A Deloitte partner is facing “confidential proceedings” launched by the corporate watchdog after being referred to a disciplinary panel for investigation.
The big four accounting firm told a New South Wales parliamentary inquiry the partner was still employed but would not be performing audit work until the investigation was finalised.
“The matter related to Australian Securities and Investments Commission (Asic) initiating confidential companies auditors disciplinary board (CADB) proceedings against a partner of the firm,” Deloitte told the state inquiry.
The disciplinary board can consider whether auditors have failed to “adequately or properly” perform their duties as required by law. It can question whether someone is “a fit and proper person to remain registered as an auditor”. The board can cancel or suspend an auditor’s registration.
“The individual remains a partner of the firm but has agreed with Asic not to perform the duties of a registered company auditor whilst these proceedings are ongoing, or until receipt of further orders of the CADB,” Deloitte told the NSW inquiry.
Deloitte did not disclose the allegations against the partner but told the inquiry that it was considered a “reportable event” by the powerful US auditor, the Public Company Accounting Oversight Board (PCAOB). Deloitte is also based in the US.
“We notified the PCAOB within the required timeframe and advised Asic that we had done so. The partner also advised [the industry body] Chartered Accountants Australia and New Zealand in line with their professional obligations,” Deloitte told the NSW inquiry.
An Asic spokesperson said: “Proceedings filed in the CADB are confidential until the board publishes their decision and reasons.”
Separately, Deloitte has revealed which federal government department’s confidential information it shared without permission last year, after being criticised for not immediately disclosing that detail to a federal inquiry.
“The government department was the Department of Defence,” Deloitte told the state inquiry.
The consultancy firm has previously described the breach as inadvertent and not motivated by commercial gain. It told the Senate inquiry the responsible staff member had been “stood down”.
“For the avoidance of doubt, we would like to clarify that this was in relation to standing down from the engagement and not from their employment,” Deloitte told the NSW inquiry.
Deloitte Australia’s chief executive, Adam Powick, told the state inquiry there was “certainly a lack of clarity” about regulatory oversight and said the firm would support a government review to strengthen accountability.
The firm also told the NSW inquiry it launched an internal investigation into a former partner using defence documents obtained while working at Deloitte after leaving the firm.
“We are currently investigating one matter regarding a former partner of Deloitte relating to removal of government information from their Deloitte device when they left the firm in 2017,” the firm told the NSW inquiry.
“The partner in question has provided a statutory declaration that any such information has now been deleted and/or destroyed and we have worked closely with the relevant government department in relation to this matter.”
The firm also told the federal inquiry that 19 partners are paid more than $1.4m a year. Another 33 are paid between $1.15m and $1.43m.
During the inquiry hearings in July, Powick conceded his salary was not worth seven times the amount given to the prime minister.
“I happen to deeply recognise that I’m incredibly privileged to earn what I do for what I do,” Powick told the inquiry.
