UK accounting firms struggle to win large audits.

TLDR

Key Points:

• UK’s new Labour government aims to break the dominance of the Big Four accounting firms in controlling audits of large companies.
• Mid-sized accounting firms in the UK are struggling to take on audits of FTSE 350 companies.

In the UK, there is a push to reduce the control of the “Big Four” accounting firms (Deloitte, Ernst & Young, KPMG, PwC) in the audit market. This push from both the current Labour government and its predecessors is aimed at increasing competition and diversity in the sector. However, mid-sized accounting firms in the UK are facing challenges in snagging big audits, particularly for FTSE 350 companies.

The UK’s accounting watchdog has highlighted poor audit inspection reports for some mid-tier firms, indicating a lack of capacity and quality in handling audits of large and mid-sized companies listed on the London Stock Exchange. While Grant Thornton has shown improvement in its audit quality in recent years, it remains to be seen if other mid-sized firms can rise to the challenge.

Overall, the article points out the struggle faced by mid-sized accounting firms in the UK as they try to compete with the Big Four in securing major audit contracts. The issue of capacity and quality remains a key challenge for these firms as they navigate the competitive audit market in the UK.