Public prosecutor settles KPMG office tax evasion case

DutchNews, July 19, 2017

The public prosecution department has reached deal with accountancy firm KPMG about a fine for tax evasion in relation to the construction of its current head office in Amstelveen. 

KPMG has agreed to pay a fine of €8m on top of repayment of the tax that it failed to pay, the public prosecution department said in a statement. Five people connected to the case will also face legal action, the department said. 

Two former KPMG executives, a civil-law notary, the property developer with whom KPMG did business at the time and an indirect shareholder of the property company will face trial and the case will start on October 3. 

The case dates back to 2009 to 2011 when KPMG II – a joint venture between KPMG and the owner of the land – saved itself a major tax bill by effectively deducting the cost of the new office in one go, rather than in installments. 

It was also one of the incidents which led to the resignation of the company’s chairman in 2014.

Financial services watchdog criticises big four accountants

DutchNews, June 29, 2017

Photo: Depositphotos.com

The Dutch financial services watchdog AFM has criticised the big four accountants groups for again failing to carry out adequate checks on the accounts of listed companies and banks. 

AFM staff carried out additional checks on 32 annual reports and found shortcomings in 19 of them.

‘Although steps have been taken, the monitoring of quality by audit firms continues to be a concern and implementing the change agenda continues to be difficult,’ AFM board member Gerben Everts said in a statement. 

‘We have also seen good audits, which proves that auditors can deliver quality. But this has to apply consistently across the board in the coming period.’

Five tax advisors arrested as finance ministry gets tough on fraud

DutchNews, March 21, 2017

Photo: Joep Poulssen 

Five tax advisors have been arrested for defrauding the tax office of €2.7m following a string of investigations by finance ministry inspectors. 

The five were arrested in raids on homes and offices in Stein, Rijssen, Hoorn, Purmerend, Hendrik-Ido-Ambacht and Wezep over the past two weeks. The tax advisors are suspected of claiming extra tax breaks on healthcare costs and gifts, and in some cases used forged papers to justify the claims. 

Officials sequestered several bank accounts, homes and cars and found €185,000 in cash at one address. The origin of the cash is still being traced. 

Tax inspectors will now reassess the tax returns made by some 6,000 clients, and they have also been asked to check their papers again themselves. The tax office said in a statement that everyone is ultimately responsible for their own tax return, even if it has been filled in by an advisor. 

‘If a tax advisor draws up a tax return for you which is too good to be true, then it probably is,’ the department said in a statement. 

A further 10 tax advisors face a grilling by department experts on their methods, officials said.

PwC approves ‘misleading’ accounts for SHV, says NRC

DutchNews, February 28, 2017    

Photo: Depositphotos.com

PwC has approved the accounts of a subsidiary of SHV, Holland’s largest privately held trading company, even though the accounting firm admitted internally that the accounts were ‘misleading’, the NRC said on Tuesday. 

The paper bases its claim on its own investigation into the affair based on interviews and confidential documents. 

SHV is a trading company owned by the Fentener van Vlissingen family which has interests in transport, retail, oil, food and financial services worldwide. PwC, the paper says, has approved the accounts of SHV subsidiary Econosto Mideast for years. The unit supplies industrial valves and pipeline connections for oil companies in the Middle East. 

The NRC says Econosto Mideast has always paid buyers for its customers in cash, but has booked these payments as personnel costs, as if they were their own sales staff. 

Misleading

PwC was aware of this and termed the practice ‘misleading’ in internal reports to SHV. It warned the SHV board that these payments were ‘criminal’ and said it had ‘serious misgivings over the legality of the payments’. Nevertheless PwC continued to approve the accounts for years. 

PwC and the individual accountants made no reaction to the NRC investigation. But last weekend, the paper said Econosto Mideast was also involved in shadow accounting and possibly involved in trade with Iran. 

On Monday, Bart Koolstra, a member of the supervisory board of Amsterdam financial markets watchdog AFM abruptly resigned. In his former job as senior partner at PwC he had signed off on the 2009 accounts of the company.

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Transport equipment importer Pon loses €75m to internal fraud

DutchNews, December 5, 2016

Pon, the importer of Volkswagen cars and other transport equipment, has been hit by a €75 mln fraud related to illicit selling on of spare parts for Caterpillar earth-moving equipment. 

