes Deloitte's U.S. chief executive in June, told the Wall Street Journal. "I suspect a handful of clients will terminate either the audit relationship or terminate planned consulting projects."

Deloitte is also dealing with a growing focus on its role in alleged accounting irregularities at Dutch food company Ahold.

Recognizing the challenges ahead of it, Deloitte’s Board is expected to meet this week to discuss the best alternatives for moving the Big Four firm forward.

You may like these other stories...

We've probably all worked for soul-sucking managers who expect employees to spend their workdays tethered to the office with no other life obligations or desires. But that's not what the "When Work Works"...
A new report from global consulting and outsourcing company Accenture PLC found that internal complexity is the most significant challenge CFOs of large companies are currently encountering.The top four issues pertaining to...
Read more from Allan Boress here and in the Truth Be Told About Business Development archive. I've always been enamored with the concept of what it took to motivate employees and owners, all the way back to my...

Already a member? log in here.

Upcoming CPE Webinars

Oct 9In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards.
Oct 15This webinar presents the requirements of AU-C 600, Audits of Group Financial Statements (Including the Work of Component Auditors).
Oct 21Kristen Rampe will share how to speak and write more effectively by understanding your own and your audience’s communication style.
Oct 23Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.