Tax leak controversy separates PwC Australia 2023

The move will enable the company to “move forward with predictability and focus,” according to a statement from PwC Australia.

In January, it was revealed that a former associate at PwC Australia had disclosed the classified information.

The ex-partner, who was advising the Australian government, had distributed drafts of corporate tax avoidance legislation to colleagues, who then used them to sell potential clients. The breaches took place between 2014 and 2017.

The corporation denied using sensitive information to help clients reduce taxes.

However, politicians and government officials have demanded that PwC Australia be barred from receiving government contracts until it has adequately addressed the scandal.

PwC Australia announced earlier this month that it had identified 76 current and former partners associated with the scandal and provided their identities to Australian legislators.

Monday, Kristin Stubbins, the acting CEO of PwC Australia, told a parliamentary inquiry that employees found to have acted unlawfully would face “severe” consequences.

She stated, “We have fallen short of the expectations we set for ourselves as an organization, and I apologize on behalf of our company.”

On Sunday, PwC Australia named Kevin Burrowes as its new chief executive officer. He was previously the global client and industry leader for PwC Network.

“He will work with his colleagues and management team to re-earn the trust of PwC Australia’s stakeholders,” said Justin Carroll, chair of PwC Australia’s governance board.

The company also announced that it will sell its Australian federal and state government business to private equity firm Allegro Funds, with a goal of finalizing the transaction by the end of next month.

The transaction will result in the formation of two independent companies without “disruption of vital services to public sector clients,” according to PwC Australia.

PwC Australia’s government division employs approximately 1,750 people and accounts for approximately 20% of the company’s annual revenue.

Tom Seymour, the former chief executive officer of PwC Australia, resigned in May after admitting he was one of at least 67 recipients of the confidential information at the center of the scandal.

Later that month, the company placed nine partners on leave and restructured the board of directors.

Treasurer of Australia Jim Chalmers described the revelations as a “shocking breach of trust.”

According to official data, the Australian government has contracts with PwC worth A$255 million for the current fiscal year.

Since the scandal broke, significant pension funds such as AustralianSuper and the country’s central bank have stated that they will not execute any new contracts with PwC.

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About the Author: Sanjh Vishwakarma

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