The Financial Reporting Council (FRC) is believed to have considered and then rejected a plan to force the Big 4 accountancy firms to spin off their audit arms.
Citing the Financial Times, Accountancy Age reports that the idea has been dropped after a document outlined the implications that such a move would have in the financial sector.
FRC, an independent regulator, is thought to have said that spin-offs could offer wider choice at a small cost but that the potential impact on quality was unknown.
Paul Boyle, the FRC's chief executive, cautioned that "until the Marketing Participants' Group (MPG) has a chance to comment it would be unsafe to assume any of these proposals will see the light of day - they're not official policy".
The MPG was formed last year to assess the actions that could be taken to mitigate the risks arising from the audit market for UK public interest entities.
It is made up of individuals from audit providers and shareholders.
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