An investigation by the Financieele Dagblad has uncovered a system of ‘creative bookkeeping’ carried out by Pon employees over the years which contravened regulations set by both Pon and Caterpillar. 

Pon, which has annual turnover of €7bn, has been the importer and distributor of Caterpillar equipment and spare parts in the Netherlands and several other European countries since 1927. 

The affair came to light when the Financieele Dagblad acquired a large dossier with confidential findings by the Pinkerton detective agency, accountancy group KPMG, lawyers, witness statements and an unpublished ruling by Rotterdam district court. 

The documents show Pon has concluded that a number of its employees have been systematically defrauding the company through a conspiracy of illicit trade. 

This involves a part-time Pons account manager in a blue Ferrari who prepared the scheme, cash withdrawals of hundreds of thousands of euros, deposits to secret bank accounts, payments through pre-paid credit cards and gifts of cars, scooters, kitchens, plane trickets and trips to the Dakar car rallies, the FD said.

Caterpillar, which has not yet commented, can levy heavy fines for violation of its rules.

Accountancy firms fined, improve their auditing

DutchNews, March 24, 2016

Photo: Depositphotos.com 

The four biggest accountancy firms operating in the Netherlands have been fined a total of €6m by the financial services regulator AFM. 

The fines follow an earlierinvestigation by the AFM which said Deloitte, EY, KPMG and PwC did not achieve the required duty of care and were lax in checking corporate accounts in 2012 and 2011.

In many of these cases, the accountant had already provided a final statement before receiving all the necessary information from the client. This is against the law, the regulator says. 

The biggest fine – €2.2m, went to EY.

11 arrested in major tax evasion probe involving foreign bank cards

DutchNews, October 30, 2015

A major investigation based on the use of foreign bank cards in the Netherlands has led to the arrest of 11 people on tax evasion charges. 

The seven men and four women were identified after officials carried out a major data mining project involving cards attached to foreign bank accounts. None of the 11, who are aged between 54 and 73, had registered their foreign bank accounts with the tax office, the department said. 

Among the suspicious transactions was a €7,000 bill in a department store and cash withdrawals running into tens of thousands of euros. 

In total, tax office officials combed through almost all the 140 million payments made in the Netherlands using a foreign bank card between 2009 and 2011, spokesman Ton Scholing told the Financieele Dagblad. 

Ferrari 

Ten homes in Haarlem, Zoetermeer, Rotterdam and Leiden were searched in the investigation and a number of bank accounts and cars, including a Ferrari and an Aston Martin, have been sequestered. Some €90,000 in cash was also confiscated. 

Officials said they are continuing to follow up on other transactions involving unregistered foreign bank accounts as part of their crack-down on illegal savings accounts.

‘There will be more arrests next week,’ public prosecutor Anita van Dis told the Financieele Dagblad. 

Tax advisors, accountants and notaries who work for the 11 people arrested are also under investigation.

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Companies aiding tax evaders will be criminally liable

New offence of corporate failure to prevent tax evasion, and offshore dodgers face ‘strict liability’ criminal charge

The Guardian, Patrick Wintour, Thursday 19 March 2015

HMRC website page. Critics of the coalition’s tax evasion crackdown fear
innocent people will be snared by the new rules. Photograph: Christopher Thomond

Banks and accountants that aid tax evasion will face criminal penalties under plans unveiled by the government.

A new offence of corporate failure to prevent evasion is being created to address those who assist dodging. Such offenders could also be “named and shamed” alongside the evaders themselves.

Although crackdowns on tax evasion are a hardy perennial of politicians, Danny Alexander, the Lib Dem chief secretary to the Treasury, insisted his proposals represented a meaningful new measure.

He told MPs: “We inherited from the previous government a tax system that had more holes than a Swiss cheese and was more complex than a Rubik’s cube. The opportunities for those who wish to get away without paying were many and varied.”

A Treasury document signed by Alexander and the chancellor, George Osborne, sets out plans for raising an extra £5bn a year from tax dodgers. A consultation will be held on a new “strict liability” criminal offence for offshore tax evaders.

“It will no longer be possible to evade large sums of tax and plead ignorance in an attempt to avoid criminal prosecution,” the paper says.

Alexander said: “Strict liability will bring an end to the defence of ‘I knew nothing, it was my accountant, m’lord’. The Treasury consultation document also promises we will also be increasing financial penalties, including a new penalty linked to the underlying asset for those who enable evasion; we will create a new offence of corporate failure to prevent tax evasion or the facilitation of tax evasion.

