Allen & Overy (A&O) saw profits available for distribution fall by almost £100m last year, according to the firm's recently filed limited liability partnership (LLP) accounts.

The accounts reveal that profit available for division among partners fell 18% from £491.5m in 2016-17 to £401.8m last year, despite the firm posting an 8.6% increase in profit per equity partner (PEP) last summer.

By way of explanation, A&O said that its 'normalised' operating profit before tax figure of £690m, announced last July, more accurately reflected the amount its distributed to partners, adding that for "technical and local regulatory reasons", some partner remuneration had been charged as an expense rather than a profit share.

The LLP accounts also reveal A&O incurred an "exceptional property cost" of £21m after a sub-tenant vacated its lease at the firm's Bishops Square headquarters.

While a new sub-tenant was found – technology company Improbable, which took up 58,000 sq ft of office space at 10 Bishops Square – the terms of the deal resulted in a £21.1m loss for A&O for the remaining period of the lease. The firm said this loss had been "normalised out of headline profits and the distribution to partners".

The accounts also reveal that a total of £14.8m was paid to the firm's management team during the financial year. The amount shared between the group – which includes senior partner Wim Dejonghe and managing partner Andrew Ballheimer, as well as the heads of the main global practice groups – is 6% lower than the previous year's figure of £15.8m, but the firm declined to disclose whether the number of people in the group had changed compared to last year.

While the firm's 2016-17 accounts revealed that its highest-paid member had received £3.5m for that year, A&O said that it had decided to no longer disclose this figure.

Staff costs continued to rise, increasing 7% from £523.2m to £561.1m, while the average number of partners increased by 10 from 528 to 538, with fee-earner headcount up 2% to 2,434, and support staff numbers up 2% to 2,249.

The firm said its banking, corporate and international capital markets practices had performed strongly during the year, which it said in turn helped support strong growth within its alternative delivery service model.

A&O posted a 3.5% revenue rise for 2017-18 to reach a new record high of £1.57bn. The firm is in ongoing merger discussions with US firm O'Melveny & Myers, as revealed by Legal Week in April last year.

Lateral hires during the year included Paul Hastings City banking partner Ben Regnard-Weinrabe and Kingsley Napley white-collar specialist Eve Giles, while the firm also expanded its South African offering with a four-partner Johannesburg team from Baker McKenzie.