The public accounting market - France (2024)

1.2 The global accounting services market

The profession of chartered accountant is governed by standards specific to each country (***) in Canada. At the very least, you need to be familiar with the legislation in force in the country where you intend to work.

Despite the development of IFRS standards, the profession of chartered accountant is still relatively compartmentalized by borders, and the majority of chartered accountancy firms will work with companies based in their own country.

However, it may be interesting to observe global demand for accounting services, which appears to be growing steadily. Since ****, the market has grown by a CAGR of *.*% from $***.* billion to $***.* billion. The sector's CAGR is expected to rise to *.*% between **** and ****, reaching $***.* billion by that date.

evolution of the global accounting services market France, ****-****, in billions of dollars Source: ****

The main opportunity for chartered accountants and related services lies in changing legislation , which is prompting companies to call on professionals to guide them and validate their accounts. However, the lack of new talent could be a brake on growth, with a *% drop in the number of candidates for the CPA (***) exam in the United States between **** and ****.

1.3 A growing French market

NAF code **.**z covers companies engaged in accounting activities. These activities come under the heading of chartered accountancy and are carried out by chartered accountancy firms. This NAF code includes the following activities:

recording commercial transactions for companies or others ; drawing up or auditing financial accounts; examining accounts and certifying their accuracy; preparation of tax returns for individuals and companies; advice and representation (***), on behalf of clients, before the tax authorities.

The latter are covered by the monopoly of chartered accountants on all activities relating to the audit and appraisal of company accounts, as provided for by the Ordre des Experts-Comptables. [***] In France, it is therefore impossible to become an independent accountant without being a chartered accountant. However, some companies, such as the Big * firms registered under this NAF code, also carry out peripheral assignments, such as consultancy or advisory services.however, some companies, such as the big * firms registered under this NAF code, also carry out peripheral services such as consulting and asset management, which are not part of the chartered accountancy framework (***). The sales figure obtained is therefore slightly higher than the reality of the sector.

With sales of **.** billion euros in ****, we deduce, with the help of sales ...

1.4 The upheaval brought about by the PACTE Act

The Pacte Act of May **, **** has led to upheaval in the public accounting sector, and more specifically in the statutory auditing business in France, due to increases in audit thresholds. Prior to this law, compulsory audit thresholds in France were much lower than in the rest of Europe. SARLs exceeding two of the following three thresholds were required to undergo a statutory audit:[***]

* million euros balance sheet ; * million euros in sales; ** employees.

For SARLs and other legal entities (***), the thresholds were as follows:

if balance sheet total exceeded *.** million euros ; if sales exceeded *.* million euros (***); For companies with more than ** employees.

However, the Loi Pacte has raised the aforementioned thresholds, which induces a loss of sales for chartered accountants. Indeed, many companies are no longer obliged to appoint a statutory auditor and will therefore no longer call on their services. Companies exceeding two of the following three thresholds must now appoint a statutory auditor:[***]

A balance sheet of * million euros; Sales of * million euros; More than ** employees.

The PACTE law does, however, present some beneficial developments for chartered accountants, with, in particular, a broadening of their scope of action. They can now:

Carry out environmental (***), financial or digital work, provided ...

1.5 The impact of Covid-19 on public accounting activities

The accounting business was not particularly affected by the Covid-** crisis, and proved to be highly resilient.

Thus, we note a slight slowdown compared with **** in March, April and May ****, with a difference in sales that reached **.*% less in April **** compared with ****. However, June saw a notable catch-up, with sales up **% year-on-year.

Sales index for accounting activities France, ****-****, in index base *** **** Source: ****

This is a service business that has been able to adapt by switching to telecommuting. However, thecessation of prospecting activities and the priority given to crisis management by companies led to a slight drop in activity.

Covid-** also led to an upheaval in the activities of chartered accountants. Companies had to implement short-time working, defer charges and obtain state aid during the pandemic. All these steps had to be taken with the support of accounting firms. They therefore obtained a postponement to June ** for routine work, tax returns, income tax and CVAE. This led to a substantial increase in business volume , which may explain the rise in sales in June. [***]

2.1 The main clients of chartered accountants

Chartered accountants' main clients are associations and businesses. According to the Ordre des experts-comptables, **% of companies and **% of associations will use a chartered accountant in ****.

Rate of recourse to a chartered accountant by structure size France, ****, in percent Source: ****

Companies with between * and ** employees are the most likely to use a chartered accountant. The size of their structure does not allow them to have an accounting department, and they have to call on an outside player for bookkeeping and other services. **% of companies with between ** and ** employees use a professional accountant, compared with **% of those with between ** and *** employees. The internal resources of these companies enable them to do without the help of an independent firm. They must, however, comply with the obligation to appoint a statutory auditor in accordance with the applicable thresholds.

