Auditors: We weren’t to predict future

A top firm of auditors has defended the €66m it was paid to probe Bank of Ireland, saying it was not there to predict future events.

PricewaterhouseCoopers told the Oireachtas inquiry into the banking collapse that auditing rules at the time only allowed it to consider previous transactions, not predict the future.

PWC chiefs said the firm had not been complacent when looking at the bank’s books from the start of the financial crisis as it was not its place to give an opinion on the institution’s business model. PWC senior partner Ronan Murphy told the committee the company had not erred. “We stand over the quality of the audits of the financial statements of Bank of Ireland, AIB and Bank of Scotland Ireland and the robustness of the audit opinions issued on their respective reporting dates.

“Audits in the period from the start of the financial crisis were clearly challenging due to the inherent uncertainty facing the Irish and global economies and the particular issues faced by Irish banks,” he said.

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Committee chairman Ciaran Lynch questioned whether PWC’s personnel were sufficiently expert in property transactions to perform their audit functions properly at the bank. PwC chiefs said the appropriate level of experience was on hand during the audits.

Fine Gael’s Kieran O’Donnell said they did not criticise the accounts in any way when signing off on the 2007 accounts on May 20, 2008.

The committee heard this was followed shortly afterwards by the bank guarantee and a few months later with €3.5bn of State money.

Mr O’Donnell questioned how PWC could look on the statements as a true and fair picture of the situation.

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