The penumbral dealers then vanished without a trace. Avto
VAZ wrote off more than $1 billion in "uncollected bills" by late
1995. PwC did make a mild comment in the 1997 audit. But the first
real warning appeared only three years later in the audit for the
year 2000.
Andrei Sharonov, deputy minister in the federal Ministry of
Economics said, in an interview he granted "Business Week" last
February: "Auditors have been working on behalf of management rather
than shareholders." In a series of outlandish ads, published in
Russian business dailies in late February, senior partners in the
PwC Moscow office made this incredible statement: "(Audit) does not
represent a review of each transaction, or a qualitative assessment
of a company's performance."
The New York Times quotes a former employee of Ernst&Young in Moscow
as saying: "A big client is god. You do what they want and tell you
to do. You can play straight-laced and try to be upright and protect
your reputation with minor clients, but you can't do it with the big
guys. If you lose that account, no matter how justified you are,
that's the end of a career."
PwC should know. When it mentioned suspicious heavily discounted
sales of oil to Rosneft in a 1998 audit report, its client,
Purneftegaz, replaced it with Arthur Andersen.
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