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EY has taken longer than originally planned to clear the debts it had built up on its failed advisory arm, according to the Big Four firm’s annual accounts.
A $700mn credit facility opened to cover the cost of Project Everest – which will split the firm in two and reshape the global professional services industry – was still $270m outstanding at EY’s financial year-end in June.
Including other loans, interest paid by EY’s Global Operations Business for the year totaled $74mn, more than double the previous 12 months.
Registered in the United Kingdom at Companies House, the three-year-old institution was paid after the end of the financial year. A person familiar with the matter said the last payment was made in October.
“Through our financial planning and regular reviews that guide our capital decisions, we have decided to repay this loan facility 16 months early rather than 20 months early,” the person said.
A year ago, EY he said. “Expenses incurred during Project Everest will be almost fully repaid by 1 July 2024”.
In common with the rest of the Big Four, the firm had more. A slow year More than expected. Globally, it increased its revenue by 3.9% to $51.2 billion, which led to a year-over-year increase in its audit and tax consulting business.
Project Everest is designed to promote growth in consulting and auditing, freeing it from conflict of interest laws that prevent the sale of consulting services to clients.
The ambitious plan fell through in April 2023 after failing to get a sign-off from EY’s leadership in the US.
Unlike a typical multinational, EY is a network of nationally owned cooperatives linked through a global legal entity that sets strategy and manages shared services such as IT. An international operating company based in the United Kingdom is supported by levies on national member firms during the holiday period.
$600 million was spent on planning Project Everest before it was written off. In the year The 2024 bills show a big drop in spending on professional fees such as lawyers, falling from $1.4bn in the year to June 2023 to $972mn.
New global CEO Janet Truncale made a different promise A systematic approach Advise clients on transformation and sustainability to drive new investments and grow revenue by expanding EY’s managed services business.
