UK Audit Firms Push Back on “Name and Shame” Practice

The UK’s largest accounting firms are pressing the Financial Reporting Council (FRC) to end its practice of publicly “naming and shaming” firms at the start of audit investigations, as reported by the Financial Times.

The Big Four — Deloitte, EY, KPMG, and PwC — and a number of mid-tier firms have reportedly discussed filing coordinated complaints to the regulator. The effort is also supported by professional bodies, including the Institute of Chartered Accountants in England and Wales and the Association of Chartered Certified Accountants.

The industry pushback against the “name and shame” practice follows an FRC consultation, which was opened in October and closed earlier this month, that proposed faster resolution of some audit probes, higher thresholds for launching investigations, and the option of supervised self-reviews. While firms have broadly welcomed the proposals, the consultation included no change to the FRC’s policy of announcing investigations when they begin. 

When investigations are announced, the FRC typically names the audit firm, the audited company, and the relevant year, often making individual partners identifiable. Firms argue that early publicity can be disproportionate, place severe stress on audit partners, and linger for years before any wrongdoing is established.