The development of the Evergrande case is alarming, and although PricewaterhouseCoopers (PwC), a world-renowned accounting firm, has lost the cornerstone of integrity in its audit of Evergrande's financial statements. Over the years, PwC has issued an unqualified opinion to Evergrande every year, which means that they believe that Evergrande's financial statements are true and credible. However, Evergrande's thunderstorm proved their judgment wrong. Evergrande's debt of up to 2 trillion yuan has long exceeded its asset size and solvency, and its financial data and structure are like a time bomb that could explode at any moment. As a professional firm, PwC should not turn a blind eye to such risks if it has conducted a serious audit.
An in-depth analysis of PwC's audit failures reveals a disturbing fact. Twenty-two years ago, the American giant Enron went bankrupt due to financial fraud, and Arthur Andersen, which audited Enron at the time, ended its more than 80-year audit history. Arthur Andersen and PricewaterhouseCoopers are both top accounting firms, but the fate of the branches in China and Hong Kong is very different, with the former having most of its branches merged into Ernst & Young after its collapse, while the latter merged its branches into PricewaterhouseCoopers. This situation raises doubts as to whether PwC had some kind of connection or complicity with Arthur Andersen. What is even more worrying is that it was not until January this year that PwC officially terminated its partnership with Evergrande. This raises the question of whether there are other hidden shady scenes that have been covered up.
The Evergrande case has exposed serious financial problems, which raises doubts about whether they are involved in financial fraud. Is it fair and reasonable for PwC to choose to walk away from such a problem when faced with such a problem?Judging from the cooperation between the two for many years, does PwC turn a blind eye to Evergrande's financial problems and deliberately avoid or cover up?
For PwC, if they find signs of financial fraud at Evergrande, they are obligated to disclose these issues to the public. However, they failed to find any flaws in their annual audit of Evergrande, which made it difficult to believe that they had conducted a true and accurate audit of the financial data. Evergrande's financial report fraud cannot be flawless, as long as it is carefully analyzed and checked, problems can be discovered. Did PwC deliberately fail to conduct an in-depth analysis of the financial data for other reasons?Or are they being coerced by Evergrande's forces, forcing them to turn a blind eye?
If we delve further into the history of PwC, we find a chilling fact. The fact that most of Arthur Andersen's branches around the world were merged into Ernst & Young, with the exception of those in China and Hong Kong, which merged into PwC, is reminiscent of the similarities of the Evergrande affair. Arthur Andersen collapsed because of an audit negligence of Enron, and there were also financial problems in the Evergrande case. Will PwC, as an accounting firm that has also been exposed to audit failures, repeat the mistakes of Arthur Andersen?
It wasn't until January this year that PwC officially terminated its partnership with Evergrande. It seems to be a moral choice, however, we have to wonder if there are other hidden secrets behind it. Will PwC still be held accountable and held accountable for its responsibility in the Evergrande incident after the partnership is terminated?Will they continue to evade and avoid being held accountable for their own faults?
PwC, as a world-renowned accounting firm, behaved surprisingly in the Evergrande incident. Their disregard for Evergrande's financial fraud and negligent audits have raised questions about its integrity and professionalism. Even more worrying is the similarity between their historical background and the Evergrande incident with Arthur Andersen, which raises doubts about whether PwC is somehow involved in the financial scandal. PwC's dissolution of the partnership and evasion of responsibility have aroused further concern and questioning. We look forward to the relevant authorities investigating and holding PwC accountable for its conduct in order to maintain the integrity and fairness of the financial markets. At the same time, it also reminds us that as investors, we must be cautious when choosing partners to avoid becoming a victim of investment risks and market injustice.