LONDON: British financial services giant EY said on Tuesday (April 11) it was stopping a project to split its audit and advisory units after opposition from its US branch.
The move, agreed in September, aimed to accelerate growth and avoid conflicts of interest but required the approval of EY’s 13,000 worldwide partners.
EY’s global management said in a note that the company’s US executive committee “decided not to move forward” with its plan, dubbed “Project Everest”.
“Given the strategic importance of the US member firm to Project Everest, we are stopping work on the project,” it said.
EY’s global executive said it remained “committed to moving forward with creating two world-class organisations that further advance audit quality, independence and client choice”.
But it conceded that separating its businesses came with challenges, including giving both organisations the capabilities to compete effectively in the market, and that more time was needed to make necessary investments.
A vote on the split on a country-by-country basis was originally scheduled to conclude by early 2023 but was delayed on several occasions.
Britain’s auditing and accounting regulator, the Financial Reporting Council, had asked the Big Four firms in 2020 to separate auditing as a standalone business in Britain by June 2024.
EY's latest move was first reported by the Financial Times. – AFP, Reuters
