Concerns have been raised about their lack of skepticism and independence from company management if, at the same time, they are seeking lucrative consultancy work from the same companies. The Big Four have been employed by the tobacco industry as both auditors and advisors for many decades. While some of the services provided are technocratic, providing help on IT systems for instance, other work concerns issues of public interest.
This includes: helping devise strategies to oppose tobacco control regulations, providing seemingly independent evidence to win public policy debates, and advising on corporate responsibility to shift public perceptions of tobacco companies. Work for the tobacco industry has generated multi-million dollar fees.
Auditing of tobacco companies by the Big Four generates multi-million dollar fees, although these are overshadowed by much larger consulting fees earned from the industry. For many decades the Big Four have helped controversial companies, including tobacco, improve their reputations.
The Big Four have all produced tobacco-funded reports that have been used to support industry lobbying against tobacco control regulations and are often directed at persuading policymakers and the media. It has, however, earned the Big Four many millions over decades.
Tobacco companies have long argued that the economic benefits of the industry outweigh the negatives of what their products. Consultants from the Big Four have helped the industry develop strategies around this argument with some — KPMG in the s and s 14 and PWC in the s — producing multiple reports to bolster this case. Another issue that the tobacco industry has used to push back against regulation is that it will drive the trade in illicit tobacco.
Again, Big Four firms have provided multiple studies to support these claims. Many of these reports by the Big Four on the illicit trade have been presented to policy makers to argue against the introduction of standardised, or plain packaging , regulations, particularly in Australia and the UK which have led on the issue. Plain packaging, the industry claimed , will make counterfeiting easier.
There is clear potential for conflicts of interest from the Big Four providing consultancy services to firms they audit. The Big Four, however, regularly provide other services to organisations that they audit.
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Log in or Register Manage subscriptions, submit translations and permissions requests, nominate a board or committee member, and more. However, the silver lining is that the level of audit concentration in India is less worrying than in some other western economies.
A senior executive at one of the big four firms said there are different segments in the market, and some large firms do not see value in assigning statutory audits to smaller audit firms for reasons that are no different from the trend seen in other markets.
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