Ernst & Young paused its plan to separate its auditing division and consulting division after partners voted against it.

According to reporting by The Wall Street Journal, the United Kingdom-based financial services company said it was “stopping work on the project” in a note sent to its 13,000 partners, after U.S. executives rejected the split during a vote. U.S. partners, who make up a large share of the company, reportedly rejected the proposal due to concerns of operational inefficiencies and limitations on EY’s operations.

“We thought we had something everyone would sign up to,” a person familiar with the plan told The Wall Street Journal. “This means going back to the drawing board.”

One of the “Big Four” accounting firms, EY announced its plans to split the two divisions in September 2022. The financial services company intended to grow the number of clients EY’s consulting arm did business with.

Some countries that EY wanted to do business in disallowed doing both consulting and auditing for the same client, hence limiting the number of contracts its consulting firm could sign.

News outlets, such as The Wall Street Journal and the Financial Times, reported that the negotiation process for the proposed split was lengthy and complex.

EY executives had consulted with partners around the world and engaged in extensive discussions with regulators and industry groups. The company would have had to raise millions of dollars to be given to its auditing partners to end business with the consulting arm. Despite these efforts, U.S. executives remained unconvinced.

By splitting the two arms, EY hoped that its actions would serve as a model to be followed by other firms in the accounting industry, which had been moving toward combining its consulting and auditing services despite scrutiny from the U.S. Securities and Exchange Commission. The regulatory agency questioned if doing both services for clients would inhibit the company’s ability to review their financials objectively, consequently giving way for fraudulent activity.

Several high-profile accounting scandals have occurred within the auditing industry. German financial services provider Wirecard AG was found to have participated in financial reporting fraud.

Additionally, the 2001 collapse of Arthur Andersen, which was a member of what was then known as the “Big Five” accounting firms, resulted from a scandal with energy company Enron Corp. EY’s separation plans had been compared to the split of Arthur Andersen’s consulting firm, which now does business as Accenture, and its now-defunct accounting firm.

By separating its auditing and consulting services into two legal entities, EY would be able to grow its consulting arm and reduce potential conflicts of interest. Still, some partners were concerned that the split would create unnecessary costs and limit EY’s flexibility. Accenture reportedly spent about $175 million when it rebranded from Andersen Consulting.

EY had spent over $100 million and more than a year trying to make the proposal go through, according to The Wall Street Journal.

EY CEO Carmine Di Sibio, who introduced the proposal in 2021 under the title “Project Everest,” was slated to retire in June but postponed it by two years in order to oversee the proposal being carried out.

Di Sibio was also nominated to spearhead the newly-separated consulting firm. Julie Boland, the chief of the company’s U.S. division, would have led the auditing firm, though her fellow executives did not join her in supporting the split.

According to The Wall Street Journal, in a note sent to partners, EY leaders said they will remain committed to continued discussions and engagement on the issue.