Audit report suggests Big Four probe likely. By Dan Martin

Kashflow logo
Share this content

An investigation into the Big Four's dominance of the UK blue chip audit market looks likely after the long-awaited publication of the findings of a governmnent-sponsored analysis of competition in the sector.

The report by the Financial Reporting Council (FRC) examined the role of Ernst & Young, Deloitte, KPMG and PricewaterhouseCoopers in auditing the UK's biggest companies.

It concluded that the Big Four's strangehold over the services was unhealthy for competition and prevents smaller firms from winning blue chip clients.

The study revealed that 97% of the FTSE 300 companies are currently audited by one of the Big Four.

Barriers to entry in the market for the four accountancy firms' smaller competitors are "high", it said, and under current conditions entry by a mid-tier business is "unlik...

Please Login or Register to read the full article

The full article is available to registered members only. To read the rest of this article you’ll need to login or register. Registration is FREE and allows you to view all content, ask questions, comment and much more.

About AccountingWEB


Please login or register to join the discussion.

20th Apr 2006 09:22

What a waste of time and money !
Government interference will achieve nothing and waste money. The problem here is that big corporates have to "fit the mold". There is a perception - wrong in my opinion - that a company without a big name auditor is inferior or more risky in some way - clearly this is nonesense, but nonetheless a fact of life that we have to live with. Let normal competition take it's natural course - Big Four charge rates are often preceived to be poor value for money for those on the receivign end.

Thanks (0)
23rd Apr 2006 19:25

Sour grapes or fear
Surely the reason the Big 4 are hitting back is fear of the loss of audit income and fear that if a medium company carries out an audit - it may actually be an audit and what skeletons would be found in the cupboard.

Thanks (0)