The OFT on Friday said it would refer the audit market for large companies listed in the UK to the .

Richard Sexton, board member for reputation and policy at PwC, which earned 47 percent of FTSE100 companies' audit fees, said he believed "in competitive markets where buyers are able to choose freely on the basis of quality and price. We see this market investigation as an opportunity to show that this is a fair and competitive market.

He added: "There is fierce rivalry as we compete vigorously for audit appointments. All of our audit engagements are for one year only, after which shareholders must vote again to decide on our reappointment."

Mazars, Europe's eighth largest audit and accountancy group which audits almost 300 companies with a listing on European capital markets, also welcomed the announcement but for different reasons.

David Herbinet, Mazars' London managing partner, said: 'An independent inquiry into the degree of competition in the large audit market is necessary in the public interest. We need a much more open vibrant market. This would better serve the 21st century needs of shareholders and wider society.