New Partner Appointments at Big Firms

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kennyb3

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I see from the latest accountancy Ireland there has been a raft of new partner appointments at KPMG, BDO and a number of the other big accountancy firms.

I've always wondered though what happens in a downturn? As a partner you are self employed - do they just return to being directors or are they are no longer needed as the clients aren't there? Surely they can't continue with the same amount of partners in this case?

Anyone know?
 
Some are salaried partners, and others are partners with points ie profit-sharing - and most are somewhere in between. Fee income/fee-profit per partner and relevant partnership agreement would be a determinant on whether a partner chooses to leave voluntarily/involuntarily.
 
Thanks for the input Setanta12, any idea what happened in the last downturn? Did they fire salaried partners or how does that work? Surely they can't just continue to carry them?

I'm just curious more than anything as was wondering what would happen all these new partners if things went that way again?
 
They managed them out in many cases. A number of directors were let go (some joined Revenue).

One consequence of the crash is a logjam at the top as senior partners hang on (because they need to rebuild their balance sheets) thus delaying the career progression of those below them.
 
Why would the bosses be fired in a downturn? Surely it is the lower staff that would go first?

These firms do a lot of international work, a lot of audit work, liquidations, so there is always work for them albeit on reduced earnings.
 
SBarrett said:
Why would the bosses be fired in a downturn? Surely it is the lower staff that would go first?

These firms do a lot of international work, a lot of audit work, liquidations, so there is always work for them albeit on reduced earnings.
Click to expand...

You need the staff to do the work though? You can't have €350ph partners doing audits.

There has to be enough clients to go around in terms of work to review etc.

I know in last downturn a lot of the managers were made redundant so maybe it's the middle level that is cut out with partners more directly dealing with junior staff.
 
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