Friday, March 20, 2009
"The auditor PricewaterhouseCoopers [PWC] is overhauling its operations in India two months after starting an investigation into fraud at one of its Indian clients. The auditor, which has nine offices in India, said Thursday that it would make sweeping changes to 're-emphasize quality.' They include addind a five-member advisory board in India, appointing a new head of risk managment from outside India to oversee work done in the country and a new auditing team in India, and changing the managment in its office in Hyderabad. ... [PWC] has said that there was no evidence that the two auditors were complicit in the suspected fraud. Still the changes announced Thursday may raise questions about whether quality problems are more widespread in India. ... [PWC's] new advisory board will comprise four executives from outside the company and one [PWC] executive from outside India. A new head of quality assurance and risk management, who will review the company's work in India, will also come from [PWC] operations outside India. The global firm fully supports the new steps taken in India, Samuel A. DiPiazza Jr., chief executive of [PWC] International, said in a statement. 'It is essential that the quality, expertise and behavior and partners in PWC firms all over the world are, and are clearly seen to be,of the highest standards,' he said", Heather Timmons at the NYT, 6 March 2009, link: http://www.nytimes.com/2009/03/06/business/worldbusiness/06audit.html.
More PWC smoke and mirrors. Will PWC agree to be sued for its Indian "affiliate's" actions? If not, PWC doesn't exist. PWC can apparently force changes on its Indian affiliate, yet claims to be a legal separate entity. Well PCAOB, where are you? End this nonsense. Now. Did PWC fail to emphasize "quality" before? What does audit "quality" mean anyway? A new advisory board, bah humbug. More corporate governance nonsense. See also my 12 February 2009 post: http://skepticaltexascpa.blogspot.com/2009/02/price-watergate-3.html.