Competition watchdogs are facing a fierce backlash from corporate Britain over plans to force major listed companies to appoint two sets of auditors to oversee their accounts.

Sky News has learnt that the 100 Group, which represents the finance directors of Britain's largest public companies, is preparing a blistering response to the Competition and Markets Authority's (CMA) proposal to introduce a system of joint audits.

Sources said the 100 Group was "dismayed" by the proposal, which they argued would drive up the cost of auditing company accounts without any assurance of quality improvement.

Under the CMA's plan, unveiled last month, FTSE-350 companies would be required to appoint a second auditor from outside the big four firms - Deloitte, EY, KPMG and PricewaterhouseCoopers - in an attempt to bolster competition.

The measure would affect blue-chip companies such as BP, GlaxoSmithKline, Marks & Spencer and Rolls-Royce Holdings.


‎One finance chief said this weekend that the reforms risked being counterproductive, and could sow confusion about auditors' responsibilities.

In its original response to the CMA's audit market study, the 100 Group said little about the concept of joint audits, which are already used in countries including France.

However, it said its members opposed them because they "increase complexity and do not lead to increases in quality or competition".

"They are more expensive and time-consuming with decisions relating to key accounting matters often taking longer to get agreement from the auditors.

"We understand that, despite a number of French companies appointing one 'big four' firm and one smaller firm in a joint model, it is not clear that this has enabled the smaller firm to take on the larger audits themselves.

"We are, therefore, not supportive of a joint audit model as, currently, there are no benefits to shareholders."

Finance chiefs of large multinationals are especially concerned about the inflated cost of joint audits, with existing services already running into tens of millions of pounds for the largest companies.

The impetus for an overhaul of the UK audit market has been provided by the collapse of companies such as Carillion and BHS, but auditors, regulators and companies are split on the most appropriate way to achieve beneficial changes.

Responding to an enquiry from Sky News, the 100‎ Group said it had yet to formulate a response to the CMA.

‎"The 100 Group will shortly be discussing our position on these proposals and, if we choose to, will respond directly to the CMA with our comments by the deadline of 21 January," it said.