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The Wall Street Journal: Deloitte considering plan to split its audit and consulting businesses

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Deloitte is exploring a plan to split its global audit and consulting practices, following an effort by fellow Big Four accounting firm Ernst & Young to potentially spin off its consulting arm, according to people familiar with the matter.

The moves would mark the biggest shake-up in the accounting industry in decades, handing windfalls to tens of thousands of the firms’ partners and creating two new consulting giants and two stripped-down auditing firms.

Deloitte reached out to investment bankers at Goldman Sachs Group Inc. after news broke of rival EY’s potential worldwide split, the people familiar with the matter said. Goldman and JPMorgan Chase & Co. are advising EY on its possible restructuring, the people said.

The Deloitte talks are still at a very early, exploratory stage, according to one of the people familiar with the matter.

After the initial publication of this article, a Deloitte spokesman denied the firm was exploring a plan to split. “We remain committed to our current business model,” the spokesman added.

An expanded version of this report appears on WSJ.com.

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