) in
London ,
England .]]
(or PwC) is the world's largest
Professional Services firm. It was formed in 1998 from a merger between '''Price Waterhouse''' and '''Coopers & Lybrand'''. PwC is the largest of the
Big Four accounting firms, the other three being
Deloitte Touche Tohmatsu ,
Ernst & Young and
KPMG .
PricewaterhouseCoopers earned aggregated worldwide revenues of $22 billion for fiscal 2006, and employed over 140,000 people in 149 countries.
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In the
United States , where it is the third largest
Privately Owned Organization , it operates as PricewaterhouseCoopers
LLP .
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The firm was created by the merger of two large firms Price Waterhouse and Coopers & Lybrand. These two firms each had histories dating back to the nineteenth century.
Samuel Lowell Price, an
Accountant , started his practice in
London in 1849. In 1865 Price went into partnership with
William Holyland and
Edwin Waterhouse . Holyland left shortly after to work alone in accountancy; and the firm was known from 1874 as . (The '& Co' and comma were dropped from the name much later.) The original partnership agreement, signed by Price, Holyland and Waterhouse can be found in
Southwark Towers , one of PwC's offices in London. By the late nineteenth century, Price Waterhouse had gained significant recognition as an accounting firm. As a result of trade between the
United Kingdom and the
United States Of America , Price Waterhouse opened an office in
New York in 1890, and the American firm itself soon expanded rapidly. The original British firm also opened more offices in the main countries in the
British Empire , each time establishing a separate partnership in each country that gave each partner a strong incentive to expand their local practices. The worldwide practice of PW was therefore a federation of collaborating firms that had grown organically rather than being the result of an international merger.
In 1854 William Cooper established his own practice in London, which became Cooper Brothers seven years later when his three brothers joined. In the USA in 1898 Robert H. Montgomery, William M. Lybrand, Adam A. Ross Jr. and his brother T. Edward Ross formed Lybrand, Ross Brothers and Montgomery. is the result of a merger in 1957 between Cooper Brothers & Co; Lybrand, Ross Bros & Montgomery and a Canadian firm McDonald, Currie and Co. In 1990 Coopers & Lybrand merged with Deloitte Haskins & Sells in the
United Kingdom , but most other parts of Deloittes merged with Touche Ross to form
Deloitte Touche Tohmatsu .
In addition to setting up an office in the major capital cities of the world, the PW or Coopers firm in each country often assimilated local accounting practices. This provided even more offices in the regions of each country and so resulted in 'critical mass', allowing the rapidly increasing number of international corporations to be fully serviced wherever they traded. Growth was also spurred by increasing audit requirements, especially after the
Great Depression in the 1920s and 1930s, and by the increasing complexity of taxation.
In a further effort to take advantage of
Economies Of Scale , PW and
Arthur Andersen had discussed a merger in 1989 but the negotiations failed mainly because of conflicts of interest such as Andersen's strong commercial links with
IBM and PW's audit of IBM. In 1998 Price Waterhouse and Coopers & Lybrand merged to form in an attempt to gain a scale that would put the new firm in a different league. The following year merger discussions between PwC and
Grant Thornton failed. Because of the reduced number of major firms, it is unlikely that further mergers would be allowed by competition authorities.
The 2002 indictment of
Enron and
WorldCom and the subsequent collapse of Arthur Andersen resulted in stringent
U.S. Securities And Exchange Commission rules on auditor independence. One such result was the adoption of the
Sarbanes-Oxley Act , which required auditor independence and separation of core audit from general consulting. This forced many of the Big Four to divest their interests in management consulting. However, a major part of the firm's practice is still to provide business advice in addition to its auditing services, notably in taxation and corporate finance.
,
Australia .]]
The legal structure of a limited liability partnership is very different to that of a
Company , and as such the global firm is in fact a collection of member firms, that are run
Autonomously in their respective
Jurisdiction s. The senior partners of member firms sit on a global board of
Partner s and there is also an 'umbrella' organisation called PricewaterhouseCoopers International Limited, a
UK -based company which provides co-ordination. The current global
CEO is
Samuel DiPiazza , a 52 year old partner of the former Coopers & Lybrand.
