Finance directors and their companies need to be expecting and welcoming a greater amount of challenge from auditors, Mike Suffield of the Financial Reporting Council’s (FRC) Audit Quality Review told Financial Director yesterday.

The accounting watchdog has singled out KPMG for an “unacceptable” decline in its auditing work, while calling for an overhaul of audit practice across the Big Four firms in general.

According to the FRC, the fall in quality across the Big Four is due to a number of factors, including “failure to challenge management and show appropriate scepticism across their audits”.