Rules on changing accountants set to push up costs
Large Dutch companies will probably have to spend more on their accountants because of changes to the law on corporate audits, the Financieele Dagblad reports on Tuesday.
The new legislation will require companies to switch auditor every eight years and will also stop firms using the same accountants to provide audit services and advice.
The FD bases its claim on statements from major accountancy groups and supervisory board members from stock exchange-listed companies. The big four accountants - KMPG, Ernst & Young, Deloitte and PwC - carry out 90% of the audits at the 1,000 firms which will be covered by the new law.
'It will turn the entire sector upside down,' Peter Bommel, chairman of Deloitte told the paper. 'Almost all companies will have to change their accountants in the coming years.'
Accountancy firms expect the musical chairs will push up tariffs, the paper says. 'You will have to spend more time in the first year to work yourself in,' PwC's Pieter van Mierlo, told the paper. 'You used to be able to spread that out over a large number of years.'
The new rules are set to come into effect in 2016. The legislation stems from the 2008 financial crisis and unease over the role of accountancy firms.