On February 19th, the Audit Committee of Brown-Forman Corporation [BF.B] – the production and distribution company known for alcoholic beverages including Jack Daniel’s, Chambord, and Korbel – dismissed PwC, ending its 87-year tenure with the Big Four auditor. According to the 8-K filed on February 25th, the dismissal will become effective following PwC’s completion of the Company’s audit for the fiscal year ending April 30, 2020.
On February 19, 2020, the Audit Committee dismissed PwC, which is currently serving as the Company’s independent registered public accounting firm, effective upon completion of its audit of the Company’s consolidated financial statements as of and for the fiscal year ending April 30, 2020 and the issuance of its reports thereon (the “2020 Audit”).
As illustrated, Brown-Forman’s 87-year relationship with PwC is among a small fraction of S&P 500 companies; tenures lasting more than 80 years account for less than 8% of auditor-client relationships within this market index.
Notably, Brown-Forman is one of only ten S&P 500 companies having an auditor change in recent years.
Since 2018, there were only two other S&P 500 companies to change auditors after a longer tenured engagement: General Motors [GM] and DuPont de Nemours [DD]. The auditor change for DuPont de Nemours occurred in conjunction with the split of its predecessor – DowDuPont – into three independent, publicly traded companies.
Brown-Forman has engaged EY for its 2021 audit, effective following PwC’s completion of its 2020 audit.
On February 19, 2020, the Audit Committee approved the engagement of Ernst & Young LLP (“EY”) as the Company’s independent registered public accounting firm for the Company’s 2021 Audit, subject to completion of EY’s customary pre-acceptance and independence procedures and the execution of an engagement letter. The change in the Company’s independent registered public accounting firm from PwC to EY will be effective upon the completion of the 2020 Audit.
According to our peer download, EY currently audits five of Brown-Forman’s 14 compensation peers.1
1. Audit Analytics collects all disclosed compensation peers, excluding any foreign companies. ↩