Thursday, May 31, 2018

ウォートン・スクール 2018-2019 MBA Deadlines

The Wharton School is placing a big bet on business analytics
The Wharton School‘s MBA program moved up its round one application deadline by a day to Sept. 18th for entry into the fall class of the 2018 intake. If you’re an early bird, you’ll get an interview invite or a rejection by Oct. 30, with a decision by Dec. 13th.
Wharton boasts three application rounds per year with three key dates for each round: Application Deadline, Interviews, and Decision Dates. For round two, the deadline is Jan. 3, 2019, with interview invitations going out on Feb. 7, and decisions on March 21st. For the third and final round, Wharton set a deadline of April 2nd, with interview invites released on April 18th, and decisions revealed on May 9th.
Wharton strongly advises candidates to apply in the first and second rounds and makes an app to its Lauder and JD/MBA programs mandatory in those rounds. “Space in the class becomes more limited for round 3 applicants, resulting in a more competitive round,” according to the school.

Wharton’s 2018-2019 MBA Application Deadlines

Wharton RoundsApplication DeadlineInterview InvitesDecisions
Round OneSeptember 18, 2018October 30, 2018December 13, 2018
Round TwoJanuary 3, 2019February 7, 2019March 21, 2019
Round ThreeApril 2, 2019April 18, 2019May 9, 2019
To be considered for a round, you must submit a completed application by 5 p.m. Eastern Time (ET) on the day of the deadline. If you submit your application after the deadline for Round 1 or 2, it will be rolled into the next round. If you submit your application after the deadline for Round 3, it will not be accepted.
If you submit an application earlier in a round, you can confirm receipt via the online application system and will have more time to schedule an interview. Interviews are by invitation only. At any point, applicants can use the online application system to check the status of their applications.
In the 2017-2018 admissions cycle, Wharton received 6,692 applications for the 863 seats available in the Class of 2021. The school accepted 1,287 candidates for an overall acceptance rate of 19.2%.
The mean GMAT score for the incoming class was 730, with a range of 530 to 790, while the average undergraduate grade point average was 3.6. The mean GRE verbal score was 163, while the mean GRE quant score was 162, with an average writing score of 4.7.
Mean work experience, which ranged from zero to 14 years, was five full years.
“As with any school, try to reflect upon the reasons why you want to attend business school in the first place. Speak with students and alumni to hear a broad and diverse set of perspectives about Wharton. Reach out to affinity clubs you are interested in, get to know the DNA of the school, and bring those insights into your application process. A common misconception is that Wharton only selects candidates with quantitative and finance backgrounds. In reality, Wharton values all types of backgrounds and experiences. Don’t try to be someone you think the admissions office wants you to be.” — Tomer Meir, 2018 Wharton graduate now working at Amazon as a product manager
“There is no ‘typical’ Wharton student. It is our unique experiences and stories together that create this class and the opportunity to learn from each other. Focus on demonstrating who you are, how your goals fit with Wharton, and how you can bring that true self to this community. For me, being at Wharton means allowing all of our uniqueness’s to shape each other’s experiences. Now the question is, what does it mean for you?” — Prathama K Nabi, 2018 Wharton graduate now working at Barclays as an investment banking associate
“What you’re most ashamed of is often what has contributed most to who you are. When I was a teenager, I worked over 50 hours a week in restaurants, often 12 hours at a time. I vividly remember my feet stinging in my shoes while having to serve my peers, and teaching myself SAT math on my waitress pad whenever I had a break. I hid the fact that I worked in restaurants when I went to college because it wasn’t the typical high school experience, even though I’d often daydream about having my own restaurant one day. I started working again in restaurants at night while at Deloitte, and I embraced how it made me a better consultant on my MBA applications. My clients would often bond with me before anyone else on my team (even my managers) because I didn’t seek to impress with my intellect first, I approached them with an attitude of service. In restaurants, you leave your resume and your GPA at the door. That repeated lesson over years-and-years continues to impact me every day, and owning that part of myself before I applied to b-school allowed me to be my full self, confidently growing into a leader at Wharton and beyond.” — Natalie Neilson Edwards2018 Wharton graduate now building her own company, Broomstick Weddings, which provides wedding planning resources to brides from racial and cultural backgrounds often left out of traditional media

