Ernst & Young Plans Outsourcing Pact --- Shell Deal, the First in Europe, Adds to Accounting Sector Merger Mania

The jolts from the onslaught of mergers in the global accounting markets over the last two months will likely intensify Friday as Ernst & Young LLP announces an "outsourcing" joint venture with oil company Shell Internatonal Inc. The deal between Shell and Ernst & Young -- already...

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Bibliographic Details
Published inThe Wall Street journal Asia
Main Author By A. Craig Copetas and Elizabeth MacDonald
Format Newspaper Article
LanguageEnglish
Published Victoria, Hong Kong Dow Jones & Company Inc 31.10.1997
Subjects
Accounting firms
Acquisitions & mergers
Antitrust
Audit departments
Internal auditors
Outsourcing
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Summary:The jolts from the onslaught of mergers in the global accounting markets over the last two months will likely intensify Friday as Ernst & Young LLP announces an "outsourcing" joint venture with oil company Shell Internatonal Inc. The deal between Shell and Ernst & Young -- already in the throes of unifying its operations with KPMG Peat Marwick LLP -- will create a new partnership of superbookkeepers. The unit, Tasco Europe LLP, will break new ground in Europe; it is the first time a major accounting firm has created a joint venture with a multinational corporation to establish a pan-European accounting-services company. Tasco is a bold twist on an old idea dubbed outsourcing. Every large company relies on outside auditors to check whether its internal auditors are working effectively to deter fraud and waste. But a growing number of companies are cutting costs by outsourcing their internal-audit departments to accounting firms. According to KPMG's latest annual study on this sector, the total global outsourcing market will top $280 billion by 2000, with annual growth rates of 20%.
ISSN:0377-9920