PwC will be only truly independent Big Five auditor, says chief

Under the plans, announced yesterday, only audit, tax and business advisory services will remain under the PricewaterhouseCoopers banner, while management consultancy and other functions will become a separate business.

The firm has not wasted any time in capitalising on any marketing advantage the split offers, even though full details have yet to be rolled out.

In a statement to the firm’s clients published on its Internet site, chief executive James Schiro said: ‘This constitutes something unique to the Big Five – a completely independent global auditing firm.’

Regulatory constraints, particularly under tough US Securities and Exchange Commission rules, have made it hard for the PwC to raise cash because of its audit relationships.

Schiro added the move would give the firm ‘freedom to create strategic alliances and joint ventures and access capital markets – all of which are now largely prohibited by auditor independence requirements.’

The decision to split follows mounting speculation that PwC was considering a break-up and moves by the US Securities and Exchange Commission to enforce audit independence rules more strictly.

Last November PwC announced it was examining different options for its future structure following the merger of Coopers & Lybrand with Price Waterhouse.

Schiro’s reorganisation message to clients

Related reading