“This will complement the existing criminal offences for individuals. We will also introduce new civil penalties, exposing those who enable evasion to the same level of financial penalty as the tax evaded by the evaders themselves.”

Alexander said: “We will increase financial penalties for offshore evaders, including, for the first time, linking the penalty to underlying assets. A billionaire evading £5m of tax will not just be liable for that £5m.”

The document says both evaders and enablers of evasion will face penalties. “If someone helps someone else evade £1m of tax, they risk a penalty of £1m, or even more, themselves,” Alexander said.

The document also “proposes to extend the scope for HMRC to publish their names, exposing them to public scrutiny”.

Chris Leslie, the shadow chief secretary to the Treasury, broadly welcomed the proposals but expressed scepticism that extra money would be raised without extra staff at HMRC. Officials at HMRC have been roundly criticised for failing to prosecute anyone in light of the tax allegations involving HSBC’s Swiss bank.

The document claims the coalition raked in an extra £100bn revenue over the past five years from tackling tax evasion, avoidance and non-compliance.

The sum included £31bn from big businesses and £1.2bn extra from the UK’s 6,000 richest people, who each have a net worth of at least £20m.

The Chartered Institute of Taxation said that while tax evasion was a serious crime, the government’s proposal that “intent to evade tax” would not be necessary for a conviction could catch innocent people.

“UK and international taxation is a minefield of complexity and, while some taxpayers do actively seek to hide their income by intentionally failing to declare it, there are others who simply make mistakes in their financial affairs without intending to act wrongly,” said the institute’s tax policy director, Patrick Stevens. “A taxpayer may fall within the ambit of the offence without any intention or knowledge on their part.”

Deloitte talks settlement in Innoconcepts 2010 bankruptcy

DutchNews.nl, March 13, 2015

Accountants group Deloitte is embroiled in a new book-keeping scandal, this time in connection with the bankruptcy of Innoconcepts in 2010, the NRC says on Friday. 

Curator Louis Deterink says Deloitte ‘wrongly’ approved two sets of annual accounts for the company which were worth €400m on the Amsterdam stock exchange in 2007. 

Deterink, considered one of the Netherlands most expert bankruptcy specialists, says in his report that Innoconcepts went bankrupt due to its ‘vague’ and ‘conflict of interest-scented’ interests in China. The company’s alliance partners in China effectively emptied the company but Deloitte failed to take any action on this, the NRC says. 

The 10 Chinese partner companies built up debts running into millions of euros with Innoconcepts but this was not included in the annual report. The partner firms also refused to hand over their annual reports and said this was considered normal in China, Deterink’s report says. 

According to the Financieele Dagblad, there were also conflicts of interest involving both management and supervisory board members. Innoconcepts was set up to exploit inventions and support innovative R&D. 

Settlement 

Deloitte said in a statement it was taking the report ‘extremely seriously’ and would look ‘critically at its own role’. 

Deterink and Deloitte are in talks about a settlement and Deterink considers Deloitte liable for a ‘substantial part’ of the €63m inventory shortage. 

Deloitte was also the main accountant for merchant bank Van der Hoop, which went bankrupt in 2005 and supermarket group Ahold at the time of the book-keeping fraud which came to light in 2003, the NRC says.

Swedish private jet scandal claims seventh scalp

SCA loses seven executives after revelations that it used corporate planes to fly board members’ relatives to hunting lodge and sporting events

The Guardian, David Crouch in Gothenburg, 11 February 2015

Jan Johansson has stepped down from his role as chief executive
of SCA. Photograph: TT News Agency/Reuters

A corruption scandal in Sweden centred on extravagant corporate perks and private jets has now cost the jobs of seven senior executives.

Jan Johansson, chief executive of SCA, a forestry group and the world’s largest maker of incontinence products, resigned on Tuesday after coming under increasing pressure after reports that wives, children and even pets of board members had traveled on corporate jets. The flights included trips to a company hunting lodge, Formula One races, the World Cup and the Olympics. On one occasion, Svenska Dagbladet reported, a plane had flown empty from Sweden’s far north to pick up a wallet that an executive had forgotten.

The revelations have demonstrated an extravagance at the top of a country that still prides itself on egalitarian values. It has also lifted the lid on a secretive world of corporate perks in a society that has embraced globalisation but is still uncomfortable with ostentatious displays of wealth and privilege. It has sucked in one of the country’s largest investors, two large banks and accountants PwC, while attracting the attention of prosecutors and financial regulators.

