BDO national chairman Helen Argiris said inbound referrals will be a key plank in the growth of its Sydney-Melbourne offices in 2015-16.
Fees from international engagements reached almost $6 million, up from $2.5 million three years ago, and are expected to jump again over the next six months.
“A big part of our business is about winning more of that international work out of China and the United States,” Argiris told The Australian Financial Review via phone from BDO’s partner retreat in Bowral, south of Sydney.
The three-day retreat comes amid controversy about low growth and unrest over partner pay, which is being blamed for the resignation of three Sydney tax partners in BDO’s East Coast Practice.
BDO is the nation’s sixth largest accounting firm by revenue. Its $85 million East Coast Practice spans Sydney and Melbourne.
Tax partners Vanessa Priest and Hannah Soh have jumped ship to Deloitte Private, while Andre Spnovic has relocated his family to Queensland.
A spokesman for the firm rejected claims that as many as 15 partners in Sydney and Melbourne could leave pending the outcome of the retreat being held which started on Sunday and wraps up Tuesday in Bowral, south of Sydney.
It is hoped the get together will quell unrest over the firm’s partner remuneration schedule shared publicly with senior managers last week.
“There is change happening at the East Coast Practice and inevitably a minority are not happy with it,” BDO Brisbane managing partner and former national chairman Tony Schiffmann said.
Argiris said eight new recruits made over the last year, such as ex-PricewaterhouseCoopers transfer pricing partner Zara Ritchie, are “coming into their own”.
Chief flies in
BDO International chief executive Martin van Roekel flew in to attend the partner pow-wow, to throw his support behind the new leadership of the East Coast Practice (formerly PKF East Coast Practice).
BDO East Coast Practice chief executive Chris Brant was sacked in June after two years in the role. The job was split between Melbourne audit partner David Garvey and Sydney audit partner Grant Saxon.
The pair, flanked by Argiris, will reveal structural changes core to a new growth plan at this week’s partner retreat.
BDO East Coast Practice desperately needs to kick-start growth. The loss of key partners, such as Paul Lyon to Ernst &Young and Ken Whittingham to restructuring boutique PPB Advisory, has created a drag on annual sales which have fallen by about $10 million to $13 million in the last two years.
Nationally, BDO’s revenue grew nearly seven per cent, to $252 million, for 12 months to June 30, 2015.
Melbourne-based partner Rachel Burdett-Baker has been charged with developing a plan to fix the underperforming insolvency division, which is rumoured to be 50 per cent behind plan and a particular pain point firm.
BDO is eager for stability in its Australian branch. Three years ago BDO International expelled the $88 million debt laden Sydney-Melbourne offices from its network for being unable to service its loans. Shortly afterwards it plugged the gap in the two biggest markets for financial services, striking a deal with rival PKF to merge.
Upper mid-market accountancy firms can ill afford to be bogged down in internal squabbles with intense pressure coming at them from all sides.
The Big Four giants, PwC, Deloitte, EY and KPMG, are using new digital offerings and low cost offshore teams to amp up their private client offerings.
At the same time small, nimble rivals such as Perks in Adelaide and ESV in Sydney are refining their services to high net worth individuals and private businesses.
Grant Thornton Australia revealed its 2020 vision to expand advisory services, including deeper links into Asia through new appointee out of PwC Richard Gruppetta, and expanded leadership and organisational culture offerings through Rory Gregg’s team.
Grant Thornton new chief executive Greg Keith said “cash flow is strong” and the firm is “on budget”.