TORONTO, April 26 /CNW/ - Yesterday's publication of the UK Financial
Reporting Council's (FRC) Market Participants' Group (MPG) report into choice
in the audit market confirms that the largest public interest entities in the
UK have, in recent years, been unlikely to select non-Big 4 firms as auditors.
As such, the loss of another Big 4 firm would be a major concern for investors
and a risk within international capital markets.
The report identifies a wide variety of reasons which have led to, but
more importantly, which preserve, auditor concentration in the UK. These range
from a limited understanding of audit quality to limited share owner
engagement on auditor selection.
The report recognises that the current status quo is not one upon which
to build the future and calls for more efficiency, enhanced competition and
Commenting upon the report, Ken Sharp, global leader - assurance services
for Grant Thornton International said: "We welcome the FRC's suggestions in
the UK which are aimed at creating a more efficient market. This is about both
choice and capability. There are organisations such as our own whose member
firms are already more than capable of auditing and do audit many public
interest entities around the world. Grant Thornton International member firms
are ready and able to meet the challenge."
Grant Thornton International member firms already have over 500 SEC
issuer clients as defined by the PCAOB and our UK member firm is the number
one auditor for listings on the AIM market. In addition, all of the
organisation's member firms are equipped to provide the same high quality
service to their clients wherever they are in the world through one single,
continually updated, audit methodology worldwide.
Ken continues, "The tide is turning and historic market prejudices are
eroding. Institutional investors are beginning to encourage large corporates
to cast their net wider and many are now realising that choice is not so
Of course we acknowledge that there are a small number of the world's
largest companies that, because of either scale or very specialist resource
needs (such as the largest banks and insurance companies), are best served by
a Big 4 firm. However, in my view, this is not the case for companies outside
this relatively small group.
The focus of our member firms is one of providing clients, wherever they
are in the world, with a strong, internationally accredited suite of services
across the areas of tax, specialist advisory services and assurance. Grant
Thornton International's appointment of global service line leaders, of which
I am one, should be seen as a strong signal of just how seriously we view this
commitment to serving an increasing number of international clients. Grant
Thornton International's plan is to double the size of our member firms'
aggregate market share in public interest audits over the next four years. We
believe we have already more than stepped up to the mark and will continue to
invest our combined efforts to deliver the required level of quality and
choice to clients wherever they are in the world."
Notes to editors
About the FRC
The Financial Reporting Council is the UK's independent regulator for
corporate reporting and governance. Their aim is to promote confidence in
corporate reporting governance and to promote high quality reporting; high
quality auditing; high quality actuarial practice; high standards of corporate
governance; the integrity, competence and transparency of the accountancy and
actuarial professions and their effectiveness as a unified independent
About Grant Thornton International
Grant Thornton International is an international membership organisation,
with each member firm independently owned and operated. Services are delivered
nationally by the member and correspondent firms of Grant Thornton
International, a network of independent firms throughout the world. Grant
Thornton International is a non-practicing international umbrella organisation
and does not deliver services in its own name or otherwise. Each member and
correspondent firm in Grant Thornton International is a separate national
firm. These firms are not members of one international partnership or
otherwise legal partners with each other (with the exception of certain
limited instances), nor is any one firm responsible for the services or
activities of any other. Each firm governs itself and handles its
administrative matters on a local basis. Although many of the firms now carry
the Grant Thornton name, either exclusively or in their national practice
names, there is no common ownership among the firms or by Grant Thornton
International (with the exception of certain limited instances).
Grant Thornton International member firms operate in 113 countries in 521
Member firms across the Grant Thornton International organisation are
making investments to strengthen their domestic and global capabilities.
Recent expansions by the member firms in India, China, Japan, Russia and parts
of South America and a new member firm in Spain are but a few examples.
For further information:
For further information: Kate Speirs, Head of Communications, Grant
Thornton International, T: 44 (0)207 3919520, E: email@example.com,
www.gti.org; Canadian media contact: Donna Carmichael, (416) 360-5001