Johansson is seen in business circles as a CEO who “lays golden eggs” – SCA reported record profits only last month. He resigned on Tuesday night, saying investigations into the use of corporate jets were diverting his attention from managing the company. He leaves with two years’ salary, worth 22m krona (£1.7m).

SCA’s commercial success appears to have been accompanied by an increasingly extravagant corporate culture at odds with its stated ethics. In 2013 the company said it had “zero tolerance for all forms of corruption and unethical business practices”.

Attention has focused on a hunting lodge built by the company at a cost of 100m krona (£7.7m), according to media estimates, on prime elk-hunting land in a remote and beautiful part of central Sweden. According to business daily Dagens Industri, the lodge was “worth its weight in gold” as a venue for entertaining potential business partners.

But the leader of the trade union for SCA’s employees has viewed it rather differently, comparing management’s behavior to Vladimir Putin’s Russia. The company has said is considering selling the hunting lodge.

SCA also announced the resignation of its vice-president, who had come under fire for flying with his wife on a company jet, while chairman Sverker Martin-Löf resigned last month after it emerged that his son had been used as a financial adviser on business deals.

Martin-Löf was also forced to step down from all his other board positions on major Swedish companies, including the chairmanship of Industrivärden, a vast investment house that, together with the Wallenberg family, controls more than half the Stockholm stock exchange.

Industrivärden owns controlling stakes in companies such as Volvo, Ericsson and Handelsbanken, one of Sweden’s biggest banks.

In total, the four big companies implicated in the private jets scandal – SCA, Industrivärden, Handelsbanken and steel firm SSAB – have now lost their chairmen. Three of of the companies have lost their chief executives, although some have been reshuffled, rather than sacked.

The scale of the scandal has raised questions about Sweden’s distinctive model of corporate ownership, with large and active shareholders, and an emphasis on long-term investment rather than short-term share price gains. But cross-holdings between SCA and Industrivärden meant that executives were also signing off on each other’s expenses.

Sweden’s national anti-corruption unit last month began an investigation into SCA’s use of corporate jets. Sweden’s financial supervisory authority is also investigating whether the chief executive of Nordea Bank acted improperly by flying to the SCA hunting lodge. SCA banks with Nordea.

The company’s auditors, PwC, are also facing scrutiny for taking part in the hunting trips. Sweden’s accountancy association said in a statement: “It is very inappropriate that the auditor participates in an elk hunt that the client company organises and hosts.”

The behavior by SCA executives and their associates would be at the limits of corruption law in other countries, said Carl Rosen, head of Sweden’s Shareholder’s Association. He condemned an “unholy alliance” between large shareholders and company executives, insisting that companies should not be free to spend unlimited sums on corporate travel and entertainment. He added: “If the message is that you have to go to a hunting lodge in a corporate jet to do business in Sweden, that’s bad.”

Swedish steel company SSAB, whose executives also traveled on board SCA’s jets, defended the practice of inviting clients on hunting trips. “Our customer hunts are a tradition. I have chosen to continue with them,” CEO Martin Lindqvist told Swedish media this week.

Sweden’s main business daily last month called on the country’s capitalists to think about their legitimacy in the eyes of the wider population. In an editorial, Dagens Industri said: “Royalty that celebrates its privileges in unsuitable company is living dangerously, but a monarch who clearly contributes to the development of society can bridge the gap between a culture of democracy and the right to inherit the throne.”

SCA said it had now changed its policy in regards to relatives using business aviation travel, even when there is no extra cost to the company. It also said that business aviation would no longer be used for corporate hospitality.

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bustards in just 21 days while

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World unites to decry prosecution of source behind LuxLeaks tax scandal

More than 70 public figures sign letter criticising Luxembourg’s decision to prosecute former PwC auditor Antoine Deltour

The Guardian, Simon Bowers, Tuesday 23 December 2014

Antoine Deltour, 28, could face jail and a heavy fine. He leaked tax rulings that
PwC had secured in Luxembourg for some of its clients Photograph: RL/Liberation

More than 70 politicians, academics, union heads and charity leaders around the world have come out in opposition to the decision by Luxembourg to prosecute the 28-year-old accountant accused of sparking the LuxLeaks tax scandal.