PricewaterhouseCoopers has up to six service lines in major countries:
- Audit And Assurance ,
- Tax , (planning and compliance with local tax laws, Transfer Pricing )
- Advisory and Consulting which covers Performance Improvement, Transactions and M&A and Crisis Management in a range of specialist areas such as accountancy and actuarial advisory.
PwC's service lines face the market in each country by broad industry specializations such as:
- Consumer and Industrial Products and Service (CIPS),
- Financial Services (FS),
- Technology, Information, Communications and Entertainment (TICE),
- Private Company Services (PCS)
These sub-divisions may vary slightly in some territories.
The firm also has in-house
Human Resource services, and a network of correspondent
Law firms known as
Landwell Global (some of the member firms of which now use the PwC name).
offices at
Freshwater Place .]]
Europe and
North America account for about 48% of PwC's annual revenue, with Europe alone accounting for 35%. The firm's dominant practice is
Audit & Assurance , which accounts for over 50% of PwC's revenue.
As of March 2005, PricewaterhouseCoopers' audit clients included four of the 10 largest public companies in the United States (
ExxonMobil ,
Ford Motor Company ,
ChevronTexaco and
IBM ). PwC also audits four of the 10 largest companies in the
United Kingdom (
GlaxoSmithKline ,
Royal Dutch Shell ,
Barclays and
Lloyds TSB ).
PwC's other large clients include
American International Group ,
Freddie Mac ,
Bank Of America ,
JP Morgan Chase ,
Goldman Sachs ,
Tesco , the
United States Department Of Health And Human Services and
Unilever .
One client, the
Academy Of Motion Picture Arts And Sciences , gives PwC the unique distinction of having been (in various incarnations) the tabulator and certifier of votes for the
Academy Awards since 1934.
PwC audits 46 per cent of companies in the
FTSE 100 Index ; 22 per cent of those in the
FT Asia Pacific 100 and 43 per cent of the
Fortune 1000 .
In December 2006 the .
The following are PwC audit clients that are part of the FT Global 500 (2006), grouped by FT industry
Raytheon ,
United Technologies
Toyota Motor ,
Volkswagen ,
Peugeot
Al Rahji Banking & Investment ,
Bank Of America ,
Bank Of China (Hong Kong) ,
Bank Of Ireland ,
Banco Itau ,
Banco Popular Español ,
Barclays ,
Compass Bancshares ,
Credit Agricole ,
BB&T ,
BNP Paribas ,
BradescoSamba Financial ,
Commerzbank ,
Dexia ,
DnB NOR ,
Firstrand Bank Limited ,
Fortis ,
JP Morgan Chase ,
Lloyds TSB ,
Riyad Bank ,
Sanpaolo IMI ,
Sberbank (Russia) ,
SEB ,
Standard Bank ,
Suntrust Banks ,
Westpac Banking Corporation
Anheuser-Busch ,
Miller ,
SAB
Albemarle ,
Bayer ,
E.I. Du Pont De Nemours ,
Praxair ,
Shin Etsu Chemical ,
Rohm & Haas
Chubu Electric Power ,
FirstEnergy ,
Exelon ,
Unified Energy System ,
ATCO
Agilent Technologies ,
Kyocera ,
LG Philips LCD
BellSouth ,
BT Group ,
Deutsche Telekom ,
Etisalat ,
KPN ,
Nippon Telegraph And Telephone ,
Saudi Telecom
Krispy Kreme ,
Seven & I Holdings Co. ,
Tesco
Danone ,
Kellogg ,
Unilever
Centrica ,
E.ONRWE ,
National Grid Plc
American Express ,
Freddie Mac ,
Franklin Resources ,
Goldman Sachs ,
Nikko Cordial ,
SLMMoody's
3M ,
Honeywell International ,
Hutchison Whampoa
EBay ,
GUS ,
Marks & Spencer
Baxter International ,
HealthSouth Corporation ,
Medco Health Solutions ,
Medtronic ,
Zimmer Holdings
Reckitt Benckiser
Caterpillar ,
Volvo
Alcan ,
Alcoa ,
Nippon Steel ,
Nucor ,
Phelps Dodge ,
POSCO ,
Tenaris
Burlington Northern Santa Fe Corp. ,
Deutsche Post
Nintendo
Legal & General ,
Protective Life Corporation ,
Prudential Financial
CBS ,
Thomson ,
Viacom ,
Walt Disney
Barrick Gold ,
Newmont Mining ,
Rio Tinto
Alltel ,
Bharti Tele-Ventures ,
KDDI ,
MTN Group ,
Sonera ,
Telia ,
Vodafone
Ace ,
American International Group ,
AMB Generali ,
AXA ,
Millea Holdings ,
Progressive Corporation ,
Swiss Re ,
Zurich Financial Services
BG ,
Burlington Resources ,
Canadian Natural Resources Ltd ,
Exxon Mobil ,
Chevron ,
EnCana Corporation ,
Eni ,
Gazprom ,
Imperial OilSuncor Energy ,
Marathon Oil ,
Royal Dutch Shell ,
Shell Canada , Stuart Petroleum
Schlumberger
Colgate-Palmolive ,
L'Oreal ,
Nike ,
Richemont
Biogen Idec ,
Bristol-Myers-Squibb ,
Genzyme ,
GlaxoSmithKline ,
Johnson & Johnson ,
Merck & Co. ,
Novartis ,
Novo Nordisk ,
Sanofi-Aventis ,
Teva Pharmaceutical Industries ,
Wyeth
IBM ,
Yahoo!
