Thursday, 8 January 2009

PwC feels the heat from Satyam fraud

(By Anthony Miller) As the sordid Satyam saga gains momentum, it was inevitable that the role of its auditors, PricewaterhouseCoopers (PwC), would be called into question. This is, of course, the cross that all audit firms must bear and goes with the territory. You could almost feel sorry (I did say almost!) for the audit profession. After all, how do auditors get their job satisfaction when there are so few plaudits? I mean, how many times do you hear someone say, “hey, that was a great audit, guys, where can I get one just like it”?

Usually, you only hear about audit firms when something goes badly awry with a company they have been auditing. Then they find their own actions (or inaction!) being scrutinised using a sliding scale which has ‘Careless’ at one end, ‘Complicit’ at the other, and ‘Negligent’ somewhere in between. Rarely do they come out of it all smelling of roses! Mind you, comparing Satyam to Enron, as so many in the media are doing, and then wondering if PwC will go the way of Arthur Andersen, is probably a leap way too far. But the PwC damage limitation machinery needs to be revved up pretty quickly before the blame pointer moves too far up the sliding scale!

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