Why India Needs Homegrown Audit Giants: Insights from Grant Thornton Bharat CEO Vishesh Chandiok

Vishesh Chandiok, CEO of Grant Thornton Bharat LLP, highlights an important issue in India’s auditing scene. Currently, the landscape is dominated by the Big Four firms and smaller players. Chandiok asks, “Who stands up for Indian capital?” He believes we need more support for local firms to have a voice in setting standards.

India’s Audit Landscape

India is growing quickly, and some think it should have its own robust institutions. Looking at China, they began strengthening their audit firms about 15 years ago. By supporting their top firms, China significantly boosted their auditing capabilities. Many of these firms now compete with the Big Four on a global scale.

India, however, hasn’t taken similar steps. We face two main issues. First, there’s a lack of clear regulations for auditors of public interest entities. Second, we need to rethink how we attract capital. While the Big Four have access to various funding sources, Indian firms struggle to compete. Why can’t they explore private equity or venture capital?

There’s also potential for creating demand for domestic firms. For instance, introducing joint audits for top companies could be a smart starting point. Currently, in banking, joint audits exist, but many Indian firms often play smaller roles, preferring the Big Four due to their perceived credibility.

Addressing Capacity Concerns

Chandiok points out that both sides need to recognize the professional landscape. If changes are made, we might see the rise of an "Indian Big 10," where firms like Grant Thornton become major players.

Concerns about independence in accounting are valid. However, a more nuanced approach is needed. Restrictions should not be so strict that they inhibit growth. Around the world, many successful firms allow non-accountant professionals to join as long as qualified chartered accountants retain control. This model can help Indian firms gain the capital and talent they need without sacrificing independence.

The Urgency for Change

Chandiok emphasizes that the next six months are critical. By April 1, 2027, many companies will need to change auditors. Over half of the top firms are expected to rotate, and if reforms aren’t in place by January 2026, India could miss out on a significant opportunity for the next decade.

Building Indian Firm Capacities

To compete, Indian firms need to invest more in talent and technology. They should also have robust guidelines for whistleblowing and harassment policies. Many of these firms already have relationships with global networks, which can be leveraged to adopt best practices and modern methodologies.

Recent statistics show that companies prioritizing strong governance often attract better investments. A solid audit foundation can lead to better resource management and more attractive offers for investors.

Conclusion

India’s auditing scene stands at a crossroads. With the right support and reforms, there’s a real chance for domestic firms to thrive. As Chandiok suggests, it’s about building a competitive future rather than letting this crucial moment slip away.

For further insights on auditing and finance reforms, you can check out the Institute of Chartered Accountants of India or other trusted sources that discuss financial governance in more detail.

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