PracticeAuditOFT retires to consider audit competition referral

OFT retires to consider audit competition referral

The OFT's audit competition consultation closed today and the watchdog will now deliberate on referral to the Competition Commission

THE OFFICE of Fair Trading today closed its consultation on competition in the audit market, and now has until the end of the year to decide whether the Competition Commission should take up the cause.

A spokesman said the watchdog has “a number of responses to be processed” but would not be drawn on how many had been received.

It has not been idle while waiting for stakeholders to have their say, recently publishing an econometric analysis of the audit market.

Following on from a study by consultancy Oxera, the OFT concluded there is a link between auditors with a greater market share charging higher fees, but concluded: “We cannot rule our that [this is] because they offer a higher quality product.”

While the body has until the end of the year to make its decision, a spokesman said it is aiming to make it “relatively quickly”.

If the audit market is referred to the Competition Commission it could result in stringent measures to whittle down the alleged dominance of the Big Four including, at their most extreme, forced divestment of assets.

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