スタンフォード大学経営大学院 2018-2019 MBA Deadlines

Stanford GSB 2018-2019 MBA Deadlines

Stanford University’s Graduate School of Business
Stanford University’s Graduate School of Business is moving up its round one MBA application deadline this year to Sept. 18th, a day earlier than last year. For R1 applicants that means getting a final admit/deny decision by Dec. 13th.
Stanford set a round two deadline of Jan. 10, exactly the same as last year, with decisions due by March 28th, a day earlier. And the school’s final and third round will have a cutoff date of April 3rd, a day earlier than last year, with decisions going out by May 16th.
All applications are due by 11 a.m. PST, including letters of reference and the GSB’s $275 application fee. The school does not disclose a specific date for its invitation-only interviews by alumni and admissions staff. Typically, an applicant and an interviewer work together to schedule the interview once an invite goes out, generally within seven to 10 days.
Round one interviews usually occur from mid-October to late November over a four- to five-week window. Round two interviews start in early February to go until mid-March. For round 3, Stanford begins inviting candidates to interview approximately a week after the application deadline and continues issuing invitations until a week before the decision notification date for that round, from mid-April to early May.

Stanford’s 2018-2019 MBA Application Deadlines

GSB RoundsApplication DeadlineInterviewsDecisions
Round OneSeptember 18, 2018Mid-Oct. to Late Nov.December 13, 2018
Round TwoJanuary 10, 2019Early Feb. to Mid-MarchMarch 28, 2019
Round ThreeApril 3, 2019Mid-April to Early MayMay 16, 2019
The most highly selective prestige MBA program in the world again retains its iconic essay prompt: What Matters Most To You, and Why? The school also requires an essay on why an applicant wants to get an MBA from Stanford. Answers for both essay questions combined may not exceed 1,150 words, with a suggested word count of 750 for the first essay and 400 for the second.
During the 2016-2017 admissions cycle, Stanford received a record 8,173 applications for just over 400 classroom seats, a 21.7% increase in apps over the past five years. To put Stanford’s popularity in context, Stanford enjoyed 26.6% fewer applications than Harvard Business School…but its 418 member class was also half the size of its Boston rival. To look at it another way, 89% of applicants who received a Stanford acceptance letter ultimately enrolled – just a shade under HBS’ 90.8% mark.
Last year, Stanford admitted 469 applicants, for an acceptance rate of just 5.7%, lower than any other prestige business school in the world. In short, Stanford has increasingly emerged as the “cool” school – the go-to destination for the brainy, laid back, and spunky alike.
Record applications wasn’t the only big news last year. The incoming class notched a 737 GMAT average – another high mark and a four point improvement over the previous year. For enrolled students, GMAT scores ranged from a low of 610 to a high of 790. The overall average was also six points better than HBS and seven points above Wharton and Chicago Booth.
Average GRE scores on the verbal were 165, with a range of 150 to 170, and 164 on the quant, with a range of 156 to 170. In addition, the class also mustered a 3.74 GPA average as undergraduates, also the highest performance among the top business schools.
“GSB is a place that celebrates people, optimism and authenticity. Make sure this philosophy resonates with you, and reflect that in your application materials.” — Animesh Agrawal, Class of 2018 graduate from Stanford will be working at The Blackstone Group as an investment analyst
“Make the application process meaningful for you regardless of the outcome. A countless number of my classmates have spoken to the legitimate introspective process that the application provides. Take the time to step back from your work and life and consider what gives you energy and what takes it away, what conditions help you be your best self, and what the purpose of your work actually is. If you can do this, chances are your best self will shine through, too!” — Sarah Anne HinkfussClass of 2018 graduate from Stanford will be working at KKR’s Next Generation Technology Growth Fund
“Before you sit down to write your personal statement, spend some good time thinking about the moments in your life that have been meaningful and transformative. Write down these scenes individually and consider them in the larger trajectory of your past and your intended future: where do your gifts and monumental experiences intersect with your interests, and how can you weave these pieces together into a coherent narrative? Your personal statement is less about conveying a personal brand and more about giving the admissions committee the opportunity to see you: not simply what you’ve done, but how you think, what you value, and why you’ve chosen to tackle the things that you’ve accomplished. Own up to your sense of self: your quirks, your decisions, your beliefs. In this way, you are not only creating an authentic essay but you’re also giving yourself permission to show up completely in the later stages of your application process: during your interview, your school visits, and your chats with students, faculty and alumni.” — Jayce HafnerClass of 2019 MBA student at Stanford
“I was lucky to know a few GSBers and through them reached out to several students. This was maybe the best thing I did during my application process. That’s not because they told me something I had never heard before, but I realized that all of them were so different, that there was no way there is a perfect candidate. In all of them I could see the reasons why they were accepted. But I could also see some reasons why they might not have been accepted. This was extremely useful to me, because it made me realize that I didn’t need to show myself as a perfect candidate – because no one checks all the right boxes. The superstars don’t come to business school, because they don’t need it! This made it much easier to write my essays. I actually wrote about some mistakes I’ve made in my life. At the end, I think admissions cares more about having a diverse class than having only the most accomplished people in the class.” — Felipe KettlunClass of 2019 MBA student at Stanford

