Accounting & Auditing Market

Accounting & Auditing Market Outlook (2022-2032)

The global accounting & auditing market is valued at US$ 217.74 billion in 2022 and is anticipated to progress at a CAGR of 5.7% to reach US$ 379.05 billion by the end of 2032.

In the U.S., based on companies filing with the Securities and Exchange Commission (SEC), the average annual audit fees for public companies increased from US$ 2.6 million in 2020 to US$ 2.8 million in 2021.

Report Attributes	Details
Accounting & Auditing Market Size (2021A)	US$ 206 Billion
Estimated Market Value (2022E)	US$ 217.74 Billion
Forecasted Market Value (2032F)	US$ 379.05 Billion
Global Market Growth Rate (2022-2032)	5.7% CAGR
North America Market Share (2021)	44%
East Asia Market Growth Rate (2022-2032)	6.8% CAGR
United States Market Growth Rate (2022-2032)	5.2% CAGR
Market Share of Top 5 Companies	31%
Key Companies Profiled	Armanino LLP Baker Tilly US, LLP Binder Dijker Otte Citrin Cooperman Crowe Global Crowe LLP Deloitte Touche Tohmatsu Limited Ernst & Young Global Limited Evelyn Partners Grant Thornton LLP Haines Watts Group Johnston Carmichael Kearney & Company KPMG International Mazars MHA MacIntyre Hudson Moore Global PwC RSM US LLP UHY Hacker Young

Growth in Business Activity and Rising Corporate Revenues Pushing the Need for Accounting & Audit Services

The accounting services industry will benefit from an increase in business activity as economies improve. As new businesses are opening up, there has been an increase in demand for accounting and other related services.

The growth of U.S. businesses is likely to benefit small accounting firms the most, as these businesses turn to local operators to provide services. There are also many positive factors surrounding IPO activity, benefitting the accounting & auditing industry.

• Short Term (2022 Q2 to 2025): The COVID-19 pandemic accelerated the transition of audit firms towards new ways of operating, which will outlast the immediate effects of the pandemic. The recent trend of working remotely and flexibly by both audit firms and the companies they audit adds a new layer of complexity to the challenge of adapting the audit to a rapidly changing corporate world.
• Medium Term (2025-2028): Audit firms will need to employ a wider range of skills to keep up with the demands of digital technologies and data analysis. This trend will increase the demand for auditors to check the accuracy of financial data and inputs provided by organizations.
• Long Term (2028-2032): The amalgamation of people and technology will shape the future of the accounting and auditing industry. Companies have already started hiring resources from different domains such as mathematics, science, and technology to enable them to use AI, machine learning, and Blockchain in the industry.

The global market for accounting and auditing services registered a CAGR of 5.4% from 2017 to 2021. According to the analysis by Fact.MR, a market research and competitive intelligence provider, the market is projected to expand at 5.7% CAGR between 2022 and 2032.

Market share analysis of accounting and auditing market based on service type and region. Under the service type segment, financial audits enjoy 48% market share in 2022.

Why is the Need for Accounting and Auditing Services Increasing across the World?

“Advancements in Technology Will Drive Demand for Accounting & Auditing Services”

As technology advances at an unprecedented rate and enables organizations to mine and analyze more data, financial audits are poised for rapid change. Technology, combined with the expertise of today's qualified auditors, allows audit professionals to dive deeper into the financial aspects of an organization and provide insights that help make informed decisions.

In addition to regular audit work, clients are also approaching auditors for specific observations and recommendations that can add value, rather than just the usual list of ideas. With the help of technology, audit firms can provide comprehensive offerings, including tracking trends and alerting organizations to emerging issues.

“Improved Macros to Drive Market Revenue”

Post-COVID, economies across the world have been recovering and growing significantly. Macroeconomic factors such as new businesses being established, growth in employment rates, growing GDP numbers, and companies reporting improved financial numbers will create huge demand for audit and accounting services.

Consistent push from regulatory bodies to public and private companies to use the services of audit firms will provide consistent demand for traditional accounting and auditing services. As economies are growing, the trend among primary financial markets (IPOs) is also very promising, and will definitely drive the demand for the services of audit firms.

What Should Accounting & Auditing Companies Keep an Eye On?

“Constant Changes in Rules and Regulations”

The audit and accounting industry is heavily regulated. Constant changes in laws and regulations have a material impact on businesses or industries. A change in a law or regulation made by the government or a regulatory agency can increase a company's operating costs, decrease the attractiveness of an investment, or change the competitive landscape in a particular economic sector.

