PwC Resigned From Anil Ambani's Reliance Home Finance & Reliance Capital

In a most recent development with regards to Mr. Anil Ambani, PriceWaterhouseCoopers has resigned as the auditor of two of the group companies: Reliance Capital and Reliance Home Finance.

PwC was forced to dump the audit mandate after it claimed that the management of the two companies had failed to give satisfactory replies to questions that the auditors had raised with respect to certain transactions “which in its assessment, if not resolved satisfactorily, might be significant or material to the financial statements”. No details were given.

A furious Reliance Capital said it could sue the global audit firm for leaving the company in a lurch by resigning from its mandate just a day before the audit committee was supposed to vet and certify the accounts for 2018-19.

The company disputed PwC’s observations and claimed they had acted in accordance with the provisions of law. The audit remained unconvinced and sent in another letter on May 14. PwC said, “the company did not convene an audit committee meeting within the expected time”.

The global audit firm said: “These actions by the company have prevented PwC from performing its duties as statutory auditors and exercising independent judgment in making a report to the members of the company, and impaired its independence. Hence, PwC is no longer in a position to complete the audit and instead feels compelled to withdraw from the audit engagement and resign.”

The company riposted that it had responded to the various queries and the letters of PwC, after which it had convened a meeting of the audit committee on Wednesday (June 12). The auditor’s resignation became effective from Tuesday.

“The company expected PwC to have participated in the meeting of the Audit Committee and not resigned on the eve thereof,” Reliance Capital said in a regulatory filing.