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June 12, 2012

Number of UK audit firms halved in 10 years

The number of audit firms registered with the Institute of Chartered Accountants in England and Wales (ICAEW) has halved in a decade and the trend is not set to change, it emerged during an ICAEW general annual meeting held in London this week.

The institute’s chief executive, Michael Izza, said the number of firms offering audit services is declining. Firms registered with the institute dropped from about 9,000 in 1999 to 4,526 in 2007, and down to 3,865 in the past year.

“The number is going to go down even further. The reason being is quite a large element of those firms has between one and five audits and you have to ask how long that is sustainable,” Izza said.

Despite the drop in firms, the number of ICAEW members has increased to 138,000 and income has grown by £6m to £82.4m.

During the meeting members voted in favour of an amendment that would allow the ICAEW to regulate alternative practices that offer different services, including legal.

Members also voted in favour of an increase in fees for 2013 and the reappointment of Grant Thornton as auditor.

Izza and ICAEW president Clive Parritt said the institute delivered a strong performance in 2011 in spite of difficult economic conditions.

“But we still can’t see light at the end of the tunnel and we had to work very hard just to stand still,” Izza said.  

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