PwC face probe into failure to detect €21m fraud
TOP dollar accountants PricewaterhouseCoopers are facing an embarrassing probe into their failure to spot a €21m fraud at Greencore.
The Institute of Chartered Accountants of Ireland (ICAI) will ask how PwC audited Greencore's Scottish mineral water subsidiary for two years without finding the fraud.
But the probe will be held behind closed doors. Neither press nor public will be allowed to monitor the investigation. Nor will the findings necessarily be made public.
The chartered accountants' body has written to interested parties, asking for comments on the behaviour of PwC.
Greencore, led by Patrick Coveney, is actively reviewing its auditors' contract which is likely to be put out to tender. PwC's chances of winning the contest are seen as slim.
As well as changing auditors, Greencore will probably seek legal redress plus the return of a chunk of PwC's huge audit fees.
In the two-year period of the fraud, PwC charged Greencore over €1.6m in fees .
Hopes of the institute's probe reaching an early conclusion are low. The ICAI is a self-regulating body. It appoints all the members of its Complaints and Disciplinary Committees. A substantial minority of committee members is drawn from the accountancy profession.
Two years ago, an oversight body, the Irish Auditors and Accountancy Supervisors Authority (IAASA), was set up to monitor the accountancy business, following severe criticism of self-regulation.
In last year's annual report the chartered accountants' watchdog pronounced itself "pleased" that the number of complaints during 2007 fell.
It claims that "the very low number of complaints made against chartered accountants demonstrates a high level of professionalism and compliance".
In the light of such confidence, their findings in the Greencore/PwC case are awaited with interest.
- SHANE ROSS
