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An analysis of the economic impact and the anticipated reactions of clients to management consultants' defections from public accounting firms.
Over the past few years, the issues of compensation and firm direction have become increasingly important to management consulting partners of major public accounting forms. While growth in the audit and tax practices has slowed, rapid expansion has occurred in the consulting divisions. The Wall Street Journal reported that "At major accounting firms, consulting revenues are ballooning at an average 30% annual rate, about double the growth of auditing and tax work" (July 26, 1988, p. 1). Clinton A. Alston, a consulting partner with the international public accounting firm of Ernst and Whinney (now Ernst and Young after merging with Arthur Young & Co.), reported that at ...
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