PricewaterhouseCoopers stands to lose more than #2m in annual audit fees after high street bank Abbey National announced plans on Tuesday to switch to Deloitte & Touche.
An Abbey National spokeswoman said the company decided to embark on a review of its audit arrangements earlier this year because of concern over the concentration of banking and life assurance audits brought about by the merger of Price Waterhouse and Coopers & Lybrand.
Pending a shareholder vote at its agm in April, Abbey National will make the change after PricewaterhouseCoopers completes its audit of the bank’s 1998 accounts.
Coopers & Lybrand earned #2.1m in fees for Abbey National’s 1997 audit and the bank spent a further #4.8m on tax advice and other consultancy. A spokeswoman indicated that the company would continue to work with PwC on other projects in the future.
Abbey National’s internal audit committee was chaired by former English ICA president Keith Woodley and considered tenders from all of the Big Five firms.
A PwC spokesman said the firm was ‘naturally disappointed’ to lose a long-standing client. Abbey National was one of a small number of clients that had expressed concerns about the merger, he added, ‘but we’ve been able to assuage the fears of others who expressed that view.
‘No other FTSE-100 company has put its audit out to tender as a result of the merger.’