FOA0012.pdf

The Association of Practising Accountants submits that the current audit market concentration, particularly among the FTSE 350, needs addressing. They propose reforms such as shared audits, joint appointment liability reform, and proportionate audit oversight to encourage new market entrants and increase competition. The APA believes that increased competition can drive audit quality and innovation, but notes that mid-tier firms face barriers to entry and expansion in the FTSE 350 market. They suggest creating a market with at least twelve firms capable of auditing international Public Interest Entities (PIEs) and a pipeline of potential entrants to mitigate future concentration. The APA argues that reform is necessary to make it attractive for mid-tier firms to invest in scaling up and that a ten-year project is required to achieve this, involving regulatory and liability reform to tackle increased risks and compliance costs.