According to the Financial Times, PricewaterhouseCoopers (PwC) was sanctioned with a six-month suspension by the Ministry of Finance and the China Securities Regulatory Commission (CSRC) last September for its involvement in financial fraud cases related to China Evergrande Group.
Following this, dozens of Chinese partners have left the firm, with the number of departures significantly exceeding that of other firms in the industry.
As of this Tuesday (Feb. 11), the Ministry of Finance’s registration data shows that PwC had a total of 277 registered equity partners, with 66 exiting the partnership—65 of whom have confirmed their departure. This represents a reduction of over 20%, marking the largest drop in five years.
A spokesperson for PwC China stated that the company has been restructuring its business over recent months, and some of the departing partners are retiring as part of normal turnover.
The Ministry of Finance and the CSRC imposed the six-month suspension last September and confiscated illegal earnings, along with fines totaling RMB 441 million. The sanctions were a result of the firm's failure to disclose and even enabling fraudulent activities during its audit of Evergrande.
According to PwC's disclosures, before the imposition of the ban, there were 1,048 partners in mainland China and Hong Kong as of September 2023, including both equity and non-equity partners.
Notable departures include Raymund Chao, former chairman of PwC Asia-Pacific and China; Gavin Chui, former finance chief of PwC China; Jim Chen, a Beijing-based partner overseeing state-owned enterprise clients; and Bur Chan, who previously led the firm’s auditing division in northern China. Reports indicate that several partners from PwC's Guangzhou office have also left, as the office was forced to shut down following the penalties related to Evergrande. Current regulations in mainland China prohibit state-owned enterprises and listed companies from hiring auditors who have been penalized in the past three accounting periods.
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