I’ve always subscribed to the belief that you lose your edge in the absence of competition. In my humble opinion, the more heated the competition, the better.Coming from the New York area, I witnessed such now-defunct retailers as Herman’s World of Sporting Goods and Pergament Home Centers inexplicably remain in business for years — powered solely by a disastrous tandem of high prices and poor service. Normally, that one-two recipe for disaster would result in soaped-up windows. They managed to survive only because they were relatively competition-free in their respective channels. However, once national powerhouses such as Sports Authority, Home Depot and, later, Lowe’s arrived on the scene, they disappeared faster than Tony Soprano at an FBI convention.

The same principle of competition obviously applies to the auditing profession. Would, say, Deloitte, the country’s largest accounting firm, be as motivated to secure new audit clients or retain its current book of business if it didn’t have Ernst & Young, KPMG or RSM McGladrey ready to step in if it faltered?

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