Brussels, 16/07/2009 (Agence Europe) - A total of 67 (90%) of responses to the consultation exercise believe that “the Commission should strive to reduce all potential barriers to the entry, growth and survival of audit firms in the international audit market”. That is one of the main lessons drawn by the Commission in its analysis of responses to the consultation on measures that would bring about increased competition on the audit market for international companies (see EUROPE 9786). Respondents identified “a need for more harmonisation at EU level concerning independence rules, qualification requirements, liability limitations and auditing standards for auditors”. Being able to provide cross-border audit services with having to be registered in several member states would also be a step forward.
Directive 2006/43/EC requires the majority shareholding in audit firms be held by the auditors themselves. Most stakeholders consider that the lack of access to external financial capital is not the most significant barrier to the emergence of new players. They believe that “changing the current rules on control of audit firms would not be sufficient on its own”. Some take the view, however, that allowing external investors in audit firms might help smaller firms to grow, even though they remain convinced that some restrictions on control of audit firms, for example, restricting the maximum voting rights per investor, should be maintained. Other ideas advanced include allowing other professionals who work full-time in audit firms, such as tax advisers, to have a shareholding.
In 2007, the market share of the four largest audit firms (the famous “Big 4) - Deloitte, Ernst & Young, KPMG and PriceWaterhouseCoopers) in terms of revenue from services such as auditing, insurance, and tax advice was 80%. The financial crisis could very well see the gap widen between these four world players and the other audit firms. (M.B./transl.rt)