PwC tax leaks ‘deeply disturbing’, says rival EY

afr.com:

EY’s boss said the tax leaks scandal at rival big four consulting firm PwC was “deeply disturbing”, but was criticised by frustrated senators investigating the industry for failing to disclose his firm’s partnership deed and partner pay rates.

In another fiery day of public hearings at the Senate inquiry into consultants, EY Oceania chief executive David Larocca said the firm would welcome having to deal with fewer regulators but was against any forced separation of the firm into independent auditing and consulting firms.

EY Oceania boss David Larocca at the inquiry: “I’ve spent the last five months talking to our partners and our staff and our clients about why we are not PwC.” Martin Ollman

There was a shift in the tone of the second day of the inquiry’s hearings, as Greens senator Barbara Pocock and Labor senator Deborah O’Neill repeatedly cut off EY’s representatives when they did not directly answer questions.

Even normally taciturn Liberal senator Richard Colbeck intervened several times to spell out the committee’s thinking.

The inquiry, which was triggered by the PwC’s leaks matter, has now expanded beyond the troubled big four firm. On Tuesday, it was EY’s turn to get stuck in its powerful vortex for several hours.

Mr Larocca said PwC’s behaviour in the tax leaks scandal was “deeply disturbing and disappointing conduct” that had rightly triggered “intense scrutiny” of the whole sector.

“I want to specifically address the conduct that triggered this inquiry by saying that at EY we don’t deliberately breach confidentiality. We don’t market tax minimisation schemes,” he said.

”We don’t use blanket legal professional privilege claims to frustrate regulators, and our business model is not built on condoning,