CHOICE IN THE UK AUDIT MARKET

That this House welcomes the publication of the Financial Reporting Council's recent discussion paper Choice in the UK Audit Market; recognises the valuable role that auditors play in ensuring confidence in corporate reporting and governance, helping to protect and enhance the UK's economic strength in competitive international markets; notes that the big four audit firms, Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers supply audit services to most large companies, including 99 per cent. of the FTSE 100 and 97 per cent. of the FTSE 250; believes that the monopoly of only four companies in this market is anti-competitive, unhealthy and promotes complacency within the industry, all of which could affect audit quality and increase the risk of corporate wrongdoing going unchecked; urges the Government to consider structural reform to set the highest possible standards of accountability and transparency; and calls upon the Government to initiate an urgent debate about how to break up this monopoly and to ensure that the public interest is better served by a fairer, more competitive and more open audit market.