Price Waterhouse & Co. and Deloitte Haskins & Sells said yesterday their partners rejected a proposed merger that would have created the world's largest accounting firm.

The two firms said in a statement that they ended the merger negotiations "largely because mutually acceptable arrangements could not be established in certain important countries."

Spokesmen at Price Waterhouse and Deloitte declined to comment on rumors that partners of both firms' operations in Britain especially were opposed to the merger. But the statement said that "at a minimum," partners of the two firms in the United States, Britain, Canada and Australia would have had to reach a definitive agreement before the merger could proceed.

Analysts had predicted the two firms would have trouble getting a sufficient number of partners to approve a merger agreement. Price Waterhouse and Deloitte, like all major accounting firms, are privately held by partnerships among accountants who work at them.

If the merger had gone through, the newly created company would have been the largest accounting firm in the world in terms of annual revenue, industry observers said. It would have surpassed the current No. 1 accounting firm, Arthur Andersen & Co.

Public Accounting Report, a newsletter that reports on the accounting business, lists Price Waterhouse as fifth and Deloitte as seventh in its ranking of the nation's eighth-largest accounting firms, commonly referred to as the Big Eight.

There have been rumors that two other Big Eight firms, Arthur Young & Co. and Ernst & Whinney, were discussing a possible merger.