October 17, 2018

Extraneous mentions of Enron in the MSM

PwC’s Ian Powell Will Have You Know That His Firm Is Turning Away Millions in Business in the Name of Independence

It could be argued that the Big 4 is on some thin ice re: independence by trying to grow their advisory businesses. But hey, can you blame them? The audit and tax service lines alone can’t keep the lights on of a multi-billion dollar firm (but not really one firm, it’s actually a network of firms that operate under a single name, JSYK).

And besides, if you were to ask Ian Powell, the UK Chair of PwC, he’d tell you that they have to beat off clients with a stick that want that PwC experience all over them. But you know what? Independence is far too crucial tenant of the business to be jeopardized by some overeager clients that are throwing a few million clams at P. Dubs. THEY. DON’T. NEED. IT.


Mr Powell put down his binoculars to give an interview to the Financial Times where the “affable and youthful-looking” Chair dispelled any idea that the consulting business posed any risk to PwC losing its independence merit badge:

Mr Powell thinks the traditional skills of consulting can still have great value, such as in “sourcing, outsourcing, supply chain and workforce efficiency” – areas PwC has been investing in – “that can demonstrate a short term payback”.

Here again he faces controversy – persistent claims since the collapse of Enron that the Big Four’s growing consulting practices could affect their audit independence.

He responds: “We will not take on any assignment that we believe either will bring us into any independence issue, but even more so would bring us into any perceived independence issue – so we turn away millions and millions of pounds worth of business each year.”

PwC boss seeks debate on regulation [FT]