Regulator criticises big firms of accountants

Britain"s four biggest accountancy firms have been heavily criticised by the Competition Commission, states accountancy serives Harris & Co.

The regulator has accused PWC, Ernst & Young, Deloitte and KPMG of being too dominant and enjoying too cosy a relationship with company management.

The four accountancy firms act as auditors for 90% of the UK"s stock-market listed big companies.

They have also been criticised in the past for not doing enough to warn of the financial crisis.

The Competition Commission also found that companies do not tend to change their auditors - with almost a third of the FTSE 100 having used the same one for more than 20 years.

The concern is that the relationship between the two becomes too comfortable with a "tendency for auditors to focus on satisfying management rather than shareholders" needs".

Laura Carstensen, chair of the Audit Investigation Group, said: "We have found that there can be benefits to companies and their shareholders from switching auditors, but too often, senior management at large companies are inclined to stock with what they know."