Big 4 vs Local Accounting Firms Malaysia: Which is Better?

The accounting landscape in Malaysia is dynamic and diverse, with a mix of local firms and international giants. The presence of the Big 4—Deloitte, PwC, EY, and KPMG—alongside numerous local accounting firms creates a competitive environment. This variety offers businesses and individuals various services, from auditing and tax advice to consulting and financial planning. Choosing the right accounting firm is essential for both businesses and individuals. 

A good accounting partner can help ensure compliance with local regulations, optimise financial performance and provide valuable insights for decision-making. The right firm can also cater to specific industry needs and provide personalised services that align with clients’ goals. In this context, understanding the differences between local firms and the Big 4 can help clients make informed choices that best suit their financial needs and objectives.

What Defines Local Accounting Firms in Malaysia?

Local accounting firms are typically smaller, independent firms that operate within a specific geographical area. They cater to local businesses, individuals, and communities, offering tailored financial services. These firms often prioritise building solid client relationships, allowing for a more personalised approach to accounting. Their familiarity with local regulations and market conditions sets them apart from larger international firms.

5 Common Services Offered by Local Firms in Malaysia

Local accounting firms provide a range of services that can include:

• Bookkeeping and Accounting

Maintain accurate financial records, track income and expenses, and ensure your business complies with financial regulations.

• Tax Preparation and Planning

Prepare and file tax returns efficiently while devising strategies to minimise tax liability and maximise savings.

• Payroll Services

Manage employee payments, benefits, and tax deductions accurately, ensuring compliance with employment laws.

• Financial Consulting

Receive expert advice on budgeting, cash flow management, and financial strategies to drive business growth and stability.

• Audit Services

Conduct thorough reviews of financial statements to ensure accuracy, transparency, and compliance with legal standards.

These firms often focus on meeting the specific needs of their clients, whether they are small businesses or individuals seeking financial advice.

What is the Overview of the Big 4 Accounting Firms in Malaysia?

The Big 4 accounting firms, which include Deloitte, PricewaterhouseCoopers (PwC), Ernst & Young (EY), and KPMG, are the largest professional services networks in the world. These firms provide various services beyond traditional accounting, including audit, tax, consulting, and advisory services. Thanks to their global reach and extensive resources, they are known for their ability to serve large multinational corporations.

4 Main Services Provided By the Big 4 Accounting Firms in Malaysia

The Big 4 offers various services tailored to meet the needs of businesses. This includes:

• Audit and Assurance

Conducting audits to verify financial statements and ensure compliance with regulations.

• Tax Services

Providing tax planning and compliance services to help clients navigate complex tax laws.

• Consulting

Offering business consulting services, including strategy development, risk management, and technology implementation.

• Advisory Services

Assisting clients with mergers and acquisitions, financial restructuring, and other critical business decisions.

5 Key Factors to Consider When Choosing an Accounting Firm

Choosing between local accounting firms and the Big 4 in Malaysia can significantly impact your business’s financial management and long-term growth. Here are five crucial factors to evaluate, with examples and insights to help guide your decision.

1. Budget

Local Firms

Local accounting firms are often more cost-effective, making them suitable for SMEs or startups. For instance, Chia, Ka & Partners offers complete accounting services starting from RM900–RM2,000 per month, covering bookkeeping, tax filing, and payroll. Maintenance fees for bookkeeping and standard services can be more flexible, catering to small-scale businesses.

Big 4 Firms

In contrast, the Big four firms have a higher price tag due to their global expertise and resources. PwC, for example, might charge RM10,000 or more annually for audit services for a private limited company (Sdn Bhd), in addition to a maintenance fee for ongoing support. While pricier, the investment may be worthwhile for more giant corporations seeking comprehensive, global-standard services.

Important Note

Under Malaysian law, audit fees for Sdn Bhd companies are mandatory, whereas sole proprietorships and enterprises are not necessarily required to conduct audits. Local firms are ideal for businesses with straightforward accounting needs, while the Big 4 firms cater to larger enterprises with complex structures.

2. Scope of Services

When deciding between local accounting firms and the Big 4, understanding the scope of services they provide is vital. Both offer unique strengths tailored to different types of businesses, from SMEs to multinational corporations.

