EY to split out audit governance

EY has announced a shake-up of its top management team, splitting responsibility for audit and assurance under two separate heads, following the appointment of Hywel Ball as the firm’s managing partner and UK chair

Ball, a 35-year veteran with the firm, was previously EY UK&I managing partner of assurance and UK head of audit.

The new leadership team sees Kath Barrow named as UK&I managing partner for assurance, while Andrew Walton takes up a separate role as UK head of audit and will sit on the EY UK LLP board.

In a statement EY said: ‘The roles of UK&I managing partner of assurance and UK head of audit have been split in recognition of the societal importance of these functions and to ensure that audit quality continues to receive dedicated focus.’

Barrow, the new managing partner for assurance, joined the firm in 1992 and is currently the chief operating officer of the EY UK&I assurance practice and leads the audits of three FTSE 100 listed companies.

Walton has held a number of senior roles at EY and is currently the UK&I deputy head of audit.

EY has announced two other senior appointments, with Benoit Laclau named as the EY UK&I managing partner for consulting and Jeff Soar becoming UK&I managing partner for tax.

Laclau and Soar Benoit succeed Stephen Lambert and Jason Lester respectively who have stood down due to ongoing health challenges but remain as partners in EY.

Laclau joined EY in 2012 from EDF and is currently the global energy leader. Soar became a partner in 2009 and has been the global insurance tax sector leader since 2017.

The appointments are effective from 1 July, when Ball officially takes over as EY’s UK chairman and UK&I regional managing partner. The board remains 60% women and 40% men.

Ball said: ‘Covid-19 and an uncertain economic environment will create new challenges for many businesses across the UK and globally.

‘I’m confident these new appointments will equip EY to navigate these conditions and best advise our clients over the months and years ahead.

‘Benoit, Jeff and Kath will provide the depth and breadth of experience needed to guide and develop our people, serve our clients and stakeholders, and position us for long-term sustainable growth.

‘Audit quality is a key priority for EY and Andrew brings 29 years of audit experience which will ensure this this continues to be a key area of focus for us.’

Following the Competition and Markets Authority review of the audit market last year, the government has been mulling proposals for the Big Four firms to separate their audit and consulting practices, in bid to increase transparency.

Last year EY posted total revenue of £2.45bn for year end 30 June 2019, up from £2.41bn, retaining the number three slot in the Accountancy Daily Top 75 Firm rankings.

Audit fees accounted for 19% of total UK revenue (up 1%), while audit profitability improved year on year at £68m, up from £58m FY18.

The firm audits 71 companies in the FTSE 350, including Royal Dutch Shell, Royal Bank of Scotland and Sainsbury’s. In common with the rest of the Big four, EY has cut the monthly profit payments distributed to its UK partners by 20% during the pandemic.

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