The Big 4 refers to the four largest accounting firms in the world.
These firms provide an extensive range of accounting and auditing services including external audit, taxation services, management and business consultancy, and risk assessment and control.
They also provide massive employment and career development opportunities to accountants and auditors around the world.
The following are the members of this internationally renowned group.
1. Deloitte Touche Tohmatsu Limited
Deloitte Touche Tohmatsu, popularly known as just "Deloitte", is probably the biggest professional service organization in the world. The firm was founded by William Deloitte in 1845. It went through a series of mergers and reorganizations but kept its brand name along with its quality standards and company values. Now, it emerges as one of the most successful brands in the world.
In 2014, it earned $34.2 billion and had approximately 210,000 employees in more than 150 countries demonstrating excellence in providing audit, consulting, financial advisory, risk management, and tax services to clients worldwide. See Deloitte Website
2. PricewaterhouseCoopers (PwC)
With $34 billion revenues in 2014, PwC is one of the world's largest providers of accounting services. It employs more than 195,000 professionals in 157 countries around the world. The company was formed by the merger of two large accounting firms – Price Waterhouse, and Coopers & Lybrand. The two decided to merge in 1998 and dedicated themselves to provide services of value while establishing and maintaining good customer relations.
PwC firms operate locally in different countries around the world. These independently owned and managed firms, like other international companies, share common values and standards. PwC provides excellent assurance, consulting, and tax services. See PWC Website
3. Ernst & Young (E&Y)
Ernst & Whinney merged with Arthur Young to create Ernst & Young in 1989. Ernst & Young is a global organization of member firms in more than 150 countries. It employs people equipped with professional skills and values of integrity, respect, teamwork, enthusiasm, and motivation. These form the core values of Ernst & Young.
The organization also values knowledge and skills development, helping around 190,000 employees achieve their potential through professional training and career growth programs. Ernst & Young offers assurance, advisory, tax, and specialty services. Ernst & Young earned $27.4 billion in 2014. See E&Y Website
4. Klynveld Peat Marwick Goerdeler (KPMG)
KPMG is a global network of accounting firms providing audit, tax, advisory, special interest and industry-specific services. It employs approximately 162,000 professionals working together to provide quality service in 155 countries around the world. KPMG earned $24.8 billion in 2014.
The organization was formed in 1987 through the merger of Peat Marwick International and Klynveld Main Goerdeler. Like other professional service organizations, KMPG places great value on its people and quality of service. See KPMG Website
Some Historical Facts
The Big 4 used to be known as Big 8 made up of (1) Arthur Andersen, (2) Arthur Young & Co., (3) Coopers & Lybrand, (4) Ernst & Whinney, (5) Deloitte, Haskins & Sells, (6) KPMG, (7) Touche Ross, and (8) Price Waterhouse. It was after a series of mergers and dissolutions that brought about the elite four.
In 1989, two huge mergers reduced the Big 8 into the Big 6. Ernst & Whinney merged with Arthur Young to form Ernst & Young; and Deloitte, Haskins & Sells with Touche Ross to form Deloitte Touche. Then in 1998, Price Waterhouse merged with Coopers & Lybrand to form PricewaterhouseCoopers, famously known as PwC. It further reduced the group into the Big 5.
In 2002, the five was cut by one due to the fall of Arthur Andersen after its involvement in the world-shocking Enron scandal. From then on, the four largest existing accounting firms have been known as the Big 4.
Next to the Big 4 are: BDO International, the 5th largest accounting firm with 60,000 employees in 151 countries and 2014 earnings of $7.02 billion; and Grant Thornton, placing in 6th with 38,500 employees in 125 countries and $4.5 billion revenues.