E&Y Holds Largest Slice of Top Retailer Audit Pie
Ernst & Young holds the largest slice of the clients audited market share pie when it comes to the auditors of the Top 100 retailers, according to ANR’s analysis of the annual list compiled by STORES.
The analysis was restricted to company’s on the STORES list ANR was able to obtain auditor information for.
E&Y audits 25 of the 81 retailers in the analysis good for first place in the client audited category, good for a 30.9% share (See chart, right and page 7.)
Deloitte and KPMG finished hot on E&Y’s heels in audit client market share.
Deloitte finished runner-up in clients with 21.
KPMG finished one client behind Deloitte with 20.
Auditing Top 100 retailers isn’t just Big Four business, BDO USA holds two audit clients in the analysis.
Beyond auditor market share, the analysis of 2011 fees paid gave an indication that in general the auditors of companies included in the analysis are facing fee compression.
The composite % change in audit fees and total fees was a decline of 2.4% in audit fees and a 4.7% drop in total fees.
In drilling down a level, and looking at the change in fees by SIC code revealed auditors of department stores (SIC code 5311) have fared the best, or suffered the least depending on your point of view, actually seeing an increase in audit fees, up 3.9% and a slight uptick in total fees up 0.9%.
Auditors of retail-variety stores (SIC code 5331) saw no increase in 2011 audit fees, as a group, but no decrease either as the % change came in at 0% compared to 2010.Total fees was a totally different story, a steep decline of 8.4%.
Audit fees for grocery store (SIC code 5411) audit engagements fell 11.2% in 2011. Total fees declined 1.1%. The sample size was much smaller for the 5411 group, three, than the size of retail-variety stores group that disclosed 2011 fees paid to their auditors and the department stores group. Each group had seven companies that has filed fee information for 2011.
Clients in the analysis range from the largest retailer Walmart/Bentonville, Ark. (Revenue: $426.2 billion), audited by E&Y, to retailers with less than $3 billion in annual revenue.
Auditor information for the publicly traded companies on the list reflects the most current data available through AuditAnalytics.
Editors Note: ANR’s “Who Audits Analysis” analysis is not intended to be a comprehensive listing of companies and auditors in a given industry.
The analysis is a snapshot of the selected industry.
This analyis with a full list of the auditors ran on pages 6 and 7 in the July 14 issue of Accounting News Report