MUNCIE, Ind. -- A merger of two accounting powerhouses should dramatically affect the industry, says a Ball State University accounting professor.

When Ernst & Young and KPMG Peat Marwick announced plans to form the largest accounting and consulting company, it was part of a continuing trend toward amalgamation, says W.T. Wrege, an accounting professor.

The latest merger comes on the heels of the joining of Coopers & Lybrand with Price Waterhouse, which created a firm with global sales revenues of $13.8 billion.

"Over the last few years we've gone from eight major firms to six to four," Wrege said. "It is a shift toward monopolization. It is happening a lot in finance-related industries such as banking, insurance and accounting."

Wrege said the merger trend is occurring because of the advancement of technology and increased competition. Advancing technology and the ability to take advantage of economics of scale have sparked mergers in banking and insurance.

Globalization of the economy and the lack of foreign partners in the major economies have forced combinations of accounting firms, he said.

"There are only three major accounting firms in Japan with whom American firms can align themselves," Wrege said. "These alignments are typical in accounting. The fourth American firm trying to be a global one is at a competitive disadvantage by not having a major Japanese partner."

Accounting firms also have been expanding by offering management-consulting services to clients. These services were once the domain of law firms, investment banks, commercial banks and management consultants.

"The monopolization at the top and the expansion of business in general is very good for people beginning careers in accounting," Wrege said. "We already are seeing beginning salaries being forced up."

Accounting is far removed from the everyday awareness of the common person. These events will have little effect on them, he said.

"To the average individual, this isn't really big news," Wrege said. "However, if you are an accountant, it is extremely exciting news because of the wage and employment opportunities that are growing."