Australia tightens oversight of Big Four after KPMG scandal | Ukraine news - EUROPE SAYS
ASIC will face new powers to scrutinise top audit firms, hinting at fines and structural change. The government kept details vague. The Australian government announced its intention to strengthen oversight of. . .
ASIC will face new powers to scrutinise top audit firms, hinting at fines and structural change. The government kept details vague. The Australian government announced its intention to strengthen oversight of the leading accounting firms known as the Big Four, after a series of serious failures in governance and auditing systems. The most notable example was the scandal at KPMG, where firm employees are suspected of improper use of confidential information to win contracts. The government has tasked the Australian Securities and Investments Commission (ASIC) with strengthening the regulation of audit and accounting firms, increasing accountability, transparency, and oversight of the audit sector. The government statement did not disclose specific future steps, but earlier this month a proposal was put forward to bring these firms under regulation and grant the regulator greater powers and tougher sanctions to stop violations. ASIC also said it would consider whistleblower complaints this month regarding auditing practices in the sector, while continuing a separate investigation into allegations related to KPMG. The government also stated that the question of splitting up the Big Four is one of the policy options. All four Big Four firms have faced scandals in Australia in recent years. In addition to the KPMG scandal, two EY employees were fired in June over alleged access to the prime minister’s personal banking data. In 2023 PwC was criticised for disclosing confidential tax policy data in order to attract clients. Last year Deloitte apologized after academics found in a government department’s report the use of artificially generated data. ASIC has also been tasked with strengthening standards in Australia’s superannuation sector, preventing corporate ‘greenwashing’ and ensuring the efficiency of the market’s financial infrastructure. A Look into the Future of Regulatory OversightThe tightening of oversight is expected to lead to tougher sanctions for violations and potential structural changes in the auditing market, which could affect the competitive landscape in Australia and the regulation of the Big Four in the long term. Tags:accounting accountabilityasic oversightasic oversight big four regulation kpmg scandal audit reform accounting accountabilityaudit reformbig four regulationkpmg scandalNewsScandalscandal news