FTSE 350 audit tenders are expected to double this year, as new rotation regulations take hold
New figures, published by PwC, suggest that up to 56 FTSE 350 companies will put their audit out to tender in 2014, compared with 30 in 2013 and 18 in 2012.
PwC currently audits 29% of FTSE350 companies, as the dominance of Big Four firms comes under increasing scrutiny, particularly over the FTSE 100.
Two thirds of the 51 companies that have tendered their audit contract since October 2012 have switched firms. This includes 75% of FTSE100 firms, 62% of FTSE250 and 67% of FTSE 350.
In 2014, there have been 17 completed tenders, 14 are currently in progress, 7 are in the “pipeline” and 18 are “expected”.
James Chalmers, UK head of assurance at PwC, said that greater clarity over new regulation has allowed companies to make more informed decisions over when to put their audits out to tender.
He said, “Tendering activity is at unprecedented levels. We expect between 50 and 60 FTSE 350 tenders in total this year, nearly double the number in 2013.
“Now that there is greater clarity on the implications of the EU rules, companies are able to make decisions on when to tender at a time that makes most sense for their particular circumstances.
“For some, that means going early, for others it means going later, but – crucially – the choice is still theirs to make.
“In our experience, companies make their choice based on the quality of the team and the strength of the network in the UK and overseas.”
M&S and Berkeley drop PwC
Unilever drops PwC
Commission drops five-year tender proposals