BDO Chief Says Big 4 Dominance Is “unhealthy”
A top BDO chief said today that the dominance the Big 4 companies have on the large audit market is unhealthy for the profession as a whole.
Dermot Mathias, who is one of the senior most figures of the BDO board, said that the dominance the Big 4 companies have in Europe’s growing audit field is not good for the industry.
The Big 4 companies namely are, Deloitte, Ernst & Young, Pricewaterhouse Coopers and KPMG.
Mathias is the policy board chairman at BDO, which is UK’s 6th biggest auditing firm. In an interview he said that there may be frequent conflicts of interest because the range of professional services offered by the accountancy giants was huge.
Mathias also said that the control that the Big 4 companies had on the audit market meant that potential clients could only choose from one or two accountancy firms if and when conflict arose.
In an interview to City AM, Mathias said: “Having four big players is unhealthy”.
Mathias was quick to admit that his questioning the Big 4 companies’ dominance was because of professional interest, since his firm was in competition with them, but he also said that there were “others in the [audit] market who say this also”.
Mathias said that regulators underwent a lot of debate regarding ways to control the dominance of the Big 4 but there was little being done about it. He backed the idea of putting a cap on the number of clients the Big 4 should be allowed to handle.
He was also enthusiastic about regulators selecting the auditors for big companies, as a measure to control Big 4 dominance.
Mathias also mentioned in the interview that BDO was now ready to take on bigger and more complex audits of big client companies.