PricewaterhouseCoopers announced that its new Japanese accounting firm, PwC Aarata, has completed the necessary regulatory steps to open for business July 1. PwC announced in May that it would be opening a new firm in the country after its audit partner in Japan received major penalties for poor supervision of its staff.
Poor internal controls at ChuoAoyama Audit Corp., which audits the financial statements of more than 5,500 companies, led to Japan's Financial Services Agency ordering the firm to suspend any audits that fall under securities and exchange, or corporate laws, for the months of July and August. The Big Four firm did promise to maintain a partnership with ChuoAoyama, which employs 2,500 people.
PwC Aarata -- whose names signifies "new and fresh" -- will be a member firm of the PricewaterhouseCoopers global network and is expected to grow to about 80 partners by the end of the year.
The new firm will service both domestic and international companies in Japan, but will initially focus on Japanese multinational companies, Japanese companies listed on exchanges outside Japan, and Japanese subsidiaries of major international multinationals. PwC Aarata will divide its audit services into three industry groups -- consumer and industrial products; technology, information, communications and entertainment; and financial services.
PwC Aarata will be led by partner Kazutaka Iwashita, who was previously an audit partner of Price Waterhouse Japan, until an interim management board is appointed Sept. 1.
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