Chinese authorities have banned accounting firm PwC for six months and fined it over 400 million yuan (€50.86m) due to fraudulent practices during the audit of collapsed property developer Evergrande. The firm will not be able to sign off on financial results in China for half a year. The fine includes penalties from the Ministry of Finance and the China Securities Regulatory Commission. PwC’s work was criticized for lacking professional skepticism and failing to identify errors. The firm fired six partners and five staff involved in the audit and is issuing financial penalties for former leaders as well. PwC had audited Evergrande for 14 years until 2023, giving it a clean bill of health, before it collapsed in January. The securities regulator found that Evergrande had inflated its revenues by $80bn, resulting in a fine. PwC, the largest of the “big four” accounting firms in China, has faced consequences for their involvement with Evergrande in the midst of a property market slump. China has been cracking down on excessive borrowing by developers.
Source
Photo credit www.euronews.com