Entertainment MBA programs are uniquely positioned to prepare graduates for an industry in transition.

In a February 2016 editorial for Financial Times, Jonathan Moules noted that the rapidly changing face of the post-recession business world had blurred the differences between the technology and entertainment industries to the point that distinctions seemed more or less irrelevant. The primary beneficiary of this change, Moules contended, would be the graduates of MBA programs who would be increasingly relied upon to help these companies manage their explosive growth.
Indeed, in recent years, MBAs have been snapped up, both by emerging entertainment companies focusing on streaming services such as Hulu, as well as traditional media firms like CBS, Warner Bros., and NBCUniversal. These MBAs need to grapple with an industry in the midst of a sea change, with rapid developments taking place in nearly all aspects of the sector.
Digital firms like Netflix are increasingly hiring MBAs
Digital firms like Netflix are increasingly hiring MBAs
The changes are taking place almost daily, says Sam Craig, Director of the Entertainment, Media and Technology Program at New York University's Stern School of Business.

“Even if it’s the same title, something we offered in 2000 is totally and completely different [now],” Craig says. “In terms of the program itself, we started off focusing on the entertainment industry, and in the late 90s, the entertainment industry was pretty much siloed. Movie studios were movie studios, and TV networks were TV networks. But that has changed considerably, so there’s this huge move toward convergence, and what television is today is really quite different from what it was in the year 2000.”
“It’s not broadcast. It’s not cable. It’s streaming, it’s Netflix, it’s broadcast, it’s cable: it’s all of these things rolled into one.”

A variety of options

For those looking for a MBA program with an entertainment specialization, there are a number of options. Beyond the Stern program, there’s also UCLA Anderson’s MBA specialization in Entertainment and Media, with courses in Entertainment Law, Negotiation Analysis, and Advertising and Marketing Communications, among others.
Taking an even tighter focus, Berklee College of Music and South New Hampshire University offer a joint MBA in the Music Business, a program that focuses exclusively on finance and marketing within a constantly evolving music industry. Similarly, Henley Business School features an MBA for Music and Creative Industries program, with courses focusing on innovation, design, and intellectual property.
For Barry van Zyl, a graduate of the Henley program and musician who has spent 18 years as the drummer for legendary South African singer-songwriter Johnny Clegg, the experience has transformed the way he thinks about the music industry.
“I have experienced a ‘rewiring’ in terms of expertise, capabilities and most importantly self-knowledge or personal development,” van Zyl explains. “On starting the program I was focused only on a toolkit to exploit opportunities in the music sector. The critical transition I have experienced is that I am no longer tied to the music business through the comfort of networks but am excited to explore creative entrepreneurship in any industry.”

