Please ensure Javascript is enabled for purposes of website accessibility

UK Financial Reporting Watchdog: ‘We don’t need no Big 5’

Solutions.jpgEditor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
Once upon a time, there were 8. And then 7. And then 6. And then 5. And now 4. I’ve thrown out the idea of a large audit failure sending one of the Big 4 tumbling but the idea has been met with resistance; and naturally so, they’ve survived this long, right?


Accountancy Age:

Stephen Haddrill, the new Financial Reporting Council chief executive, in his first interview since taking the post, said there was little chance a global challenge to the Big Four – PricewaterhouseCoopers, Ernst & Young, Deloitte and KPMG – would emerge in the near future.
“I don’t think it is achievable in the near term and the priority for us has to be that we are prepared for the worst and that is where I will put my focus,” he said.

To read the rest of Haddrill’s interview with Accountacy Age, one might be inclined to point out that the guy is only a little bit pessimistic and for good reason. The Big 4 cannot exist indefinitely as they have, deflecting fines each time they bumble a big audit. It isn’t a problem exclusive to the UK and in fact, the Big 4 might not realize it but they are fighting the battle to save American capitalism. To that end, sacrifices may be required in the name of “competition”, whether or not the Big 4 are ready to embrace the idea.
They call them the Final Four because it is widely believed that the large accounting firms cannot lose another player but what’s to stop regulators — either Internationally or here at home — from busting down the joint and shutting one down? Anyone forgotten Satyam?
The firms — clever Trevors that they are — already know regulators are on their asses and behave accordingly. Crossing their Ts and dotting their Is, it was incredibly easy for PwC to say “Satyam wasn’t our problem” here in the states just as they’d have done if it had gone down in the UK, Dubai, China… it doesn’t matter, that’s what the lawyers get paid for.
Anyone get the feeling we’ve got a problem on our hands or is that just me? “Preparing for the worst” eh? Sounds like a plan.

Solutions.jpgEditor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
Once upon a time, there were 8. And then 7. And then 6. And then 5. And now 4. I’ve thrown out the idea of a large audit failure sending one of the Big 4 tumbling but the idea has been met with resistance; and naturally so, they’ve survived this long, right?


Accountancy Age:

Stephen Haddrill, the new Financial Reporting Council chief executive, in his first interview since taking the post, said there was little chance a global challenge to the Big Four – PricewaterhouseCoopers, Ernst & Young, Deloitte and KPMG – would emerge in the near future.
“I don’t think it is achievable in the near term and the priority for us has to be that we are prepared for the worst and that is where I will put my focus,” he said.

To read the rest of Haddrill’s interview with Accountacy Age, one might be inclined to point out that the guy is only a little bit pessimistic and for good reason. The Big 4 cannot exist indefinitely as they have, deflecting fines each time they bumble a big audit. It isn’t a problem exclusive to the UK and in fact, the Big 4 might not realize it but they are fighting the battle to save American capitalism. To that end, sacrifices may be required in the name of “competition”, whether or not the Big 4 are ready to embrace the idea.
They call them the Final Four because it is widely believed that the large accounting firms cannot lose another player but what’s to stop regulators — either Internationally or here at home — from busting down the joint and shutting one down? Anyone forgotten Satyam?
The firms — clever Trevors that they are — already know regulators are on their asses and behave accordingly. Crossing their Ts and dotting their Is, it was incredibly easy for PwC to say “Satyam wasn’t our problem” here in the states just as they’d have done if it had gone down in the UK, Dubai, China… it doesn’t matter, that’s what the lawyers get paid for.
Anyone get the feeling we’ve got a problem on our hands or is that just me? “Preparing for the worst” eh? Sounds like a plan.

Latest Accounting Jobs--Apply Now:

Have something to add to this story? Give us a shout by email, Twitter, or text/call the tipline at 202-505-8885. As always, all tips are anonymous.

Related articles

Carmine Will Not Let That Split Thing Go

Only days ago, WSJ ran the headline “EY Breakup Plan Is Really Dead” and included a quote from EY Americas Vice Chair of Tax Kevin Flynn, lifted from a recording of a staff call: “My message to everyone about Everest is, it’s behind us. Let’s not spend time in the rearview mirror.” And days before […]

EY’s Gonna Borrow Money and Do Some Accounting Tricks to Spare Partner Payouts From Everest Fallout

The following tidbit of information about the aftermath of the Project Everest failure is going in Footnotes later today however we felt it important to call it out for those who skip the weekly linkwrap. Apologies for doubling down on EY news today. WSJ published an exclusive about the post-Everest mess at the crack of […]