Art of Accounting: Top 100 10-year comparison

Public accounting is a growing profession. The growth from 2015 to 2025 in revenues was 125% and in total personnel 113%. These are real numbers and vitiate what the naysayers claim about the doom and gloom of the profession.

Last week I provided an analysis of the Top 100 numbers that appeared in the March 2025 issue. What I did was actually simple and was typical of what I do for clients and teach my students. Rather than accepting the aggregate numbers, I look beneath them. In this situation I did a few things. I broke the total amounts into three groups based on revenues and used that to analyze the relative performance of the three groups, and I think I came up with some reasonable conclusions. You can look at last week’s issue to see what they were.

This week I looked at the changes over the last 10 years and will discuss some of my observations here. The revenue growth was impressive, but it came primarily from the group of 12 and then the other 84, with the lowest percentage increase from the Big Four. Also the growth of employees was the lowest for the Big Four and greatest for the group of 12. To see what this means, I looked at the revenue per employee. The Big Four’s revenue per employee was virtually flat, indicating no growth, which I translate as stagnant efficiency or effectiveness. That would seem to retard profit growth. Running a business with a growing top line and presumably a large growth in technology usage but flat revenues per employee does not make sense. 

However, there was significant growth in revenues per employee in the other groups. I did not use percentages, but dollars of growth. Both of the other groups had similar growth of about $43,000 annual revenue per employee. Looking at the overall total of $13,000 per employee does not provide any insights other than macro growth for the Top 100. If I were managing a Big Four firm, I would seriously look at this. I did not look at each of the Big Four separately. I could have but do not want to make a career out of this as my aim is to provide insights and comparative data to readers. 

Another thing I want to point out is a reiteration of what I wrote last week about the MAS grouping of the Group of 12 being closer to the remaining 84 than the Big Four. Looking at this from 2015 indicates that the MAS group grew similarly to the two smaller groups, while the Big Four grew significantly. Also the A&A for all three declined as a percentage of revenues, while the taxes grew for the group of 12.

I also want to point out that using aggregate data doesn’t usually provide the information clients need. And my “teaching” self wants to inject a lesson here that what I did here can be done for every one of your clients. I do it, and so can you.

A final observation. Last week I provided the average revenues and staffing of the bottom five firms. That was 64.5 million revenues and 312 total employees. Ten years ago, these were $33.2 million and 201 total employees. Revenues almost doubled and headcount grew 50%. This indicates growth with much more efficiency and effectiveness or better pricing. The revenue growth was below each of the three groups, but the lower headcount growth is very impressive. Better numbers could be obtained by segmenting into more groups. Do that if you want. This is a column for accountants with the purpose of providing a method of looking at data more effectively. When I advise my clients, I work out the right data to advise them with. One suggestion for those running an accounting practice in the Top 100 is to look at the five firms above and below you and see how you are doing. Then look further above and consider setting that as a goal.

There is a lot more to do. There always is a lot more to do. Use this and last week’s charts and the Top 100 list and figure out what works for you. Use my process to look beyond the primary chart and come up with helpful observations. And this process should be applied to your business clients.

Do not hesitate to contact me at emendlowitz@withum.com with your practice management questions or about engagements you might not be able to perform.