Among associations, those with over ** employees are the most likely to use a professional accountant (***).

Private individuals can also call on a chartered accountant for tax declarations, or for assistance at key periods such as inheritance. However, these clients represent a minority share of business, and few French households can afford these services.

2.2 Demand drivers

On the business side, the number of start-ups and insolvencies is a key factor in the growth of the chartered accountancy business.

Since ****, the number of businesses has been rising steadily in France. In ****, **% more microentrepreneurs are starting up than in ****. Sole proprietorships, meanwhile, saw their number of start-ups rise by **%, and companies by **.*%.

Among companies, in ****, **% will be SASs (***) and **% SARLs.

These new companies represent an opportunity for chartered accountants, who see them as potential new clients.

number of business start-ups France, ****-****, in '*** Source: ****

The number of business failures, on the other hand, which represent a loss of potential clients for chartered accountants, has been contracting sharply since ****. The number of failures per year fell from **,*** to **,*** before the arrival of Covid, a drop of **.*%.

In ****, the fall is phenomenal thanks to government aid and the freeze on legal proceedings for companies in difficulty during the pandemic. By ****, only **,*** companies had disappeared. By ****, this figure had fallen even further, to **,***. However, it is possible that government aid has only succeeded in postponing the deadline for these companies.

Number of business failures France, ****-****, in thousands Source: ****

The year **** could see an exceptional increase in insolvencies delayed by government ...

2.3 Regulatory changes encourage the use of chartered accountants

Regulatory changes are creating a favorable environment for chartered accountants. Indeed, when laws and obligations change, companies are more likely to call on accounting professionals to support them.

For example, when the withholding tax was introduced, a large number of business owners turned to a chartered accountant to help them prepare their pay slips in the best possible conditions.

The graph below represents the proportion of searches for a given keyword in a given region and for a specific period, compared to the time when the rate of use of this keyword was highest (***). Thus, a value of ** means that the keyword was used less often in the region concerned, and a value of * means that the data for this keyword is insufficient.

The graph below follows a peak in searches for the chartered accountant business at the start of ****, when the withholding tax was introduced.

Search interest for the professional activity "Expert-comptable" France, ****-****, in Google Trends index Source: ****

Demand for the services of a chartered accountant appears to have maintained remarkable stability over the past four years. Despite cyclical variations, fluctuations in demand generally remain moderate, regularly ranging between ** and **. Peak periods of interest in the term "chartered accountant" ...

2.4 Reasons for calling in a chartered accountant

The main reasons for using the services of a chartered accountant are to certify accounts (***). In contrast, only **% of those surveyed use a chartered accountant for business start-ups, and entrepreneurs are not the majority of firms' clients.

**% of those surveyed also use a firm to help manage administrative complexity.

Main reasons for using a chartered accountant France, ****, in percent Source: ****

While the reasons for calling in a chartered accountant may be occasional, the relationship is generally long-term. For example, **% of companies have had the same chartered accountant for at least * years, a figure that rises to **% for associations.

Length of relationship between customers and their chartered accountant France, ****, in percent Source: ****

3.1 Value chain

Every year, the accounting profession publishes a ranking of public accounting and statutory audit firms. This ranking only takes into account firms registered with the Ordre des experts-comptables (***) and the Compagnie nationale des commissaires aux comptes.

The top * operators in France in terms of sales are KPMG, EY, Cerfrance, PwC and Fiducial. The former will achieve sales of *.** billion euros in the ****/**** financial year in these regulated activities, the same for EY and *** million euros for Cerfrance. We note a drastic drop in sales for Deloitte, due to the sale of In Extenso that took place in ****.

These ** players therefore total sales of * billion, and the vast majority of the sector's revenues are therefore generated by smaller firms.

There are different categories of players in the profession:

Large firms such as KPMG, Deloitte, EY, PwC, Mazars and Fiducial, which are not limited to chartered accountancy and offer consulting services, for example; Groups of independent firms whose strength lies in the pooling of resources, such as ATH, France Défi, Eurus, Fidunion or Walter France. These groupings can be networked (***).[***] Associative networks such as Cerfrance, which federate numerous entities in all départements in order to cover the entire country. Independent ...

3.2 The French accounting industry

According to the Conseil Supérieur de l'Ordre des Experts-Comptables, there are **,*** chartered accountants in France today, of whom **,*** are men and *,*** are women. They are supported by more than ***,*** associates, and *,*** trainee chartered accountants.

