PwC scandal gets murkier
The PwC tax scandal just gets messier and murkier. The latest statement from acting CEO Kristin Stubbins was one for the ages.
Boy, did she throw “former” PwC partner Peter Collins and only him under the bus – and then reverse back over him.
He is of course only now a “former” partner; he was just another partner when, according to Stubbins, he “breached confidentiality”; acted “contrary to obligations”; and contrary to PwC “policy and values”.
Collins was the only partner named by Stubbins in her lengthy, purportedly fully transparent statement, that didn’t manage to get around to naming the nine partners sent on “leave”. That is, apart from former CEO Tom Seymour, whose stepping down earlier in the month is the reason she is now the “acting CEO”; and Tony O’Malley, who has stepped up as “chief risk and ethics leader”.
Seymour, incidentally, stepped down three days after stating categorically that he would not step down.
That best captured the PwC floundering; in both business and politics it tends to be ever thus.
To me, the most intriguing sentence – claim – was at the end of the Stubbins statement.
“Secondly, in relation to the breach of confidentiality, our clients were not involved in any wrongdoing and no confidential information was used to enable clients to pay less tax (my emphasis)”.
So, “what’s this all about, Alfie”? If no confidential information was used to cut client tax bills, where exactly was the breach of confidence?
Storm in a tea cup anyone?
But equally, if that was the case, what exactly was PwC selling to those big global tech companies, to generate multimillion fees? This whole mess is supposed to be about PwC doing exactly that.
Advising Canberra on how to structure anti-tax avoidance policies; and then using that inside knowledge to advise clients on how to avoid the tougher policies PwC had just helped put in place.
The whole point of big accounting firms like PwC; the reason partners get million dollar-plus incomes; is all and only about helping big biz save tax. That sentence takes PwC – and indeed, all the major accounting firms – deep into the territory of just what exact value they deliver to their clients for the fees charged?
It also feeds back into this whole murky question of the massive use by the public sector – federal and state – of external high-cost professional consultants.
It was only in 2021 – after of course all this blew up in secret – that, according to Stubbins, PwC prohibited “market-facing partners from participating in confidential tax consultations”.
That does seem rather late for an accounting firm to realise it was not exactly, well, ‘appropriate’. But not appropriate, both ways – just as much to the corporate client as to the ATO.
More broadly, the big accounting firms – and the partners especially – have waxed rich, very rich, by having their public sector consulting cake, while also getting to chow down on their lucrative client fees – mixing and matching and munching to maximum benefit.
Maybe they are, or should be about to, now choking on their gluttony. Hence, why partners at the other three are so ropeable.