Scandals in China and Australia hit Big 4 giant PwC, but global revenues reached a record high

PwC faced reputation-damaging scandals in Australia and China in 2024.

After scandals in Australia and China this year, PwC has lost business in the Asia-pacific region.

On Monday, the Big Four consulting firm reported a 12.7% decline in net income in the region for the financial year ending in June. PwC said demand was particularly slow in China, where revenues fell.

In September, the firm was found to have helped conceal fraud at the now-collapsed Chinese property developer Evergrande.

The Chinese government fined PwC $62 million and removed its license to operate in the country for six months. 11 employees were fired or left the company, and state-owned enterprises have since dropped PwC as their auditor.

Mohamed Kande, PwC’s global chairman, said the findings of the Evergrande audit were in “stark contrast” to the high-quality work PwC produces and were not representative of what the firm stands for.

The firm’s second regional scandal hit in Australia after a senior partner in its tax division was found to have passed confidential information from his work with the government to colleagues to help them win new business with multinational technology companies like Uber and Google, the Australian Financial Review first reported.

PwC sold its government consulting business in Australia following the revelations.

Overall revenues in Asia-Pacific, which is the smallest of the firm’s regions, were down by 5.6% in local currencies. PwC highlighted that business had performed well in India, where revenues increased.

Despite the regional impact on the business, PwC posted an overall growth of 3.7% to reach record-high gross revenues of $55.4 billion.

Like other leading consultancies, PwC has been hit by falling demand for consulting services, and its growth rate has slowed. In FY2023, revenue grew 9.9%.

Following a pandemic-era rush on advisory services, demand for professional services has slowed, leaving firms overstaffed for the level of work. While EY and Deloitte have been trimming back staff numbers in the past year, PwC expanded its workforce by 10,000 in FY2024 to reach 370,000 global employees.

“Despite a backdrop of economic headwinds, we’ve seen revenue growth across all of our lines of business, deepened our strategic alliances, and invested $1.5 billion to expand and scale our AI capabilities,” said Mohamed Kande, PwC’s global chairman.