RSM McGladrey saw a 39-percent drop in pre-tax income on a 4.2 percent decline in revenue for the year ended April 30 as the economy pressure billable rates and hours. That came as its parent, H&R Block, saw net income fall by 1.3 percent while revenue was off by 5.1 percent for the same period because of a decline in the number of tax returns prepared for the total tax season. Meanwhile, the resolution of the attempts by McGladrey & Pullen to end its relationship with RSM McGladrey cost the organization $14.5 million.
RSM McGladrey reported pretax income of $58.7 million for the fiscal year just ended, down from $96.1 million the prior year. Revenue fell to $860.3 million. H&R Block had $479.2 million in revenue for the most recently ended year, a drop from $485.7 million a year ago. Fiscal 2010 revenue was $3.9 billion, a decline from the prior year's $4.1 billion.
Although RSM McGladrey and McGladrey & Pullen, now operating under the name McGladrey, preserved their relationship, the litigation and the arbitration processes involved had their impact. The unit also took a $15 million charge for impaired goodwill at its capital markets business unit.