A foot in the door

For Evelyn Zhang, a West Point graduate who spent five years as a technology officer in the United States Army, the transition to the world of entertainment media wasn’t clear. “I went into Stern, and I was like, ‘I want to be in media,’ and after Stern I thought, ‘Okay, now I know how media is organized and how films and TV studios – how those business relationships look,’” Zhang explains.
Zhang says that the MBA gave her a foundation for understanding the media industry, which allowed her to jump right into the field.
After internships at ABC and Showtime, Zhang started a two-year rotational program at Viacom following the MBA. Having already spent six months in product management, followed by six months in data analytics, Zhang is currently working in content distribution. With opportunities to network with and learn from industry veterans, Zhang says she is positioned to put into practice the skills and knowledge she acquired at Stern.
It’s who you know

Many of the MBA programs in entertainment put a focus on making contacts within the industry.
That’s particularly true of the MBA Program in Arts, Media and Entertainment Management at the Schulich School of Business at Toronto’s York University.
“[Graduates] usually get jobs in the entertainment industry directly, and they move [within the industry], says Joyce Zemans, the program’s director. “Some of it is upward and some of it is lateral, but most of our students end up working in the entertainment industry.”
Zemans says that, in several of the MBA courses, students are teamed up with senior executives in the industry. Through these relationships, students can explore how their classroom learning plays out in the real world.
That direct contact remains an essential component of Stern’s program, as well. The challenge for MBA programs, Craig says, is maintaining a balance between focusing on the time-honored fundamentals while staying flexible enough to address trends as they emerge. The Stern program accomplishes this partly through their use of adjunct professors who are also industry tastemakers, such as Buzzfeed president Greg Coleman.
The entertainment industry is changing, and the future is going to come through a new generation of MBAs who both understand the pace of change and can anticipate the direction.
“If you look at a lot of the legacy businesses, they are run by senior executives who grew up in a different environment, and they are aware that it’s changing, but they don’t always get it,” Craig explains.
“So that’s one of the reasons they hire bright, young MBAs who are more digital savvy, and they expect them to be able to drive the business forward.”

Tuesday, May 29, 2018

ロンドン・ビジネス・スクール Essay Questions 2018-2019

London Business School Essay Questions 2018-2019

London Business School Essay Questions
2018-2019 LBS Essay Questions
Required: What are your post-MBA goals and how will your prior experience and the London Business School programme contribute towards these? (500 words)
Optional: Is there any other information you believe the Admissions Committee should know about you and your application to London Business School? (500 words)
Admissions dates for the August 2019 entry have not been set yet, but LBS expects them to be similar to the current cycle:
Round 1: Mid-September 2018
Round 2: Early January 2019
Round 3: Early March 2019
Round 4: Mid-April 2019

ゴイズエタ・ビジネス・スクール Deadlines 2018-2019

Emory / Goizueta Deadlines 2018-2019

Goizueta female CEOs
The Emory University MBA admissions committee has posted the Goizueta MBA deadlines 2018-2019 for the school’s full-time One- and Two-Year MBA Programs.

2018-2019 Emory Goizueta MBA Deadlines

The deadlines are as follows:
Round 1
Application Deadline: October 5, 2018
Notification Date: November 30, 2018
Deposit Due: December 21, 2018
Round 2
Application Deadline: November 9, 2018
Notification Date: January 25, 2019
Deposit Due: February 22, 2019 (International & One-Year) / April 19, 2018 (Domestic)
Round 3
Application Deadline: January 4, 2019
Notification Date: March 8, 2019 (Domestic) / March 15, 2018 (International)
Deposit Due: April 9, 2019 (One-Year) / April 19, 2018 (Two-Year)
Round 4
Application Deadline: March 8, 2019
Notification Date: Rolling (One-Year) / May 3, 2019 (Two-Year)
Deposit Due: Upon Notification (One-Year) / May 15, 2019 (Two-Year)
For more information about applying for the Emory MBA, visit the Goizueta admissions website.

