PwC Responds to Allegations Concerning Its Auditing of Evergrande

PwC has publicly refuted claims in an anonymous letter regarding its audit work for the troubled real estate giant Evergrande. The firm emphasizes its commitment to ethical standards and legal compliance despite the complex challenges of the Chinese property market downturn.

PricewaterhouseCoopers (PwC), a global leader in audit and assurance services, today addressed an anonymous letter that has raised concerns over its past involvement with Evergrande, the heavily indebted Chinese property developer. The letter surfaced on social media and accused PwC of mismanagement and cultural issues within its operations. PwC firmly denies these allegations, stating they are both inaccurate and unfounded.

“We believe the letter contains inaccurate statements and false allegations that could tarnish PwC’s reputation and infringe our legal rights,” said a spokesperson for PwC. “We have reported the matter to the relevant authorities and are conducting a full investigation with high priority.”

Evergrande has been at the centre of China’s real estate crisis, symbolizing the sector’s broader economic challenges. The company was recently implicated in a significant revenue overstatement, with accusations amounting to $78 billion, as reported by local regulators. PwC had served as Evergrande’s auditor for over a decade, resigning last year due to disputes over audit methodologies related to the 2021 accounts.

The controversy extends beyond PwC, touching on broader regulatory and financial issues within China’s property market. Last month, Chinese authorities announced a lifetime securities market ban for Evergrande chair Xu Jiayin following allegations of financial fraud.