Australia’s accounting regulator is considering major reforms to the country’s Big Four firms after recent audit scandals. Multiple reports say the regulator is evaluating a structural separation option that would require firms to split their audit businesses from their consulting or advisory operations. The proposed change would prevent the same firm from providing both audit and certain non-audit services to the same client, a move aimed at reducing conflicts of interest.
In addition to separation, at least one report notes a possible cap on the size of accounting partnerships, with figures mentioned of 400 partners versus about 1,000 currently. The overall package is framed as a response to public concerns about audit independence and the effectiveness of safeguards within large, multi-service firms.
While details and final decisions are not reflected in all sources provided, they converge on the direction of travel: tighter rules for the Big Four’s structure and operations, with audit independence and conflict management at the center of the regulator’s review.
