But does this matter? With growth in the professional services market continuing at a staggering pace, you could be forgiven for thinking it does not.

Despite their upheavals, each of the Big Five are still growing at almost 20 percent a year, according to the latest Accountancy Age Top 50 survey, enough to create a new Big Five firm every 12 months. Among mid-tier and smaller firms growth is a little slower but still respectable.

But while much of this has been seen before -- mergers and restructuring are nothing new, of course -- what has changed is the extent to which firms are now masters of their own destiny. Their future, it seems, is no longer in their own hands.

U.S. Securities and Exchange Commission Chairman Arthur Levitt, arguably, is now determining the services offered by the Big Five -- even in the U.K. And any mid-tier firm that lacks a lean structure and is failing to consistently deliver strong rises in fee income is a takeover target for a stronger rival.

However, there is more than just profit at stake. And nothing less than the reputation of the profession as a whole is on the line. In all this confusion there is a very real danger that firms will spend too much time worrying about internal issues and take their eyes off the groups that really matter: clients and new recruits.

Clients don't care about internal structures and politics, they are interested in the balance between cost and service. And any firm that pursues their own survival at the expense of offering value will have a limited shelf life.

Firms also have a massive marketing job on their hands if they are to convince thousands of graduates looking for a challenging career path that an accountancy firm that has sold off its consulting arm is every bit as vibrant as a dot.com startup. By reputation consulting is sexy, audit and tax are not. That will require a new flexibility in terms of hierarchy, remuneration and working practices.

So far most firms are only paying lip service in pledging to introduce those sorts of arrangements. They will pay a heavy price if they don't.

Damian Wild is editor of Accountancy Age, the leading weekly magazine for accountants in the U.K. He has written for several Web sites, newspapers and magazines including The Times and CNNfn in London and the South China Morning Post in Hong Kong.

Back to NewsLine