Well this is fascinating research from across the pond. Do you mean to tell me the fact that four audit firms basically rule the roost is bad for audit quality? I'm shocked.
Here's the scoop from Economia:
According to the YouGov research which was carried out for the Financial Reporting Council, “Overall there is a fear that four firms with the capacity to audit large multi-national companies is too few and presents the risk of becoming three if one firm fails.
“No one expresses any concerns about the competence of any of the firms, which is seen to be very high. There is perceived to be a large gap between the Big Four and other audit firms in terms of global reach which significantly reduces choice for many multinational companies.”
That's not all. Investors aren't happy either.
The research also shows that the closer to the audit process stakeholders are, the more they are likely to trust the outcome and less likely to want to see large-scale reform. So, while those closest are aware of a public expectation gap about audit, they will see this is a failure in communication rather than anything intrinsically wrong with the process.
A second – and the largest – group of stakeholders, which covers investors among others, are generally content with the audit but have serious concerns about the quality of auditors, their independence and how they deliver services.
What is most hilarious — and predictable — is that those of us who report on these clowns are the least confident in auditors' abilities:
A third category of stakeholders (largely journalists, politicians and academics) had the lowest confidence in audit, partly because they thought it should be performing a much more significant public interest role by protecting the public from failing institutions.
It's worth noting that the research involved just 36 people, so it's possible a wider pool of Kool Aid-drinking unicorn jockeys would feel differently about this issue.