Australia's corporate regulator said on Thursday it had begun reviewing audit conduct complaints received by the Big Four accounting firms KPMG, Deloitte, EY and PwC after recent allegations of auditor misconduct at KPMG.
The review follows the Australian Securities and Investments Commission's (ASIC) formal investigation, launched in June, into three KPMG Australia partners over whistleblower allegations that the firm misused confidential client data to win lucrative audit contracts.
The surveillance will examine internal complaints, including whistleblower complaints, received by the firms in connection to the external audit services they provide, ASIC said in its statement.
ASIC also said on Thursday it will continue its "significant investigation into specific allegations of misuse of client confidential information at KPMG."
"ASIC will use the existing suite of limited powers available to us, while continuing to engage constructively with the Government's reform process," ASIC Chair Sarah Court added.
The four auditing firms did not immediately respond to a request for comment from Reuters.
Under the existing laws, ASIC does not have broad-based powers to regulate the partnership-based auditing firms as opposed to corporations such as listed companies.
"ASIC's jurisdiction in relation to audit firms, as opposed to individual auditors, is limited," she said.
"We can generally only investigate certain individuals within a partnership, registered company auditors, and only in relation to their conduct of an audit."
ASIC has pushed to be given greater powers to police audit firms and to increase the sanctions available for wrongdoing.
The review will also include whether the firms have received complaints relating to misconduct by auditors, such as the misuse or sharing of confidential information, the regulator added.
In March, Labor Senator Deborah O'Neill told parliament a whistleblower had alleged KPMG used confidential Lendlease (LLC.AX) board papers to support bids for major audit tenders at Westpac (WBC.AX) and Dexus (DXS.AX).
KPMG had investigated the claims internally at the time but did not substantiate any misconduct.