Antoine Deltour, who spent two years as a junior auditor at PricewaterhouseCoopers before quitting in 2010, was this month charged with a string of criminal offences. He has said: “From the beginning, I acted out of conviction for my ideas, not to appear in the media.”

The charges came less than six weeks after the Guardian and more than 20 news organisations around the world, in conjunction with the International Consortium of Investigative Journalists (ICIJ), published detailed investigations into the tax affairs of several multinationals based on leaked tax rulings that PwC had secured in Luxembourg for some of its clients.

In an open letter to prosecutors in the Grand Duchy, critics of the decision to prosecute Deltour argued that the leak had been “manifestly in the public interest, helping to expose the industrial scale on which Luxembourg has sanctioned aggressive tax avoidance schemes, draining huge sums from public coffers beyond its borders”.

Deltour is charged with theft, violating Luxembourg’s professional secrecy laws, violation of trade secrets, and illegally accessing a database. The charges stem from an official complaint brought by PwC. He could face jail and a heavy fine.

The Grand Duchy is reeling from what finance minister Pierre Gramegna has called “the worst attack Luxembourg has experienced in its history”.

Luxembourg tax rulings granted to subsidiaries of Amazon and Fiat were already under investigation by the European commission, suspected of being sweetheart deals amounting to illegal state aid.

For months, Luxembourg has refused to hand over further tax ruling information sought by the commission, disputing the legality of such requests. Last week, however, ministers performed a U-turn in the wake of the scandal, agreeing to provide documents sought by state aid investigators so long as similar requests were made of other EU member states.

Explaining the volte-face, Gramegna described the LuxLeaks affair as a “game changer” that had transformed the way European regulators were scrutinising tax rulings granted to multinationals.

Politicians from Germany, France, the UK, the US and Australia were among the signatories to the letter opposing the prosecution of Deltour, which was organised by a handful of media groups including the Guardian. The majority of political signatories were from parties of the left, but there was also support from among Liberal Democrats in the UK and from the centre-right UMP in France, led by Nicolas Sarkozy.

US Congressman Lloyd Doggett, a member of the ways and means committee that has held a number of hearings on tax avoidance, also signed the letter. So too did his fellow Democrat member of Congress Rosa DeLauro. In the UK the letter was signed by four MPs, including the former environment minister Michael Meacher and two members of the public accounts committee, which this month summoned PwC’s head of tax in the UK to face a grilling on the Luxembourg situation. Among UK union leaders supporting the letter were Unite’s Len McCluskey, Paul Kenny of the GMB, and Mark Serwotka, general secretary of the Public and Communications Services union.

In Australia signatories included Ged Kearney, president of the Australian Council of Trade Unions, and Rev Prof Andrew Dutney, president of the Uniting Church in Australia. Senior figures from a host of charities and campaign groups supported the letter, including War on Want, ONE, Oxfam Novib, Action Aid, Christian Aid, Justice et Paiz, Eurodad, Transparency International, Christian Aid, Global Financial Integrity, the Fact Coalition and the Tax Justice Network.

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Luxembourg judge brings theft and trade secrecy charges

Charges against unnamed individual follow publication of journalistic investigation and PricewaterhouseCoopers complaint

The Guardian, Simon Bowers, Saturday 13 December 2014

PricewaterhouseCoopers’ HQ in Luxembourg. Photograph: Nicolas Bouvy/EPA

An investigating judge in Luxembourg has charged an unnamed individual with theft and other criminal offences after a complaint was brought by PricewaterhouseCoopers in the wake of a leak of hundreds of confidential tax deals exposing avoidance by multinational corporations.

Last month journalistic investigations into PwC tax deals were published by the Guardian and more than 20 media organisations around the world linked to the International Consortium of Investigative Journalists, sparking an international scandal that continues to threaten the position of the new European commission president, Jean-Claude Juncker.

Juncker stepped down as prime minister of Luxembourg last year after almost two decades at the helm, dominating politics, setting tax policy and aggressively courting investment from multinationals.

In a short statement, the Luxembourg authorities said charges had been brought for theft, professional secrecy violations, trade secrecy violations and illegal obtaining of data.

The action followed a PwC complaint submitted in June 2012.

The Luxembourger Wort newspaper reported that it understood the person charged to be a French national who had previously worked at PwC.

