Companies ban use of auditors for IT consulting
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Apple Computer has become the latest in a growing list of companies to tell its auditors they can no longer also provide IT consulting.
19 February 2002 Apple Computer has become the latest major company to ban its financial auditor from also providing it with IT consulting services.
Reacting to conflicts of interest exposed by the collapse of energy giant Enron, Apple says it will stop using IT consultants from its independent accountant, KPMG. "In the aftermath of the Enron disaster, we concluded that from an appearance point of view it would be better not to use auditors for IT consulting," says Fred Anderson, chief financial officer at Apple. The policy shift follows allegations that financial advisor and management consultancy Andersen (formerly Arthur Andersen) was connected to financial cover-ups at Enron.
Apple joins a growing band of companies that have slapped a consulting ban on their auditors. Most notably, in recent weeks Walt Disney announced its accountant, PricewaterhouseCoopers, would no longer be eligible for IT consulting work at the company.
Such moves, if they become widespread, could spell upheaval for many companies providing both auditing and IT services, forcing them to formally separate the two activities — as some already have.
In the last two years, Ernst & Young has sold its IT services wing (to Cap Gemini), KPMG Consulting has been spun off as an independent company from KMPG, IT services giant Accenture has split from Arthur Andersen, and both PricewarehouseCoopers and Deloitte Touche Tohmatsu say they will detach their management consulting operations later this year.
