U.K. Audit Separation Plan for Big Four Panned as Cosmetic

A new agreement for the Big Four accounting firms to split their U.K. auditing and consulting arms is a cosmetic exercise that won’t improve audit quality or independence, multiple analysts and investors argue.

“It’s not only voluntary, but parts of it are weak to the point of harmful. No wonder the Big Four signed up to it,” Tim Bush, head of corporate governance at Pensions & Investment Research Consultants Ltd, said in a call voicing a concern echoed by other critics.

The Financial Reporting Council on Monday announced an agreement with the Big Four—KPMG LLP, ...