When we predicted, a few days after the Andersen/Enron debacle started, that this would be the end of Andersen, very few firms believed us - history has shown our prediction to be true. Incredible though it may have seemed at the time, it was entirely possible for a brand as strong as Andersen to be demolished overnight.

Not that the big firms are complacent any more. As I was reminded just the other day from a group of partners within a 'Final Four' (as we refer to them) firm, they have little control over the activities of other partners especially outside the country within which they operate - 'There, but for the grace of God, go I' springs to mind.

We have read so much about the impact of Andersen/Enron (and a few others) on the large accountancy firms and several commentators have suggested that there may be some implications for mid tier amd smaller firms. August's Accountancy looked at the effect on client relationships and rising insurance costs, for instance.

But there is another area that smaller firms should be focussing on. Outside the Final Four, most accountancy firms serve the entrepreneurial market place and market research has shown that most entrepreneurs do not value the audit as much as perhaps Fortune 500 businesses. Additionally they are not too keen to pay for accountancy services and they hate paying tax! In fact, when asked what services they are willing to pay for from professionals, they indicated a strong interest in benchmarking and strategic planning.

So we have a situation where the entrepreneur attaches little value to the audit and is more interested in the advisory role his or her accountant can play thereby retaining the position that the audit remains a cost sensitive service and the advisory role, in all its different guises, is a benefit driven service line where the client will pay handsomely. The plc market has historically also asked its auditors to keep the quotes for the audits low, which they have been happy on the condition that they will get all the other, highly profitable, consultancy work. Well no more.

Over-reaction from the regulators is highly likely and the SEC has already indicated what non-audit services will be acceptable from an auditor and what will not be acceptable - accountancy services are apparently, not acceptable. It is hard to imagine the day when a smaller accountancy firm cannot offer accountancy services because it is technically the auditor and yet it is equally hard to imagine how and where regulation will recognise the difference between the two markets. Additionally policing the regulation in the entrepreneurial market would seem almost impossible.

Obvious steps have already taken place in the large firms - separate the consultancy business from the auditing business - no problem. But has the re-branding actually worked? Andersen (dec'd), Accenture, PwC, Monday (oops - IBM), Cap Gemini Ernst and Young etc - brands, certainly, but how fragile are they and can people really believe that these few brands can satisfy the Fortune 500's demands for an audit and their demands for consultancy without an apparent conflict of interest even if it is among themselves.

The DTI will no doubt announce an increase in the threshold limits (we hope) whereby companies below the threshold will not require an audit - great! Yet so many smaller auditing firms have profitable clients above the threshold limits and if they were to re-structure along the lines of the Final Four, could they also satisfy the needs of the smaller clients as well?

Let us look at Blueprint Ltd. Blueprint Ltd is the registered auditing company for Tenon plc. Approved to effectively carry out audits for all the clients of what where the clients of the accountancy firms that sold out to Tenon leaving Tenon to sell them whatever the clients want to buy without fear of conflict of interest.

Will the Blueprint model work for the rest of us? Could it be the only structure that allows the smaller firms to give the clients what they want without the regulators distorting the natural market forces. And yes, if you were asking, Tenon does brand Blueprint separately.

Indeed, the only safe way for those firms who will have profitable clients above the thresholds would be to separate the audit business from the rest and only have the audit business registered for auditing. A separate brand is needed and the ownership of the audit needs to be very carefully considered as will the management agreement between the audit business and the remaining business. The alternative for those firms that perhaps will only have one audit client that remains profitable would be to join forces with other similar firms and form a separate auditing business similarly to the Blueprint model. Other than that perhaps one might take the option of outsourcing the audit and focusing one's attentions to pursuing the fantastic opportunities that await any accountant who realises that clients value tax planning, strategic planning, financial services, benchmarking and many other services far more that they value the audit.

Gordon Gilchrist is the marketing director of 2020 Consulting Group