In the first half of the year, Tekedia Capital has invested in about two dozen companies across the world. Now, we are looking for more opportunities in Nigeria.

Our preference is for companies solving foundational market frictions. Yes, businesses that can eventually become platforms powering entire ecosystems and creating new bases of competition. We are sector-agnostic and back exceptional founders wherever we find them. And yes, we move quickly.

How do you get started? It is simple: send us your public website. No pitch deck. No proprietary information. No lengthy documents. If we visit your website and like what we see, our investment team will reach out for more.

Build. Launch. Share your website. Let us see what you are building in Nigeria.

Tekedia Capital >> we fund innovations

The Australian government is contemplating sweeping changes to the country’s accounting industry, including potentially breaking up the Big Four firms and bringing them under the oversight of the corporate regulator, in response to a string of damaging scandals that have shaken confidence in the sector.

The proposals, detailed in an options paper released by the Treasury Department on Wednesday, also include reducing the maximum size of partnerships from 1,000 to 400 members and introducing mandatory rotation of audit firms. The paper, according to Reuters, highlighted regulatory gaps exposed by recent misconduct at Deloitte, EY, KPMG, and PwC, drawing comparisons with oversight frameworks in Britain and the United States.

“In recent years, we have seen behavior from some large accounting, auditing and consulting firms in Australia that is not fair and honest,” Assistant Treasurer Daniel Mulino said in a statement. “This has undermined trust in the firms themselves and raised broader questions about the resilience of the frameworks meant to uphold market integrity.”

The potential interventions largely echo recommendations from parliamentary inquiries sparked by the 2023 PwC tax leaks scandal, in which confidential government policy was shared with clients to secure new business. Most of those recommendations have yet to be implemented. KPMG is currently facing its own crisis following whistleblower allegations that it shared confidential company information with prospective private-sector clients to win auditing work.

The Big Four currently operate as partnerships rather than companies, meaning they fall outside the direct supervision of the Australian Securities and Investments Commission (ASIC), which imposes strict reporting requirements on corporate entities. Instead, they are governed by state-based laws.

Mulino indicated that structural separation, forcing firms to split their audit and consulting arms to reduce conflicts of interest, is among the stronger options under consideration. An alternative would involve operational separation, preventing firms from providing both audit and non-audit services to the same client.

The government is also examining whether to lower the current cap of 1,000 partners in accounting firms to align more closely with the 400-partner limit applied to law firms. Other proposals include measures to improve audit market diversity, such as mandatory firm rotation every two decades. The Treasury paper noted that the Big Four audited 96% of Australia’s top 200 companies in 2022.

“There are other changes as well — providing ASIC with more powers, more oversight and stronger penalties,” Mulino told reporters in Canberra.

Industry Response and Calls for Deeper Reform

The Big Four firms responded cautiously to the proposals, emphasizing their willingness to engage while highlighting ongoing internal reforms.

“We welcome the release of the options paper by Treasury and the opportunity to engage constructively on any measures, which strengthen trust in the profession,” a Deloitte spokesperson said.

EY Oceania CEO David Larocca said the firm supported many of the options outlined.

“We have an important role to play in restoring and maintaining trust in the sector,” he said in a statement.

PwC described the paper as “an important opportunity to contribute to strengthening and rebuilding trust in our industry.”

“Our firm has undergone significant transformation across the past few years, and that work continues,” a spokesperson said.

KPMG said it supported reforms that strengthened governance, transparency, auditor independence, firm-level regulatory oversight, and public confidence in the profession.

However, critics argue the proposals do not go far enough. Deborah O’Neill, a senator from the ruling Labor Party who brought whistleblower allegations against KPMG to light in March, said the “unethical” culture exposed by successive scandals needed to be fundamentally disrupted.

She warned the firms would “fight tooth and nail” to preserve their existing structures “because it is in their financial interest to do so.”

Barbara Pocock, a Greens senator who has long advocated for tougher regulation, said the government already had clear recommendations from previous inquiries and should act urgently.

“Labor needs to put an end to the Big Four’s special treatment and regulate them like other Australian businesses,” she said in a statement.

Brendan Lyon, a former KPMG partner who also blew the whistle on ethical breaches, described the current proposals as “tinkering around the edges.” He argued that the firms needed to be regulated as companies to address the competitive advantages and opportunities for misconduct that arise from operating without sufficient monitoring.

“We are the global epicenter of Big Four misconduct. We’ve seen two Big Four CEOs forced from their roles, disgraced over material misconduct, and the cover-ups that have followed,” he said. “The government admits that the system is broken. It identifies many of the factors, but it doesn’t deal with the key issue, which is the competitive advantage and opportunity for misconduct that’s created when you operate completely unmonitored, unbound and unsanctioned.”

A Pivotal Moment for Australia’s Corporate Oversight

The Treasury paper represents a significant moment for Australia’s corporate governance landscape. The Big Four have long enjoyed a dominant position in the auditing and consulting sectors, but repeated scandals have eroded public trust and prompted calls for structural reform. By considering options such as breaking up the firms or imposing stricter separation between audit and non-audit services, the government is signaling a willingness to challenge the status quo.

The proposals also reflect growing international scrutiny of concentrated professional services markets. Regulators in Britain and the United States have implemented or considered similar measures to address conflicts of interest and improve competition in auditing.

For the Big Four, the coming months will be critical as they engage with the consultation process. Their responses suggest a recognition that change is inevitable, though the extent and nature of that change remain subjects of intense debate.

Australia’s corporate regulator, ASIC, would likely gain significant new responsibilities if the firms were brought under its purview. This could lead to stricter reporting requirements, enhanced oversight, and stronger penalties for misconduct.

