Private equity sings the siren's song; Grant Thornton answers

Grant's leadership provides no specifics about what it will spend the money on, sticking to conspicuous vagueness. That's better for retaining the flexibility to claim success no matter what happens.

This is a guest entry from Jim Peterson, an American lawyer whose practice focuses on financial and accountancy related issues, and who is a 19-year veteran of Arthur Andersen’s in-house legal group. He launched his column, “Balance Sheet” in the business section of the International Herald Tribune in 2002 – evolving to his blog, “Re:Balance”.  

The United States accounting firm of Grant Thornton, seventh largest of the global networks, announced on March 15 that it was selling a majority interest in itself to the investment firm New Mountain Capital.

Why the date was chosen will likely remain a mystery. Shakespeare’s invocation of the Ides of March to dramatize Julius Caesar’s bloody assassination in the Roman forum, however, suggests a comparison: Grant's foreswearing its traditional partnership structure with the dazzling spin management of Marc Antony’s funeral oration.

O judgment! thou art fled to brutish beasts,

And men have lost their reason.

As the partners/owners of Grant Thornton — the latest and largest of the mid-tier firms to embrace private equity — surrender their traditional status to become employees, it’s time to praise, not bury, the vexing challenges to maintaining professionalism when CPAs accept the golden chains of outside capital.

Where will Grant Thornton spend the money? What are its real ambitions?