The UK's 'big four' accountancy firms will have their stranglehold on the audit market challenged as part of a radical revamp of the scandal-hit industry.
A probe carried out by the Competition and Markets Authority (CMA) proposes that audits of the UK's biggest companies, listed on the FTSE 350, should be carried out by at least two firms, one of which should be from outside the big four of KPMG, Deloitte, PwC and EY.
This, the CMA argues, will give smaller bean counters access to the largest clients, allowing them to develop their experience and credibility, while also ensuring a "cross-check on quality".
In addition, the CMA is considering a possible market share cap to ensure that some major audit contracts are only available to non-big four firms.
The role of the quartet of accountancy giants has come under intense scrutiny recently and the CMA's investigation was sparked by the failures of Carillion and BHS, and the ensuing criticism of the accountants charged with auditing their books.
However, the watchdog stopped short of recommending they be broken up.
Other proposals include a split between audit and advisory businesses within big four firms, requiring separate management, accounts and remuneration. It also wants closer regulatory scrutiny of auditor appointments and management from within firms.
CMA chairman and former Tory MP Andrew Tyrie said: "Addressing the deep-seated problems in the audit market is now long overdue.
"Most people will never read an auditor's opinion on a company's accounts. But tens of millions of people depend on robust and high-quality audits."
A separate hard-hitting review has said that the accountancy watchdog is not fit for purpose and should be swept aside and replaced with an independent statutory regulator.