PwC settles disciplinary case with CPA Ontario

According to CPA Ontario, PwC self-reported that 445 of its professionals, primarily in its assurance practice, shared answers for internal training assessments between 2016 and 2020.

“This included training on accounting and auditing standards, audit strategy, planning, procedures and documentation, professional integrity and independence matters, and specific issues that arise in audits,” it said.

According to the settlement, employees collected answer-sharing documents on Google Drives, shared them by email, and worked together following in-person training sessions using the shared answers.

“There was a consistent mindset among the participants that engaged in answer-sharing that it was both widely-known and appropriate,” the settlement said. “Many viewed sharing answers as part of a collaborative culture at PwC and because the assessments were open book, some did not view answer sharing as ethically improper.”

However, the regulator noted, the mandatory assessment process “was therefore not effective in demonstrating whether the substantive professional competencies being evaluated were in fact attained.”

Some senior professionals, including managers, directors and partners, also participated in answer sharing, it noted.

After the activity was discovered, the firm took disciplinary action against certain staffers, including termination, financial penalties and requiring them to retake assessments, it reported.

As part of the settlement, the firm admitted that it didn’t have policies and procedures in place to ensure that its mandatory internal training assessments were being completed independently.

The regulator also said that PwC “failed to adequately communicate” the expectation that these assessments would be completed independently, and that it didn’t have procedures in place to prevent or detect cheating.

To resolve the allegations, the firm paid a fine of $1 million and $455,000 in costs to CPA Ontario.

The regulator noted that the settlement took into account the firm’s remediation efforts, which included the adoption of policies to ensure that its assessments are being completed independently, and to monitor and internally discipline violations of those policies.

PwC previously entered settlements with both the Canadian Public Accountability Board (CPAB) and the U.S. Public Company Accountability Oversight Board (PCAOB) regarding employee cheating on internal training assessments.

In those settlements, which were approved in February 2022, PwC neither admitted nor denied the regulators’ findings. As a result, it paid a US$750,000 penalty to the PCAOB and $200,000 in costs to the CPAB.