Pfizer and KPMG had ample time to respond to questions before we published a story on August 4 revealing a sham, a series of transactions designed to avoid tax by creating almost $1 billion in share capital. They did not respond by deadline.
Three days later, after we published a brief Despatch column asking Pfizer to pay back the money it owed the Australian people – and for the pharma giant and its auditor KPMG to apologise – we got this brief response from KPMG:
“Sorry I didn’t get back to you last week. EY did the tax advice not us. You might want to check with them.”
Not much point doing that. EY is even less communicative than KPMG, and probably slightly worse on audit standards. Though, if EY did do the tax advice – and EY may well have had a hand it it – there is little evidence in Pfizer’s statutory materials. Another check of the financial statements of all the companies involved only showed KPMG as auditor and KPMG as providing “taxation services”. No EY.
We put this to KPMG, that there was no sign of EY. There was no response. This is par for the course; there is never much more than a courteous dead-batting, and this is inevitably the response from all of the Big Four. None are worse than the other. They are all the same, polite nothingness.
They know they can rely on the relentless sycophancy of the mainstream financial press to nurture their reputations.
So, KPMG, the three entities in question are Pfizer Australia Holdings, Pfizer Australia Investments and Pfizer PFE Australia. KPMG is auditor of all three and the only firm disclosed as providing “taxation services”. There is no sign of EY.
The Big Four need to be broken up. Providing tax advice and audit is too great a conflict of interest.