A potential breakup of the Big Four accounting firms could see their legal arms boosted by the removal of conflict issues that restrict the clients they can target, according to former Big Four lawyers.

Pressure has mounted on KPMG, Deloitte, EY and PwC in recent days after all four came under heavy criticism in last week's (16 May) final parliamentary report into the collapse of construction giant Carillion.

The report states that the failures around Carillion were caused by a market that "works for the Big Four firms but fails the wider economy" and calls for the Competition and Markets Authority to consider breaking up their audit arms or splitting audit functions from non-audit services.

While these proposals have provoked strong pushback in the accounting community, with both PwC and Deloitte stating that a breakup would "hurt audit quality", lawyers who have worked at the Big Four say that an audit split-off could give accounting firms' legal departments greater access to clients previously off-limits due to conflict rules.

One former PwC lawyer now in private practice said: "Because of the rules which do not allow them to provide legal services to audit clients, a breakup could give Big Four legal teams the opportunity to broaden their client base. It has always been a challenge for the Big Four legal departments that they can't go after work for audit clients.

"If they could go after existing audit clients, the Big Four have 99% of the FTSE 100 on their audit books. Ultimately, when you have people like the Big Four with the resources and money to invest in growing a practice, you have to see that as a concern, especially with the ongoing consolidation in the legal market."

Discussions around breaking up the accounting and professional services arms of the Big Four have been aired before, but are likely to gain more traction following the Carillion collapse, according to one Big Four lawyer, who also spoke of frustration at not being able to pursue clients held by their auditing wing due to conflict rules.

A former Big Four lawyer now in private practice said that while on a "cost-benefit analysis" the Big Four would not choose to split their businesses unless forced to, such a move would open doors to wider range of potential clients for their legal teams.

They said: "It will help the legal departments if they get split up. Historically they have been unable to chase most existing clients of the business, and it would help the legal side in relation to the clients that they audit, if they could get around existing rules."

All of the Big Four have said they have drawn up contingency plans for a breakup of their UK businesses. A Deloitte spokesperson said that while the firm does "recognise the concerns" raised by the report, "audit-only firms would reduce audit quality", while a spokesperson for PwC said: "Contingency planning is regularly considered by the firm's key governance bodies."

Last year, research conducted by ALM Intelligence found that Deloitte, EY, KPMG and PwC collectively employ about 8,500 lawyers globally. PwC, which has the largest legal arm of the Big Four, has about 2,500 lawyers, making it the world's sixth-largest legal services provider by that measure.