Recent press reports on the leaked papers reveal how far the firm in Luxembourg was pushing tax rules, aggressively exploiting gaps between tax codes in different countries. The confidential papers laid bare how accommodating the Luxembourg tax office had been, turning the tiny nation of 550,000 people into a honeypot for global firms looking to massage down their tax bills.

The revelations last month sparked an emergency debate in the European parliament and an unsuccessful censure vote against Juncker. Finance ministers in France, Germany and Italy wrote to the commission demanding a faster crackdown on loopholes exploited by big business.

The UK parliament’s public accounts committee this week summoned PwC to give evidence alongside its FTSE 100 tax client Shire, the drugs firm which moved tax domicile to Ireland six years ago for tax reasons. The committee’s chair, Margaret Hodge, accused PwC’s UK head of tax, Kevin Nicholson, of lying about the saga. Hodge told him: “I think what you are doing is selling tax avoidance on an industrial scale.”

Nicholson denied the tax services sold by PwC were mass-marketed schemes and said about 80 of the Luxembourg rulings related to UK firms, were all distinct and had been disclosed to HMRC.

In the aftermath of the tax leaks scandal, Luxembourg’s finance minister, Pierre Gramegna, struck a conciliatory note on the international stage, telling a meeting of European finance ministers: “We are a country that wants to combat abuse … If we want to find solutions to this issue we have to tackle it together.”

Speaking to a domestic audience, however, he has described the affair as “the worst attack Luxembourg has experienced in its history”.

Vatican Finds Hundreds of Millions of Euros ‘Tucked Away’

Departments used to have 'free hand', but this is changing

Jakarta Globe, Reuters, Dec 04, 2014

Nuns take pictures in St. Peter's square on Dec. 4, 2014 at the Vatican during
the installation of the traditional Christmas tree. (AFP Photo/Vincenzo Pinto)

Vatican City. The Vatican’s economy minister has said hundreds of millions of euros were found “tucked away” in accounts of various Holy See departments without having appeared in the city-state’s balance sheets.

In an article for Britain’s Catholic Herald Magazine to be published on Friday, Australian Cardinal George Pell wrote that the discovery meant overall Vatican finances were in better shape than previously believed.

“In fact, we have discovered that the situation is much healthier than it seemed, because some hundreds of millions of euros were tucked away in particular sectional accounts and did not appear on the balance sheet,” he wrote.

“It is important to point out that the Vatican is not broke … the Holy See is paying its way, while possessing substantial assets and investments,” Pell said, according to an advance text made available on Thursday.

Pell did not suggest any wrongdoing but said Vatican departments had long had “an almost free hand” with their finances and followed “long-established patterns” in managing their affairs.

“Very few were tempted to tell the outside world what was happening, except when they needed extra help,” he said, singling out the once-powerful Secretariat of State as one department that had especially jealously guarded its independence.

“It was impossible for anyone to know accurately what was going on overall,” said Pell, head of the new Secretariat for the Economy that is independent of the now downgraded Secretariat of State.

Australian outsider

Pell is an outsider from the English-speaking world transferred by Pope Francis from Sydney to Rome to oversee the Vatican’s often muddled finances after decades of control by Italians.

Pell’s office sent a letter to all Vatican departments last month about changes in economic ethics and accountability.

As of Jan. 1, each department will have to enact “sound and efficient financial management policies” and prepare financial information and reports that meet international accounting standards.

Each department’s financial statements will be reviewed by a major international auditing firm, the letter said.

Since the pope’s election in March, 2013, the Vatican has enacted major reforms to adhere to international financial standards and prevent money laundering. It has closed many suspicious accounts at its scandal-rocked bank.

In his article, Pell said the reforms were “well under way and already past the point where the Vatican could return to the ‘bad old days’.”

Reuters

Big four accountants under fire in Holland for poor audit work

DutchNews.nl, Thursday 25 September 2014

(NOS/ANP)

Finance minister Jeroen Dijsselbloem has pledged to get tough on the big four accountancy firms after a damning report from the financial services regulator.

The AFM said on Thursday that all four firms - KPMG, Deloitte, PwC and EY - have done little to improve the quality of their annual report audits since the last inspection in 2010.

The problems are structural and require 'fundamental reforms and a cultural shift,' the AFM said.

In a reaction, Dijsselbloem said 'the checks which accountants are required to carry out by law should be above reproach... It is unacceptable that the quality is not up to standard.'

