PwC Canada has been fined more than $900,000 by Canadian and US accounting regulators for exam cheating involving its 1,100 auditors.
The watchdog found that the Big Four company failed to detect that employees were sharing answers on professional exams between 2016 and 2020 because of shortcomings in internal standards and oversight. close to the test.
The Public Accountability Commission of Canada fined PwC Canada $200,000 while the US Public Company Accounting Oversight Board fined PwC Canada $750,000. PCAOB, which is overseen by the Securities and Exchange Commission, has the power to sanction foreign accounting firms if they are licensed to perform work for US clients.
The sanctions are the latest to be imposed against a major accounting firm for cheating on an exam.
KPMG was fined $50 million by PCAOB in 2019, in part because its auditors improperly shared answers, some of whom also manipulated computer servers so they could pass even if they score below 25% on the tests.
It fined KPMG Australia $450,000 last year for the “improper sharing of answers” by more than 1,100 employees from at least 2016 to early 2020.
PwC, which says its aim is to “build trust in society and address critical issues”, was found to have violated accounting rules and quality control standards due to the absence of proper procedures. is suitable for supervising internal training tests, including those which its auditors are required to pass in order to maintain their accounting certification.
As a result, regulators said, PwC failed to find that more than 1,200 employees engaged in sharing incorrect answers on tests on topics such as auditing, accounting and computing. professional independence. More than 1,100 stakeholders were involved in the company’s assurance activities, including its audit function.
PwC Canada, which has 7,000 partners, employees and 21 offices, was also reviewed and asked to improve its procedures.
The company said it discovered the misconduct in January 2020 and immediately launched an internal investigation. It has also reported the matter to regulators voluntarily.
The misconduct mainly involved subordinate assurance staff, who shared documents online containing answers to internal reviews, it said.
“Since then, we have taken several remedial steps including retraining, further ethics training, financial penalties, written warnings and termination if warranted,” the company said. ty added. “While we are confident that there is no impact or compromise on the quality of our audit as demonstrated by our current audit results, we expect more from everyone in our company.”
Both the Canadian and US regulators acknowledged PwC’s “extraordinary cooperation” in the investigation.