EU tough rules to force AUDIT firms to abandon their consultancy businesses

The commission is pushing for tough rules to force the firms to
abandon their consultancy businesses.
(Reuters) - The business model of the big four accounting firms of
Deloitte DLTE.UL, PwC PWC.UL, Ernst & Young ERNY.UL and KPMG KPMG.UL
is under attack from the European Commission, the Financial Times
reported on Tuesday.

The newspaper said the commission is pushing for tough rules to force
the firms to abandon their consultancy businesses and share audit work
with smaller rivals.

A draft regulation, which the newspaper said it had seen, aims to
restore "trust" in financial reporting in the wake of the 2008 crisis,
and is being backed by Michel Barnier, internal market commissioner.

Under the plans, due to be unveiled in November, companies with
balance sheets greater than 1 billion euro would be forced to hire two
auditors to conduct a "joint-audit" of their books, including at least
one firm other than the big four.