The Financial Reporting Council (FRC) has opened an investigation to find whether professional services firm PricewaterhouseCoopers (PwC) acted independently while conducting the audit of the Berkeley Group Holdings.
As part of investigation, the British accounting watchdog will look into PwC’s audit of Berkeley’s annual financial statements for the year ended 30 April 2012 under the Accountancy Scheme with a particular focus on the joining of a former PwC partner on Berkeley’s board last year.
PwC partner Glyn Barker joined Berkeley’s board as a non-executive director in January 2012, after serving the accounting firm for 35 years. Barker was most recently vice chairman of UK at PwC.
Confirming the receipt of the investigation letter, PwC in a statement said: “We will continue to fully cooperate with the FRC’s enquiries. We take our independence responsibilities very seriously.”
Berkeley, a house-building company based in Surrey, did not comment on the probe. However, Tony Pidgley, the founder and chairman of Berkeley, told Reuters: “As far as we’re concerned Glyn has had a very distinguished career and we are very pleased to have him on the board.”
Last month, FRC launched an investigation under the Accountancy Scheme into the accounting and auditing of interest rate swap arrangements which gave rise to a prior period adjustment in the financial statements for the year ended 31 December 2012.
FRC, which did not reveal the time line of the investigation, operates independent disciplinary arrangements for accountants and actuaries. It oversees the regulatory activities of the accountancy and actuarial professional bodies.