How much credence can shareholders of public companies safely attach to financial statements that carry a true and fair imprimatur from their auditors? Big Four firms hold the lion’s share of public company audit appointments, yet they are regularly found to have issued ‘clean’ reports on accounts and financial position of client companies that later collapsed, causing severe damage to shareholders’ interests.

The main UK regulator is the Financial Reporting Council (FRC). In a recent announcement it ended with a series of notes stating that the FRC is ‘the UK’s independent regulator responsible for promoting transparency and integrity in business’.

The term ‘independent’ raises the question: independent of whom? The FRC website shows that the membership of its board, councils, committees and other divisions includes at least 20 accountants with past Big Four affiliations.

T