Reviewed by Hans V. Johnson The University of Texas at San Antonio
The recent merger of Haskins & Sells and Deloitte & Co. has brought together two firms whose rich history spans that of professional accountancy itself. It could be argued that whereas the published history (1895-1970) of Haskins & Sells mirrors the devel-opment of professional accountancy in the United States, the his¬tory (1845-1956) of the Deloitte firm likewise reflects the profession’s growth in Great Britain. The book is equally divided between pre and post 1900 periods. The character and contributions of the found¬ing partners are presented along with clients of long standing, staff relations, overseas development of the firm, and the economic and cultural environment of the times. Material for the book was com¬piled from correspondence files, internal office memoranda, memoirs, and other recorded recollections of partners and staff.
William Welch Deloitte founded the firm in London in 1845 during a period of British history described as a “time of robust, if harsh, economic development.” Of French heritage, the grandson of Count de Loitte, Deloitte left school at 15 after obtaining a position as an assistant to the Official Assignee of the Bankruptcy Court. Twelve years later he opened an office at 11 Basinghall Court and he and his wife established residence above the office. In 1845 the London Post Office directory listed 205 accounting firms. Mr. Deloitte aggressively sought new clients even to the point of searching the newspapers for bankruptcy filings. One letter stated “I am sorry to see your name in the Gazette, and write to offer my services. . .” A staff member recalled Mr. Deloitte as an “alert, decisive little man, with just a touch of austerity in his manner,” but with a “kind heart.” Leading industrialists came to recognize his outstanding abilities. His association with the Great Western Railway, starting in 1849, was a primary impetus for growth. His investigation of a stock fraud of the Great Western Railway in 1856 made him a prominent figure. Mr. Deloitte left the firm in 1897 and died one year later at age 80. His obituary appearing in The Accountant credited him with, among many other accomplishments, developing systems for keeping railway and hotel accounts both of which had become universally accepted.
The book is well written and includes many interesting anecdotes about public accounting practice in the good old days. What follows is a sampling of the trials and tribulations of the staff. New clerks, often 15 or 16 years of age, were furnished with a “Baton,” an enclosed footlong cylinder containing three compartments: one for pens and pencils, one for a bottle of ink, and the third “india-rubbers.” Inexperienced clerks received no salary for the first year, the training period, and “small salaries subsequently.” The clerks worked regular nine hour days, forty five minutes for lunch, except on Saturdays when “work permitting” the office closed at 2 o’clock for the weekend. Monthly time summaries were a “constant source of complaint;” internal memos reveal that on occasion even partners were tardy in submitting their time summaries. Discipline was some¬times a problem as indicated by a letter from Mr. Deloitte to the mother of a clerk who he had just dismissed for an unexcused absence. In the letter he suggested that the young clerk be made to move back to his country home for closer supervision and away from some associates of “the most dangerous character.” A subsequent letter to the mother indicates that her son had borrowed money from a client and left an I.O.U. From a staff of 10 in 1850 the firm grew to 125 in 1900. A woman typist was hired in 1902 and the “days of the two male copyists . . . were coming to an end.” Previously, all correspondence, accounts, and reports were written and copied in long hand. Recollections on the initial installation of electric lights, and the intense rivalry among the staff to see who got the 16 candle power lamp, the first and the only telephone, the hazards of communicating with other staffmen in remote rooms in the building through “speaking tubes,” and the laborious task of filing the mountain of paperwork all make for interesting reading.
The reviewer’s favorite passages relate to the experiences re-called by a late partner of the firm, The Rt. Hon. Baron Plender of Sunbridge. Lord Plender had spent considerable time for the firm on the European continent around the turn of the century. While in Madrid he was invited to dine one evening with “a well-known Englishman who had married a Spanish lady.” The Englishman had a violent temper, and thus when the butler brought in the leg of lamb, which the host believed to be too rare, he threw it “out the window behind him and it fell in the street, so that there was no mutton for us for that night’s dinner.” And, “his wife was overcome by her husband’s behaviour, and left the table in a temper.” In St. Petersburg he and other Englishmen occasionally were invited to dine with Russian friends. Caviar sandwiches and vodka, “which we found to be a particularly strong stimulant,” were a prelude to sumptuous meal. “We were pressed to take more (vodka) than was good for us, and sometimes we yielded and before dinner was over . . . we were in a somewhat dazed condition much to our Russian friends delight.”
Historians with an interest in the developments of accountancy in Great Britain will want to read about the impact of the Com-panies Acts, the creation of The Institute of Chartered Accountants, early audit reports, various business failures, and the environment during the two World Wars. This is a thoroughly enjoyable book. It is interesting, informative, and humorous. Deloitte Haskins & Sells should seriously consider having the book reprinted in paperback for wider distribution. It is a rare gem!
