How PwC failed to identify or deal with tax leaks scandal
Legal inquiries ordered by PwC Australia into its tax leaks scandal found a “combination of multiple failings” by individuals and the firm’s governance, culture and accountability systems.
A summary of reviews by law firms King & Wood Mallesons, Allens and Linklaters concluded that the scandal – which has rocked PwC’s local operation and heightened scrutiny of the multibillion-dollar consulting sector – was due to a litany of shortcomings and missed opportunities to address problems earlier.
Tom Seymour at the Financial Review Business Summit in March. Michael Quelch
It also partially blames the “failure to assess appropriate accountability” on former chief executive Tom Seymour.
The legal summary report, released on Wednesday along with former Telstra chief executive Ziggy Switkowski’s investigation that found widespread governance and cultural problems at the firm, amounts to the fullest mea culpa by PwC over the tax leaks affair.
The report notes that Mr Seymour “had leadership responsibility for the tax group at the relevant times, was directly involved in decision-making regarding the handling of the [tax leaks] matter and did not take steps to remove himself from the process nor to ensure that the underlying facts were fully reported to those charged with governance”.
Mr Seymour has not responded to requests for comment on the report.
The report also highlights how the firm had a broader issue about repeatedly breaching confidences across at least five different sets of government consultations, and a misunderstanding of its obligations as a tax adviser and how legal professional privilege should apply.
The tax leaks issues date back to 2013, when former international tax partner Peter Collins triggered the
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