Big 4 Partner Leaps to Audit Defenсe
John Connolly, Deloitte’s senior partner came to the defence of the auditing profession today, claiming auditing is “still the primary business” for firms involved in professional services.
Connolly went so far as to say that the recent criticism by regulators was flawed and that the audit system was far from imperfect.
The senior partner of Deloitte, one of the Big 4, in an interview to the magazine “Accountancy” said that he considered the debate over audit a good thing, as the one that had been started after the Financial Reporting Council paper report that made headlines in June this year.
Connolly said that he believed that audit at this point of time has very specific requirements because it is driven by statute. He said: ‘I think it’s wrong to suggest that auditors should have been ready to produce their own views on, say, alternative presentations on a company’s figures or provisions.”
He said that since auditors were meant to audit the information that is put in front of them by companies, changing auditing standards would change auditor’s approach of it.
When asked whether he felt that there was too little competition among audit firms, he said that a Big 5 or a Big 6 would certainly be better than a Big 4. He also said that suggesting that there was no competition would be wrong.
In recent times, Deloitte has diversified into other businesses as well, but audit remain a very important part of it. According to Connolly, each of the 4 divisions the firm has, namely audit, corporate finance, tax, and consulting, are each roughly of a similar size and each delivers about 20-30 % revenue for the firm. Audit constitutes about 30% of Deloitte’s business, Connolly said in the interview.