The UK's accounting watchdog has criticised the Big Four audit firm Deloitte for failings in its work for software provider Autonomy Corporation, whose finance chief has was last month convicted of fraud over its acquisition by Hewlett-Packard.

The action by the Financial Reporting Council follows growing criticism of the largest auditing firms — Deloitte, EY, KPMG and PwC — and calls for greater competition in the market. It also comes amid a drive by the FRC to crack down on the companies it oversees after being chastised for being too soft.