LAST JANUARY the House of Lords Select Committee on Economic Affairs concluded that the International Financial Reporting Standards (IRFS), used by British accountancy firms, as dictated by EU edict, was fundamentally flawed.
In April it concluded that auditors are as bad as the accountants and their flawed rules. Their report, “Auditors: Market concentration and their role”, said that 99 out of 100 FTSE top companies were audited by the big four – KPMG, Ernst & Young, PriceWaterhouseCoopers, Deloitte – and all are slated for “missing” the financial crisis which engulfed capitalism.
The Lords are now calling for an investigation into the big four for monopoly and uncompetitive practices. PriceWaterhouseCoopers audited Northern Rock and Royal Bank of Scotland and found no error or concerns prior to their collapse – a mere £7 million fee! The big four companies made between them in 2009 nearly £8 billion in profit.