The previous CEO of PwC Australia, Tom Seymour, has stated that it is “challenging to comprehend” why international partners have remained undesignated in light of the tax leak controversy that has caused turmoil for the corporation. This came to the surface when it was disclosed that PwC Australia’s consultancy sector used classified data on impending tax-evasion law to secure new clients, with Uber and Google among those affiliating with the company.
While several partners who departed due to the controversy were identified by PwC Australia, the international unit of PwC has held back from disclosing a review by legal firm Linklaters on how the data was manipulated by anonymous international partners. This has resulted in agitated Australian policymakers and authorities calling for complete transparency.
Tom Seymour, who stood down as CEO of PwC Australia last year and previously served as the head of tax, was interrogated by a Senate committee last Friday, in his first appearance at examinations into the incident. He indicated that it was “challenging to comprehend” why the Australian partners were revealed while international counterparts were withheld. He also speculated that it might have been difficult to determine who knew the shared data was confidential.
Earlier in the year, the Irish branch of PwC was involved in the global impact of the leak. This was when it was discovered that banned PwC Australia tax partner Peter-John Collins, prohibited from operating as a tax agent after disclosing secret data, attempted in 2015 to leverage PwC Ireland’s connections with tech firms in the US to share his knowledge. Repeatedly, PwC Ireland has refused to reveal whether it received secretive plans on Australian tax.
Deborah O’Neill, chair of the Senate committee, reiterated the demand for the Linklaters review to be disclosed. She called it “exceptionally disrespectful and exasperating” that PwC International is still withholding it, claiming it’s confidential. Top-level figures in Australian politics, leaders of PwC Australia, and the UK Financial Reporting Council have requested its release.
The PwC incident has triggered a significant reduction in external consultant expenses in Australia and the development of recommendations to enhance governance and transparency within the sector. Recently, PwC Australia appointed John Green, a former director at Macquarie, as its first independent chairman.
During the most recent senate inquiry, new information came to light regarding PwC’s recent conduct in Australia. Formerly presided over by Mr Seymour, an investigation pinpointed five individuals who reportedly engaged in questionable activity, tied to PwC Australia’s multinational business advice.
Seymour disclosed that PwC had instituted a structure concerning multinational corporate tax in 2015, which he acknowledged violated the intention of the law. He confirmed that the scheme has been terminated and disclosed to the Australian tax office.
In the same hearing, Meredith Beattie, formerly PwC Australia’s general counsel, alleged issues within the tax practice’s culture. She claimed that legal privilege had been wrongfully exerted to prevent the tax office from accessing certain documents during preliminary investigations. However, Seymour publicly disagreed with this portrayal.
The present chief executive of PwC Australia, Kevin Burrowes, who took over last year to lead the once globally successful firm, stated during the hearing that the international arm is still analysing the fallout from the tax leaks scandal in an effort to learn from their mistakes.
Burrowes rebuffed suggestions of a conflict of interest in light of the recent disclosures about his remuneration. The PwC International reportedly pays him an additional 1.2 million Australian dollars (€717,210) over his standard PwC Australia salary. – Rights reserved to The Financial Times Limited 2024.