Liberal Democrat leader, Vince Cable, has called for a fresh investigation into the audit services market to smash the domination of the so-called ‘big four’.
In a letter to the Competition Markets Authority, Cable raises concern that there continued to be a lack of competition to the ‘big four’ auditing firms.
In the wake of the collapse of Carillion, where criticism has been made that the external auditor did not highlight potential problems at the company, there is a need to look again how the market is operating and review the ‘remedies’ introduced in 2014 which Cable describes as being a ‘disappointment’ to him.
In the letter Vince Cable writes:
“For far too long regulators have stood back and allowed the Big Four to dominate. This is not healthy for the industry itself or for their clients. There needs to be far greater competition, even if this has to be facilitated by breaking up the Big Four themselves, perhaps by spinning off their consulting arms.”
“I am writing to ask you to conduct a fresh investigation into the audit market with a specific mandate to look into the merits or otherwise of this remedy. We cannot continue to see such a soft approach taken to such a vital market”