The Big 4 Auditors Hire Independent Directors to Deal With Regulators

While the economic recession and the slide snowballed from the Lehman Brothers’ bankruptcy, a number of accountancy firms were to blame for the same. These included the chartered accountancy bigwig Ernst & Young, who had been accused of providing an executive watershed to the Lehman Brothers’ bad finances.

Deloitte, PricewaterhouseCoopers (PWC), Ernst & Young and KPMG have all decided to induct independent directors to help answer the critics and showcase an unbiased and transparent audit process while looking into the accounts of the biggest of their clients (which, incidentally, also includes some of their scathing opponents).



This move might outpace some of their strictest critics, who have been calling for regulatory bodies to monitor the work done by these audit firms of late. PWC, one of the household names in the domain in chartered accountancy worldwide, has also come for heavy criticism for its handling of ‘Satyam’ accounts, a software corporate major in India. The fake profits shown by Satyam CEO Ramalinga Raju had been allowed to go unnoticed and unaccounted for by the Indian branch of PWC, and has hence taken a dent on its authenticity and transparency among the CA fraternity globally.

The employment of these independent executives and directors may however, only bring peace to the critics till that long. For, one misstep by the same, and the whip might come lashing down on these firms again.

Do you think it was a wise move by these auditing giants? Let us know through the comments section!