Big four international audit firms circumventing laws: ICAI panel

The big four global accountancy firms — PricewaterhouseCoopers, KPMG, Ernst & Young and Deloitte — are circumventing laws to provide auditing services in the country, says the report of an ICAI committee.

“It has been noticed that multinational accounting firms (MAFs), entered through automatic/FIPB route for rendering consultancy services, are transgressing the permission so granted and are rendering taxation services, auditing, accounting and book-keeping and legal services,” the high-powered body probing the Satyam scam said.

The big four international accounting firms were operating in India through their domestic affiliates, it said.

Price Waterhouse, Bangalore, an affiliate of PricewaterhouseCoopers, had been auditing the accounts of Satyam Computer Services, a company that was involved in the biggest accounting fraud in the country.

“... Indian firms and MAFs are de facto the same entities providing the assurance, management and related services and, as such, their operations are designed to circumvent the provisions of the Chartered Accountants Act, 1949, and regulations framed thereunder,” said the committee, headed by former ICAI President Uttam Prakash Agarwal.