The UK government said on Tuesday that it will replace the sector’s regulator, the Financial Reporting Council, with a new watchdog that will be given tougher enforcement powers and be funded by an industry levy.

The widely awaited reforms come after the government and industry promised to improve audit quality following a series of past scandals such as the collapse of Carillion in 2018 and the BHS failure in 2016. All of the major auditors accepted the need to change auditing since then and restructured their audit practices.

The Audit, Reporting and Governance Authority will also have the ability to designate large private companies as “public interest entities” to ensure they are more transparent with investors. FTSE 350 firms will also need to conduct some of their audits with a challenger firm to PricewaterhouseCoopers, KPMG, Deloitte and Ernst & Young – to help nurture more competition.

KPMG was fined over £14 million ($17.7 million) over misconduct on major work it carried out for Carillion and data services company Regenersis. The firm has faced ongoing criticism for the quality of its work. It has previously been fined millions of pounds over shoddy audits of companies including Conviviality Plc, Silentnight Group and Ted Baker Plc.

Administrators for NMC Health sued Ernst & Young in the U.K. over claims of negligent auditing spanning six years. Elsewhere Deloitte was penalized £15 million for its audit of Autonomy Corp., and PWC is being probed by the regulator for Greensill Capital and Sanjeev Gupta’s Wyelands Bank.

“This is about trying to reduce the risk as much as we can – these big unexpected collapses like Carillion and BHS,” Martin Callanan, minister for corporate responsibility, said in an interview. “We also want to reinforce the UK’s reputation with investors who rely on information about the health of these companies and it’s also about trying to restore public trust in big business through transparency and accountability for the people who run and the people who audit these businesses.” BM