However, the outcome of this review is expected to have far-reaching implications for corporate Australia. This is because a more competitive and better-regulated auditing sector might improve the quality of financial reporting and restore confidence in markets. At the same time, overly aggressive reforms risk disrupting established business relationships and increasing costs for companies that rely on the Big Four’s services.

Japan’s currency has fallen to its weakest level in four decades, reviving speculation that authorities could once again intervene in foreign exchange markets. However, economists and investors warn that even another multi-billion-dollar intervention is unlikely to reverse the yen’s decline unless the gap between U.S. and Japanese interest rates narrows.

The yen weakened to 162.83 per U.S. dollar on Tuesday, its lowest level in 40 years, according to LSEG data. The slide has renewed expectations that Japanese authorities could step back into the market after spending a record 11.7 trillion yen ($73.5 billion) in April and May buying their own currency.

The renewed weakness illustrates the difficult position confronting Tokyo. While Japan has both the financial firepower and political willingness to intervene, market participants say currency intervention cannot fundamentally alter the economic forces driving investors away from the yen.

At the heart of the problem is the widening monetary policy divergence between the Bank of Japan (BOJ) and the U.S. Federal Reserve.

Although the BOJ has begun moving away from years of ultra-loose monetary policy and recently raised its benchmark interest rate to 1%, Japanese borrowing costs remain far below those in the United States. The higher returns available on dollar-denominated assets continue to encourage investors to sell yen and buy dollars.

Christy Tan, global investment strategist at Franklin Templeton Institute, said market intervention has clear limitations.

“Intervention can slow a fall, punish speculative excess and signal official discomfort. But it cannot repeal arithmetic,” she said.

She explained that the interest-rate differential remains the dominant force weighing on Japan’s currency.

“As long as investors can borrow cheaply in yen and earn more in dollars, the carry trade will keep carrying the yen away,” she added.

The carry trade, in which investors borrow in low-yielding currencies such as the yen to invest in higher-yielding assets elsewhere, has become one of the principal drivers of the currency’s prolonged weakness. The challenge has intensified as investors increasingly believe the Federal Reserve could keep interest rates elevated for longer.

Persistent inflationary pressures and resilient U.S. economic growth have led markets to scale back expectations for aggressive rate cuts, with some investors even leaving room for the possibility of additional tightening if inflation remains stubborn.

Tan said markets increasingly see the policy gap as the core issue.

“It appears that investors identify the core problem as the widening credibility gap between the Federal Reserve and the Bank of Japan,” she said.

Currency markets appear to support that assessment.

While the yen has depreciated sharply against the U.S. dollar, it has remained relatively stable against the euro, suggesting that the recent weakness reflects broad dollar strength as much as concerns about Japan itself. According to LSEG data, the yen has fallen roughly 3.9% against the dollar this year, compared with only 0.9% against the euro.

Martin Schulz, chief economist at Fujitsu, said the divergence highlights the dominant role of the stronger U.S. dollar.

“If we look at the yen-euro, for example, it is more stable,” he said.

He added that investors continue to view the BOJ as moving more cautiously than other major central banks.

That dynamic significantly reduces the effectiveness of unilateral intervention. Several market participants believe Japanese authorities may intervene if the currency weakens further.

Vincent Chung, co-portfolio manager for the diversified income bond strategy at T. Rowe Price, said traders are closely watching the 162-163 per dollar range.

“If intervention comes only from Japan while the dollar remains broadly strong, I think it may have limited effectiveness,” he said, then added, “Historically, coordinated intervention involving other central banks, particularly the U.S., has tended to create a much stronger reaction in the yen.”

Alexandre Drabowicz expressed a similar view, suggesting that another intervention threshold could emerge around 164-165 yen per dollar, while cautioning that previous operations have produced only temporary relief.

“To be really effective, you need coordination between the U.S. and Japan.”

Such coordination, however, appears unlikely in the current environment. The United States has generally favored allowing market forces to determine exchange rates unless currency movements threaten global financial stability.

For Japan, the weak yen presents both opportunities and risks.

Export-oriented manufacturers continue to benefit because overseas earnings become more valuable when converted back into yen. The currency’s depreciation also improves the international competitiveness of Japanese exports.

That helps explain why Japanese equities have remained relatively resilient despite the currency’s decline. Schulz noted that Japanese manufacturers continue to benefit from the exchange rate, while the BOJ’s latest Tankan business sentiment survey showed stronger-than-expected confidence among large manufacturers.

The benefits for exporters, however, come at a growing cost to households.

A weaker yen raises the price of imported fuel, food, and raw materials, increasing living costs for consumers and putting additional pressure on household budgets. Higher import prices also risk entrenching inflation at a time when policymakers are attempting to support economic growth.

The situation creates a delicate balancing act for Prime Minister Sanae Takaichi’s government.

Tokyo wants to sustain export competitiveness and corporate investment while protecting households through subsidies aimed at cushioning higher energy and food prices. At the same time, officials are increasingly uncomfortable with the pace of the yen’s depreciation.

Tan summarized the dilemma facing Japanese policymakers.

“Tokyo wants a stronger yen without fully accepting the policy costs of one,” she said.

Those costs would likely include substantially higher domestic interest rates, which could slow economic growth, increase government borrowing costs and weigh on corporate investment.

Currently, analysts broadly agree that while intervention may slow speculative selling and temporarily stabilize the currency, a sustained recovery in the yen will ultimately depend on a narrowing of the U.S.-Japan interest-rate differential.