Big 4 Accounting Firms Embarrassed... Employees Caught Cheating Collectively, 9.1 Billion Won Fine

Sharing Internal Test Answers for US Audit Standards Training
3 Million USD for China Corporation · 4 Million USD for Hong Kong Corporation

The Public Company Accounting Oversight Board (PCAOB) in the United States has imposed a fine of $7 million (approximately 9.1 billion KRW) on PricewaterhouseCoopers (PwC) China and Hong Kong offices, global accounting and consulting firms.

PwC, Deloitte, KPMG, and EY are collectively known as the "Big Four" accounting firms worldwide.

On the 30th (local time), the Financial Times (FT) reported that the PCAOB fined PwC for detecting cheating in their exams. A large-scale cheating incident was uncovered in internal exams for U.S. auditing standards training.

The Public Company Accounting Oversight Board (PCAOB) in the United States has imposed a fine of $7 million (approximately 9.1 billion KRW) on PwC's China and Hong Kong offices.
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According to FT, about 1,000 audit staff at PwC China and Hong Kong offices were found to have engaged in cheating during the audit training courses and internal exams based on U.S. standards. They shared answers in related exams in 2019 and 2020.

As a result, the China office agreed to pay a $3 million fine, and the Hong Kong office agreed to pay a $4 million fine, reaching a settlement with the PCAOB.

Earlier in May, the PCAOB announced that it had found unacceptable errors in dozens of companies during audits of Chinese firms listed on the New York Stock Exchange.

In connection with this, PwC Hong Kong office and KPMG China branch were suspected of conducting inadequate audits.

At that time, PCAOB Chair Erica Williams pointed out, "The deficiencies related to audits of Chinese companies were so serious that PwC and KPMG failed to obtain sufficient evidence to support the fairness of the financial statements of Chinese listed companies." The PCAOB has given them a one-year deadline to correct the deficiencies and is continuing the investigation.

Chair Williams stated, "The era when companies headquartered in China could evade responsibility is over," and added, "Any institution violating PCAOB rules and standards will face strong sanctions regardless of their location."