Measures

In an effort to force the firms to improve, the AFM is planning a series of reforms. Accountancy groups will be required by law to have a supervisory board. Senior officials will have to be vetted by the AFM and the supervision of semi-public bodies such as hospitals and housing corporations will be stepped up.

According to the NRC, KPMG is the worst performer of the big four in the Netherlands. Of the 10 audits which the AFM looked at, seven were branded 'insufficient' - which means the books were signed off without the accountant being certain they were accurate.

Four out of 10 PwC and Deloitte audits failed to make the grade as did three carried out by EY.

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KPMG Nederland overhauls partner bonuses, supervisory board

DutchNews, Friday 12 September 2014

KPMG

Accountancy group KPMG is overhauling its remuneration strategy for partners and boosting the independence of its supervisory board following a string of scandals.

The aim is to ‘win back the trust of stakeholders’, the company said in a news release on Friday. The plan was approved by partners at a closed meeting on Thursday.

In the new set up, partners’ remuneration will be linked to 'the realisation of quality requirements, the motivation of employees and client satisfaction'. Profit shares will be spread out over several years and can be reversed if problems come to light.

The current bonus system is being scrapped and individual partners will only be rewarded for ‘exceptional performance’. The management board will no longer be eligible for profit sharing. They, instead, will have a fixed salary with a performance-related bonus of up to 10%.

Future

KPMG is also looking for new external candidates for its supervisory board, which is currently made up of partners. Chairman Jan Hommen said the company 'wants to take major steps right now, leave the past behind and build on a new future. For our clients, for society and for our own people.'

KPMG Nederland has been hit by a string of scandals in recent months, culminating the resignation of chairman Jurgen van Breukelen in May.

Van Breukelen had been in the firing line over possible tax fraud in connection with the company's new headquarters in Amstelveen, bribery allegations and a string of other issues at client companies.

Chairman Van Breukelen KPMG resigns. (NOS/ANP)

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Dutch health authority accepts foreign trips from drugs firms: NRC

DutchNews.nl, Saturday 14 June 2014

Theo Langejan, chairman of the NZA.

(NOS/NZA/ANP)

The Dutch healthcare authority NZa accepts foreign travel trips from companies which do business with the organisation or which the authority supervises, the NRC said on Saturday.

The paper has carried out research into Theo Langejan’s expenses claims and concludes the NZa has broken its own guidelines on foreign travel.

Other regulators, such as the financial services authority AFM and consumer and markets authority ACM do not accept paid trips on principle, the paper says.

Drugs firms

Since 2010, Langejan has been on at least 16 trips paid for by companies and healthcare institutions. In April 2012 he spent four days in a hotel on the French Rivièra, courtesy of drugs company Pfizer. The suite where he stayed cost €700 a night, the paper says.

The NZa decides which medicines are covered by Dutch health insurance, and that includes Pfizer drugs, the NRC points out.

Accountancy and consultants PwC has funded all in trips to Singapore, Washington, South Africa and Mexico. Langejan made these trips as an ‘advisor’ to a PwC think tank but in NZa time, the NRC says.

KPMG, which did €420,000 worth of advisory work for the NZa in 2012. It also paid for Langejan to attend a KPMG European Health Summit in Brussels, even though he had no role in the programme.

The NZa’s policy is to have sponsors pay travel and hotel expenses if an NZa official is speaking at a congress. Langejan’s predecessor Frank de Grave distanced the organisation from this policy.

The NZa said in a reaction that none of the trips the NRC has written about break the NZa’s internal rules.

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"THE BRIDGE OF SWORDS" – Sep 29, 2012 (Kryon channeled by Lee Carroll) - (Text Version)

“…I'm in Canada and I know it, but I will tell those listening and reading in the American audience the following: Get ready! Because there are some institutions that are yet to fall, ones that don't have integrity and that could never be helped with a bail out. Again, we tell you the biggest one is big pharma, and we told you that before. It's inevitable. If not now, then in a decade. It's inevitable and they will fight to stay alive and they will not be crossing the bridge. For on the other side of the bridge is a new way, not just for medicine but for care. Paradigms that have not yet been thought of, which don't represent any system that currently exists, will be created and developed by young minds who have concepts that the seniors don't know about. Things that don't have integrity today will fall over tomorrow. Just get ready. It's all part of what's on the other side of the bridge. And the old energy won't like it, and they will object. …”