Institutional investors call for audit fee increase
Fund managers say audit fees need to increase in order to improve audit quality and competitiveness
Hermes and Morley Fund Management claims that the cost of audit does not
reflect the risks, and called for an increase in fees despite a 22% hike in
FTSE100 audit fees this year.
The Daily Telegraph reports that the fund manager is keen to raise
fees in order to attract mid-tier firms such as Grant Thornton and BDO into the
marketplace for big audits.
‘The infrastructure now needed to conduct a large audit is substantial,’ Glyn
Barker, PwC’s UK head of assurance, was quoted as saying. ‘Audits would need to
become significantly more profitable before mid-tier firms were encouraged to
make the investment necessary for them to take FTSE250 market share from the Big
Four.’