According to the Big Five firm, ICI, is one of the first major UK blue-chips to entrust its internal audit function to an external supplier and this appointment represents the largest such arrangement for a UK-based company.
ICI is audited by KPMG.
Ernst & Young believes that others will follow ICI’s lead: ‘We are noticing a significant increase in interest from large companies in using external suppliers to provide an internal audit function.
‘Around five per cent of FTSE 350 have taken this route, compared to only one or two a few years ago. We estimate that if this trend continues we will see around a third of these companies using internal audit suppliers by 2003,’ said Howard Martin, head of Business Risk Consulting, Ernst & Young.
Ernst & Young won the work in a tender against PricewaterhouseCoopers and Arthur Andersen.
Howard Martin, head of business risk consulting, Ernst & Young, said:’We are delighted to have been chosen by ICI to work together on this important internal audit arrangement. With a global team spanning North America, the Far East, UK and continental Europe, we can provide ICI with local resource whenever it is needed while ensuring an integrated approach to audit delivery and management.’
ICI is one of the world’s largest producers of specialty products and paints.
It has virtually completed its transformation – started in 1997 – from a high volume bulk chemicals company to a coherent group of high value, knowledge centred businesses with exciting opportunities for growth and margin improvement.
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