The American Lawyer Finds Accounting Giants Again Targeting Legal Services Market, Though Survey Shows Client Interest Weak

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NEW YORK, July 30, 2014 (GLOBE NEWSWIRE) -- The Big Four accounting firms are back, hoping again to take a major share of the worldwide legal services market. ALM's The American Lawyer details their initiatives in the August issue and online today at www.americanlawyer.com, as well as reporting results of its survey suggesting that potential corporate clients are not eager for their return.

Both PricewaterhouseCoopers and Ernst & Young are likely to build leading global law firms within the next five years, according to The American Lawyer, while Deloitte and KPMG have been hiring in the United Kingdom, Germany and Asia. All are clearly refocused on markets they largely abandoned a decade ago.

One change in the environment is the new availability of U.K. "alternative business structure" licenses that open that country's market to non-law firms. In the U.S., the Sarbanes-Oxley Act remains a major limiting factor, barring the Big Four from providing legal services to companies they audit.

However, a survey by The American Lawyer of 100 general counsel and in-house lawyers at leading global corporations suggests the accounting firms may have to overcome a deeper problem than regulation: lack of potential client interest. Among the survey's findings:

  • Almost 90 percent of respondents do not think their company would be interested in receiving legal advice from an accounting firm.
  • Almost 70 percent worry about potential conflicts and over 40 percent question whether an accounting firm will have the required legal expertise.
  • Others skeptics cited concerns about confidentiality, independence and regulatory restrictions. Stated satisfaction with existing law firm relationships is another factor to be overcome.
  • On the other hand, 18 of the general counsel polled had already retained an accounting firm for a legal matter, usually tax-related, and nearly all reported satisfaction with the service and quality of advice received.

The report on accounting firms is part of an "Innovation" section in The American Lawyer's August issue, which also includes a feature, "The Future of Law," on significant new legal services technology being developed by companies ranging from IBM to Silicon Valley startups.

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Source: ALM