David York, ACCA Head of Auditing Practice explained: 'In our response to an OFT consultation, we supported its preliminary decision to make the referral as action is needed to increase competition.
'The issue of concentration in the market for statutory audit services to large companies has been debated over the last decade both in the UK and internationally. ACCA, as a global body, has provided evidence and views in relation to many of the initiatives in this regard. Our position paper Audit under fire: a review of the post-financial crisis inquiries, summarises our views on mechanisms to increase audit competition.'
Looking forward, David York continued: 'We do not believe that it is appropriate to intervene in the market by downsizing or restructuring the Big Four audit firms, nor by artificial intervention into the market, such as putting ‘caps’ on the number of audits that any one firm can carry out. Companies must have a right to appoint auditors of their choice and the long-term answer must lie in persuading directors and investors that their best interests are served by a healthy competitive audit market.'
Mr York concludes: 'It will be important to keep the current UK and EU initiatives in step. For example, in one area we advocated, addressing the need for action on banks’ restrictive covenants, which are directly anti-competitive, and to limit auditors' liability.'
For further information, please contact:
Lali Sindi, ACCA Newsroom
+44 (0)20 7059 5643
+44 (0)7921 698085
Notes to Editors
- ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.
- We support our 147,000 members and 424,000 students in 170 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. We work through a network of over 80 offices and centres and more than 8,500 Approved Employers worldwide, who provide high standards of employee learning and development. Through our public interest remit, we promote appropriate regulation of accounting and conduct relevant research to ensure accountancy continues to grow in reputation and influence.
- Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. We believe that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. Our values are aligned to the needs of employers in all sectors and we ensure that through our qualifications, we prepare accountants for business. We seek to open up the profession to people of all backgrounds and remove artificial barriers, innovating our qualifications and delivery to meet the diverse needs of trainee professionals and their employers.