Big Four, the

1. The Big Four accounting firms are *Deloitte Touche Tohmatsu, *Ernst & Young, *KPMG, and *PricewaterhouseCoopers. These firms are more than merely global accountants and auditors: External auditing is their core activity but they also provide a range of professional services, from tax advice to business *consulting. The Outsourcing of internal auditing has been an important area of Big Four activity in recent years. However, regulators throughout the world have raised concerns about the levels of the Big Four’s often-lucrative *management advisory services (MAS), and the extent to which MAS can allegedly compromise the independence of external *audit opinions. These concerns have intensified following the * Enron corporate scandal, and have crystallized in the United States’ *Sarbanes-Oxley Act of 2002, part of which addresses the topic of external auditors’ provision of MAS. Nonetheless, the Big Four remain the first-choice external auditors for large, *multinational corporations, for whom they offer a common auditing approach around the world. Other than Ernst & Young, the origins of the current Big Four can be traced back to the United Kingdom in the nineteenth century, but their center of gravity has long shifted to the United States. Decades of cut-throat competition has led to consolidation among the international accounting firms: The Big Eight of the 1980s were halved in number by 2002, with the demise of *Arthur Andersen following the *Enron corporate scandal. 2. In Japan, the term "Big Four" has traditionally referred to the country’s four main investment banks. 3. In the United Kingdom, the term "Big Four" is commonly used to refer to the country’s four largest high-street, commercial banks. Further reading: Matthews et al. (1998)