The U.K. government in its March report acknowledged that it's "not healthy for audit quality" that 97% of FTSE 350 audits are undertaken by the Big Four, especially when those same firms offer lucrative consulting services.
The FRC last month introduced fresh recommendations to put further distance between the two. The audit side of the firms' business shouldn't get paid for introducing customers to their consulting arms and accounting partners shouldn't be "incentivized" for sales passed to other parts of the firm, the FRC said.
The Chartered Institute of Internal Auditors, which represents the profession in the U.K., welcomed the proposals, but added the reforms should be implemented with urgency.
"It is disappointing that there is no detailed legislative timetable in the white paper and we need to see a clear roadmap for reform without delay or else we risk further corporate collapses," the group said.
EY's U.K. chairman Hywel Ball said in a statement that the "the introduction of a new regulator alongside tighter accountability for directors" is "essential." Deloitte called for wider consultation on the proposals.
"It is critical that input into the consultation is given not just by audit firms and policymakers, but investors, company directors, audit committee chairs and industry bodies at large," Stephen Griggs, U.K. managing partner at Deloitte, said in a statement.