The accountancy sector is not limited to the profession of chartered accountant, and relies on a large number of employees, estimated by CSOEC at over ***,***.

Companies and salaried employees in accounting activities (***) France, ****-****, in number of companies and employees Source: ****

Between **** and ****, the accounting activities sector in France showed continuous growth. The number of companies rose from **,*** to **,***, an increase of *.*%. At the same time, the number of salaried employees has risen significantly, from ***,*** in **** to ***,*** in ****, an increase of **.*%. This expansion suggests a growing demand for accounting services, leading to an increase in both the number of companies and employees in the sector.

Source: ****

Île-de-France is, unsurprisingly, the region with the most public accounting firms, due to the large number of companies in the area. These are the firms' main clients. There is also a North/South divide in the presence of accounting firms in the region.

In detail, the Île-de-France region has *,*** companies in the sector, followed by the Auvergne-Rhône-Alpes region ...

3.3 The chartered accountant diploma drives workforce growth

The chartered accountant diploma is an essential prerequisite for practicing the profession. It is relatively uncertain, but every year more than *,*** new chartered accountants join the sector.

In ****, *,*** people graduated from the DEC, a record since ****. The profession of chartered accountant therefore remains as attractive as ever, and the sector owes part of its dynamism to the new numbers of young graduates swelling the ranks of its firms.

Number of DEC graduates France, ****-****, in numbers Source: ****

However, more and more graduates are opting not to register with the Ordre and to work directly in their firms. This represents a real loss for the market.

3.4 Main mergers and acquisitions since 2023

Source: ****

Many of the mergers and acquisitions carried out by chartered accountancy firms are aimed at developing their areas of expertise, and in particularinter-professional relations with asset management. Indeed, industry players are seeking to diversify their range of skills to better serve their customers and be less dependent on chartered accountancy. In the wake of the Pacte law, this diversification has emerged as a significant means of growth.

We also note the importance of building a dense territorial network to support companies in all regions.

4.1 Services offered by accounting firms

Firm offerings can be broken down into three types of service:[***]

Public accounting in the strict sense; Consulting; Auditing.

Within the scope ofpublic accounting, firms offer services in bookkeeping and auditing, presentation of annual accounts, preparation and monitoring of management indicators, and taxation. They also prepare pay slips, social security returns, etc. Finally, on the legal front, they support customers in drawing up legal documents, approving accounts or drafting articles of association.

On the advisory side, the firms offer their expertise in financial transactions or management (***).

Finally, chartered accountants are responsible for statutory audits (***), which are carried out by statutory auditors. Contractual audits, on the other hand, are carried out by chartered accountants at the company's request, with the aim of improving performance.

According to INSEE, in ****, **% of the sector's sales were generated by account maintenance and supervision. Peripheral advisory and legal activities accounted for just **% of sales.

Breakdown of sector sales by service provided France (***), ****, as a percentage Source: ****

However, we are witnessing a desire for inter-professionality on the part of accounting firms to be less dependent on the activities of chartered accountancy and statutory auditing, the scope of which has been reduced by recent reforms. As a result, some ...

4.2 Prices for expertise services

Fees for chartered accountancy services vary not only according to the size of the client, but also according to the region of France in which the service takes place, and the type of service provider.

The accountant's fees must reflect the value of the service rendered, but the amount is not regulated. They are therefore negotiated between the accountant and the client on the basis of :

The professional's reputation The research to be carried out on the file The number of invoices to be processed The difficulty of the case; The costs incurred by the accountant.

According to Compta Facile, the time spent on a file by a chartered accountant is remunerated at a minimum of €*** (***) per hour for review by an associate. Chartered accountants rely on collaborators whose fees are much lower. But these rates can easily vary from one firm to another, and from one region to another. According to ECL Direct, an online chartered accountant generally costs **% or **% less than a local chartered accountant.

According to IFEC, the following salaries could be observed in ****-****

Chartered accountant fees by legal status

Chartered accountant fees by type of engagement

In the Paris region, firms are looking for skills and ...

4.3 The development of digital tools

Many accounting firms are beginning their digital transformation by offering IT tools to their clients. Digital technology is becoming a major asset for automating processes, and Covid-** is set to accelerate this transition.

According to Cegid, (***), by ****, **% of firms had already launched their digital transformation strategy. However, only *% of firms had completed this transformation.

status of digital transformation strategy in accounting firms France, ****, in percent Source: ****

Numerous digital functionalities are available to clients. The most democratized is bank retrieval (***), since **.*% of firms offer it to all or some of their clients. Collaborative online accounting has also been democratized, but not for all clients: **.*% of firms offer it to some of their clients.

