Early history and mergers EY resulted from several mergers of ancestor firms over the last century and a half, the oldest of which was founded in 1849, in England, as Harding & Pullein. That same year, this firm was joined by an accountant named Frederick Whinney, who, a decade later, became a partner. After his son joined the firm, it was later renamed Whinney, Smith & Whinney, in 1894. In 1903, the firm
Ernst & Ernst was founded in Cleveland, Ohio, by
Alwin C. Ernst, and his brother, Theodore Ernst. In 1906,
Arthur Young & Co. was set up by a Scottish accountant,
Arthur Young, in Chicago. Starting in 1924, these two American firms became allied with prominent British firms; Young with Broads Paterson & Co.; and Ernst with the aforementioned Whinney Smith & Whinney. The latter of these two mergers spawned Anglo-American partnership
Ernst & Whinney in 1979, then the fourth largest accountancy firm in the world.
Later developments In October 1997, Ernst & Young announced plans to merge its global practices with professional services network
KPMG, to create the largest professional services organization in the world. The announcement came on the heels of an announced merger between
Price Waterhouse and
Coopers & Lybrand only a month earlier. These plans were soon abandoned in February 1998, due to several factors ranging from client opposition, antitrust issues, cost problems, and the anticipated difficulty of merging the two diverse firms and cultures. The merger between Price Waterhouse and Coopers & Lybrand, however, went ahead as planned, creating
PwC. Ernst & Young expanded its consulting practice heavily during the 1980s and 1990s. During this time, the
U.S. Securities and Exchange Commission, and various members of the investment community, began to raise concerns about a potential conflict of interests. This conflict would be brought about by firms offering both consulting and auditing services simultaneously to overlapping clients, a common practice among the "Big Five". In May 2000, Ernst & Young was the first of those firms to fully separate its consulting practices via a sale to the French IT services company
Capgemini for $11 billion, creating the new company Capgemini Ernst & Young, which was later renamed back to Capgemini.
Recent history, re-branding and expansion , Poland in
Los Angeles, California, US ,
Johannesburg, South Africa In 2002, Ernst & Young took on a large number of the clients previously working with
Arthur Andersen following its collapse in connection with the
Enron scandal, although it did not engage with any new Arthur Andersen clients from the United Kingdom, China, or the Netherlands. Four years later, in 2006, Ernst & Young became the only member of the Big Four to have two member firms in the United States, with the inclusion of
Mitchell & Titus, LLP, the largest minority-owned accounting firm in the United States. Mitchell & Titus ended its membership in the EY network effective October 30, 2015. In April 2009,
Reuters reported that Ernst & Young, spurred by the global economic downturn, had launched a cost-saving initiative encouraging its staff in
China to take 40 days of low-pay leave between the summer of 2009 and the summer of 2010. Those who participated got a prorated salary equal to 20% of a regular salary, plus the benefits of a full-time employee. The initiative applied to employees in
Hong Kong,
Macau and
mainland China, where the firm's employees numbered 8,500 in total. In 2010, Ernst & Young acquired Terco, the Brazilian member firm of
Grant Thornton. In 2013, the firm officially changed its brand from Ernst & Young to
EY, and christened the accompanying tagline: "Building a better working world". Also in 2013, the
Pope of the
Roman Catholic Church hired EY to help review
Vatican City State's finances and help "verify and consult" the institution's administration, including the museums, post office and tax-free department store. EY expanded further and acquired all of KPMG Denmark's operations including its 150 partners, 1,500 employees and 21 offices. In 2014, EY acquired global strategy
consulting firm The Parthenon Group, gaining 350 consultants in its then-Transaction Advisory Services practice so that it could provide in-house strategy consulting services to its clients. The business unit has since been rebranded as
EY-Parthenon and is one of the most selective strategy consultancies worldwide. In 2015, EY opened its first global Security Operations Centre in
Thiruvananthapuram, Kerala in India, and coincidentally invested $20 million over 5 years to combat the increasing threat of cybercrimes. In 2017 EY announced it was opening an executive support center in Tucson, Arizona, US, creating 125 new jobs. That same year, the company opened a Digital Security Operations Center, located in Muscat, Oman, to cover the EMEIA region as part of a $10 million investment. In 2018, EY opened a $4.4 million professional services center in Louisville, Kentucky, US, creating 125 new jobs, and announced it would open an IT / tech hub in
Nashville, TN, US, creating 600 regional jobs. In November 2022, it was announced EY had acquired the
Sydney-headquartered data and analytics specialists, Bridge Business Consulting.
Project Everest The
Wall Street Journal reported in May 2022 that the firm might split its accounting and advisory divisions into two new, separate businesses. The plan, referred to internally as "Project Everest" would involve the consulting business completing an
initial public offering, the proceeds of which would be used to compensate partners at the new, separate auditing company. The firm's debt has proven to be an internal obstacle to the split. The debt is mostly owed to former partners of EY, taking the form of what the
Wall Street Journal characterized as "effectively an unfunded pension plan". EY's member firms in China, Hong Kong, Macau, and Israel stated that they would not split. Rival firms such as KPMG and Deloitte have said they do not intend to imitate EY. In March 2023, Julie Boland, head of EY US, stated in a webcast that the split would be temporarily paused amid internal debate over the proportioning of its tax service line among the proposed consulting and assurance spinoffs. The firm cancelled Project Everest as the US portion of the firm withdrew its support for the split in April 2023. Preparing and planning for the split cost EY $600 million. In 2024, EY announced an alliance between
SAP Fioneer and EY ifb SE. == Global structure ==