The FT reports that China is hoping to develop several “national champions” in the accounting sector who can compete with the aggressively expanding “Big 4” (see here). At the same time (by chance?) a draft of the much-discussed anti-monopoly law has been approved (see here).
The attempt to build local firms to compete with the big international accounting firms would aim to reduce local companies’ reliance on foreign firms, especially in the case of overseas-listed companies. The FT reports:
- “Liu Yuting, director general of the Ministry of Finance’s accounting regulatory department, told the Financial Times that he wanted the development of accounting firms to catch up with China’s spectacular economic growth.”
However, as the FT notes, the plan may be hard to implement due to a lack of experience, a fragmented sector (some 5,600 companies are in operation), and a very competitive (and very global) marketplace. In addition, no “special privileges or preferential treatment” from the government is planned (at least not publicly) to support these firms.
Some consolidation in the sector can be expected and, as I have mentioned before, the Big 4 (together with the big international law firms) are likely to be remain under the spotlight for some time.
See news source:
China to promote rivals to â€˜big fourâ€™
Financial Times – London,England,UK
China is encouraging the growth of accounting â€œnational championsâ€ to reduce the countryâ€™s reliance on the big four international firms that monopolise …