As an aspiring accountant, the odds are good that you’ve heard of the “Big Four” accounting firms at one point or another. Though they’re best known as massive and prestigious accounting firms, Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers aren’t restricting their services to accounting only. They’re now pushing their way into the legal industry,as well.
The Intersection between Business and Law
You may wonder how exactly accounting and law are interrelated. Preparing financial statements and tax returns isn’t the same as building cases and arguing in court. One clear area where the accounting and legal industries do intersect is tax law.
Most of these prestigious firms aren’t restricting their international legal services to tax litigation exclusively, according to the Financial Review. However, they’re also not actively pursuing major lawsuits and business deals that require a substantial amount of specialized work, The Legal Executive Institute reported. Instead, the Big Four accounting firms are largely seeking opportunities to use their legal services on “process-oriented” projects that they can standardize, according to The Legal Executive Institute.
The Consequences of Big Four Involvement in the Legal Industry
While the Big Four represent the largest international accounting firms, there is currently no equivalent in the legal industry. Big legal firms are certainly profitable, but they’re not as expansive – which might be a good thing, according to The Economist. Massive law firms run by lawyers, rather than business professionals, would likely be inefficient, undervaluing the use of available technology and relying too much on payment by the billable hour, The Economist reported. The addition of the Big Four into the industry is unlikely to change the status quo.
Exactly how much will change as a result of these respected global accounting firms pushing into the legal industry will most likely vary from one country to the next. In the United States, in particular, the threat of accounting firms “stealing” the work of law firms remains somewhat remote. Strict regulations govern the establishment of American law firms. Lawyers make the cut, but accountants don’t.
As an aspiring accountant, what does the Big Four accounting firms breaking into the legal industry mean for you? Don’t expect them to transition their primary function from accounting to law anytime soon. While the entrance into the legal world has increased job opportunities for lawyers within these firms’ dedicated legal teams – some the size of a law firm – the majority of their employment opportunities continue to be for accounting professionals. So far, these firms have denied intentions to compete with law firms and predicted that their expansion into the legal world will account for just a “small chunk” of their overall revenues, The Economist reported.
If you’re planning a career with one of these major accounting firms, the qualifications you need to get a job with one of the Big Four haven’t changed. You’ll still need an impressive record of academic and extracurricular achievement and status as a certified public accountant (CPA).