Big Four ‘Over-Represented’ in Tax Havens, Says Secrecy Study

Co-authored by Professor Richard Murphy (City University London) and Seila Naomi Stausholm (Copenhagen Business School), ‚The Big Four – A study of Opacity’ takes an in depth look at the size, scope and location of the activities of the Big Four.

Jul. 4, 2017, Bloomberg: Big Four ‘Over-Represented’ in Tax Havens, Says Secrecy Study

"The big four accounting firms—Deloitte, Ernst & Young, KPMG, and PwC—are “over-represented” in tax havens, according to a study that marks the latest push in financial transparency.

Jurisdictions including the British Virgin Islands, Monaco, and Bermuda have office numbers from the big four accounting firms that are disproportionate to their local populations, said the July 5 study, funded in part by the European United Left/Nordic Green Left group of European parliamentarians. From the 53 locations categorized as tax havens, the four firms are active in 43 of them, it added.

“Having offices in these tax havens is clearly not serving the needs of the local community,” Richard Murphy, City of University London’s professor of practice in international political economy, and one of the authors on the study of the big four’s worldwide operations, told Bloomberg BNA in a July 4 telephone interview. “Tax havens exist to serve the needs of people who are not actually there.”

"

The full article can be read here

 

Jul. 5, 2017: The Irish Times, Patrick Smyth: Big Four firms require closer regulation

"Regulators need to focus more intently on the facilitation of tax avoidance globally by the giant big four accountancy firms , a report commissioned by MEPs in the wake of the “Panama papers” urges.

The four, in descending order of size, are Deloitte, PricewaterHouseCoopers, or PwC, EY (until recently Ernst & Young), and KPMG, and between them they audit all but 10 of the FTSE 350 companies and had global combined sales last year totalling some €120 billion."

The full article can be read here.

 

Jul. 5, 2017, Tax Analysts: EU Lawmakers Question Transparency of 'Muddled' Big 4 Firm Structures

"The July 5 report, "The Big Four: A Study of Opacity," attempts to take a closer look at the organizational structures of the major accounting firms, which dominate the auditing sector for the major international corporations (...)

“Why are they, the [firms] who audit every other company, organized differently from that of their clients?” Murphy said. “That’s the question at the core of this.”

The question is an important one, according to Fabio de Masi, a German member of Parliament from the GUE-NGL, and vice chair of the PANA committee. “The big four auditing firms are the doorstep brigade of offshore jurisdictions and tax havens,” he said, adding that their auditing and tax consulting businesses must be strictly separated and that aiding tax evasion must be harshly punished.

“The report shows that the Big Four have adopted a muddled corporate structure,” de Masi said. “This protects themselves and their clients from regulatory oversight and disguises the size of their operations and profits.”

The study also dispels notions that the Big Four are networks of independent firms, and shows that must be seen as essentially large multinational corporations, according to de Masi. “This would simplify their regulation and it would be easier to hold them to account for their global actions,” he added."