KPMG LLP recently released its fiscal year 2010 results and that completes the reporting of the fiscal year 2010 results of all the Big Four firms: Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers PwC. A brief executive summary analysis of the results follows,and the full study can be downloaded here.

After an extraordinary period of continuous revenue growth from the early 2000s to 2008, combined revenue for the four firms in fiscal 2009 fell by 7% from fiscal 2008 in US dollar terms. Revenue decreases in US dollar percentage terms ranged from negative 5% for Deloitte to negative 7% each for Ernst & Young and PricewaterhouseCoopers to negative 11% for KPMG.

In 2010, the situation improved remarkably, with $95 billion combined revenue for the four firms in fiscal 2010 increasing 1.4% from $94 billion in fiscal 2009 in US dollar terms. Revenue increases in US dollar percentage terms ranged from negative 0.9% for Ernst & Young, 1.5% for PwC, 1.8% for Deloitte and 2.6% for the fastest-grower, KPMG. KPMG also had positive growth in all its three regions and narrowed its revenue gap with E&Y. E&Y was the only firm whose full year revenues shrank, though the firm indicated that the second half of the fiscal year was much stronger, especially in Advisory and TAS.

The big story of 2010 was that Deloitte with its 1.8% growth was able to beat PricewaterhouseCoopers with its 1.5% growth to gain first place and become the largest accounting firm on the planet. In 2009, PwC was narrowly ahead of Deloitte, but Deloitte's 2010 revenues of $26.578 billion was ahead of PwC's 2010 revenues of $26.569 billion by an ultra-slim, but very significant, $9 million. Ernst & Young took the third spot at $21.3 billion, and KPMG maintained its position as the smallest of the Big Four firms at $20.6 billion, but narrowed the gap against E&Y.

The Americas region accounts for 39% of global revenues for the Big Four firms, but its share has been falling over the years, due to the preponderance of mature markets. The region grew only 1% from 2009 to 2010. Contrary perhaps to common belief, Europe, Middle East and Africa has the highest percentage of total revenues for the Big Four firms at 45%, this region shrank 0.4% from 2009 to 2010. Asia Pacific, while being the smallest region at 15% of revenues, has posted the highest growth rates, owing to the strong upswing in many emerging Asian economies, posting a strong 9% growth from 2009 to 2010.

The Audit service line accounts for almost 47% of total revenues and this proportion has been falling across the years; and revenues further fell from 2009 to 2010. Tax services experienced strong growth in 2006 to 2008, in sync with global merger and acquisition transactions activity. Tax revenues fell 7% from 2008 to 2009 and then further 1% from 2009 to 2010. Advisory services has been the fastest growing service line as the firms extended their services into risk management and business consulting. Advisory has grown from 22% of total revenues in 2004 to 29% in 2010. Advisory revenues grew a strong 6% from 2009 to 2010.

The Big Four firms cumulatively employ more than 600,000 staff globally, with a total of 34,000 partners overseeing a steep pyramid of about 460,000 professionals. Employment fell somewhat from 2009 to 2010.

With the subsiding of the world's worst financial crisis for over 70 years, the Big Four firms turned a creditable performance in 2010, with revenues rising by moderate but welcome positive percentages, indicative of a solid momentum of improving fundamentals.

The outlook for 2011 and beyond is quite optimistic, revenue is expected to grow at a steady pace, with help from strong emerging markets and Advisory services. 2011 will also prove whether Deloitte can maintain its lead over PwC; and whether the gap between E&Y and KPMG will narrow further.

A more detailed analysis of the firms, service lines, geographies and conclusions is available at www.Big4.com.

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