フュークア・スクール・オブ・ビジネス Deadlines 2018-2019

Duke / Fuqua Deadlines 2018-2019

Duke / Fuqua Deadlines

2018-2019 Duke / Fuqua Deadlines

Early Action
Application Deadline: September 12, 2018
Interview Notification: September 25, 2018
Decision Notification: October 19, 2018
Round One
Application Deadline: October 10, 2018
Interview Notification: November 8, 2018
Decision Notification: December 13, 2018
Round Two
Application Deadline: January 3, 2019
Interview Notification: January 31, 2019
Decision Notification: March 18, 2019
Round Three
Application Deadline: March 20, 2019
Interview Notification: April 10, 2019
Decision Notification: April 29, 2019

US loses its lustre for international MBA students

Many schools experience a fall in overseas applicants, especially for two-year courses

Jonathan Moules MAY 28, 2018 

Moving to the US to attend business school is something of a family tradition for Srinivasan Masti. His cousin relocated from Bangalore to Columbia Business School five years ago. His uncle had already made a similar move and now teaches at New York University’s Stern School of Business.

But after weighing up the options of job opportunities versus course costs — and hearing warnings about the challenges of securing the necessary H-1B work visa, Mr. Masti chose Germany’s ESMT Berlin. “For many years in India, there was a fascination with going to the US to get an MBA,” Mr. Masti says. “But that has diminished.”

Falling demand for the traditional two-year MBA is a big concern for US schools, many of which suffered a decline in applications between 2014 and last year, according to data compiled by the Graduate Management Admission Council, the business school entrance exam administrator.

Given that applications have been rising at the same time for rival one-year MBAs offered by many European business schools, the suggestion by GMAC is that US schools are suffering because of their longer course length. The cost of tuition fees at top US schools, which have risen faster than salary increases achieved by students after graduation, is another concern for applicants.

Quality is another factor: US schools at the top of rankings have record numbers of applications, while the majority further down must work harder to recruit students.

However, research by the FT among a selection of US schools on its Global MBA Ranking found that, for many suffering declining applications, it is overseas students like Mr. Masti who are losing interest in the American MBA.

Eight of the 17 US schools in the FT list approached for detailed admissions data said that application numbers were down. At all but one of these, applications from US citizens have increased in the past year, while interest from overseas applicants has fallen.

The number of Americans applying for the two-year MBA degree at Carnegie Mellon University’s Tepper School of Business, for instance, increased by 5 percent in the current admissions cycle. But overall demand for the course was down 9.8 percent because applications from overseas dropped 16.8 percent.

Tepper’s dean, Bob Dammon, blames a growing reluctance among US employers to hire foreign nationals. “The job options for international students in the US [are] declining,” he says. “However, these are exactly the people who we want to keep in the US as part of our workforce.”

At the University of San Diego School of Business Administration, a 2 percent increase in applications from US residents this year contrasted with a 31 percent drop in applications from other countries. This matters because 59 percent of the school’s MBA class is from outside the US.

China and India are the two largest sources of overseas students on San Diego’s MBA course, but applications from the two countries were down 34 percent and 4 percent respectively.

Kacy Hayes, the school’s assistant dean of graduate programmes, says some students may be put off by a perception that the US is less welcoming to foreign nationals. But there are other factors behind the drop, she says. For instance, many admissions teams in US schools now use technology to detect applications from China that make fraudulent claims.

The growth in reputation and capacity of Asian schools has meant students from that region may be less inclined to study overseas, according to Ms. Hayes.

Aditi Sharma, a former consultant at Cognizant Technology Solutions, near Delhi, did plan to study abroad for her MBA, and was offered a place at Hult International Business School’s San Francisco campus and also at the UK’s Durham University Business School.

She opted for the latter, and the reputation of the UK education system, Durham in particular, was the important factor in choosing its course, says Ms. Sharma. Her fees are £23,000 ($31,000) after deductions from scholarship funding: substantially less than the $75,000 she would have paid at Hult.

