Big Four welcomes OFT inquiry
Big-Four firms looking to co-operate during the OFT's investigatory discussions
THE BIG FOUR firms are in a very welcoming mood this afternoon.
Following the OFT’s announcement this morning that it has found competition problems in the market, the firms said they welcomed the decision and looked forward to co-operating in the next stage of the OFT’s investigation.
The next stage will involve the OFT holding roundtables and discussions over the next two months on whether or not practical remedies exist to resolve the problems.
An Ernst & Young spokeswoman said the firm was “happy to co-operate” with the inquiry, outlining its ideas on opening up the marketplace.
She said: “We support increased choice in the audit market to enable audit committees to have a wider range of audit firms to choose among in meeting their audit needs and obtaining a high quality audit.
“To this end, we support a number of measures to increase choice, including reinforcing the audit committee’s role in auditor appointments; publication of independent inspection results for all audit firms that are active in listed company audits; removing Big-Four only restrictive covenants from loan agreements; liberalising audit firm ownership rules; and the creation of a single market for audit services in Europe.”
A Deloitte spokeswoman said: “We welcome the opportunity to cooperate with the OFT and participate in relevant discussions.
“We welcome all measures that enhance the quality and value of audits and we are supportive of measures that can increase competition and ensure there is – and is seen to be – a level playing field for market participants.”
Richard Sexton, UK head of assurance at PricewaterhouseCoopers said: “We welcome the OFT’s announcement today, in particular to engage all stakeholders in a programme of round tables and bilateral talks. PwC plans to play a constructive and active part in these discussions.”
A KPMG spokesman said the firm “welcomed” the inquiry, but said it believes there was already effective competition and pricing in the UK audit market “and look forward to hearing from the OFT its reasons for believing otherwise”.
“It is important to bring to a head the long-running debate on competition and choice, and we support calls for progressive and practical change within the industry.
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“In carrying out its work, it is important that the OFT puts audit quality at the heart of the debate. We support a level playing field for all parties, and market-based – not regulatory – intervention.”