PwC continues to hire despite profits fall

The professional services firm posted profits before tax of 665m in the year to June, down 3 per cent from 688m, while the average payout for each of its 820 partners was down 2 per cent to 759,000.

The results show PwC's turnover rose 4 per cent to 2.33bn, outstripping rival Deloitte, where revenues recently fell 1 per cent to 1.95bn. However the average return for partners at Deloitte was higher at 873,000.

PwC put the drop in profits down to heavy investment during the year, including the recruitment of 1,750 staff and 57 new partners, and the building of a new eco-friendly office in London.

Ian Powell, PwC chairman, said the company was right to "hold its nerve" and continue to invest, but warned that competition in the UK economy still remained challenging and urged the Government to ensure that the country was seen as "open for business".

He said: "The government is clearly addressing the debt burden and making spending cuts is unavoidable, but the emphasis must be on investing to accelerate business growth in the interests of the UK's long-term economic health."

Revenues in the firm's advisory business were up 9 per cent to 804m, reflecting business consulting growth and restructuring work, which includes PwC's role as the administrator to Lehman Brothers' European operations.

Turnover in its auditing and assurance business was up 4 per cent to 893m, while its tax practice saw a slight decline to 634m.

Mr Powell said: "Notwithstanding a tough year for our clients and our business, we've delivered a good, solid set of results given the economic and market backdrop.

"We stayed close to our clients through this testing period and continued to invest in the future of our business."

He added: "We are under no illusion that there remain challenges ahead.

"Competition in our markets remains fierce and we recognise that we need to continue to demonstrate to our clients that we can deliver the quality and value they demand."

PwC, which employs 16,500 people across the UK, and more than 163,000 people worldwide, said the 800 new jobs will be created in the next 12 months across the UK and throughout the company.