News
26 Sep 2012 10:00am

Schroders issues call for audit tenders

Schroders has put out an audit tender after a relationship with PwC dating back more than 50 years

The fund manager has put the contract out to tender amid some investor dissatisfaction at the long auditing relationship. It said the retendering reflected "good governance", adding that it was "mindful of potential regulatory change".

Schroders said in a statement that PwC and predecessor firms had been the auditor since at least 1959, when it first floated on the London Stock Exchange.

Schroders paid PwC £4.7m in 2011 – £3.1m for audit and audit-related work and £1.6m for unrelated work. In 2010 the total fee was £4.4m.

ITV has also said it is reviewing the audit contract held by KPMG since 2005. Earlier this week, KPMG replaced Ernst & Young as auditor of FTSE 250 company Stobart Group.

Research from the Competition Commission, which is undertaking an investigation into the relationships between companies and their auditors, found that more than half of the FTSE 100 companies have had the same auditor for more than 10 years.

A working paper published yesterday by the Commission, concluded that there is no evidence of "tacit collusion" between the Big Four, after accusations from mid-tier firms that the accounting giants co-ordinated to limit their rivalry.

The Financial Reporting Council is also expected to confirm this week that it will require FTSE 100 and FTSE 250 companies to put their audit contracts out to tender at least once a decade, or explain to shareholders why they have opted out.

 

 

Helen Roxburgh

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