Of more than 600 companies included in the major large and mid-cap indices in five of the largest countries in Europe, over 98% are audited by one of the Big Four. The remaining 1% were audited by either BDO or Grant Thornton.
For this post, we looked at the the fiscal 2017 audit opinions for companies from a selection of large and mid-cap indices in the United Kingdom, Germany, Italy, Spain, and the Netherlands. The indices we included are the AEX 25, AMX 25, DAX 30, MDAX 50, FTSE 100, FTSE 250, FTSE MIB, FTSE Italia Midcap, IBEX 35, and the IBEX Medium Cap.
First, let’s take a look at the Netherlands. The Big Four audit each of the companies included in the AEX 25 and AMX 25, with Deloitte, EY, and KPMG pretty much neck-and-neck for the most clients.
Two companies had a dual-audit. Unibail-Rodamco SE was audited by both Deloitte and EY, while Air France KLM was audited by KPMG and Deloitte.
Next comes Germany and the DAX 30 and MDAX 50.
BDO makes an appearance here, auditing one company – Deutsche EuroShop AG (DOLPF). The rest were audited by the Big Four, with KPMG leading the way.
When it comes to the United Kingdom and the London Stock Exchange, the FTSE 100 and the FTSE 250 comprise the largest number of companies.
Both BDO and Grant Thornton claim some of the market share of the FTSE 350, but the Big Four account for 97% of the total, with PwC taking the largest share of the market.
Now for Italy and the FTSE MIB and the FTSE Italia Midcap.
The Big Four audit 99%, with EY and PwC tied for the lead. BDO audits one of these companies, namely Banca Generali (BGN).
Lastly, we looked at Spain and the IBEX 35 and the IBEX Medium Cap. The Big Four audit all of these companies, with Deloitte taking the lead.
Two companies in this list were dual-audited. Tecnicas Reunidas (TRE) was audited by both PwC and Deloitte. (A first for them; their previous audit opinions were signed only by PwC.) Compania de Distribucion Integral Logista Holdings (LOG) was audited by both PwC and Deloitte. (This was also a first for them. Their previous opinion was signed by only Deloitte.)
As one can see from the data, each of the Big Four has a competitive advantage in at least one of the countries. Altogether, PwC has a small lead over the other firms auditing 30% of the total companies in these indices thanks to the firm’s advantage in the FTSE 100 and FTSE 250.
The Audit Analytics European database tracks public companies listed on European exchanges and covers Public Interest Entities (PIEs) as disclosed in the transparency reports of each audit firm by member state.
With the Audit Analytics European database, you can track mandatory auditor rotation, analyze year-over-year audit fee changes, monitor auditor market share, and gain insight into the PIE audit market.
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