In response to the Oxera consultation, the ABI demands that the biggest firms
should shed clients if they amass excessive market share.
All eyes on PwC then, because the firm audits just under 50% of the FTSE 100.
The response to this from the Big Four and others, is if the market chooses
the Big Four, they choose the Big Four.
This dedication to free market principles appears to preclude a radical
solution like the one the ABI proposes.
But even the London Stock Exchange is regulated. All investors must have a
level playing field on which to play out their strategies. No one investor
should have less access to information than any other and the rules must be
obeyed. Insider dealing remains a serious offence.
So it’s pretty safe to assume that markets do require some form of
constraint. An unfettered market cannot provide all solutions.
The question will be whether the FRC decides the problem requires a direct
solution, like the ABI’s, or whether it should come at the issue from a more
oblique angle, settling the liability issues or starting a campaign of
This seems the most likely tack since an interventionist approach won’t
attract much support even from the firms who might benefit from it most.
In a recent Insider Business Club webcast, Steven Edmunds a Grant Thornton
board member, said a solution had to be ‘market-led’, rather than ‘an artificial
Expect something measured then. There seems to be little appetite for radical
change. Voices like his could prove more persuasive than the clamour of
objection from the Big Four.
Gavin Hinks is Editor of Accountancy Age
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