UK - PricewaterhouseCoopers has been forced to undertake an exhaustive review of its client base after the Financial Reporting Council discovered it was acting as auditor to a company while providing actuarial services to its defined benefit pension scheme.
Under the FRC's strict Ethical Standards, auditors are warned performing both services gives rise to an "unacceptable self review threat" - when a firm effectively reviews work done by themselves or their colleagues.
The watchdog found that, on one listed audit, PwC was also the actuary to the group's DB scheme and performed the actuarial valuation of the scheme. An independent actuary then determined the key assumptions and updated PwC's valuation in arriving at a value for inclusion in the group accounts.
The report said: "These arrangements were not consistent with the underlying principles of the Ethical Standards, due to the independent actuary's reliance on PwC's valuation leading to an unacceptable level of self review threat.
"At our request, the firm is undertaking an exercise to identify whether there are any other listed audit clients where PwC also acts as actuary to the client's pension scheme. We will follow up the results of this exercise in next year's inspection."
The revelations followed an FRC review of the practices of the ‘big four' accountancy firms: PwC; Deloitte; Ernst & Young; and KPMG.
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers