Leaders of the four largest global accounting firms - Ian Powell, chairman of PwC UK, John Connolly, Senior Partner and Chief Executive of
Deloitte's UK firm and Global MD of its international firm, John Griffith-Jones, Chairman of KPMG's Europe, Middle East
and Africa region and Chairman of KPMG UK, and Scott Halliday, UK & Ireland Managing Partner for Ernst
& Young - appeared before the UK's House of Lords Economic Affairs
Committee yesterday to discuss competition and their role in the financial
The discussion moved past the topic of competition when
the same old recommendations were raised and the same old excuses
for the status quo were given.
Reuters, November 23, 2010: The House of Lords
committee was taking evidence on concentration in the auditing market and the
role of auditors.
Nearly all the world's blue
chip companies are audited by the Big Four, creating concerns among policymakers of growing systemic risks,
particularly if one of them fails.
"I don't see that is on the
horizon at all," Connolly said.
The European Union's
executive European Commission has also opened a public consultation into ways
to boost competition in the sector, such as by having smaller firms working
jointly with one of the Big Four so there is a "substitute on the bench."
"Having a single auditor
results in the best communication with the board and with management and
results in the highest quality audit," said Scott Halliday, an E&Y managing
The Lord's Committee was more interested in questioning
the auditors about the issue of "going concern" opinions and, in particular, why there were
none for the banks that failed, were bailed out, or were nationalized.
The answer the Lord's received was, in one word,
Read this article in its
entirety at the re: The
Auditors, a blog by Francine McKenna.