The US Securities and Exchange Commission’s recent audit independence clampdown has led to moves by Big Five firms, notably PricewaterhouseCoopers and Ernst & Young, to separate their audit and consulting businesses.
But Arthur Andersen claims its planned internal shake-up together with existing rigid internal controls will be sufficient to allay the watchdog’s concerns, the Financial Times reported today.
The US Securities and Exchange Commission, determined to eradicate what its sees as accountancy firms’ conflict of interests, aims to create a clear divide between consultancy and auditing practices.
Part of Andersen’s plan to internally overhaul its system will include spreading profits within the firm so as to retain and attract staff. The plan may also include altering some partnership structures to become companies, thus creating a degree of autonomy.
Andersens, commonly seen as a rather private firm, is also planning to allow more access to information concerning its finances; a move aimed at relieving fears that firms lack monies to invest in new technologies.
The firm has been building up its consulting business over the last few years in response to its impending split from Andersen Consulting.
But the firm, like its competitors, admits to nursing growing worries about the increased competition from internet companies.
Spokespeople at the firm were unavailable for comment.
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