What features have you made available to your customers? France, ****, in percent Source: ****

4.4 Supply at risk of shrinking due to recruitment difficulties

Proportion of difficult hires among accounting employees France, ****, in Source: ****

The increasing proportion of difficult hires among accounting employees in France, rising from **% in **** to **% in ****, indicates growing recruitment challenges for this sector. This trend can be attributed to the growing complexity of accounting standards, regulatory changes and increased demand for skilled professionals. Companies will need to adopt innovative strategies, such as in-house training and collaboration with educational institutions, to attract and retain qualified accounting talent.

Recruitment needs and potential pools of young entry-level talent by profession by ****. France, ****, in Source: ****

An analysis of employment prospects in France between now and **** highlights some worrying trends, particularly in certain professions. Accounting is facing negative net job creation, pointing to recruitment difficulties despite the presence of young beginners. For administrative technicians, although net job creation is positive, recruitment needs highlight a potentially insufficient supply on the market. Administrative managers are also showing worrying signs, with positive net job creation, but significant recruitment needs, suggesting a future contraction in supply. In summary, these trends signal a pessimistic climate for recruitment and an anticipated reduction in opportunities in certain professions, requiring a strategic approach to overcoming these challenges.

5.1 Regulations governing the profession of chartered accountant

Ordinance no. **-**** of September **, ****, establishing the Order of Chartered Accountants and regulating the title and profession of Chartered Accountant, defines the legal rules governing the practice of this profession.

This decree has several effects, including

the creation of the Ordre des Experts-Comptables; the definition of the profession of chartered accountant and the missions it can perform; the obligation for all chartered accountants to be registered with the Order (***); the definition of a regulatory framework for trainee chartered accountants.

The full text of the decree is available on the Legifrance website.

Decree no. ****-*** of March **, **** on the practice of public accounting amended this ordinance, notably with regard to the conditions for election to the council of the order. Article *** of this decree also sets that the ratio of the number of collaborators (***) to the number of expert accountants who are members of the order is fixed at ** for a structure.[***]

5.2 New regulations

Loi Pacte ****

The Loi Pacte has raised statutory audit thresholds, inducing a loss of business for chartered accountants. Indeed, many companies are no longer obliged to appoint a statutory auditor and will therefore no longer call on their services. Companies exceeding two of the following three thresholds must now appoint a statutory auditor:[***]

A balance sheet of * million euros; Sales of * million euros; More than ** employees.

The PACTE law does, however, present some beneficial developments for chartered accountants, with, in particular, a broadening of their scope of action. They can now:

Carry out environmental (***), financial or digital work, provided this remains an ancillary activity. Amicably collect all company debts and receivables, whatever their nature. Until now, this could only involve social security or tax debts.

Other new features include the introduction of success fees and the implicit mandate. The former make it possible to reward the achievement of a precise objective, whereas before the law, chartered accountants could not be remunerated on the basis of results. This additional remuneration must be included in the original engagement letter or in an addendum. The implicit mandate also frees the chartered accountant from a series of procedures for producing the mandate agreed with the ...

5.3 The collective agreement for chartered accountants

The collective bargaining agreement for chartered accountants defines a number of rules that firms must follow as a minimum. For example, the minimum salaries according to the employee's hierarchical coefficient are as follows:

Source: ****

If the employer fails to comply with these minimum wages, the employee has * years in which to lodge a complaint with the industrial tribunal.

6.1 Segmentation

• Deloitte France
• EY Ernst & Young France
• Mazars Forvis Groupe
• Fiducial France
• ATH Association Technique Armonisation
• France Defi
• Eurus
• Fidunion (PrimeGlobal)
• CERFRANCE
• PwC Audit
• KPMG Expertise et Conseil
• BDO
• Accenture
• Baker Tilly France
• Cabex Corporate Finance
• In Extenso
• ABCE Expertise Comptable
• Ellipce
• Keobiz
• Indy
• Aplitec
• Aplitec
• le gr
• Diagoris
• TGS France
• Orcom Expertise comptable
• Clémentine comptabilité
• Sadec Akelys
• Altex conseil et expertise - Apicap
• RSM
• Emargence
• Cogep
• Amarris
• Supervizor
• Exco Fiduciaire du Sud-Ouest
• CSP (Lebfevre Sarrut Groupe)
• EDITIONS LEFEBVRE SARRUT