The fallout from the PwC tax policy confidentiality breach continues, with the government consulting arm, Scyne Advisory, set to open its doors next week.
Scyne was created in the aftermath of controversy over a breach of a confidentiality agreement that became public when disciplinary action against both PwC and its former partner, Peter Collins, was revealed in January.
Revelations regarding the sharing of confidential information via the Tax Practitioners Board’s disciplinary verdicts resulted in government departments distancing themselves from PwC; the sale of its government consulting arm to private equity firm Allegro Funds was deemed necessary to keep government consultants gainfully employed.
The new firm’s management finalised its deal with PwC in September but earlier this week the final milestone — approval of the transaction by the Foreign Investment Review Board — was reached.
It places the final touches on the PwC-Allegro Funds deal, with the new firm due to open its doors next Monday.
Scyne’s opening does not end the woes of the accounting profession following the PwC confidentiality breach saga, with the Australian Greens successfully getting the federal government to agree to amend laws so that former Big Four partners will not be appointed to the body.
Greens’ senator Barbara Pocock said that the Greens have secured a commitment from the government to put in place changes to the law so current and former partners of large practices have no future role in tax regulation if they an ongoing pension from their former practice.
“We’re kicking the foxes out of the hen house. Through this amendment, we’re fixing the loophole that allowed big consultants to regulate themselves,” Pocock said.
“At the time, the PwC scandal broke, 43% of TPB board members were former partners of the big 4, including two ex PwC partners who were in receipt of ongoing financial payments from PwC. When the PwC scandal broke, these partners were on the board investigating Peter Collins.
“Even though they recused themselves from the Collins investigation, their membership of the board could still give rise to perceptions of a conflict of interest.”
Another amendment also requires tax agents to report other agents they work with that have broken the Code of Professional Conduct in order to discourage partners in accounting firms from protecting colleagues.
The Greens have also secured a commitment from the government to strengthen the Code of Professional Conduct to ensure that it specifically covers the circumstances that arose from the PwC case study.
“These changes are aimed at strengthening guidelines around confidentiality and conflicts of interest, banning the misuse of government information for personal advantage, greater accountability and transparency and a ban on false or misleading statements,” Pocock said.
“We need to ensure that those operating in this industry come clean with their clients about matters which would influence their decision to engage them.”
READ MORE:
PwC refugee Scyne gets government green light, but Finance warned of ‘critical deficiencies’
Any feedback or news tips? Here’s where to contact the relevant team.