Europe’s plans to curb Big Four Accounting practices will lead to hiring spree by mid tier firms

Draft plans recently announced by the European Commission aimed at curbing the power of the Big Four accounting practices could lead to a hiring spree among the mid-tier firms as they prepare to compete in what may be a far more level playing field.

Historically, companies have rarely changed their auditors which has resulted in very few FTSE 250 audits for mid-tier firms. The draft EU plans include forcing companies to change auditor at least once every nine years and from a hiring perspective we are already seeing mid-tier firms ramping up their audit teams  in the hope that if the directive is introduced they will be in a strong position to tender for big ticket work.  Additionally, companies are constantly looking at ways in which to improve shareholder value and so mid-tier firms, if they have the right staff, could be a viable – and more cost effective alternative – to a Big Four audit firm.

Many of the mid-tier firms are managing to attract ex Big Four partners to help build out teams to win larger client audits – and larger fees.  Another contributing factor to mid-tier firms wanting to woo larger clients is the recent changes in the financial services industry.  Record revenues from PwC and Deloitte recently (largely as a result of their Financial Services Advisory Practices) have led mid-tier firms to look at building their own financial services practices – mainly by recruiting ex Big Four staff. The recent announcement around the ring-fencing of retail banks from their investment banking arms may mean separate audit, tax and consulting advice. The European Commission proposals would mean that many of the Big 4 will be conflicted out of tax or advisory work opening up further opportunities for the mid-tier.

However, a FTSE 250 company or large financial institution will only appoint a mid-tier firm if it feels that they are adequately resourced – firms need to act now to recruit top quality people if they are to be ahead of the curve when the changes are enforced.

John Newcombe is Director of the professional services practice at Twenty Recruitment and specialises in senior level and partner appointments within public practice

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8000 financial services position to be shed: is this is an accurate picture of the whole sector?

Recent reports that the UK financial services sector is to shed 8000 jobs over the next quarter will, no doubt, send shudders down the spine of candidates throughout the City. But is this an accurate picture of the whole sector, or simply another example of one report providing misinformation about recruitment levels?

The survey, conducted by the CBI’s employers’ group claims that “with business volumes predicted to slow further and little growth in income expected, firms are planning to reduce their headcount in the next quarter”.  If these claims are true, the financial services sector is on course to lose a substantial number of the estimated 1.1 million people it employs.

Clearly, against a back drop of economic uncertainty and the increased fear of a long lasting Euro Zone crisis, companies across the City are being affected. This is particularly pertinent for the larger players within the sector who are still suffering a lack of credit whilst they simultaneously have to repair their balance sheets and deal with regulatory pressure and global uncertainties. In this environment necessarily all areas within the bank are being rationalised and prioritised.

But for the mid-size institutions, the predicted job losses detailed in the survey are, I suspect, not an accurate reflection. And with this is mind, there is light at the end of the tunnel – particularly for contractors and temporary candidates.

Contrary to these findings, we are seeing an increased demand for staff with a specific skill set. Many are continuing their use of temporary employees to provide a skilled labour force that often has a knowledge base that simply does not exist in-house.  Whilst others are turning to this option to get the much needed resource for projects that need to go on regardless of outside factors. As such professionals with the relevant skills and experience, and the desire to pursue temporary assignments are in a good position.

Particular busy areas we are still seeing are compliance and monitoring where contractors who can quickly enter an organisation and understand complex new legislation and regulation are in demand.  Candidates that are willing to work on a contract basis can not only earn a good salary – an interim head of compliance, for example, can earn upwards of £400 a day – but can also build up their skills and experience, in a relatively short period of time.

Despite the economic climate, and the press being full of negative stories detailing mass job losses, many candidates are taking advantage of the situation. By taking a series of short to midterm assignments, a professional can not only advance their career in a short space of time, but they can also receive a comparatively lucrative package.

Robert McLeod

Robert is Financial Services Director at Venn Group, the specialist provider of temporary and interim staff across the UK and Ireland. Robert has over twelve years’ experience of managing recruitment teams within the financial services sector.

 

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