• Register
Return to: Home > News > ICAEW asks for patience in audit reform

ICAEW asks for patience in audit reform

Michael Izza, chief executive of the Institute of Chartered Accountants in England and Wales, has warned the public to be ‘realistic’ about the timescales of any audit reform in the UK.

In a letter to the Financial Times, Izza said he agreed that a shake-up of the audit market for large listed companies is urgently required.

He also confirmed the idea a potential market cap could be a ‘viable way to bring about real, sustainable and beneficial change’.

But Izza also warned about the need to consider the interests and behaviours of audit committees and executives, to avoid them objecting to not being allowed to choose a Big Four firm.

He said even if the Big Four agree to give access to their technology and clients get on board with the cap, this would not resolve the issue of scale. He added: “For these firms, getting to a position where they can take on large multinational audits will take time: this is not an issue of quality — there is plenty of that — but of capacity.”

Getting up to scale will take time, and Izza warned: “Impatience, and the imposition of simplistic or hasty measures, risk not only adverse unintended consequences but could significantly damage global perceptions of the UK as a place to do business.”

Last week the ICAEW met with the Competition & Markets Authority to discuss potential ways of reforming the market. This meeting came on the back of meetings between the ICAEW and the largest firms in the UK, including the Big Four, where measures such as the potential client cap were discussed.

Commenting on the mood of the industry, Izza concluded with a remark that there is a broad consensus across the accountancy profession that change is necessary, as well as what might be practicable and effective.

He finished: “It will not serve the public interest if, in the interests of securing a sprint finish, we fall at the final hurdle.”

Top Content

    Time pressure: Facing up to mental health

    In an ‘always on’ culture, it is becoming increasingly difficult to manage a healthy work-life balance. While companies are beginning to address this problem by introducing different support systems, Joe Pickard finds more could be done to ensure the wellbeing of the professions workforce.

    read more

    Venezuela: the race for the dollar

    With a new currency following hyperinflation, large sections of the population emigrating to neighbouring countries, an economy on the brink of collapse and no apparent solution coming from the government, Jonathan Minter finds a profession struggling to stay afloat in Venezuela.

    read more

    Brazil: transparency and control

    Brazilian accountants have an optimistic view of the impact of more-regular reporting and the implications of audit controversies for the profession. Paul Golden reports.

    read more

    Argentina: looking for a clearer view

    The Argentine accounting profession continues to grapple with the impacts of a weak economy and a culture of financial corruption. Paul Golden takes a closer look.

    read more

    Blockchain: adapting to disruptive tech

    In the relatively few years since digital currencies first began using blockchain technology, the array of potential applications has grown significantly – and continues to expand. Dan Balla, Matthew Schell and Dave Uhryniak from Crowe look at how it impacts accountancy.

    read more
Privacy Policy

We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.