Partners at PwC will receive an average of more than £1m in pay for the latest financial year, a record for the “big four” accountancy firm.
PwC made an average profit per partner of £920,000 in the year to the end of June 2022, up from the previous record of £868,000 the year before and £765,000 in 2019 before the pandemic, according to unaudited figures.
The big accountancy firms have enjoyed a boom in recent years thanks to the flood of corporate mergers and acquisitions following the relaxation of the first wave of coronavirus lockdown restrictions.
PwC partners’ pay was topped up by an average of £100,000 each from the $2.2bn (£1.83bn) sale of a business providing tax advice for companies moving staff overseas to US private equity firm Clayton, Dubilier & Rice. That meant the average partner pay for the year broke through the £1m barrier.
The 950 members of its top executive tier were briefed on the annual payout this week, according to Sky News, which first reported it.
There is some doubt over whether the barrage of dealmaking can continue in the coming months as investors adjust to rising interest rates and become less willing to finance riskier takeovers. Yet accountants – and their burgeoning consultancy arms – are also expecting a continued boom in work advising on sustainability reporting, which is becoming increasingly common for large businesses because of regulations and investor pressure.
The record payments have come despite PwC – like its rivals in the big four, Deloitte, EY and KPMG – receiving repeated censure over standards at its auditing business. The UK watchdog last month issued a £5m fine for failures in its audit of the construction firms Galliford Try and Kier. PwC is also facing investigations by the UK’s Financial Reporting Council into outsourcer Babcock, wound-down Wyelands Bank, collapsed investment firm London Capital and Finance, and Eddie Stobart Logistics. So problematic have been the perceived conflicts of interest between audit and consulting work that EY in May said it was drafting plans to spin off its auditing arm.
Kevin Ellis, PwC’s UK chair and senior partner, said in a statement that profits per partner would fall in the coming year as the firm invests to defend its position.
“Our business is in a strong place thanks to the breadth of our services and clients, the skills of our people, and the investments we’ve made,” he said. “It has been an exceptional year, but we can’t take this for granted.
“With economic headwinds facing all businesses including rising costs and the tightness of the labour market, we have to shore up with further investment, particularly in people, skills and technology.
“These investments are likely to reduce our profit per partner next year but given the expected boost to financial performance over the medium to longer term, it’s right that we make these investments now.”
