EY Avis 

One star is generous. If negative stars existed, I would not hesitate.
EY Parthenon was appointed as an independent valuation expert in a shareholder dispute involving a forced buyout. The forcing party’s obvious interest was the lowest possible valuation, something I flagged from the start. EY’s role was to serve both parties impartially. They did not.

They assured me their valuation would follow one core principle: “a willing seller, and a willing purchaser, acting economically rationally with access to equivalent information.” This persuaded me to trust the process. It turned out to be an empty promise.

The final report relied entirely on curated information from the party forcing the buyout; the same party whose only interest was a cheap acquisition. There was no “willing seller” and no “willing purchaser” in the analysis. The forcing party was allowed by EY to present unverifiable data and play both an unwilling buyer and an uninterested seller, portraying the company as worthless while wanting to acquire it. The irony of wanting to buy something you claim has no value was lost on EY.

Every methodological choice was pushed to its most pessimistic extreme. For the buyer profile, they chose a passive financial investor with no IT knowledge, relying on management that only presented its own inability to drive the company forward. In reality, SaaS companies are acquired by IT companies with shared customer bases and quantifiable growth potential. This choice alone made the valuation meaningless. They then applied a 75% discount to comparable multiples without reasoning, and used a run-off model assuming the business dies in 6 months; while this company has paid salaries for years, operates independently, and earns well above its costs.

The report was a handful of pages of analysis dressed up in a polished slide deck. No reasoning was provided for any of the pessimistic choices. I had to babysit the process to ensure the basics of the shareholders’ agreement (the document governing EY’s assignment) were being followed.

From my first email, I submitted evidence-based feedback: analytical requests, documented concerns, and questions that could have been answered. I used their own data to show their claims were self-contradicting. Over months, not a single concern was addressed, not one question answered, not one meaningful adjustment made. Each time: “we have considered your input”, with nothing to show for it except cosmetic changes.

When I asked for explanations, the engagement partner wrote that he did not believe “a more extended exchange of views” was necessary. His final response: “In the end it is my independent judgment that must be reflected in the valuation.” No reasoning. No dialogue. Just a door arrogantly slammed shut by someone who could not bring himself to say: “Your points are correct. Let me fix what I was about to carelessly destroy.”

The result? Total shares valued at zero. For a functioning, 16-year-old SaaS company with paying subscribers, a recognised global brand, hundreds of user reviews above 4.5/5, a documented codebase, and over a decade of intellectual property. None registered as having value! For a six-figure fee, this is what I received.

This was not an independent valuation, not a professional one, and not a humane one. It was a rubber stamp. Just get the work done, get paid, move on. The obvious flaws and discrepancies I pointed out were left unchanged and unanswered.

If you are a minority shareholder hoping for a fair valuation process, look elsewhere. And if you are deciding whether to rely on EY Parthenon in a similar scenario (a forced buyout where one party controls the company, the information, and the narrative) just know this: EY will gladly take your money, ignore your input, and deliver a result that serves whoever controls the story.

I loved working for the profession as a generalist, and following the merger of Price Waterhouse and Coopers & Lybrand I worked in regulatory affairs and service development in response to major legislative and economic reforms (e.g. Anti-Money Laundering, Auditor Independence and ASX Corporate Governance, Carbon pricing, CLERP 9, Finance Function Effectiveness, Private Equity, US Sarbanes-Oxley, etc). The profession excels at responding to complex reforms and market leaders adopt this tactic to gain the high ground on new opportunities with multiple touch-points across the firm, as well as significantly reduce cost of sales and contain risk around the auditor’s expanding scope-of-service and client messaging. It’s a centralised business function (i.e. your client is the firm) with each campaign lasting 6 to 18 months and I was also Head of Research with a team of equity analysts.

At EY I was also an equity partner (i.e. an employer and not an employee) and suffered a work travel injury which left me with permanent radiculopathy, atrophy and pain management. I attempted to return to work on restricted duties, and around the same time against a backdrop of failing Federal legislation my immediate managing partner insisted that I start to deliver fee-paying services (i.e. audit, tax, advisory related services). In my opinion, from experience in regulatory affairs, that would have been a breach of professional standards as all fee-for-service staff must have specific qualifications and experience (and clients) to deliver audit and other services, albeit the profession is largely self-regulated. I was eventually expelled from the partnership and served with a debt even though I was not medically cleared to return to my own occupation, and had to go through the Supreme Court twice to secure access to the EY medical insurance policies. That was a 12-year battle and I never worked in any vocation or employment again as offers were simply withdrawn after a medical assessment.

The moral of the story is firstly, if you suffer a work injury make sure that your prescribed work/medical restrictions are recorded at the highest level in the firm, especially if you attempt to return to work before getting medical clearance; secondly, don’t assume that the partnership will “carry their wounded” or even recognise your work/medical restrictions; thirdly, don’t assume that a new employer will take on your medical risk if your restrictions affect a key aspect of your own occupation; fourthly, the partnership can require you to “bend the rules” regarding professional standards which your moral compass might not agree with, but that objection can carry a significant career penalty; and fifthly, the pressure to “fall on one’s sword” is huge in a partnership and whilst family support is hopefully a given, what is essential is a trusted career mentor or two that understand the profession (i.e. culture, APES110, KPIs, etc) including someone not affiliated with the partnership. Good luck - the profession is great but the leadership qualities vary enormously.