The US Securities and Exchange Commission is considering whether its auditor independence framework — designed to prevent conflicts between accounting firms and their clients — is outdated in an era where AI providers, cloud platforms, chipmakers and consulting firms are deeply intertwined. Kurt Hohl, the SEC’s chief accountant and a former EY partner, told an auditing standards conference in New York that current rules may no longer be “fit for purpose” as the Big Four increasingly sell products built on the same technology platforms used by the companies they audit.
Hohl said the rapid rise of AI alliances has made enforcing independence rules markedly harder. Major accounting firms now integrate tools from companies such as Microsoft and OpenAI into their own offerings. EY and KPMG sell products using Microsoft Azure OpenAI services, while PwC has become OpenAI’s largest enterprise user and markets ChatGPT alongside tax and audit work. FT Alphaville also confirmed that Deloitte is OpenAI’s auditor, a previously unreported fact that further illustrates how tightly connected the industry has become.
These overlapping commercial relationships mean that if the SEC interprets the rules strictly, some of the world’s largest tech companies could soon be left with only one acceptable auditor. Hohl said such an outcome would undermine the regulator’s goal of ensuring companies have genuine audit choice. On the sidelines of the conference, he emphasised that “a choice of one” is not a choice at all.
Big Four executives have long been frustrated by independence rules they say block them from taking on clients with only indirect or distant business ties. The rules also impose stringent requirements on staff to avoid holding any financial interest in audit clients, a constraint complicated by the spread of AI-linked products across global markets. EY previously attempted to spin off its entire consulting business to escape these limits and pursue broader tech partnerships, but the effort collapsed after internal opposition.
The SEC’s potential changes come as the commission, under chair Paul Atkins, pursues a deregulatory agenda and reassesses policies governing the Public Company Accounting Oversight Board, which oversees audit standards and independence rules. As partnerships between AI developers, cloud platforms and advisory firms accelerate, regulators now face a consequential choice: update independence standards for a new technological reality, or risk a future in which Big Tech companies effectively have no auditor choice at all.
