Mon, 19th Oct 2015
Three major FTSE 100 listed companies have been forced to look for new auditors. The companies - Rolls-Roye, BAE Systems aand Centrica are moving away from their ‘big four’ auditors.
The companies are some of the biggest names in corporate Britain, and they’re on the hunt for new auditors after a shake-up of the market, caused by the new European Union Rules. They are being forced to look for new auditors after having collectively spent 77 years working with their existing auditors. They need to find new members of the ‘Big Four’ audit firms in order t o comply with the regulations introduced during the financial crisis.
Not one of the three has tendered their audits during the time that they have been with their incumbents. BAE has had the same auditor since 1981, and does not plan to start retendering until 2017, for the 2018 accounts. There is apparently a pitching process already underway, however it is unclear whether PwC is repitching for the work.
Rolls-Royce has been with their auditor since 1990, and Centrica has been with theirs since 1997, when the company split off from BG Group. Under the new rules, audits must be tendered once every 10 years, and an incumbent auditor can be reappointed only once. These rules were introduced to address concerns that some auditing companies may be getting too close to their customers, and that auditors should have been able to point out the liquidity issues that led to the banking collapses.