Profit sharing in the Big 8 firms: Accommodating the rainmakers
Beechey, John; Baskerville-Morley, Rachel
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Citation:Baskerville-Morley, R., & Beechey, J. (2003, December). Profit sharing in the Big 8 firms: Accommodating the rainmakers. Paper presented at the 2nd Annual Auckland Regional Accounting Conference, Auckland.
Permanent link to Research Bank record:http://hdl.handle.net/10652/1961
Further to a consideration of existing research on income allocation processes in CA partnerships, this report answers the questions: how was income allocated in the Big 8 and their predecessor firms in New Zealand, and why is stability for income allocation systems compromised by the need for these systems to accommodate the 'rainmakers'? The narratives of the views of survey and oral history interviewees participants on income allocation is complemented by a case study comparing and contrasting two firm changes, illustrated by partner narratives from two firms: Coopers & Lybrand and Deloittes Haskins Sells. The variety of income allocation models is attributed to the necessity for partners to undertake multiple roles in each partnership: "professional firms live or die by the rainmakers". It will be suggested that the previous advocacy of agency perspectives and theory of the firm theoretical perspectives do not provide a close fit with the data from this study. Instead, a population ecology approach (as adopted in organisational theory) is invoked to explain the constant flux in the choice of income allocation models in accounting partnerships
Keywords:Accounting firm management, Income allocation, Accounting partnerships
ANZSRC Field of Research:150199 Accounting, Auditing and Accountability not elsewhere classified
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