(12 July 2004 – Australia) Big four accounting firm Ernst & Young believes it is in pole position for the upcoming National Australia Bank external audit appointment.PricewaterhouseCoopers, which carried out an investigation in to the bank’s forex trading losses and whose former managing partner John Thorn now sits on the NAB board and is chairman of the bank’s audit committee, has declared itself out of the race for conflict of interest reasons.
NAB’s current auditor, KPMG, is being replaced half way through its contract in the wake of risk management and organisational failures that led to the $360 million rogue trading blowout.
This leaves Deloitte as Ernst & Young’s only serious competitor for the NAB audit role, which is worth A$20 million a year to the winning accounting firm.
According to reports in the Australian media, Ernst & Young has already started choosing its team to work on the NAB contract. It has also thoroughly investigated any potential conflict of interest with strong Sarbanes Oxley requirements in the US.