Marks & Spencer backs its auditor PwC

Responding to a question at its annual shareholders meeting in London, the high street favourite said its board was not considering putting the audit contract out to tender next year and ruled out changing its auditor every three years.

Kevin Lomax, the chairman of the audit committee, said there was no evidence to suggest the sort of accounting scandals which have rocked corporate America should force a change of direction in the UK.

He said: ‘If you look at the governance regime for audit in the UK the big advantage is that most of our scandals happened in the 1980s and we have had new regulations come into place during the 1990s.’

Lomax added that M&S’ relationship with PwC ensured auditor independence was maintained by rotating the partner responsible for signing off the accounts ever seven years.

He said: ‘The problem with rotating auditors more rapidly is that there is quite a lot of evidence that things will go wrong soon after the new auditor has been appointed. It does take time for the new auditor to settle in.

‘I am confident what we have is right for the company. Shareholders can be confident about our auditors,’ he added.

In another development to come out of the meeting, M&S announced that Luc Vandevelde, its joint chairman and chief executive, would stand down as chief executive to make way for Roger Holmes, the current head of UK retailing. Vandevelde will revert to his original position of executive chairman.

This follows criticism for Vandevelde dual role as both chairman and chief executive after he resisted calls for the jobs to be split.