HSBC struggles to draw Big Four accountants to $94m-a-year audits

HSBC struggles to draw Big Four accountants to $94m-a-year audits

Fears that the UK’s biggest lender will struggle to attract the Big Four accounting firms have been stoked as HSBC prepares to tender the audits of its accounts next year, according to reports.

The heads of HSBC reached out to the Big Four auditors but found they were reluctant to bid for the bank’s audits from 2025, according to the Financial Times, which first reported the news.

Possible conflicts with consulting projects, and the high numbers of resources needed were some of the reasons flagged by the auditors for their reticence.

The sprawling size of HSBC, which has 40m customers globally across 64 countries and territories, was another cause for concern for the accounting firms. The bank’s audits will require significant resources, technology, and risks for auditors.

HSBC’s progress to find an auditor, following the end of PwC’s contract after ten years in 2025, is likely to be carefully monitored, as the bank represents one of the biggest audits, worth an estimated £1bn over a decade, for a London-listed company.

Although all of the Big Four company contenders – EY, Deloitte and KPMG – have provided consulting services to HSBC there is some concern that displacing PwC as its current auditor will be a futile endeavour as the accounting giant reportedly plans to pitch during the tender process.

Meanwhile HSBC has reportedly also reached out to ‘challenger’ audit firms outside of the Big Four accounting giants, but the scale of its audit, and the risk for auditors, means mid-tier firms are unlikely to pitch to replace PwC in reviewing the whole group.