Four big accounting firms are challenged to monopolize who changes the rules of the game

In China, a succession of staff labor intensity, may lead to "overwork death" after the news, "four" in overseas and plunged into the "monopoly door." The UK's antitrust watchdog has recently launched an investigation into the lack of competition in the country's audit market, targeting the "big four" accounting firms that occupy half of the market: PwC, Deloitte, Ernst and KPMG. "The country's large corporate audits are highly concentrated, with other companies struggling to get into the sector, and corporate clients are struggling to change audit firms," he said.　　"The UK Fair Trade Office (OFT), which is responsible for the investigation, issued an announcement. "Four" are questioned the monopoly of the "four" customers and businesses all over the world, to bear the majority of blue chip enterprises in the global financial audit. According to a report published by the British Parliament in March this year, 99 of the companies that joined Britain's FTSE 100 index in 2010 were audited by one of the "Big Four". Even in the Financial Times 250 Index (FTSE250), 98% of companies choose "Four" to provide audit services.　　These enterprises have an average of 48 years to replace the audit agency. This high concentration is also evident in income. British Accountancy Age magazine statistics show that 2010 Britain's "big four" income of up to 7.23 billion pounds, accounting firms accounted for the top 50 of the total income of 73%.　　Data show that 47% of the audit fees paid by FTSE100 companies are in the pocket of a PwC company. The UK's Fair Trade Bureau says there are "reasonable grounds" for suspecting that some institutions in the UK audit service industry "restrict, distort or hinder competition".　　For example, some banks only lend to companies that are audited by one of the "Big Four". China's audit services market is similar.　　The 2010-Year comprehensive evaluation of CPA firms released by the China Institute of Certified Public Accountants shows that in China, PwC and other "four" continue to occupy the top four of the accounting firm's income list, in the local area, the Swiss Yuehua, Lixin, Shinyong, Tian-jian, such as the top ranking. It is noteworthy that the number of CPA in the first place is 678.　　2009-year income reached 2.578 billion yuan, and the local ranked first in the Swiss Yuehua, the number of certified public accountants for 1228 people, almost Pu-yong road zhongtian twice times, but its 2009-year income is only 872 million yuan, only for Pu Yong Road Zhongtian income of 34%. "The Big Four" accounting firms can become ' four ', not the formation of administrative resources monopoly, nor the formation of unfair competition, but based on the results of the market competition of the fittest. "Liu Yan, director of the Institute of Audit and Risk management, Beijing National Accounting Institute, said to the first financial daily," the ' Big Four ' is not formed overnight, their position in the world is also gradually generated from the dozens of, is the credibility of a step-by-step cumulative formation. "In the view of Liu Yan Lun, the" four "formed a" monopoly "also has certain advantages, such as to be more professional, can make the resources in the global scope reasonable allocation, also makes the personnel division of labor more specialized.　　And as far as the "big Four" are concerned, they form an "oligopoly", a monopoly that does not completely repel competition.　　[Page] The crisis behind the monopoly but for the "Big Four" audit services there is a highly concentrated "monopoly" suspicion, OFT chief executive John Fingleton pointed out that one of the agency's main concerns is "four" to use the market dominance, may charge more audit fees, is contrary to the principle of fair and free. The "Big Four" audit cost is high, also has the embodiment in the Chinese market. Research shows that the same audit project, the "four" fees should be higher than the domestic 2~5 times. In China, the "big Four" has almost monopolized the auditing business of large enterprises, especially financial enterprises and multinational enterprises. For example, China's "four lines" of the audit business are "international Four" divided.　　Among them, Ernst and Young for the industrial and Commercial Bank of China Audit, the audit of the bank is PWC, ABC's Audit party is Deloitte, CCB's previous 7-year audit has been KPMG. Why are so many companies choosing "Big Four"? The Royal Institute of Chartered Management Accountants Zhang Yaozhu told reporters that the choice and replacement of the audit party for enterprises, financial institutions, etc., is a major issue, the company board of directors will generally be very cautious.　　Choose the "International Four", on the one hand, the importance of its business level, on the other hand, the importance of its brand effect. Zhang Yaozhu said that the "big four" profit is high, "this is in addition to the provision of professional services, but also with their responsibilities have a great relationship." "For a potential investor, if he has a large amount of money waiting to be invested, he will certainly want to invest in a company that he can trust by a big audit agency."　　In the event of a problem, he also has an opportunity to retrace his responsibilities to the audit body.　　Another concern about "four monopolies" is that under the oligopoly market structure, the high concentration of audit market will make it easy for the accounting firms to form collusion, through the non-cooperative game to reach an implicit contract, thus no longer worry about the loss of customers to their reputation damage, the persistence of professional ethics. Another concern for John Fingleton's suspicion of "four monopolies" is whether the market can continue to provide enough audit services once the "Big four" have a similar situation in Anderson.　　At that time, accompanied by the collapse of some audit companies, in the "six" into "five", "five" into the "Big Four", it caused the whole society to the audit Institutions trust crisis. [Page] who will break the monopoly despite the monopoly accusations, but the "four" response is positive. The firm responded by saying that there are more options to support the audit industry.　　PwC also said it would take an active part in the negotiations with the UK's Fair Trade Bureau, which said it supports moves to increase market competition "to ensure a fair arena".But Zhang, a professor at Sufe Accounting School, told reporters that the monopoly pattern of the international accounting firms, which is still very difficult to break in the short term of 5-10 years, will even be strengthened, and the market concentration of domestic audit business will be more and more high in the future. Is there a chance for small and medium firms to break the monopoly and compete? Oft that the form of partnership makes it hard for them to expand. The relevant laws and regulations require that the firm's shareholding is mainly held by the auditor, while in practice it is mainly owned by the partners.　　This limits the entry of capital and the expansion of small and medium-sized firms.　　As to how the monopoly pattern is cracked, the main measures considered by OFT include reducing the requirements of statutory auditing standards, giving companies more freedom of choice, and reducing the differences among different countries. For the Chinese market, Liu Youling said: "The development history of domestic firms has only more than 20 years, whether in the brand or in terms of scale and business capacity, and the ' International four ' gap is still quite disparity, to obtain the recognition of users of the report, the need for a certain accumulation process, competition with international firms still need time. "But there is room for future catch-up in Chinese firms, because they are now being integrated," he said.　　"Zhang said.　　But Zhang Yaozhu said that the integration of Chinese firms cannot be pursued for rapid expansion without regard for quality. "For an accounting firm, it's not as big as it is," he said. The nature of the industry determines that it is best to obtain recognition from others.　　Liu Yan said.　　However, Zhang Yaozhu also said that China's local firms have great opportunities for development, such as price advantages. Now, the global accounting standards are gradually unified, China's young firms should play a strong learning ability, and constantly accumulate themselves.　　Rather than envy, it is better to retreat and networking, local firms should pay more attention to serve their own customers now, so that customers get higher and better value-added services. In addition, "to ensure the integrity of each accountant, professional ethics, as well as professional services, is the lifeline of the firm, brand building is also a step-by-step process of accumulation." ”