Finance still knee-deep in PwC review

The Department of Finance has told the committee looking at government consulting that PwC Australia is still being reviewed for its suitability to continue work on government auditing and accounting.

PwC ditched its government consulting arm last year in what was effectively a fire sale when government departments declined to provide the firm with consulting work following the tax leaks scandal.

Finance deputy secretary Andrew Jaggers told the committee a review of the Big Four firm was necessary to ensure it was suitable to continue to do work outside the scope of Scyne Advisory, the government consulting firm formed last year.

“We are having a look at PwC in terms of its ability to do work for the Australian government in a range of different ways,” Jaggers said.

“As you know, PwC has been split with the creation of Scyne, and a lot of the contacts have been novated, including the management advisory services panel contracts.

“But PwC is performing some functions for some areas of government, and we are committed to doing a review of whether for current arrangements and future panels PwC met that ethical standard for future contracting.”

First assistant secretary Andrew Danks said the PwC review includes looking at the firm’s response to the Ziggy Switkowski review. It was also assessing the firm’s policies and frameworks to strengthen internal practices.

Danks said Finance will also continue to consult with Dr Simon Longstaff from The Ethics Centre as it works through its review of the accounting firm.

Finance’s ongoing review of PwC’s suitability is in addition to the continuing investigation of the tax leaks saga by the Australian Federal Police, the nine cases being investigated by the Tax Practitioners Board, and the ongoing monitoring of the firm’s commitment to keep CAANZ, the professional body that hit the firm with a disciplinary penalty, updated with changes it is making internally.

Jaggers told the committee the other Big Four firms were not the subject of similar reviews, following a query from senator Deborah O’Neill.

Finance officials also faced rigorous questioning from senators regarding the Supplier Code of Conduct, which is still in draft form. The deadline for comments is this Friday.

Jaggers told the committee, chaired by senator Richard Colbeck, that the draft code of conduct would help assess individuals and entities from which the government buys goods or services.

Jaggers said the current framework was outdated and unsuitable to grapple with certain crosscutting issues, such as when firms fail contract requirements.

“It is fair to say that we really haven’t had a sort of a framework for reviewing the performance of every entity across a range of panels,” Jaggers told the committee.

“That’s one of the reasons why the Supplier Code of Conduct is being developed or consulted on at the moment because that’s a code of conduct that will fit for all suppliers against all commonwealth procurements, and so breaches around that will have implications across the commonwealth.”

Finance told the committee it would also be meeting with Chartered Accountants Australia and New Zealand to look at its most recent publications related to rebuilding trust in the accounting profession. It was prompted by Colbeck reading from a document referencing public interest.

Committee members have referred to work done by consultants and other suppliers as being work done in the public interest but the term ‘public interest’ itself is not in the proposed code out for consultation.

O’Neill said individuals and groups working within the same ecosystem were keen to see the code improved.