The CMA statutory audit market investigation
First published by Author on November 16, 2018 in the following categories: Investigations Latest and tagged with cma | incentives | investigations
The CMA’s (Competition and Markets Authority) statutory audit market investigation was launched last month.
A number of key issues are being looked into by the CMA to make sure that the market is working fairly and efficiently. Comments on the key issues are being invited, and a statutory deadline has been applied to the investigation.
It’s early days, with the investigation only being launched last month. It’s another important one for us to keep an eye on as lawyers who fight for competition to be fair and consumer-focused!
Key issues in the statutory audit market investigation
The keys issues being looked at by the CMA in the statutory audit market investigation are:
- Choice in the market;
- Switching in the market;
- The long-term resilience of the sector;
- Incentives between audited companies, audit firms and the investors.
No conclusions have been drawn yet, and we cannot assume that the CMA will find anything untoward. What’s important is that they have the freedom to fully review the sector and conclude whether there are any problems or not.
Who has responded for invitations to comment in the statutory audit market investigation?
A number of firms have responded to invitations for comment since the CMA launched their market investigation.
According to the CMA, those who have responded to the invitation so far are:
- BDO;
- Crowe;
- Deloitte;
- EY;
- Grant Thornton;
- KPMG;
- Mazars;
- Moore Stephens;
- Nexia Smith & Williamson;
- PwC;
- RSM UK;
- RSM independent non-executives;
- Hermes;
- ICAEW;
- ICAS;
- Schroders;
- Standard Life;
- The Investment Association;
- USS.
Source: Competition and Markets Authority.
That’s a number of big-name firms!
What’s next for the statutory audit market investigation?
When the initial market investigation period has concluded, the CMA will have a choice to make. They should either be satisfied that all is well, or they may refer the investigation for more in-depth analysis.
The decision as to what may happen next is said to be due for April 2019. We will keep an eye on the statutory audit investigation as time goes on