Grant Thornton’s UK chief executive has hit back at critics of private equity ownership who warn that pressure for financial returns could lead to sloppy audits, arguing it has sharpened the focus on quality.
Malcolm Gomersall said a majority investment in the UK’s sixth-largest accountant from European buyout group Cinven in 2024 had heightened scrutiny and the need to preserve the firm’s value for future buyers.
“At some point [Cinven] will exit and then we will go and have a different ownership. That involves a sale. You cannot sell something which has an awful reputation for quality because nobody will want to buy it,” he said.
Grant Thornton would not audit a company in which Cinven had invested and bowed out of any “grey areas”, Gomersall said, acknowledging that complex ownership structures can create uncertainty over how far independence restrictions extend. “Can we audit something where Cinven has an investment in it? We would not do that.”
RM Block
The rush of private equity money into accountancy has sparked concerns over whether outside ownership by traditionally profit-focused buyout shops could threaten auditor independence, particularly where firms are auditing companies influenced by the same buyout groups.
Gomersall’s comments come as a rash of transactions has drawn scrutiny from regulators, industry bodies and academics, who have warned that private equity ownership could encourage a more short-term culture, losing sight of audit quality.
More than 1,000 accountancy practices globally received private equity investment in the past decade, accelerating from 2022, a report this year from the International Federation of Accountants found.
In Ireland, the Grant Thornton member firm merged at the start of last year with Chicago-based Grant Thornton Advisors. The initial transaction valued the Irish business at €480 million.
Cinven’s 60 per cent stake in Grant Thornton valued it at about £1.5 billion (€1.75 billion) in the biggest private equity investment in a British accounting firm, helping to kick-start a wave of large deals across the UK sector.
Grant Thornton’s growth is being closely watched across the profession as the first major test of whether private equity can turbocharge a large UK accounting firm.
UK rules are designed to prevent conflicts of interest and protect auditor independence, but increasingly complex private equity structures can leave grey areas over how they apply, which can be challenging to navigate.
In one case, Gomersall said his firm consulted the accounting regulator, the Financial Reporting Council, about whether to take on a client. The regulator agreed it was a “grey area” of independence, and Grant Thornton decided not to proceed.
The sensitivity is acute at Grant Thornton, which spent years recovering from a series of high-profile audit failures. The firm audited Patisserie Valerie before the cafe chain collapsed following the discovery of accounting irregularities in one of the previous decade’s most damaging failures, and was later fined millions by the FRC over failings across several major audits.
For Gomersall, that period belongs to an earlier incarnation of the firm. “I believe we have turned the page,” he said.
Just months into Gomersall’s tenure, he watched Grant Thornton’s US firm pursue its own private equity deal and began “testing the hypothesis” that taking a cash injection would help fuel change, bringing in Rothschild bankers and keeping the work, codenamed “Project Acorn”, under wraps for several months.
The decision needed 75 per cent support. On voting day, Gomersall stood with all the UK partners to watch a TV-show-style ticker climb. When it stopped at 100 per cent, he cried. “This is like a momentous point in the history of our firm,” he recalled. “I think that’s how it felt for us all.”
The firm has set targets to rebuild its position at the top end of the market, which one person familiar with Grant Thornton said would help make it more attractive to future buyers, and has steadily revamped its audit quality rating from the regulator.
Gomersall is aiming for £1 billion in annual revenues by the end of next year, after rolling 12-month revenues to June rose above £800 million compared with £787 million in the year to December. He expects they will exceed a target of hiring 160 new partners by the end of 2027.
Rather than seeing a reduction in graduate-level jobs due to AI, Grant Thornton was increasing its graduate hiring, he said, arguing AI “creates a massive opportunity”.
However, some clients did not want AI to be used in their audits and consulting projects, Gomersall added. “Everybody’s on a different level of comfort with this.” - Copyright The Financial Times Limited 2026
