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PwC contests Ernst leadership claim

Bhupesh Bhandari

PricewaterhouseCoopers has contested the claim of Ernst & Young that its acquisition of the Indian operations of Andersen will make it the biggest professional services firm in the country.

PwC's contention is based on the number of people on the rolls. In April 2002, the firm had 3,804 people across various functions with 1,075 in consulting alone.

In comparison, Ernst & Young will add 900 people to its strength of 1,200 with the merger, taking the total to 2,100. PwC has also said as compared to the 60 partners in the merged entity, there are 70-odd partners or partner-equivalents on its rolls.

"After the merger, there will be a second player in the market," PwC sources said.

On the other hand, Ernst & Young has claimed leadership on the basis of the number of its clients. Sources in the firm said the merged practice would have more than 1,000 clients for various services like audit, tax consulting as well as corporate advisory jobs.

"We are yet to exchange the list of clients. The revenues of each of the two are quite formidable," Kashi N Memani, who will serve as the chairman and country managing partner of the merged practice, told Business Standard.

As professional services firms are closely held, their revenues are not made public. Hence, a comparison of these firms has to be on the basis of either the number of employees or the number of clients.

Ernst & Young does its audit practice under S R Batliboi & Co. PwC has claimed that its audit practice is bigger than Ernst & Young.

"With a cap on the number of audit reports that a partner can sign (the earlier limit of 20 has now been raised to 30), PwC, with a larger number of partners, will have a bigger practice," sources said.

Ernst & Young on Friday announced that it was acquiring the Indian practice of Andersen. PwC was formed by the global merger of PriceWaterhouse and Coopers & Lybrand some years ago.

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