Latest news with #auditing
Free Malaysia Today
28-05-2025
- Business
- Free Malaysia Today
Major audit firms have been complicit in financial scandals, says Anwar
Prime Minister Anwar Ibrahim said the focus on good governance and auditing should go beyond merely attracting investments. (Bernama pic) PUTRAJAYA : Prime Minister Anwar Ibrahim today said that major audit firms have, at times, been complicit in financial scandals, citing the 1MDB affair as an example. Without identifying any auditor in particular, he said no auditors 'were entirely free from being targeted'. 'If you look at 1MDB, (you will see the) complicity of big audit firms,' he said at the closing of the Asean Auditor Conference 2025 here. The 1MDB scandal, which US authorities dubbed the largest kleptocracy ever, saw over US$4 billion embezzled from the state investment arm. In 2023, Anwar was reported as saying that the scandal would not have occurred if not for the 'complicity' of international financial institutions, including Goldman Sachs. Speaking today, Anwar said the focus on good governance and auditing should go beyond merely attracting investments. 'That (auditing), to me, is critical but not pivotal,' he said. He also underscored the importance of strengthening audit institutions to ensure true accountability. 'That's why to my mind, it is a particularly important endeavour that audit institutions be empowered, to operate independently and to follow the trail of accountability wherever it leads,' he said. Referring to his experience as head of government, Anwar said he had no intention of interfering in the auditing process. As head of government, Anwar said his job was to present the findings of the audit department to the Cabinet, which would then be tabled and debated in Parliament. 'That is what we mean by good governance and transparency,' he said.
Malay Mail
28-05-2025
- Business
- Malay Mail
Anwar urges Asean to empower independent auditors, says it's key to building trust and investment
PUTRAJAYA, May 28 — Prime Minister Datuk Seri Anwar Ibrahim today called for stronger governance systems and independent audit institutions across Asean. He said that improving the quality of audits and financial reporting would provide investors and stakeholders with reliable data to support regional economic integration. 'Some say good audits help attract investment. I say good auditing is more than a tool for investment, it is a responsibility,' he said during his closing remarks at the Asean Auditor's Conference 2025 here today. The prime minister said that upholding the highest standards of accountability requires continued efforts, including empowering independent auditors and regulatory bodies to carry out their duties effectively. 'Even large global audit firms haven't always remained free from scandal or complicity, as seen in the 1MDB case,' he said, referring to the multibillion-ringgit corruption scandal involving the misappropriation of funds from 1Malaysia Development Berhad. 'This is why audit institutions must be truly independent and able to follow accountability wherever it leads,' he added. He also said he does not interfere in audit findings, adding that this approach helps strengthen governance and contributes to improving Malaysia's position in the Corruption Perceptions Index.
Zawya
19-05-2025
- Business
- Zawya
EY negligently missed huge fraud at collapsed UAE hospital operator, $3bln UK trial hears
EY failed to spot a major fraud by main shareholders of UAE hospital operator NMC Health in what lawyers for the firm's administrators described as disgraceful auditing, at the start of a roughly $3 billion London trial on Monday. The administrators of NMC – a FTSE 100 company when it collapsed in 2020 after disclosing more than $4 billion in hidden debt – are suing over audits from 2012 to 2018, when EY gave an unqualified opinion that NMC's accounts were accurate. The company's administrators Alvarez & Marsal say EY, one of the world's "Big Four" auditors and formerly known as Ernst & Young, was negligent in failing to get proper access to NMC's books, missing billions in unreported borrowing. EY, however, denies the negligence allegation and argues that it was NMC's own senior personnel who perpetrated the fraud and manipulated its accounts, hiding the fraud from EY. The 12-week trial at the High Court which began on Monday is the latest lawsuit brought against a major auditor and comes after recent criticism of EY specifically over work for travel firm Thomas Cook and German payments company Wirecard. NMC Health PLC listed in London in 2012 and joined the FTSE 100 in 2017, before short-seller Muddy Waters questioned its financials in December 2019 sending NMC's shares tumbling by almost a third in a day. NMC's administrators were seeking up to 2.7 billion pounds from EY in damages for losses, largely relating to undisclosed guarantees, but court filings for the trial put the figure at around 2 billion pounds plus interest. Their lawyer Simon Salzedo said EY's audits over seven years were among the "most fundamentally flawed examples of big-firm auditing that have disgraced a courtroom in this jurisdiction". Salzedo accepted that auditors giving a wrong opinion did not amount to negligence, but said: "Two wrong opinions looks very much like carelessness and to give seven in a row is rather harder to explain away." But EY's lawyers argued in court filings the auditing firm was "itself a principal target and victim of the fraud" committed by NMC staff for the benefit of its principal shareholders. NMC's case was based on expecting an auditor "to do the impossible by uncovering a pervasive and collusive fraud being practised and covered up in effect by the directors and management", EY's lawyers said. NMC has separately brought litigation against its founder BR Shetty, who denies any wrongdoing, and others in London, the UAE and the United States. (Reporting by Sam Tobin Editing by Tomasz Janowski)
