In an exclusive interview the new head of the Financial Reporting Council,
Stephen Haddrill, tells Accountancy Age this week that his priority is not to
create the market conditions for a new competitor to the Big Four. His strategic
aim will be to plan for the possibility that one of the Big Four will crash and
burn as a result of scandal.
There is some merit to this. To create the environment in which a fifth firm
might emerge will take a lot of time – so planning for disaster, rather than
heading it off, seems logical.
And yet abandoning the idea of a new competitor will seem to many like
abdication in the face of the Big Four lobby. It is right that there are few
markets where more than four global players exist, but few of those have such a
vital statutory role, such as audit, which requires special protection. Giving
up on number five could be giving up on a crucial and necessary edition to
support the world’s capital markets.
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