EY has shed its status as the Big Four accounting firm with the worst record in US audit inspections, vaulting to lead the regulator’s audit quality league table jointly with Deloitte. Reports published by the Public Company Accounting Oversight Board showed inspectors found flaws in just 5 per cent of EY US audits examined, matching Deloitte’s deficiency rate. KPMG had the highest rate at 13 per cent, with PwC at 9 per cent. All figures represented an improvement on last year, reversing the post-pandemic increase in flaws.

Under new PCAOB chair Jim Logothetis, appointed by the Trump administration’s SEC, the organisation has promised to review inspection reports and the wider regime, focusing more on firms’ overall quality control systems. Some in the profession argue that deficiencies found in inspections, which target the most difficult audits, are not the best measure of audit quality.

The PCAOB also released reports for Grant Thornton and BDO, which showed significant improvements: flaws in 34 per cent of BDO USA audits (down from 60 per cent) and 33 per cent of Grant Thornton US audits (down from 48 per cent).