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The business, which was formerly known as Smith and Williamson, decided to consolidate its brands under a new name back in June of 2022

Evelyn Partners’ private equity owner reportedly could be looking to split off its accounting arm in a £500m deal, according to The Sunday Times.

The outlet revealed that Permira is considering making the move as investor interest in professional service firms continues to grow and has appointed investment bank Evercore to lead the sales process.

The business, which was formerly known as Smith and Williamson, decided to consolidate its brands under a new name back in June of 2022.

It now employs over 4,000 members of staff and most recently revealed that its adjusted EBITDA rose 18.3% to £103.9m for the six months ended 30 June 2024.

Alongside this, the company’s assets under management (AUM) hit a record £62.2bn, up 13.3% year-on-year and 5.2% since 31 December 2023.

The firm’s operating income increased 10.3% to £360.8m, up from £327.2m in the same period last year.

This included a 23.4% growth in professional services operating income which the company put down to continued strong organic growth alongside the contribution of acquisitions made last year.

Evelyn Partners declined to comment on reports.

Accountancy Today

“There are indications that audit quality is being challenged by changing market conditions with an unprecedented movement of complex audits from larger to smaller firms which is requiring those smaller firms to move quickly to upscale their risk and quality processes. Greater visibility of this movement is important so that the Institute can check proactively that firms have the right expertise and experience to take on new larger audits.”

The results were based on nearly 500 audit monitoring visits carried out by ICAEW’s Quality Assurance Department in 2023/24

A total of 71% of audits in 2023/24 were deemed good or generally acceptable, ICAEW has revealed. 

The latest audit monitoring report showed a strong performance by the larger audit firms with 88% of non-Public Interest Entity (PIE) audits carried out by larger firms considered good or generally acceptable. 

Outside of the larger firms, most firms reviewed this year were different to those reviewed last year due to most firms being on a six-year review cycle, which makes year on year comparisons very difficult. 

The results were based on nearly 500 audit monitoring visits carried out by ICAEW’s Quality Assurance Department in 2023/24. Reviewers were asked to select the audits considered to be the most complex and challenging so the overall result is not necessarily representative of average audit quality, which is likely to be higher. 

Rama Krishnan, chair of ICAEW’s Audit Registration Committee, said: “While there has been no deterioration in the overall result this year, it is slightly disappointing that overall performance has not improved. However, we recognise that different firms are reviewed each year which makes it difficult to make year on year comparisons.

“There are indications that audit quality is being challenged by changing market conditions with an unprecedented movement of complex audits from larger to smaller firms which is requiring those smaller firms to move quickly to upscale their risk and quality processes. Greater visibility of this movement is important so that the Institute can check proactively that firms have the right expertise and experience to take on new larger audits.”

Krishnan concluded: “That is why the Committee fully supports the proposal by the ICAEW Regulatory Board to change the Audit Regulations to require firms to report the acceptance of new audits falling within certain criteria.”

Accountancy Today

It comes following reports earlier this summer that CVC Capital Partners, the private equity backer of Six Nations Rugby reportedly held discussion with the firm over acquiring UK and Irish affiliates

Swedish global investment firm EQT has reportedly joined the race to acquire a large stake in the UK arm of accountancy firm Grant Thornton, according to Sky News.

The outlet reported that EQT submitted a bid to Grant Thornton’s advisers ahead of the auction deadline last week. It is thought that any deal would be valued between £1bn-£2bn.

It comes following reports earlier this summer that CVC Capital Partners, the private equity backer of Six Nations Rugby, reportedly held discussions with the firm over acquiring UK and Irish affiliates.

Since then, a number of potential suitors have been cited, including Carlyle, Cinven, Permira and Nordic Capital.

CVC owns advisory firm Teneo which acquired Deloitte UK’s Restructuring Services division back in 2021.

A spokesperson for Grant Thornton UK LLP told Accountancy Today at the time: “As all businesses do, we continually evaluate the external business and economic landscape and explore various avenues that will drive growth for our firm.

“This enables us to make informed decisions about what’s best for our people, our clients and our firm. We are not actively engaged in any such transaction. We are committed to remaining as a multi-disciplinary firm. We will not be commenting further on this matter.”

Lewis Catchpole writes in Accountancy Age

The FRC’s report, which was published today, showed that the overall quality of audits has improved as 74% of firms were categorised as good or requiring limited improvement

The ICAEW has renewed calls to establish ARGA as a new regulator whilst welcoming the FRC’s latest annual Tier 1 audit firm inspection results, which showed that overall audit quality has risen.

The FRC’s report, which was published yesterday, showed that the overall quality of audits has improved as 74% of firms were categorised as good or requiring limited improvements.

The Big Four firms all improved with 94% of Deloitte 76% of EY audits, 89% of KPMG audits  and 76% of PwC audits up to standard.

Audit quality for the FTSE 350 has also improved, up from 81% to 87% year on year.

The FRC warned of a widened gap in audit quality between the Big Four and the other so-called Tier one firms, however. The ICAEW also highlighted this, underscoring the “challenges” faced by firms outside of the Big Four who are looking to take on PIE audits. 

Alan Vallance, ICAEW CEO, said: “While it is encouraging to see that overall audit quality has gone up, these results demonstrate the challenges firms outside the Big Four have faced while building a presence in the PIE audit market. 

“The FRC has set out plans to boost performance where it is lacking and the report acknowledges the important role smaller firms play in creating a resilient audit market, as well as the potential issues arising from de-risking audit portfolios.” 

He added: “The FRC’s role in improving audit quality and competition must also not be overlooked, including through its scalebox initiative, and we urge it to renew efforts to support firms seeking to take on PIE audits.  

“The regulator has also highlighted the Spring Report, which found that performing a good audit of challenging companies requires action by the company and the auditors.

In our view it is essential that the new regulator ARGA is established and given wider powers to take effective enforcement action as needed.” 

Writes Heather Sandlin in Accountancy Today