Deloitte revenue down, employees up ... mystery behind the numbers

Deloitte's audit and tax functions were basically unchanged from fiscal year 2008. These lines of business tend to be relatively stable regardless of broader market conditions, with even major events unable to cause wide swings in audit and tax revenues. The firm's financial advisory services group saw revenue fall 6.1%. A global decline in mergers and acquisitions is responsible for most of the FAS practice's year-over-year change.

The consulting function, on the other hand, posted a 7.3% increase in revenue. Apparently, what the consulting partners used to tell me is true: "Strong markets and weak markets favor us -- flat markets don't."

On a local currency basis, not accounting for changes in the value of the U.S. dollar, Deloitte's revenue was actually up 1% from the year prior. Currency changes, however, were ultimately responsible for the final revenue result.

Even with the favorable local view, Deloitte's 2009 results are a sharp departure from recent history. In 2008, the firm posted its sixth consecutive year of double-digit revenue growth at 18.6% (13% using local currencies), ultimately reaching $27.4 billion.

"In a difficult economic climate we were able to achieve growth in many places," Deloitte's CEO Jim Quigley told Reuters. Quigley does see an increase in economic activity next year, which is likely to benefit the firm and is already focused on managing through the recovery. He sees the public sector as a growth opportunity for the firm, and regionally, Asia is up 7.6% on a local currency basis, with India up 29.9% and Australia gaining 11.5%. This marks five years of Asia as the fastest growing region in Deloitte.

Asia wasn't the only area where Deloitte showed rapid growth. The firm added 40,000 people in fiscal 2009, increasing its workforce by approximately 31%. The acquisition of business units and employees formerly belonging to consulting firm BearingPoint -- which began its short life as a KPMG spinoff -- contributed substantially to the swelling of the workforce.

Even though the number of bodies increased, the workforce was far from stable. Throughout the year, there has been plenty of chatter on Green Dot Life, an (incredibly) unofficial message board, about the employment situation. From the comments left (many anonymous), there have been plenty of layoffs this year, and as usual, there hasn't been much information to accompany it. Says one anonymous commenter, "The woman HR manager at my lay-off extravaganza meeting knew squat. It was embarrassing for her. Fairly basic questions which she could not answer." Another contributed, "Honestly the HR person whom I spoke with barely knew answers to any of the questions that I asked. He kept referring me to 1-800-DELOITTE. I was very disappointed with the level of knowledge he had. These are the so called 'BEST' people now remain employed with 'D'."

For those coming in the door, start dates are being pushed back. And the bitterness is flooding into the process, as evidenced by another anonymous rant, "However, if an HR person truly does not like you they will put you where ever they think you will be miserable. If you don't like the sound of this you should go back to school or go on welfare."

Other bits of advice are more constructive, but no less bitter: "One more thing I wanna say is that please pass your CPA asap. Get that $5,000 bonus before you get laid-off. $5,000 means lasting a few extra months on your own before you move back in with your parents. Trust me, I passed CPA exam one week after I was laid-off and I didn't get the 5k bonus. You know how shitty that makes you feel?"

This is a bit extreme, but economic downturns do make life difficult for existing and new employees at Deloitte. Stress increases, and hours worked tend to exceed those actually billed. Layoffs have happened, despite the net increase in positions last fiscal year, with the real impact obscured by the BearingPoint purchases and hires.

So, revenue was flat and the workforce grew at Deloitte last fiscal year. Pretty boring, right?

Disclosure: I do not currently work for Deloitte or have any relationship with the firm. I have worked there in the past, but not since the end of 2007.