Times
10-05-2025
- Business
- Times
Audit firms lobby regulator for help to tackle tariff disruption
The UK's big auditing firms are asking for more leeway when signing off financial statements because of the uncertainty that has been triggered by Donald Trump's ever-changing tariff regime. Accountants are lobbying the Financial Reporting Council, the sector's regulator, to provide more guidance and rules for auditing companies whose operations are significantly affected by the US president's trade war. Some of those lobbying for greater guidance include members of the big four — KPMG, EY, Deloitte and PwC — it is understood. They are telling the regulator that the current uncertainty around tariffs makes forecasting future profits more difficult. Forecasting trading is important because it determines whether accounts can be signed off as showing a business is a going concern. This means that the company
Forbes
07-05-2025
- Business
- Forbes
ChatGPT's Largest Enterprise User, PwC, Cuts Workforce By 1,500 Jobs
AI is changing the face of auditing, in the workforce. getty On Monday, a massive enterprise client with a $1 billion investment in Open AI's ChatGPT platform announced layoffs for 1,500 employees. 'We are moving forward with a workforce reduction across parts of our US firm— including Assurance, Tax and areas of our legacy Products & Technology business,' Deanna Byrne, head of assurance at PwC, said in an internal memo. PwC, one of the largest accounting and services companies in the world, cut about 2% of its U.S. workforce this week. PwC, together with KPMG, EY and DeLoitte, is part of the 'Big Four' accounting firms - services companies that collectively employ 1.5 million people worldwide. AI is changing the workforce, right now, and these changes are just the tip of the iceberg. A McKinsey report notes that 30% of hours worked will be reduced or even removed with automation in the next five years. Is AI the reason for the changes at PwC? Not entirely, but advancements in AI have undoubtedly played a role. According to their annual report, PwC's revenues last year were up 4.3%. However, the growth in net income did not match that performance, coming in at just 1% - a reduction of nearly two-thirds versus the prior year. Globally, the World Economic Forum Future of Jobs Report predicts that 92 million jobs will be displaced by technology. The same report says that 40% of employers expect to reduce their workforce in places where AI will allow them to do so. It seems PwC is stepping towards this future today, as part of a three-year partnership with Microsoft and OpenAI (parent of ChatGPT) that was announced in 2023. In a speech titled, Algorithms, Audits and the Auditor, Kara M. Stein said, 'Technology or computer-assisted analysis is a tool that can enhance, but cannot replace, professional skepticism and professional judgment.' Stein, a past commissioner of the SEC, is a board member at the Public Company Accounting Oversight Board. Human skepticism (judgement) is still needed, it seems. Yet the number of humans needed to deliver it is experiencing some (wait for it) skepticism. Attrition at major accounting firms has slowed, especially at higher levels. With the scarcity in white collar jobs, it's no surprise. According to The Financial Times , PwC has cut back on campus hiring because of this low staff turnover. 'We are in an era of reinvention, with many companies looking to transform their businesses through data, AI, and other advancing technologies while also building greater trust with stakeholders and upholding the integrity of the capital markets,"according to senior partner, Paul Griggs, head of operations for the firm across most of North America. The impact for leaders today is clear: moving towards the future with AI means reallocating resources - and finding ways to cut costs often starts with layoffs. For companies large and small, it's not necessarily financial hardship or tariffs that are driving the adoption of ChatGPT and other forms of AI. However, can you really blame an accounting firm for looking for more profitability? And a follow-up: are you a shareholder in said accounting firm? Once driven by massive amounts of human leverage, services firms are rethinking how resources are allocated - and how automation can help reduce cost, improve efficiency and absorb various tasks. Layoffs at professional services organizations are here, not just in accounting, as AI drives restructuring and profits. Right-sizing an organization means finding ways to insert human oversight and collaboration with these new capabilities, as workforce layoffs will continue to dot the headlines.
