Even the Irish have had enough of PwC

Ireland is one of Richard Murphy’s favourite punchbags – most recently talking about the parlous state of their banking system. My friend Tom Raftery who decamped to Sevilla last year recently said Ireland is in such a state that house prices could decline 80%. Wow.

This morning, John McManus of the Irish Times has a pop at PwC over the banking crisis arguing:

IT IS probably unfair to pick just one example of the conflicts that are rife among the people advising the Government on the recapitalisation, so let’s pick two.

The most obvious one being PricewaterhouseCoopers. They are the auditors to Bank of Ireland who are desperately trying to avoid being taken over by the State. At the same time they were hired by the Financial Regulator to asses the quality of the banks’ loans books, the bottom line being will the Government have to take them over.

Equally, Arthur Cox are advising the Minister for Finance while at the same time they are the lawyers for Bank of Ireland.

The stock response from professional firms is that such conflicts are unavoidable and they have robust rules for dealing with them which fundamentally rely on the integrity of the individuals involved. Quite so. Unfortunately, even though this may be the case, it can lead to bad decisions and poor advice.

How can PwC really take a view as to whether there is something systemically wrong with the way Irish banks are run without having to confront the possibly that there is something systemically wrong with PwC who audit one of the big two?

Equally, how can Arthur Cox advise the Minister that Bank of Ireland may have done something it should not have, without having to deal with the possibility that it was Arthur Cox that gave them the advice they could do it?

Hearing the Gaelic twang behind the words about the only thing that’s missing is: “What a bunch of feckin’ eejits.” And with some justification.

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Tagged as: Arthur Cox, Bank of Ireland, Financial Regulator, PricewaterhouseCoopers, Pwc, Richard Murphy, Tom Raftery