Audit - More PwC clients defect
Two former PricewaterhouseCoopers audit clients have switched to Deloitte & Touche after recent review exercises.
Building products conglomerate Caradon told Accountancy Age that it had made the decision after asking PwC and rival Big Five firms to tender for the work towards the end of last year. There were ‘no factors’ involved, according to Caradon’s group finance director Martin Clarke.
The Caradon defection followed that of private City bank Leopold Joseph, which indicated the change in its interim report for the six months ended 30 September 1998. Deloittes’ appointment will be subject to confirmation at the bank’s agm, scheduled for September.
Leopold Joseph financial controller Paul Conroy said the bank had a five-year contract with Coopers & Lybrand and decided to invite tenders from all of the Big Five. KPMG and Ernst & Young declined the invitation.
Leopold Joseph paid PwC #107,000 in audit fees and #45,000 for other services in the 1997 financial year.
‘Price is always a consideration, but there wasn’t too much in it,’ said Conroy of the decision that followed the bank’s beauty parade. Although Deloittes did not have such a hold on the retail banking market as PwC, ‘they have a background in our market and pitched very well,’ he added.
A PwC spokesman said the firm continued to have a good relationship with Leopold Joseph’s senior managers.
The loss of Caradon’s audit was not so much fall-out from last year’s merger, but a commercial decision, he added. ‘The reduction in the fee which Caradon was apparently seeking coupled with the potential costs of reproposal were greater than we were prepared to accept,’ he said.