A report released by the Public Company Accounting Oversight Board (PCAOB) highlights finding from an investigation into PwC Sweden. The results of the investigation highlighted deficiencies in the audit work conducted by the firm.
PCAOB reviewed parts of one issuer audit performed by PwC and also its audit work with one other issuer audit engagement in which it played a role but was not the principal auditor.
The result of the report was based on field work, reviews of audit work papers and the evaluation of the firm’s quality control policies and procedures conducted through interviews with the firm’s personnel.
The report said: “Certain deficiencies identified were of such significance that it appeared to the inspection team that the Firm, at the time it issued its audit report, had not obtained sufficient appropriate audit evidence to support its opinion that the financial statements were presented fairly.”
It appears that the firm failed to perform sufficient procedures to ‘test the design and operating effectiveness of controls over the allocation of revenue’.
The inspection also included reviews of the firm’s audit work of financial statement and even when applicable looked into audits of ICFR, as well as the firm’s audit work with other issuer audit engagements, which it played a role in.
If discrepancies were found in the report then the chance was given to PwC to provide a written response, the firm however did not provide a response which led to a deficiency and is evaluated for inclusion in the inspection report.
By Mishelle Thurai