Anthony Lawlor (Kildare North, Fine Gael) | Oireachtas source

When one considers the banking reports in this country and across Europe one of the fascinating points is that we are stuck with four main audit companies. Less than ten years ago we had five but the situation with Enron reduced the number by one. Nothing in the proposals encourages more companies to come forward and take on the mantle. We must broaden the base of existing audit companies. We found that each of the four audit companies was involved in some way or another with the banks in this country. The sad fact is that there is nothing in the proposals that would encourage other companies to be able to compete at a major level. If we do not have competition at that level, everyone gets stale and we get the negative reports we have been getting in recent years on the banking sector in various locations. I hope we will include something in the legislation to encourage smaller and medium audit companies to develop. We need competition. We do not want to have only the big four companies.

I am fascinated by the fact that the big four audit companies have their fingers in many pies in terms of the non-audit services they provide. It is evident at Government level also. They are employed as consultants to compile various reports and assessments. What are the implications for them with regard to the provision of non-audit services and audit-related services? I suspect the companies would not be happy with the regulation that is proposed by the EU.

Reference is made in the proposals to the liberalisation of the ownership rules of audit firms. We do not seem to have a problem with the issue. Could Mr. Houlihan indicate why we should not have a problem in that regard? I am fascinated by the stances taken on various aspects of the proposals. We should question the ones where it is suggested that we do not have a problem because they are the ones that got us into trouble previously. Reference has been made to appropriate legislation. I would like a response in that regard.

Could Mr. Houlihan identify the three member states of ESMA, the European Securities and Markets Authority? They may be shining lights and we might learn something from them but if they are not then we might learn from them about faults.

I am interested in the length of time we will have before we deal with the proposals as legislation. An issue such as this should not be presented to us quickly. This is a measure we will put in place for the next 20 years or 30 years and we must be able to confidently assure the public that the people who will examine banks, major corporations and companies are trustworthy. The problem currently is that I do not trust any of the big four companies although they are big employers in this country. I am sceptical about everything they say because they have not proved to us that they are worthy of our trust following on from their failures that have resulted in the current position for this country in terms of signing off on bank accounts in recent years.