PwC replaces Deloitte as Linklaters auditor after Arsenal lawsuit

PwC replaces Deloitte as Linklaters auditor after Arsenal lawsuit

The conflict began when Arsenal stakeholder Lady Nina Bracewell-Smith filed a professional negligence claim against the Big Four and magic circle firms, claiming their advice caused losses of £10m

PwC replaces Deloitte as Linklaters auditor after Arsenal lawsuit

Deloitte has resigned as auditor of Linklaters after the firms became embroiled in a tax advice row over the sale of a major stake of Arsenal.

PwC has been selected to take over as the magic circle firm’s auditor after Deloitte stepped away due to the conflict of interest.

Friction between Deloitte and Linklaters began last year when major Arsenal stakeholder Lady Nina Bracewell-Smith filed a lawsuit against both firms for “professional negligence”, after she employed their services to advise on selling her 15.9% share of the club to majority shareholder Stan Kroenke in 2011.

Bracewell-Smith accused the firms of negligent advice which led to loan notes being sited in the UK rather than overseas, making her liable for capital gains tax in the UK and leading to losses of £10m. She added that the error forced her to move to Monaco at the cost of £1.25m.

Both Deloitte and Linklaters pointed fingers at one another in court documents at the time. Linklaters said that responsibility of the tax aspects of the deal fell to Deloitte and Bracewell-Smith, while Deloitte countered that it did not know where the loan notes would be sited and “did not have any duty to check.”

Deloitte added that it was Linklaters responsibility as “they had been retained to advise her on the legal documentation relating to the sale of her shares.”

In now deleted tweets Bracewell-Smith said she “deeply” regretted selling her shares to Kroenke, which helped him secure a 63% majority.

Related Articles

Sir Donald Brydon appoints team for his audit review

Audit Sir Donald Brydon appoints team for his audit review

2d Beth McLoughlin, Managing Editor
Patisserie Valerie rescued in management buyout backed by Causeway Capital Partners

Audit Patisserie Valerie rescued in management buyout backed by Causeway Capital Partners

1w Lucy Skoulding, Reporter
"There isn't a single answer to fixing the cyber security problem," says Rainbird CEO

Audit "There isn't a single answer to fixing the cyber security problem," says Rainbird CEO

1w Emanuela Hawker, Reporter
What do audit clients think about audit?

Audit What do audit clients think about audit?

2w Emanuela Hawker, Reporter
Time for an overhaul of public audit

Audit Time for an overhaul of public audit

2w John Tizard and David Walker
Audit reform: The devil is in the detail

Audit Audit reform: The devil is in the detail

3w Ruth Bender
Has the audit process improved since Carillion? No, say company secretaries

Audit Has the audit process improved since Carillion? No, say company secretaries

4w Beth McLoughlin, Managing Editor
EY to improve audits via independent panel

Audit EY to improve audits via independent panel

4w Lucy Skoulding, Reporter