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Journalism of Courage
The Big Four global accountancy firms PricewaterhouseCoopers,KPMG,Ernst amp; Young and Deloitte are circumventing laws to provide auditing services in the country,says a report of a committee of the Institute of Chartered Accountants of India ICAI.
It has been noticed that MAFs multinational accounting firms,entered through automatic/FIPB route for rendering consultancy services,are transgressing the permission so granted and are rendering taxation services,auditing,accounting and book keeping services and legal services, the high-powered body probing the Satyam scam said.
The Big Four international accounting firms were operating in India through their domestic affiliates,it said.
Price Waterhouse Bangalore,an affiliate of PricewaterhouseCoopers,had been auditing the accounts of Satyam Computer Services,a company that was involved in the biggest accounting fraud in the country. 8230; Indian firms and MAFs are de facto the same entities providing the assurance,management and related services and as such their operations are designed to circumvent the provisions of the Chartered Accountants Act,1949,and regulations framed thereunder, said the committee,headed by former ICAI president Uttam Prakash Agarwal.
The government does not allow Foreign Direct Investment FDI in accounting,auditing and book keeping,taxation and legal services,it said,adding no commitment so far has been made by India for opening of such services under the WTO/GATS General Agreement on Trade in Services.
The Indian affiliate of PricewaterhouseCoopers include Price Waterhouse firms and Lovelock and Lewes,while Deloitte has tie-ups with C C Chokshi,A F Ferguson,Fraser and Ross and S B Billimoria. KPMG has association with BSR firms and Ernst amp; Young has a tie-up with S R Batliboi entities.
ICAI had in June last year sought details from 94 chartered accountanting firms about their arrangement with the international accounting firms. However,a number of firms have not furnished complete information as asked for by the committee, said the panel.