• One example of regulatory risk includes the passage of the 2002 Sarbanes-Oxley Act, which created more stringent accounting requirements and tougher criminal penalties for violating securities laws. Following public outcry over several accounting scandals in the early 2000s, including those of Enron Corporation and WorldCom, the Sarbanes-Oxley Act was passed in 2002.

Country-wise Insights

Will Revenue Growth of Firms Keep the Momentum High for the U.S. Accounting & Audit Market?

For most audit firms, accounting and assurance services are the major sources of revenue. To improve audit efficiency, many U.S.-based firms continue to explore ways to streamline the audit process. This includes offshoring, setting up lower-cost centers of excellence, outsourcing aspects of the audit, and using data technicians.

The expected increase in audit fees in the United States could lead to an increase in the growth of the audit profession. Recent acquisitions of audit and accounting firms are contributing to the growth of the U.S. market.

The United States accounting & auditing market is currently estimated at US$ 79.76 billion and is expected to reach US$ 146.77 billion by 2032.

Why is India a Prominent Market for Accounting & Auditing?

India is one of the fastest-growing economies among the major countries. India’s accounting and auditing market is largely captured by the Big 4 audit firms - Deloitte, KPMG, EY, and PWC.

During the recent worldwide economic recession, India increased its domestic demand, raised foreign direct investments, and achieved an economic growth rate of 7%. Recent government initiatives, such as Startup India, Mudra Loan, and the listing of startups on stock exchanges are some of the factors that will accelerate the demand for audit and accounting services.

Additionally, the adoption of GST is creating great opportunities for market growth. The introduction of GST has forced companies to transform their supply chains to take full advantage of the new tax structure.

Category-wise Insights

Will Complex Internal Audits Push the Need for Audit Services?

As the global economy has grown and the tax and regulatory environment has become more complex, businesses have increasingly needed internal audits. Internal auditing is a process that helps organizations improve their operations by providing assurance and consulting services. A systematic, disciplined approach to risk management, control, and governance can help an organization achieve its objectives.

According to a report by the Internal Audit Foundation (IAF) and the Institute of Internal Auditors (IIA), the pandemic presented the perfect opportunity for fraud to occur and go undetected. In recent years, there have been many changes in the way work is done. This has created opportunities for criminals to exploit weaknesses in systems. According to the report, a third of companies surveyed have given their internal controls more attention in the past year.

How are Financial Services Generating High Revenue for Market Players?

The current financial environment is very challenging for banks, insurance companies, and specialized financial firms. Regulations and standards, mergers & acquisitions, initial public offerings, cyber risk, and changing technology, all play important roles in their day-to-day business.

The financial services market is a major source of revenue for audit and accounting firms around the world. As the revenue generated by the Big 4 audit firms has shown recently, it is likely that financial services will continue to be a major part of their business. To stay in the business, these financial institutions are coming up with new product/service offerings.

Some recent products include NFTs, Buy Now, Pay Later (BNPL), quick personal loan apps, etc. This constant introduction of new products can lead to financial and cyber fraud. From product offerings to fraud detection, one needs the services of audit & accounting firms.

Competitive Landscape

Prominent accounting & auditing companies are Armanino LLP, Baker Tilly US, LLP, Binder Dijker Otte, Citrin Cooperman, Crowe Global Crowe LLP, Deloitte Touche Tohmatsu Limited, Ernst & Young Global Limited, Evelyn Partners, Grant Thornton LLP, Haines Watts Group, Johnston Carmichael, Kearney & Company, KPMG International, Mazars, MHA MacIntyre Hudson, Moore Global, PwC, RSM US LLP, and UHY Hacker Young.

The global accounting & auditing market is highly competitive owing to the top global players trying to gain market share through various strategies such as mergers & acquisitions, expansions, collaborations, and partnerships.

• In June 2020, BDO USA, LLP acquired Piercy Bowler Taylor & Kern to expand its presence in Nevada and Utah.
• In August 2022, Guidehouse, a leading global consulting provider, signed a definitive agreement to acquire Grant Thornton’s Public Sector Advisory practice.

Fact.MR has provided detailed information about the providers of accounting & auditing services positioned across regions, revenue growth, and product offering expansion, in the recently published report.

Segmentation of Accounting & Auditing Industry Survey

• By Service Type :

  • Financial Audits
  • Capital Markets
  • Corporate Reporting
  • Actuarial Services
  • Internal Audits

• By End-Use Industry :

  • Consumer Markets
  • Energy and Natural Resources
  • Financial Services
  • Government & Public Services
  • Life Science & Healthcare
  • Media & Telecommunications
  • Technology

• By Region :

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Oceania
  • MEA