Work visas are still a problem. In the UK, overseas students have only four months to find work after graduation, while if she had chosen to study in the US, Ms Sharma would have been able to stay for a year after graduating under the Optional Practical Training programme.

For many students, choosing a place at a business school outside the US is a positive choice.


Masti, for example, chose a German MBA over a US course primarily because of the benefits of moving to Europe’s largest economy, and the option to work in other EU countries without having to apply for separate visas every time he moves.

“The economy here is booming,” he says. “And the jobs are good quality.”

From the FT 

Sunday, May 27, 2018

Tuck Deadlines

Dartmouth’s Tuck School of Business has just announced the Tuck MBA deadlines for the 2018-2019 admissions season. The deadlines, listed below, reflect the school’s recent decision to eliminate its November round and shift the overall timeline to give applicants faster responses.

 2018-2019 Dartmouth / Tuck MBA Deadlines
Application Round
Application Deadline
Notification Date
Enrollment Deposit Due
Consortium For Graduate Study in Management 1
Consortium For Graduate Study in Management 2


Happy May, friends! May is a fascinating time for me and my Admissions colleagues, as we balance looking at both the present and the future. We’re still working to evaluate, select, and enroll great T’20s, as we fill the final seats in the class. At the same time, we’re gearing up to travel the world and meet you and aspiring T’21s in the coming months. We’re also working on revising and refreshing significant parts of our evaluation process and timeline. So let’s take a look at what’s happening!

There’s incredible enthusiasm at Tuck about our capital campaign for tomorrow’s wise leaders. This ambitious $250 million campaign is part of Dartmouth’s $3 billion campaign, and will strengthen our people, programs, and places. Each of these priorities advances our mission, and enhances your opportunities to contribute and thrive as a student. You may be most immediately interested in the commitment to growing our scholarship resources. I recognize that financing your MBA is an important consideration. If you want to be at Tuck, I want you to have the financial resources you need to be here. I’m thrilled that the campaign will bring us closer to that goal. I hope you’re excited about how the campaign will better equip you to be successful at Tuck and beyond. Don’t just take my word for it, hear how Dean Matt Slaughter and our students describe it.

My colleagues and I want your Tuck application experience to be as enjoyable and stress-free as possible. One of the least enjoyable, most stressful parts: the wait. I don’t want you waiting for your admissions decision any longer than necessary. So the team and I looked at our admissions rounds, and one number jumped out…100. That’s the number of days between our November round application deadline, and when we give you a decision—the longest wait of any round at any of our peer schools! We can do better. You’re hearing it here first. We’re “sun setting” the “applicant-unfriendly” November round. We’ll now offer three admission rounds with more applicant-friendly turnaround times: one in late September, one in early January, and one in early April. We’re saying goodbye to the “Early Action” designation in our first round, which is no longer early and required a higher enrollment deposit from you. And our rounds named for months? We’re simplifying that too. You’ll now apply in Round 1, Round 2, or Round 3. Exact dates are coming soon—I’ll have them for you here in June!

Admissions directors assess your professional trajectory and impact, but we need our own career growth and development too. Later this month, I’m participating in Tuck’s Leadership and Strategic Impact program, supported by Tuck Executive Education and our great faculty. Why share this with you? I want you to know how important lifelong learning is to contributing and thriving at the Tuck School, both for administrators like me and for aspiring students like you. When my colleagues and I read applications, we’re looking for evidence of your hunger and desire to grow and improve. This goes beyond others’ recognizing and rewarding your performance; it reflects your active pursuit of growth opportunities. If your organization offers professional development and leadership programs, build the case for your inclusion! If organizational opportunities are limited, find coaching and mentorship through your broader network. Professional development helps us all provide better service to our clients, good leadership to our teams, and increases our confidence in what we know while remaining humble about what we do not. I assure you that you’ll be a stronger applicant and a more prepared leader when you commit to your growth and development.

Speaking of commitment, I’m making a renewed commitment to be more active on Twitter. Follow me there if you want to see what I’m thinking in between blog posts, or to connect with me directly. See you there, or back here in June!

