Barclays replace PwC as auditors after 120 years
Barclays bank, which is Britain’s second-largest bank, is to replace the current auditor PWC. The Big Four firm has been the banks auditors for a total of 120 years.
Audit firms can now compete for the audit contract but as the bank is trying to implement the new rules set out by the EU and UK designed to encourage competition in the audit market, PWC will not be allowed to take part in the tender process.
Although PWC has been the banks auditors since 1896, Barclays decided in their annual report to announce the Big 4 firm will be replaced following a tender process due to begin in 2015 or 2016 with respect to the 2017 or 2018 audit. Barclays suggested in their annual report that the audit contract could have gone out to tender this year for the 2015 audit but the audit committee stated that it would put extra pressure on the business and also both the group finance director Tushar Morzaria, and audit committee chairman Mike Ashley, are new in the roles.
PwC is being replaced by the bank in order to comply with EU regulations that will require auditors to be replaced every 20 years, while the UK Competition Commission is implementing rules that will place a ten-year cap on audit tenures. Read more in our previous blog Preliminarily agreement reached on the EU audit reform
PwC was paid £44m last year by Barclays for its audit and non-audit work on behalf of the bank.
There has been a lot of changes in the audit market recently because of the new guidelines set out by the EU include: Berkeley Group; Marks & Spencer; and Unilever. Read more about these in our previous blogs;
PwC picks up lucrative HSBC audit
Unilever appoints audit firm KPMG as new auditor
Big 4 audit firms appointed as new auditors for Berkeley Group and Marks & Spencers
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