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Big Four Face Big Split as Watchdog Sets Separation Deadline

  • Financial Reporting Council wants audit arms split by mid-2024
  • Move aimed to end ‘persistent cross-subsidies’ of audit units
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The U.K.’s dominant accounting firms must separate their audit units from other operations by June 2024 as the country’s industry watchdog reacts to shortcomings that led to the collapse of several companies.

The Financial Reporting Council is asking the so-called Big Four -- KPMG, Deloitte, PricewaterhouseCoopers LLC and Ernst & Young -- to agree to operational separation to ensure audit practices don’t rely on “persistent cross-subsidy from the rest of the firm,” it said Monday.