Big Four Urged to Challenge Clients as Audit Quality Slides
- Deloitte fares best and KPMG worst in FRC’s evaluation
- Firms must do more to ‘back auditors making tough decisions’
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The dominant accounting firms must do a better job of challenging their clients in order to reach a satisfactory level of audit quality, the industry’s U.K. watchdog said.
The so-called Big Four -- KPMG, Deloitte, Ernst & Young and PricewaterhouseCoopers LLC -- were individually assessed in reports released by the Financial Reporting Council on Tuesday. Deloitte scored the highest of the four with 76% of the audits evaluated by the FRC deemed as ‘good’ or needing limited improvements. PwC and KPMG fared the worst at 65% and 61% respectively, which the regulator dismissed as “unsatisfactory.” Three smaller firms were also assessed.