NEW DELHI: The recent action by the disciplinary committee of the Institute of Chartered Accountants of India (ICAI) suspending a former Pricewaterhouse Coopers Pvt. Ltd auditor from the ICAI register for a year has once again exposed negligence on the part of Big 4 audit firms.
The ‘Big 4’ audit firms dominate the audit business in India, with the majority of listed corporations using their services. PwC, Deloitte, KPMG, and EY are the Big 4 accounting firms that provide professional services to the government in policymaking and project implementation.
But what happens if the guardian begins to break the rules? The Big 4, which audit big corporations in India and around the world, have frequently made the news in recent years due to a number of audit failures around the world.
Pricewaterhouse Coopers – Satyam Computer Connection
The current case is not the first time when PwC is caught in soup. One of India’s biggest frauds which exposed the negligence in auditing also involved PwC.
Satyam Computer Services Ltd., based in Hyderabad, India, was a renowned information technology business. Ramalinga Raju, the company’s promoter, admitted to large-scale financial earnings manipulations in January 2009. Since April 1, 2000, the market regulator Securities and Exchange Board of India has issued show-cause notifications to PWC network firms, Satyam’s auditors. SEBI barred PwC network businesses in India from giving any certificate of audit for listed companies for a period of two years after completing its probe in January 2018.
Amidst the rising cases of such lapses, experts are worried if PwC was going Arthur Andersen’s way. Arthur Anderson was formerly one of the “Big Five” accounting firms, but professional lapses led to the fall of the American firm. Also, experts highlight that government must keep a watch on such malpractice and regulate auditing firms.
Here Are Some Of The Cases Where PwC Was Caught On The Wrong Side:
1) PwC fined over exam cheating involving 1,100 of its auditors
2) PwC ‘under probe’ in Religare fraud: EOW. PWC fined Rs 230 crore for Foreign Exchange Management Act violation
3) SEC slaps $17.5 million in fines on Satyam, PwC in fraud case
4) PwC slapped with 2 year audit ban in India
5) PwC Banned From All Kerala IT Projects For Inadequate Scrutiny Of Prime Accused In Gold Smuggling Case, Swapna Suresh
6) Sebi bans PwC for 2 years: It is unprecedented but a wake-up call for auditors, others associated with capital markets
7) Regulator Fines PwC for Audit Shortfalls Related to British Service Provider
8) Audit regulator fines PwC Mexico $100,000 for violating independence rules
9) PWC fined Rs 230 crore for Foreign Exchange Management Act violation
10: PwC Canada Is the Latest Big 4 Firm to Get Busted By Regulators For Employees Cheating on Internal Training Courses
11) PwC fined £6.5m over ‘lack of competence’ in audit
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