Separate audit units from other biz by June 2024: UK watchdog to Big Four

The UK-dominant accounting companies must separate their audit units from other businesses by June 2024 as the country’s accounting watchdog reacts to shortcomings that led to the collapse of several companies.

The Financial Reporting Council is asking the so-called Big Four — KPMG, Deloitte, PricewaterhouseCoopers and Ernst & Young — to agree to operational separation to ensure audit practices don’t rely on “persistent cross-subsidy from the rest of the firm,” it said Monday in an emailed statement.

Auditors are under greater regulatory scrutiny than ever after a serious of high-profile lapses in recent years, with Ernst & Young’s role in the collapse