I could not believe my eyes when I saw this headline! Once upon a time when Chartered Accountants were judged by their reputation, things were different I guess.
PwC when it pitches for business now must be saying..’See we are such a big firm, a few frauds do not matter’. However long ago when I had just passed out of Bcom we were told to choose a firm to do C A – the choice of Sharp & Tannan was not because they were big (yes they continue to have L&T, Crompton Greaves, etc.) but because THEY HAD (HAVE) REPUTATION. Unfortunately in any profession judging the skills of a professional by just the money he has is so so stupid! I do agree there are accountants in practice who make far more money than their honest counterparts, but their white shirt and white pant does not make them look clean does it? There are people like Mr. Y H Malegam, H K Bilpodiwala, Mr. Patil, Mr. Nair (C C Choksi) etc. who got business because they were good.
Mr. Y H Malegam actually must have lost money when his firm (S B Billimoria) refused to give a ‘certificate’ to Raymond for issuing bonus shares. On principles he quit the audit – which was taken up by Dalal & Shah. Sure Dalal& Shah got all the money and the chuckle chuckle from all the professionals. Or why Mr. Lodha has a higher net-worth than my friend Mr. Vikamsey. Mr. Vikamsey’s clients do not have to worry about a will :).
So the clients of Pricewaterhouse should ask themselves why they are paying a premium to PWC for their name. If it is for getting red ticks all over their vouchers – my daughter can do it in her forthcoming summer vacation. If it is for reputation, that should have taken a hit. If professionals continue to work for a brand that people sneer at (Satyam and Global Trust bank, RBI censure – all of this is a pattern is it not?).
Shame, shame on corporates who have stuck to the same firm – at least they should have cut the audit fees by half perhaps. Pw C found it so convenient to allow Satyam to be ‘internally audited’ by their own staff, that this alone is enough to question their intention and integrity, forget competence.
PwC global chief of course has said they have taken steps to boost internal controls. Quite a joke Mr. Dennis Nally. It also leads us to one question – if audit firms are so big, should they not be audited and rated? Of course they will baulk, but the role of auditors, rating agencies, etc. have to be questioned post 2008. Mr. Nally says ‘you can never completely eliminate the possibility of material fraud’. Nice one Mr. Nally. Only the fees that Satyam paid – Rs. 4 crores vs. Rs. 1 crore of Infosys is a little difficult to digest.
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