The guidance has been prepared following the high-profile Prince Jefri vs KPMG case last year, which highlighted the responsibilities of firms where the interests of two clients or of a client and a former client conflict, but the timeliness is also indicative of growing international concerns about Big Five firms.
The report stresses that firms should seek to obtain client consent wherever possible, but if it is not, a Chinese wall will be effective if it has certain characteristics.
These include the physical separation of the various departments in order to insulate them from each other, carefully defined procedures for dealing with instances where the wall may be crossed, and monitoring by compliance officers.
The guidance applies to all firms, but the increasing instances where Big Five firms are involved with several clients in the same industry, and offering a range of advice will make this particularly applicable to them.
At the same time, the SEC, Auditing Practices Board and the European Commission are all in the process of examing the quality of audits and touch on independence and conflict of interest.
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