THE PROFESSIONS' WATCHDOG has launched an investigation into PwC's work as auditor of Berkeley Group Holdings.
The Financial Reporting Council (FRC) is looking at PwC's independence when it conducted the audit of house building company The Berkeley Group Holding's.
The investigation relates to the financial statements for the year ended 30 April 2012, and was brought about because a former PwC partner joined Berkeley's board.
Accountancy Age understands PwC's former UK vice-chairman Glyn Barker was appointed non-executive director on 3 January 2012 having been at PwC for 35 years.
He previously held several senior posts within PwC including managing partner and head of assurance as well as establishing and running the transactions services business.
Accountancy Age understands that the investigation is into the independent feedback role that Barker held when at PwC. The Big Four firm assigns a partner to gather feedback into the way the firm handled an audit. Although the partner has no role in conducting the audit or its judgment, the idea is that a business is more likely to be honest, if they have any aggreviances, with an indepdent person.
It is understood the watchdog is investigating whether Barker was in the "chain of command" by receiving feedback from Berkeley.
Earlier this month, at the FRC annual meeting the board said it had intitated new processes to ensure investigations were completed quicker.
In September the FRC hit Deloitte with a record-breaking fine of £14m for advisory work the Big Four firm undertook ten years ago.
A statement from PwC said: "We can confirm that we have received a letter from the FRC informing us that they are commencing an investigation. We will continue to fully cooperate with the FRC's enquiries. We take our independence responsibilities very seriously."
You may also like
If budgeting is to have any value at all, it needs a radical overhaul. In today's dynamic marketplace, budgeting can no longer serve as a company's only management system; it must integrate with and support dedicated strategy management systems, process improvement systems, and the like. In this paper, Professor Peter Horvath and Dr Ralf Sauter present what's wrong with the current approach to budgeting and how to fix it.
In this white paper CCH provide checklists to help accountants and finance professionals both in practice and in business examine these issues and make plans. Also includes a case study of a large commercial organisation working through the first year of mandatory iXBRL filing.