24 March 2004

Calpers Opposes PwC as Freddie Mac Auditor

Calpers Opposes PwC as Freddie Mac Auditor - - CFO.com:

Pension fund challenges Freddie's use of PricewaterhouseCoopers for non-audit services.

Stephen Taub, CFO.com

The California Public Employees' Retirement System (Calpers) is opposing Freddie Mac's reappointment of auditor PricewaterhouseCoopers and the reelection of members of the mortgage finance company's audit committee, according to the Washington Post.

The pension fund giant, which owns 5.1 million Freddie shares, is taking the action because the company has used PwC for non-audit services, Calpers spokesman Brad W. Pacheco told the paper.

As a matter of policy, Calpers withholds votes from audit committee members at companies that allow auditors to perform non-audit work, elaborated Pacheco. 'We believe that auditors should not be compensated or perform work for anything else besides their role in conducting the audit,' he told the paper. 'It creates too many conflicts of interest, and our experience shows that it leads to problems.'

Calpers is withholding its vote from the reelection to the audit committee of presiding director Shaun F. O'Malley, who was chairman of PricewaterhouseCoopers when the firm was known as Price Waterhouse LLP, noted the Post."

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