But PwC said the matter “was prioritised internally and was subject to a
detailed internal review” in September 2019 which “did not identify any
evidence that the ATO had been misled”.
The results of the review were shared with the ATO by Tom Seymour, PwC’s
then head of financial advisory services and later Mr Sayers’ successor as CEO,
in October 2019 and the firm from then on “had understood that PwC had
addressed the ATO’s concerns.”
The Sydney Morning Herald
reported in early July that Treasury had launched a review of an unknown number
of foreign takeovers involving PwC after the ATO raised concerns about an
application that, while legal, may have had the effect of misleading the Tax
Office about the intended use of aggressive tax structures.
The answers were posted late on Thursday, hours before senior PwC figures
past and present – including three CEOs – were due to testify about the firm’s tax leaks scandal at
what shaped as a blockbuster day of hearings before a parliamentary committee.
Current CEO Kevin Burrowes and three senior partners of the firm have been
asked to appear both in the morning and the afternoon, with the firm’s former
general counsel, Meredith Beattie, Ziggy Switkowski – who was commissioned by
PwC to investigate the firm’s governance – and former chiefs Luke Sayers and
Tom Seymour testifying in between.
It is the first time since the extent of the scandal was revealed
by The Australian
Financial Review in May last year that Mr Seymour and Ms
Beattie will speak publicly about the tax leaks matter.
The hearing of the joint parliamentary inquiry into the structure of the big
four consulting firms, chaired by Labor senator Deborah O’Neill, is scheduled
to run from 8am until 5.45pm in Parliament House.
New PwC Australia
chairman
Senator O’Neill said it was appropriate the executives had agreed to appear
and stressed the committee’s focus was on “the ethical dimension of this
scandal, what that means for the future of professional accountability, and how
that can shape the future of the consulting sector”.
Separately, PwC Australia on Thursday announced the appointment of former
Macquarie Group executive director and thriller writer John M. Green as its
inaugural independent chairman.
The firm also appointed boutique law firm Webb Henderson, supported by
former NSW Supreme Court chief justice Tom Bathurst KC, as an independent
monitor to check its progress on improving governance and
operations.
The tax leaks scandal involved a former partner, Peter Collins, sharing
confidential tax information with PwC personnel. The firm’s tax advisers then
developed structures to help clients sidestep tax laws the firm was helping
Treasury to develop.
During the past year, parliamentarians have been reluctant to call Mr
Seymour and other past leaders at the firm because Australian Federal Police
are investigating the tax leaks matter. That investigation, along with nine
inquiries by the Tax Practitioners Board, is ongoing.
Mr Burrowes is likely to be the subject of the
most torrid questions over his pay and the decision by PwC International to
withhold a legal report into the overseas aspects of the tax leaks scandal.
PwC International
payment
On his pay, Mr Burrowes will have to explain why he didn’t tell parliament
he was being paid an
additional $1.2 million by PwC International for the extra role of leading a
firm in remediation.
That revelation in June came after he told Senator O’Neill in a February
hearing of the now-finished Senate inquiry into consulting firms that he was
earning $2.4 million (later revised upwards to $2.8 million) for his role as
PwC Australia’s boss.
The additional role also shines new light upon Mr Burrowes’ earlier insistence
to parliament he could not produce the report by international law firm
Linklaters into the actions of overseas partners relating to the tax leaks
matter because he had “rescinded his role with PwC International Limited”.
The
firm has been accused of engaging in an ongoing cover-up over its refusal to
release the report. PwC International, which has only released a brief
summary of the report, disciplined six of the firm’s international operatives
for not inquiring about the nature of what turned out to be leaked data.
First time
testifying for Seymour, Beattie
Mr Seymour, who is scheduled to appear for two hours alongside Mr Sayers, is
likely to be asked when he first knew about the leaks and his response to the
crisis.
Mr Sayers led the tax practice between 2008 and 2012, while Mr Seymour led
the practice from 2012 to 2016 before becoming the head of Financial Advisory
(where tax and legal used to sit), and then Asia Pacific Americas Tax Leader
between 2016 and 2020.
Mr
Seymour was one of eight partners who were asked to exit the firm in July 2023.
At the time, PwC said he had been one of three partners asked to leave early
because they had failed to “adequately exercise their expected leadership or
governance responsibilities to prevent these actions or to address the
deficiencies in culture at the firm or hold others accountable for their
behaviours”.
When Senator Deborah O’Neill last year forced the parliamentary tabling of the PwC emails that revealed the firm’s breaches of government confidentiality provisions, then-chief Tom Seymour wasn’t too fussed. The other people on the emails?
The other people on the emails? Not involved, he insisted. The whole thing involved one ex-partner and the firm, to his mind, suffered from a “perception issue”. Or so he told our colleagueJennifer Hewett on stage at the Australian Financial Review Business Summit in May
—-
With ex-PwC CEO Luke Sayers set to face parliament tomorrow, it's worth remembering he gave secret equity in his private company to Mathias Cormann immediately after Cormann left parliament. Cormann now boss of the OECD & massive questions remain (ICYMI):
Firm secretly owned by OECD boss given taxpayer millions
The Secretary-General of the OECD, former Australian Finance Minister Mathias Cormann, stands to have made substantial gains from secretive share dealings with the man who was CEO of PwC Australia for the entire tax leaks affair.
Investigations show the private company Luke Sayers founded in 2020 after departing as PwC Australia CEO has been given over $10 million in Australian Government contracts — around $9m of which while Cormann was a secret co-owner.
Between December 2020, and November last year, when Sayers said Cormann had “recently”, “rescinded” his equity, Sayers Group was awarded at least 23 Federal Government tenders worth $9.18m, investigations by The Klaxon reveal.
The true value is likely higher, as only contracts of a certain size and type are required to be published on government contracting register AusTender.
PwC Australia CEO Kevin Burrowes is paid $1.2m by the international arm of the firm to advise the global consulting giant on its response to the tax scandal hanging over the local business.