Local Firms

Local accounting firms in Malaysia, such as Crowe Malaysia, excel in offering a wide range of services specifically for small and medium-sized enterprises (SMEs). Their expertise lies in understanding the nuances of Malaysian laws and market conditions.

Example of Services Provided by Local Firms

Crowe Malaysia works with local businesses to claim incentives like Pioneer Status tax relief, helping SMEs reduce their tax burden effectively. Their tailored services ensure smaller businesses are compliant without unnecessary costs.

Local firms are ideal for SMEs seeking personalised attention, affordable pricing, and guidance on Malaysian-specific issues.

Big 4 Firms

The Big 4—Deloitte, PwC, EY, and KPMG—provide an extensive suite of services designed for more giant corporations or businesses with complex needs. Their global reach and advanced tools make them indispensable for multinational corporations and businesses planning international expansion.

Example of Services Provided by Big 4 Firms

Deloitte Malaysia could assist multinational corporations with Labuan tax planning, enabling them to benefit from a 3% tax rate while ensuring compliance with international tax laws. Their Sustainability Assurance services have also helped large companies align with ESG regulations.

Big 4 firms are the go-to choice for larger enterprises needing advanced expertise, especially in international taxation, mergers, and strategic sustainability.

3. Long-Term Goals

Local Firms

Local accounting firms are adept at supporting SMEs in scaling operations within Malaysia. Services like tax planning and accounting help small businesses manage their finances efficiently, ensuring long-term stability.

Big 4 Firms

Big 4 firms cater to businesses with ambitious growth plans, such as regional or global expansion. They provide expertise in mergers and acquisitions, international tax incentives, and global compliance—a key advantage for multinational companies.

4. Industry Focus

Understanding an accounting firm’s industry focus is essential when selecting one. This ensures that you partner with a firm that aligns with your business’s specific needs, whether you’re an SME in the retail sector or a multinational corporation.

Local Firms: SME-Centric Expertise

Local accounting firms excel at catering to small and medium-sized enterprises (SMEs), particularly in sectors like retail, food and beverage (F&B), and manufacturing. Their understanding of practical business challenges in Malaysia allows them to deliver highly relevant services.

Key Focus Areas for Local Firms

• Tax Compliance: Ensuring accurate tax calculations for smaller-scale transactions.
• Incentive Guidance: Helping SMEs identify and claim local government incentives.
• Industry-Specific Insights: Tailored advice for SMEs in niche markets, such as retail and F&B.

Local firms are well-suited for businesses that require targeted expertise in Malaysian regulations and practical advice for scaling operations.

Big 4 Firms: Global Expertise for Large Corporations

Big 4 accounting firms are designed to meet the needs of more giant corporations operating across multiple sectors and countries. Their vast resources and specialised teams allow them to tackle complex industry challenges.

Key Focus Areas for Big 4 Firms

• Regional Tax Incentives: Navigating benefits like the Labuan 3% tax rate for companies operating in tax havens.
• Compliance in Regulated Industries: Ensuring adherence to global and regional regulations in oil and gas, technology, and finance industries.
• Strategic Consulting: Offering comprehensive industry reports and data-driven strategies for multinational corporations.

Big 4 firms are ideal for corporations requiring expertise in regulatory compliance, international tax planning, and global expansion strategies.

5. Client Testimonials and Recommendations

Client testimonials and recommendations play a crucial role in guiding businesses to the right fit. The feedback from current and past clients provides valuable insights into a firm’s strengths, which can influence a company’s decision-making process. Here’s how each firm builds credibility and trust with its clients.

Local Firms: Building Trust through Personal Relationships

Local accounting firms thrive on their close client relationships, which are central to their business model. These firms often serve small and medium-sized enterprises (SMEs), including those in retail, food and beverage (F&B), and manufacturing industries. Local firms are known for their accessibility and hands-on approach, which allows them to understand the unique challenges businesses face within Malaysia’s regulatory environment.

What Clients Appreciate

• Accessibility and Personalisation: Local firms communicate directly with their clients, providing highly tailored services. This personal approach ensures clients feel understood and valued, often resulting in long-lasting partnerships.
• Local Market Expertise: Clients recommend local firms for their deep understanding of Malaysia’s tax laws and local market conditions. This insight enables businesses to make informed financial decisions.

