The Leader Column

Who can tell the best way to deal with a downturn? Is it best to proceed with caution? Or should you be hell-bent on using it as a time to get one over on the magic circle, seeing it as an opportunity to nab partners normally out of your league? Only time will tell.

Norton Rose is a definite believer in the latter category. In the last 18 months, it has been playing serious catch-up with its rivals, particularly in Germany, where it merged with the Cologne office of Gaedertz and opened a second office in Frankfurt.

The merger may have given Norton Rose instant credibility in Germany, but there is no way it will have brought in profits. German offices bring many benefits to a UK firm, but an increase in profitability is not one of them.

Learning that the firm is strapped for cash comes as no surprise, but is a sure sign that it’s in it for the long haul. It may have hit murky waters, but the fact that it has amassed very little debt means that it is in a better position than most. What matters now is speedy integration and increasing the amount of its cross-referral work.

DLA is another firm refusing to have its ambition curbed by a blip in the economic cycle. Not only does its relentless drive in Europe continue, but there is little time for rest in the UK either. The announcement this week that Jeremy Dickerson is joining from Hammonds is almost par for the course. In light of the investment, the announced 16 per cent rise in profits is somewhat jaw-dropping.

Yet the admittance by Finers Stephens Innocent that this year’s decline in profits is partly a result of accounting irregularities last year proves that it is hard to draw too much from figures for any one year.

Anthony Barling claiming that last year Finers altered the treatment of assets on the balance sheet to give an “optimistic” report on profits makes a mockery of the whole process.

We all know it happens, but to have it out in the open is a different ball game entirely. If firms are now going to admit their dishonesty a year later in a feeble attempt to make the current year look better, perhaps it is best to postpone judgement for 12 months.

Norton Rose? DLA? The jury’s out until next year.