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PricewaterhouseCoopers, Ernst And Young Become TARP Auditors
PricewaterhouseCoopers, Ernst And Young Become TARP Auditors
Just a few days ago, the Treasury Department of the United States Government announced it had hired two of the Big Four firms, PricewaterhouseCoopers and Ernst & Young to help the government implement the $700 billion bailout program aimed at Wall Street and the economy.
The US government, US Treasury Department and the US Federal Reserve recently unveiled their Troubled Asset Relief Program (TARP) to help inject liquidity and stability into the US banking system. $250 billion of this will be used to buy preferred stock from several large commercial banks and a variety of regional banks.
The Treasury has indicated that it has signed blanket contracts to allow both these firms to perform actions on an as-needed basis to implement the bailout program, with both contracts going to September 30, 2011.
In a statement, Treasury said that the two firms will help the department with accounting and internal control services that will be needed \"to administer the complex portfolio of troubled assets the department will purchase, including whole loans and mortgage-backed securities.\"
PricewaterhouseCoopers will be the main program auditor to monitor the purchase of billions of dollars of preferred bank stock as well as toxic assets from banks. PwC stands to gain $191,000 from this initial order for auditing work.
Ernst & Young will provide general accounting support, and will initially get $492,000 from the Treasury.
Inevitably, the onus of credible and unbiased participants in this entire process falls again on the Big Four firms, to continue their watchdog duties on behalf of investors. In this case, this is perhaps the highest profile auditing work that could be granted to any firm. Investors in this case are taxpayers in the United States and the client is the US government. The whole process will be under extraordinary scrutiny and every step of the audit would need to be rigorously checked for quality. More so, since this is a unique initiative, the auditing circumstances are quite complex. PwC and E&Y have been awarded this prime engagement, but this is not without risk.
We question what happened to KPMG and Deloitte in this process, were they not awarded for some reason, or did they not even choose to participate.
PricewaterhouseCoopers, Ernst And Young, TARP, Auditors
Posted by: Big4 10.26.2008 10:14 am
Just a few days ago, the Treasury Department of the United States Government announced it had hired two of the Big Four firms, PricewaterhouseCoopers and Ernst & Young to help the government implement the $700 billion bailout program aimed at Wall Street and the economy.
The US government, US Treasury Department and the US Federal Reserve recently unveiled their Troubled Asset Relief Program (TARP) to help inject liquidity and stability into the US banking system. $250 billion of this will be used to buy preferred stock from several large commercial banks and a variety of regional banks.
The Treasury has indicated that it has signed blanket contracts to allow both these firms to perform actions on an as-needed basis to implement the bailout program, with both contracts going to September 30, 2011.
In a statement, Treasury said that the two firms will help the department with accounting and internal control services that will be needed \"to administer the complex portfolio of troubled assets the department will purchase, including whole loans and mortgage-backed securities.\"
PricewaterhouseCoopers will be the main program auditor to monitor the purchase of billions of dollars of preferred bank stock as well as toxic assets from banks. PwC stands to gain $191,000 from this initial order for auditing work.
Ernst & Young will provide general accounting support, and will initially get $492,000 from the Treasury.
Inevitably, the onus of credible and unbiased participants in this entire process falls again on the Big Four firms, to continue their watchdog duties on behalf of investors. In this case, this is perhaps the highest profile auditing work that could be granted to any firm. Investors in this case are taxpayers in the United States and the client is the US government. The whole process will be under extraordinary scrutiny and every step of the audit would need to be rigorously checked for quality. More so, since this is a unique initiative, the auditing circumstances are quite complex. PwC and E&Y have been awarded this prime engagement, but this is not without risk.
We question what happened to KPMG and Deloitte in this process, were they not awarded for some reason, or did they not even choose to participate.
PricewaterhouseCoopers, Ernst And Young, TARP, Auditors
Posted by: Big4 10.26.2008 10:14 am
 Views: 380 |
 Comments: 0 |
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