Laureus World Sports Awards
Cisco Systems ,
Corning Inc. ,
Dell ,
EMC Corporation ,
Ericsson ,
Hon Hai Precision Industry ,
Nokia ,
Qualcomm ,
Samsung Electronics ,
STMicroelectronics
Altria ,
British American Tobacco ,
Imperial Tobacco ,
ITC
Carnival ,
Las Vegas Sands ,
SKYCITY Entertainment Group
ABB Grain Limited
houses three of PwC's Japanese affiliates (Misuzu Audit Corp., PwC Japan Tax Services and PwC HRS), which operated under the ChuoAoyama name until 2006.]]
The member firm and a network firm provide auditing services in Japan.
From 2000 to 2006, PwC's affiliate in Japan was . In May 2006, the Financial Services Agency suspended ChuoAoyama following a suspicious audit of cosmetics company
Kanebo in which three of the firm's partners allegedly assisted with accounting fraud and boosted earnings for the company by about $1.9 billion over the course of five years. The accountants involved were reprimanded by the Tokyo District Court but escaped prison time after a judge deemed them to have played a "passive role" in the crime.
CPAs in Kanebo fraud avoid prison , ''The Japan Times'' (registration required), Aug. 10, 2006.
Shortly after the suspension of ChuoAoyama, PwC acted quickly to stem any possible client attrition as a result of the scandal. It set up the PricewaterhouseCoopers Aarata, and many of ChuoAoyama's accountants moved to the new firm, including most of the international divisions. ChuoAoyama resumed operations on September 1 under the Misuzu name. However, by this point the two firms combined had 30% fewer clients than did ChuoAoyama prior to its suspension.
Rocky road for new accounting firm , ''The Daily Yomiuri'', Sep. 2, 2006.
Global CEO Sam DiPiazza issued a statement to the firm's most senior partners outlining the steps the firm would take. Part of the response included dispatching a team of the most senior global partners to Japan, including the former engagement leader from the Unilever audit in the UK, to manage the relationship with a number of key Japanese clients such as Toyota and SONY. There was significant concern that the Firm's reputation will be harmed amongst its 2,300 Japanese clients, particularly after Shiseido announced the signing of an audit agreement with KPMG.
Because PwCs' only product is the output of its employees, the firm has a competitive recruiting program. PricewaterhouseCoopers was recently included in , as published in
Maclean's magazine, one of only a handful of professional services firms to receive this honor.
1
PwC sponsors the
Binghamton University School of Management ''PricewaterhouseCoopers Honors Program'' and hires students from the program.
Though the firm's core business is
Audit , it had created a large professional
Consulting branch, as did other major accountancy firms, generating about 35% of its fees. Management Consulting Services (MCS) was the fastest growing and often most profitable area of the practice, though it was cyclical. The major cause for growth in the Nineties was the implementation of complex integrated
ERP systems such as
SAP R/3 for multi-national companies.
However, PwC came under increasing pressure to avoid conflicts of interests by not providing consulting services to its audit clients. Since it audited a large proportion of the world's largest companies, this was beginning to limit its potential market. These conflicts were going to increase when additional services such as the
Outsourcing of ERP systems were offered. For these reasons, in 2000,
Ernst & Young was the first of the
Big Four to sell its consulting services, to
Capgemini .
