I have read with interest the reactions to the Competition and Markets Authority's report on the future of audit from of my campaigning accountants colleagues Prem Sikka and Atul Shah.

Prem, in the Guardian, argues that the CMA plan will not solve the problems. He defined that problem as:

What do BHS, Carillion, Conviviality, Quindell, Aero Inventory, the Co-op Bank, and London and Capital Finance have in common? They were all audited by the big four accountancy firms — PwC, KPMG, EY and Deloitte — which audit 97% of FTSE 350 companies and collect 99% of audit fees. In each case, these firms collected huge fees and delivered little of any public value. Their failure to spot the fragility of those businesses resulted in the loss of jobs, savings, pensions and tax revenues.

Yet the victims of these failures have no legal recourse to seek compensation because auditors owe a “duty of care” only to the company that hires their services, not to any individual stakeholder or creditor.

And he suggested that the CMA plan to create Chinese Walls in audit firms will not solve the problem of cross-subsidisation of audit and consulting services, and so conflicts of interest. It also, he says, does not address the problem of auditor longevity in office. And, although Prem does not say it, by implication he notes that there is no change to those to whom auditors are liable, which is too limited. What he does add is that he wants more market entry from firms not controlled by auditors: I confess I am not sure I follow the logic of this unless it is to allow state-owned audit functions.

Atul Shah in the FT has more focussed arguments. First, argues that the CMA:

avoids tackling directly the monopoly power of the Big Four and the urgent need to break them up to preserve competition and independence.

And he adds:

The other major contributor to audit failure is the UK's system of corporate governance. My research into the 2008 collapse of HBOS, the largest corporate failure in British history, shows that the bank's board and audit committee failed to adequately question the business strategy and risk-taking or to police the quality and conduct of audits.

Most non-executive directors rarely challenge the executives they ostensibly oversee. Instead, they have become habituated to rely on auditors to provide them comfort, and the auditors have in turn relied on management.

Everyone has been far too comfortable for far too long, and this CMA review does not change that in the slightest.

I mentioned when the CMA report came out that I was pleased there had been no backsliding by it: I had seriously expected it to back away from the demand it had made for Chinese Walls in the Big 4 and for joint audit. It did not. That amazed me, so great was the lobbying pressure on it. As a result I took comfort from that. And I still do. It makes me think that a line has been drawn which, I presume, will be defended. But it is, off course, worth asking whether the line is in the right place.

Let me be clear, I wanted the Big 4 to be split. No Chinese Walls. Split.

And I wanted greater audit rotation.

And support for the idea that a state agency could undertake audit when those in the market would not do so. Just as the state is lender of last resort and rail franchise operator of last resort the least we should have permitted was the idea that it be auditor of last resort as well.

And those did not happen. So I share the disappointment and frustration of Prem and Atul. But I would go further. I happen to think audit reform is meaningless without changing the content of accounts themselves. An audit of the wrong data is still going to fail, whoever does it. Hence the Corporate Accountability Network. And governance is not going to change until the statutory duty of companies changes to embrace all shareholders, with liability to them becoming a fact. So whatever happened I was going to be disappointed, because the reform required goes much further in my view than those mentioned by Prem and Atul.

But that leaves me a question, which is whether or not the reforms proposed by the CMA and criticised by Prem and Atul will work. I do not think they will.

I may be quite wrong, but if the CMA has withstood the pressure to impose Chinese Walls I suspect they intend to make them real. So, no cross working; no cross-subsidy; no shared finance; no data transfers; and so on. If this regulation is as tough as it should be the firms will split anyway. And that can happen in the UK in isolation because of the absurd corporate structure of these firms: they are not international entities when it suits them not to be so on this, so let's call them out and enforce this now. I think Prem and Atul (and I) will get the desired total split by the back door.

What I do think is that the smaller firms simply won't want the joint audits. There is little in them to their advantage I suspect. So that won't work.

And the clamour for deeper reform will continue as audit failures continue to amass - as they will, since accounts really do report the wrong information right now.

Of course I'd have liked this to have been done well. But maybe the profession has to realise that only radical change will work anyway. The CMA's half-hearted version won't. I suspect it will be enacted. I then think it will become apparent that it is undeliverable. And that is when radical reform will happen. And frustrating as it is, this may have been necessary.

The argument for fundamental reform - including to accounting as well as auditing - goes on in other words.