US watchdog forces loss of major client for PricewaterhouseCoopers
PricewaterhouseCoopers has lost the Compaq audit after pressure from the US Securities and Exchange Commission persuaded the computer giant to name Ernst & Young as its new auditor.
Compaq said it had been asked by the US watchdog to name new accountants as a result of its crackdown on auditor independence, the Financial Times reported from the US today.
The firm may also be forced to drop another major client, Cisco, and potentially faces the embarrassment of having to stand aside while a rival firm repeats last year’s audit.
Both developments follow the publication of an SEC report last month which found that more than 8,000 instances of PwC staff and partners holding shares in audit clients, which contravenes its regulations.
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