PwC therefore planned to capitalize on MCS's rapid growth through its sale to for approximately $3.9 billion in cash and stock.
Today, PwC brands its remaining consulting activities as Advisory Services, directed globally by Alec Jones in PwC London. Advisory services are organized by country and by industry sector. PwC also has developed several broader consulting initiatives in the
Enterprise Risk Management (ERM) framework, including a global effort to assist corporations with outsourcing, as well as a global political risk assessment and risk management service with the political risk advisory firm
Eurasia Group .
Advisory services offered by PwC also include two ,
Life Insurance ,
Non-life Insurance and
Investments . AIMS deals with life and non-life insurance and investments while HRS deals mainly with pensions. The actuarial functions supplied by PwC include advice to the PwC accountants on insurance company financial reporting, advising buyers and targets on (mainly insurance )
M&A's and
Financial Modeling .
PwC serves the U.S. Federal Government through their Washington Federal Practice (WFP). PwC has over 2000 professionals based in the Washington Metro Corridor. WFP’s mission is to become the U.S. Federal Government’s preferred provider of advisory and assurance services. PwC WFP helps Government agencies solve complex business issues, manage risk, and add value to performance through PwC's service offerings in financial management, program management, operations improvement, and security and data management.
On January 31, 2007 PwC was named as a co-defendant in a class action lawsuit filed against
Dell , the world's number two
PC manufacturer. Taken on behalf of shareholders, the lawsuit alleges that Dell failed to disclose and properly account for rebates received from
Intel , which was until recently the sole provider of
CPU chips installed in Dell machines.
The lawsuit claims that the payments took the form of "secret and likely illegal" kickbacks which were paid by Intel - who was also named as a co-defendant - to prevent Dell from co-sourcing its CPU's from Intel's competitior,
Advanced Micro Devices .
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- Frank Brown , former leader of the Advisory service line and current Dean of INSEAD
- Barbara Cassani , former CEO of Go Fly and former chairman of the London 2012 Olympic committee.
- Cynthia Cooper , internal auditor, WorldCom accounting scandal whistleblower
- Robert Dart , Prominent Canadian businessman and Philanthropist
- David Gill , Chairman of Manchester United F.C.
- Jonathan Howell , Director of Finance for the London Stock Exchange
- Margaret Jackson , Chairman of Qantas (2000–present)
- Mark King], CEO Of Affiliated Computer Services
- Phil Knight , CEO and Co-founder of Nike
- Chris Lucas , Finance Director of Barclays Bank
- Dennis Powell , CFO of Cisco Systems , INC.
- James Schiro , CEO of Zurich Financial Services
- James M. Schneider , CFO of Dell
- Peter Smith , Chairman of Savills estate agents
- Henry Staunton , Finance Director of ITV Plc (2003–present)
- John Surma , Chairman and CEO of U.S. Steel (2004–present)
- Eugene Tenenbaum , managing director of Millhouse Capital UK Ltd
- Min Zhu , co-founder of WebEx
- Richard Meddings , Group Finance Director, Standard Chartered plc
- Gianluca Meardi , Partner in Reply and founder of xPrice.biz international PwC Alumni community
- Steven Ciobo , member of the Australian House Of Representatives (2001–present)
- Justine Greening , Conservative Member Of Parliament Of The United Kingdom (2005–present)
- David Heathcoat-Amory , Conservative Member of Parliament of the United Kingdom (1983–present)
- Mark Hoban , Conservative Member of Parliament of the United Kingdom (2001–present)
- John Liu , member of the New York City Council (2001–present)
- Jeffrey Lucy , chairman of the Australian Securities And Investments Commission (2004–present)
- Robert McNamara , United States Secretary Of Defense (1961–68); President of the World Bank (1968–81)
- Morten Andreas Meyer , Norwegian Minister of Modernisation (2001–05)
- Francis Plowden , laymember of the Judicial Appointments Commission
- John Stuttard , Lord Mayor Of London (2006)
- Paul Szabo , Member of the Canadian House Of Commons (1993–present)
- Stephen Williams , Liberal Democrat Member of Parliament of the United Kingdom(2005–present)