MBA view: should the Big Four be broken up?

Business school students discuss the future of the accountancy titans

The Big Four accounting firms, Deloitte, KPMG, EY and PwC, have successfully maintained their power and influence, despite repeated crises. But now British MPs have demanded that the Big Four be referred to the competition watchdog for a potential break-up following the collapse of Carillion, a government contractor.

Should the Big Four be split up? We put the question to MBA students from some of the world’s top business schools for their views. Join in the discussion in the comments below.

Breaking up the Big Four will neither increase auditor competition nor restore auditor independence and rigour. The question of “should” is irrelevant. Decreeing a split in these firms is pointless, as it would not solve the root problem. Plus, implementation is impractical as the Big Four’s operations are global and governments can only place restrictions within limited sovereign boundaries. Also, previous attempts demonstrate that “breaking up” the firms is not a lasting remedy for lax auditing.

Audit quality has been compromised over the past half-century by the addition of other revenue-generating services (ie, consulting), the increase in hires with non-accounting backgrounds, and the growing emphasis on maximising revenue. The result: significant cultural change within the firms.

Regulations need teeth. Current regulations are unenforceable and at the core of this issue is a lack of competition

Julie Kellman, Olin Business School
To maintain business, firms are more willing to go along with a client’s desire to avoid the standards rather than take a hard stance on observing them. The latter is a mark of true professional integrity. If we aim to restore the integrity of audits, we should require all professional staff at accounting firms to be certified as public accountants, injecting renewed respect for ethical practices. That is the first step to cultural reform and behavioural transformation.

The Big Four enjoy considerable lobbying power that would be reduced by breaking them up and this may help in stricter repercussions in auditing catastrophes.

However, it would be a mistake to think that simply breaking up the Big Four would be enough. The regulatory framework needs to be fixed soon — unless this barrier to entry is reduced, there will be a vacuum for truly multinational auditing firms that will sooner rather than later be filled up by an oligopoly again.

Breaking up the Big Four firms will not solve the problem arising from audit scandals.

This is because the audit firm and consulting firm fall under the same brand, but operate independently. In fact, in some countries, each practice is a separate entity. When both practices serve the same client, the Big Four firms have ringfencing mechanisms which restrict information-sharing between them. In addition, when the client uses both practices, the contracts are structured separately, as if purchasing from two different vendors.

Since the industry has failed to self-monitor, more effective regulations are necessary. But regulations need teeth. Current regulations are already unenforceable and the lack of competition is the core of this issue. The Big Four should be broken up to encourage competition, allow regulations to be enforced, and correct systemic failures.

The ‘big four’ auditors have life far too easy
What stands out here is the conflicts of interest inherent in professional services. All things considered, the Big Four are comparable. Corporations turn to the Big Four tier for legitimacy (a recognised seal of approval on their numbers) and seek an easy audit process. One way to differentiate is based on ease of client experience, a short-term factor that incentivises firms to sign off on flattering financial figures.

Unfortunately, the numbers have to add up eventually — which is glaringly obvious when suddenly the value of Carillion’s contracts diminished by £1bn .

More competition would allow regulations to act as intended: by penalising and correcting systemic failures as they occur.

I am not convinced a break-up of the Big Four professional service firms, by spinning off the audit functions as standalones, will completely alleviate the conflict of interest problem prevalent in the industry.

Operating with “Chinese walls” is embedded within the operating models but has not prevented companies from engaging in conflicting activities between audit and consulting.

Splitting up the Big Four can provide some temporary structural reforms that could contribute towards solving the conflict of interest problem. However, I believe in order to effectively combat the issue and protect its relatively vulnerable stakeholders, additional regulatory reforms will be required.

A break-up, in addition to regulatory reforms such as statutory rotation of auditors, could help reduce the problem.

If the firms are merely broken up, it will be a matter of time before they find legal and innovative ways to work with their consulting counterparts and we will be back to exactly where we are now.

From the FT