Recent audit failures are bringing new scrutiny to the dominance and business practices of the Big Four accounting firms.
Strong words, and more, are being hurled at the global accounting establishment these days. A recent UK House of Commons report on the collapse of sprawling construction contractor Carillion derided auditing’s Big Four—Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers—as a “cozy club incapable of providing the degree of independent challenge needed.” Carillion went into liquidation owing creditors £1.5 billion ($1.9 billion), despite its accounts having been cleared by Deloitte as internal auditor and KPMG as external auditor.
In the US, a surprise $15 billion charge related to General Electric’s…
