Chinese authorities have banned PwC China for six months and fined it Rmb441mn ($62mn) for auditing failures related to the collapsed property developer Evergrande, in Beijing’s toughest action yet against a Big Four firm.
The move follows a March announcement by China’s securities regulator that PwC China had approved Evergrande’s accounts even though the developer had inflated mainland revenues by nearly $80bn in the two years before its default in 2021.
China’s finance ministry said on Friday that PwC Zhongtian, commonly known as PwC China, and its Guangzhou branch were aware of “major mistakes” in the audit of Evergrande from 2018 to 2020 but failed to point them out. The Guangzhou branch of PwC China has been ordered to shut down, according to the ministry.