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The UK ministers are investigating further legislation on reducing feedback aimed at reforming the audit market as they seek to facilitate the regulation of the company in encouraging economic growth.
Ministers monitors who are monitored by audit reform and the proposal of the Corporate Management Act discussed the rejection of a measure that would force the BIG Four accounting company to share audits with the largest companies with smaller companies, according to four people, I am introduced to this issue.
This move could claim the legislation, which the Labor promised to bring if he won the 2024 General Election, while the two other main reforms were also in danger of watering or landfill.
The previous conservative government proposed a mandate of joint audits so that FTSE registered in the UK, using the Big Fours auditor, would have to give outsourcing “meaningful” part-and 10-30 percent of the audit companies in the new “juvenile” role.
The proposal aimed at reducing the reliance on the large four – Deloitte, Ey, KPMG and PWC – and to alleviate concern about the risk of systemic failure if one company collapses. About 88 percent of the FTSE 350 companies used one of four in 2023.
It is planned as part of a wider legislative encouragement to reinforce the audit framework and corporate management in the UK after multiple failures in corporation and audit, including Outsourcer Carillion and BHS sellers.
But most accounting companies have not welcomed the odds of joint audits, and a company that would affect the measure of fear that they will result in larger fees, according to three people, familiar with the discussions of ministers.
One government figure confirmed that Business Secretary Jonathan Reynolds views the rejection of a joint audit obligation in the law proposal – a move that would “reduce business costs” at a time when the Government’s priority is economic growth.
The person emphasized that the final decision had not been made and that Reynolds still spoke with the Financial Reporting Council, an accounting regulator, about the matter.
Big four companies are reluctant to share their work, while some accounting challenger’s accounting companies are also opposed to changes. They are concerned that the designation of “smaller” audit partners could limit their ability to independently provide the FTSE 350 audits while expanding.
Concerns that joint audits could duplicate work and increase the fees, they also lagged behind the proposal, two people said.
Parts of the audit could leave a proposal of the law after two of his other large reforms were under the restored supervision.
Proposals for the uninfequion of the largest private companies to be subjected to firmer regulations are already exposed to risk be set upAnother proposal to set up a non-accountant director of companies responsible for failure could be watered.
Reynolds told the Financial Times 2023 that if the Labor conquer power, he would go through long -term reforms to the audit market.
Last year the government used its own The first royal speech Promote the draft of the Audit Audit and Corporate Management Act, which included replacement of the current regulator with a more powerful audit, reporting and management body.
But one person familiar with the discussions of ministers with the industry said that the bill proved to be difficult to draft and could be delayed after spring.
Baroness Margaret Ford, President of the Public Interest Center, Lobbying Group, said she would be “disappointed” if ministers watered proposals “intended for launching resistance and reliable reporting on the market.”
“If the Government is seriously involved in the responsibility and quality of the audit, it must ensure that this account brings strong changes in the long -promised profession,” she said.
The business and trade department said: “The Government wants to ensure that there is a resistant and competitive audit market in the UK. Considering how to achieve this goal.”
