Auditor with conflict of interest?

A PwC whistle blower has accused  the Big Four accounting firm of serious independence failing after it allowed its auditors to fly in a jet owned by a major client, US-listed chipmaker Micron.

Mauro Botta, a former PwC auditor is suing the firm in the US for wrongful dismissal, alleging that a photo of the Micron audit team with the private jet was singled out for praise during a meeting in California in 2016.

The incident is one of the several alleged lapses involving a handful of PwC’s clients that were mentioned in a document sent by Mr Botta to the US Securities and Exchange Commission against his former employer in 2016.

Mr Botta said  in a document  the photo was shown to PwC’s San Jose office as an example of “beat practice” as it demonstrated the auditors had a “ great relationship” with Micron. Micron’s CEO had offered to fly the PwC team to San Jose so they did not miss an “internal firm party”. Mr Botta further highlighted a potential conflict of interest between PwC and Bluecoat, formerly one of its IT clients. When PwC was pitching for the audit, it transpired that Bluecoat’s vice-president of tax was married to a PwC tax partner in San Jose.  Symantec which acquired Bluecoat declined to comment.

PwC’s independence office assessed the matter and concluded that the firm was independent after the tax partner agreed to relocate to San Francisco.

Mr Botta also alleged that the CFO of another client semi-conductor group  Cavium, fell victim to an email scam and mistakenly paid $500, 000 to an external party,  He claimed Cavium’s executives did not flag the issue to PwC before submitting a routing SEC filing.