Wednesday, September 06, 2006

Perceptions. Whose perceptions?

What are we to make of the news that accounting multinational Ernst & Young has become a sponsor of Transparency International's Corruption Perception Index?

Ernst & Young:
* has exploited its privileged status to profit from selling tax shelters;
* has been found guilty of contempt of court in a malpractice suit;
* provides tax minimisation services from a wide variety of tax havens;
* been forced to pay $100 million settlement for its part in overstating the revenues of AOL during the TimeWarner takeover;
* agreed a $4.5 millionsettlement for over-billing on government related expenses claims;
* is not transparent about its own tax payments to governments around the world;
* has participated in a fee-fixing cartel in the auditing services market;
* has been found guilty in the USA of violating audit standards through conduct that was both reckless and negligent.

Our perception is that Ernst & Young is part of the problem, not the solution.

Our conclusions:

Transparency International further undermines our perceptions of its index by aligning itself with companies like Ernst & Young.

Ernst & Young appears to be engaging in a cynical ploy to align itself with civil society efforts to highlight corruption, and invites criticism by continuing to play a lead role in advising on tax avoidance schemes.

1 Comments:

Blogger Richard Murphy said...

See my comment on this at http://www.taxresearch.org.uk/Blog/2006/09/07/you-couldnt-make-it-up/

Richard Murphy
Tax Research LLP

7:03 am  

Post a Comment

Links to this post:

Create a Link

<< Home