PwC shelved as John Lewis picks KPMG

Retailer John Lewis has checked out of its 20-year relationship with PwC, choosing KPMG as its external auditor following a six month tender process

In its annual report and accounts for the year ended 31 January 2015 John Lewis, which operates as a partnership, noted that it had initiated an audit tender process for the 2016/17 financial year, which it said was in line with good governance practice.

The report said that in 2012/13, the audit committee had adopted a policy in line with the code relating to tendering the external audit contract at least every ten years. Prior to that, there had been no tender for 20 years, although the PwC partner on the audit was rotated every five years. 

In its latest statement, the company said the audit tender process has now been completed and the partnership intends to appoint KPMG as its auditors at the 2016 annual general meeting.

Former Financial Reporting Council (FRC) chair Baroness Hogg, who is chair of the retailer’s audit and risk committee, said: 'We thank PricewaterhouseCoopers for their strong contribution as the Partnership's auditors over many years and for this coming year. We look forward to working with KPMG for the 2016/17 financial year'.

John Lewis paid PwC a total of £1.1m in the last financial year, according to its annual report, made up of £800,000 of fees for audit or audit-related services and £300,000 for non audit services.

The company is the third major retailer to part company with PwC in 2015, following both Tesco and Sainsbury’s.

PwC said: ‘The audit market is in a state of flux and highly dynamic, with competition remaining fierce. We expect that over the next five years many large companies will switch their auditors because of new rules. These changes are creating opportunities for us to work with companies in new capacities, including as auditors.’

PwC has gained a number of high profile audit clients this year, including Morrisons, WH Smith, Vodafone and Ladbrokes. 

 

 
 

 


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Pat Sweet |Reporter, Accountancy Daily [2010-2021]

Pat Sweet was the former online reporter at Accountancy Daily and contributor to the monthly Accountancy magazine, pub...

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