Investigations

MPs grill PwC, EY over Thomas Cook going concern status

MPs have severely criticised senior audit professionals from PwC and EY over their level of challenge to management’s going concern statements as part of an investigation into the collapse of Thomas Cook, as well as highlighting strong objections to the provision of non-audit services to audit clients.

Both firms faced questions from the Business, Energy and Industrial Strategy (BEIS) Select Committee about their auditing of the travel firm, with one MP suggesting the presentation of the company’s financial position ‘defied common sense’ given the risks its business faced.

Hemione Hudson, PwC’s head of audit, told the committee that PwC had highlighted in considerable detail its challenges to the board in every one of the years the audit firm audited Thomas Cook, from 2007 to 2016.