This year’s KFAT shows that membership of the accountancy bodies continues to grow, with nearly 390,000 members in the UK and Republic of Ireland and over 590,000 members worldwide. The number of accountancy students in 2021 the UK also increased by 0.3% to 164,000.

The report also looks at trends in the audit market and found that the five largest challenger firms outside the Big Four continued to increase their share of the FTSE 250 audit market, auditing 24 companies in 2021, compared to 19 the previous year.

Improving competition across the FTSE 350 audit market is one of the primary objectives as the FRC transitions to the new regulator, the Audit, Reporting and Governance Authority (ARGA). The government recently set out how new powers for ARGA will boost resilience, competition and choice in the audit market in its response to the consultation on strengthening the UK’s audit, corporate reporting and corporate governance systems.

Despite the challenging economic climate, the Big Four firms increased their audit fee income by 6.5% from 2020 to 2021, compared with 7.9% from 2019 to 2020. While the audit fee income for audit firms outside of the Big Four also increased, the growth slowed to 12.5% from 2020 to 2021, compared with 20.9% from 2019 to 2020.