Deloitte, close to the tobacco industry, sentenced in Malawi

The Institute of Chartered Accountants of Malawi (ICAM) has fined Deloitte Malawi. ICAM points to the firm’s culpability in matters involving audits of a tobacco company, Malawi Leaf Company. Deloitte is one of the “big four” financial auditing and consulting firms, like the firm KPMGLike its counterpart, the firm has long-standing relationships with the tobacco industry.

The Institute of Chartered Accountants of Malawi has conducted investigations and convened disciplinary hearings. According to ICAM, the firm had failed to exercise due diligence in its audits of the Malawi Leaf Company. Indeed, the 2014 and 2016 audits contained errors and inaccuracies. Indeed, these included fictitious sales made to an external company, the Eastern Tobacco Company. For this reason, ICAM fined Deloitte Malawi 1.5 million Kwacha, or 90,000 euros. For its part, Deloitte emphasizes that it complied with the international standards in force.[1].

Deloitte, a long-standing partner of the tobacco industry

As the University of Bath’s Tobacco Tactics website points out, Deloitte has a long-standing relationship with the tobacco industry. This is demonstrated through auditing, or conducting analyses on behalf of manufacturers, designed to prevent or challenge the implementation of tobacco control measures. Like its counterpart and competitor KPMG, the audit firm Deloitte has been singled out by independent research for participating in the deliberate overestimation of levels of illicit trade. This strategy has been identified in Australia in particular. The aim of these practices has been to dissuade the British authorities from following the Australian example and implementing plain packaging.[2].

FT

[1] Malawi 24, Deloitte finished over its audit of Malawi Leaf Company, 07/21/2022, (accessed 07/25/2022)

[2] Tobacco Tactics, Deloitte, 06/06/2020, (accessed 07/25/2022)