The Australian Competition and Consumer Commission (ACCC) has been called on by the Labor party to investigate the Big Four over ‘cartel’ like behaviour, according to local reports.
Labor member Julian Hills and assistant treasurer Andrew Leigh made a written request to the ACCC’s chairman Rodd Sims, asking him ‘to examine the structure of the auditing market’.
The area of “immediate concern” arose following revelations that private dinners had been held between the CEO’s of the Big Four in the country, leading to speculation around possible collusion.
However local press have reported that the ACCC replied to the written request with a comment saying ‘Competitors are not precluded from meeting or talking with each other’.
The request made to the ACCC has no formal power behind it as only the Treasurer can direct the ACCC to investigate the matter.
The current minister for finance and the public service Mathias Corman was reported to have given a different opinion to that of Hills, saying: “The suggestion that business dinners are evidence for collision and cartel behaviour is absurd.”
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By GlobalDataFurthermore, the Big Four have denied any sensitive matters being discussed in the meetings.
In the letter Leigh and Hill both wrote: “The traditional financial statement and assurance auditing functioning of the Big Four firms is of critical importance to the Australian economy and the wider capital markets.
“Like the UK however, concerns exist regarding the perceived internal conflicts of interest between the traditional auditing function V. the faster growing and profitable consulting service market.
“These issues may also be of interest to the commission given its role to strengthen the way competition works in Australian markets and industries and promote the proper functioning of Australian markets.”
It was also revealed that Hill asked the Big Four to disclose the amount of tax they pay as a result of winning big government contracts.
The IAB has reached out to Hills for comment.
By Mishelle Thurai
