For weeks, the rags in the U.K. have speculated about which midtier firm would win the battle to audit Goldman Sachs’ London-based European operations, a job PwC has held for what seems like a gazillion years. Would it be Grant Thornton? Would it be BDO, which became the fifth-largest firm in the U.K. earlier this year after its merger with Moore Stephens was finalized? Could it possibly be Mazars?
Well, the winner of the prestigious Goldman Sachs International engagement was announced earlier today, and Mazars did indeed get the gig. Not bad for the eighth-largest accounting firm by revenue in the U.K.
Reuters reported:
The move comes as British lawmakers and regulators are pushing to weaken the grip of PwC, EY, Deloitte and KPMG, the so-called Big Four accounting firms that dominate audits of top companies in Britain.
A Mazars spokesman confirmed that it would be conducting Goldman Sachs International’s European audit, which is focused on activities in Britain and Germany.
This is actually pretty big news across the pond today because Goldman Sachs will be the first large bank in the U.K. that will not have one of the Big 4 auditing its books. Mazars will take over as auditor in 2021.
European Union rules now require listed companies, as well as the European operations of a few major multinationals—which include Goldman Sachs—to appoint a new auditor every 20 years.
The Big 4 currently audits a whopping 98% of all FTSE 350 companies in the U.K., which is the reason why regulators want that shit to end. As far as we know, Deloitte and EY were in play for the Goldman Sachs International gig. So was KPMG, but you knew Goldman Sachs wanted KPMG nowhere near its books. And Grant Thornton gave up bidding for new audit work at the largest U.K. companies in March 2018.
[Update: I guess the other Big 4 firms were not in play for the engagement, as they provide consultancy services to Goldman Sachs, according to Economia.]
So, good for Mazars. And don’t worry, P. Dubsteppers: PwC, which has audited Goldman Sachs International since 1926, will continue to audit Goldman’s operations outside of Europe.