Big 4 Firms: A Reputation Built on Global Expertise and Proven Success

Big 4 accounting firms—Deloitte, PwC, EY, and KPMG—are global leaders in accounting services, known for their credibility, vast networks, and exceptional resources. Multinational corporations often recommend these firms due to their proven track record in handling high-stakes financial matters, tax compliance, and complex corporate structures. These firms tend to focus on large-scale projects that require extensive resources and specialised knowledge.

What Clients Appreciate

• Global Reach and Expertise: Multinational clients value Big 4 firms for their extensive international expertise and the ability to navigate complex cross-border transactions and regulations.
• Proven Success in Complex Matters: Big 4 firms are highly regarded for their ability to handle high-level compliance needs, large mergers and acquisitions, and global financial reporting.

PwC has been instrumental in advising large corporations in Malaysia, such as multinational companies expanding into the ASEAN region. These clients often praise PwC for its meticulous attention to detail, tax expertise, and ability to provide strategic advice on international operations. Their client testimonials reflect PwC’s reputation for handling intricate financial matters, tax planning, and legal compliance across multiple jurisdictions.

4 Differences of Local and Big 4 Accounting Firms in Malaysia 

When deciding between local firms and the Big 4, it is important to weigh the differences in cost, service quality, expertise, and industry knowledge. Each option has its strengths, and your choice should depend on your business size, budget, and the specific services required.

Criteria	Local Accounting Firms	Big 4 Accounting Firms
Cost Differences	– Affordable & flexible pricing for smaller businesses.  – Lower overhead clients	– Reflect global presence and resources.
Service Quality & Personalisation	– Provide personalised service. – Direct interaction with clients.	– Less personalised, clients may interact with multiple team members.
Expertise & Resources	– Local knowledge. – Fewer resources and tools.	– Extensive resources – Specialised knowledge across industries.
Industry Knowledge	– Strong understanding of local industries and regulations. – Ideal for SMEs.	– Broader knowledge. – Suitable for multinational corporations.

Conclusion

In summary, choosing between a local accounting firm and a Big 4 firm depends on cost, service quality, expertise, and industry focus. Local firms offer personalised services and in-depth knowledge of the local market, making them ideal for small and medium-sized enterprises (SMEs). With lower costs and close relationships, local firms are an excellent choice for businesses that require day-to-day financial management, tax planning, and bookkeeping services.

In contrast, the Big 4 accounting firms—Deloitte, PwC, EY, and KPMG—best suit giant corporations and multinational businesses with more complex financial needs. They offer extensive resources, global expertise, and specialised services, including international tax planning, mergers and acquisitions, and compliance with global regulations. Companies looking to expand internationally or needing high-level consulting will find these firms to be strategic partners.

Ultimately, the decision comes down to your business’s specific requirements and budget. Careful consideration of these factors will help you make the best choice. If you’re also looking for website development, SEO services, or digital marketing solutions, NewNormz is here to support your business goals with tailored, expert services.

Frequently Asked Questions

1. How Can Accounting Help Your Small Business Succeed?

Accounting is essential for small business success as it helps track financial performance, manage cash flow, and ensure tax compliance. By keeping accurate records of income, expenses, and assets, business owners can make informed decisions, identify areas for cost-saving, and plan for future growth. Additionally, proper accounting provides insights into profitability and helps prevent financial issues by highlighting potential problems early on.

2. Which Big 4 Firm Has The Most Employees?

According to recent data, Deloitte has the largest number of employees among the Big 4 firms. With over 400,000 professionals worldwide, Deloitte leads in terms of global workforce size, offering a broad range of services, including audit, consulting, risk advisory, and tax.

3. Why Are They Called The Big 4?

The term “Big 4” refers to the four largest international accounting and professional services firms: Deloitte, PwC (PricewaterhouseCoopers), EY (Ernst & Young), and KPMG. They are called the “Big 4” due to their dominance in the global market. They provide most audit, assurance, consulting, and tax services to the world’s largest companies. Their size, resources, and global presence distinguish them from smaller accounting firms.