Following multiple years of strong growth, EY has prioritised continued investment in audit quality, talent, technology, environmental sustainability, and the expansion of its regional business over the past financial year, growing UK revenues by a steady 1.5% and hiring over 2,600 people.
EY’s UK fee income grew to £2.45 billion in the financial year ending 30 June 2019, increasing from £2.41b the previous year. Despite a challenging business environment, revenues in transaction advisory services and tax grew strongly by 9% and 8% respectively, while advisory and assurance revenues declined on previous years by 3% and 5%. Over the past five years, EY has achieved a UK Compound Annual Growth Rate (CAGR) of 6%.
Steve Varley, EY’s UK chairman commented: “We are very clear about the crucial role that our work plays in building and sustaining trust and confidence in the capital markets and helping to improve the attractiveness of the UK as a centre for business. That’s why it’s important that we have continued to invest in the right places, despite the uncertain economic environment. This year alone we’ve hired over 2,600 people, with more than a third of all roles in our regional business, invested around £31m in training and development, and have made significant investments in our tech capabilities.”
Growth in the Thames Valley and South
EY has continued to invest in its regional business across the UK with 31% of its 2,600 new recruits based in its regional offices and 55% of its graduate and student hires based outside of London. In the Thames Valley and South, the headcount of EY’s offices in Reading and Southampton reached over 700 people.
Highlights from the Thames Valley and South:
- Continued investment in senior talent with two three partners, nine associate partners and two new directors.
- Recruited 47 university graduates and 49 apprentices on EY’s business apprenticeship programme.
- The EY Foundation’s Smart Futures programme supported ten students from disadvantaged backgrounds across the Thames Valley and South by offering paid work experience.
Richard Baker, managing partner at EY in the Thames Valley and South, commented: “This year we’ve seen growth both nationally and across the Thames Valley and South. EY’s continued commitment to the region is once again illustrated this year by our growth in headcount, bolstered by our recruitment of university graduates and apprentices. We also made a record number of appointments to our regional leadership team as they play a key role in driving growth for our clients and for our business.”
Dave Hales, Southampton Office managing partner at EY, added: “Through the continued collaboration of our Reading and Southampton offices – which creates our 700-strong Thames Valley and South business – we will continue to build upon our presence in the regional market, enabled by investing in the very best talent. We have in excess of 40 new people joining us this year in our Southampton office as we continue to grow our South Coast business.”
Investing in audit quality
EY established a long-term audit quality programme and a dedicated Audit Quality Board in the UK in 2014 and continues to make significant investments to drive ongoing improvement. EY has increased its investment in audit quality in the UK to £25 million per annum, while the number of people dedicated to its audit quality programme has grown by 25% over the last 12 months alone. EY has also continued to invest heavily in new technology and training for its people, recruiting around 30% more UK graduates and school leaver apprentices in audit than last year.
Investments in audit quality have contributed to a number of significant audit wins this year including: Vodafone, Cobham, The Rank Group, Burberry, SSE, Imperial Brands, Beazley, Aston Martin Lagonda, Intermediate Capital Group, Keller, SIG, Tullow Oil, Brewin Dolphin and BGL Group.
Varley commented: “After multiple years of strong UK growth, we have continued to prioritise the infrastructure needed to deliver high quality audits by investing in compliance, our people and new technologies. While there’s more to do, I’m encouraged by the improvements in our latest audit quality scores from the Financial Reporting Council (FRC). The FRC inspections looked at 18 of our audits this year, with 89% of the 9 FTSE 350 audits rated in the top category.
“We audit around 5,000 organisations in the UK and are increasing our focus to ensure that every one of these audits meets the highest standards. I’m confident that we are taking the steps needed to build on these results in the future.”
Focus on diversity and inclusion
Earlier this year, EY set ambitious new targets to double the proportion of female and Black and Minority Ethnic (BME) partners in its UK business to 40% female and 20% BME by July 2025, as part of a new strategy to radically accelerate its progress on diversity and inclusiveness.
Varley commented: “I’m proud of the steps we are taking to build diverse and inclusive teams. We’ve made positive progress but want to accelerate the speed of change, which is why we set ourselves ambitious new UK diversity targets at the start of the year. We see this as a business imperative and a key part of our future growth.
“Our approach to diversity and inclusion extends beyond gender and ethnicity targets. We’re committed to opening the doors of the profession to a broad spectrum of talent. In recent years we’ve launched new apprenticeship programmes such as a digital degree apprenticeship. This year alone we hired 918 graduates and apprentices across the UK.
“Our charity, the EY Foundation, also continues to grow from strength to strength. The Foundation worked with 4,061 young people and 322 employers this year, expanding to three new locations in Liverpool, Stoke and Wolverhampton.”