EY’s Failed Split Highlights Challenges of Partnership Model
- Accounting firm planned to spin off consulting, tax business
- Eventual split possible, but more time and investment needed
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Ernst & Young on Tuesday scrapped its planned breakup, exposing the shortcomings of the partnership model in professional services.
The Big Four accounting firm intended to spin off its consulting business and much of its tax practice into a stand-alone public company. But the plan, known as Project Everest, fell into jeopardy this year after its influential US affiliate balked, while partners squabbled over key issues like how to divide the tax practice.