PwC Cyprus accountants start their own office to serve Russian clients

A group of PwC’s partners in Cyprus left the organization and set up their own office to take over work for clients affiliated with Russia who are no longer served by the four chief accountants.

Since the Russian invasion of Ukraine, PwC has pursued a strict sanction policy that goes beyond what is required by law and assumes that it is “punished somewhere everywhere”. This had serious consequences for PwC’s activities in Cyprus, given the island’s many Russian ties.

PwC Cyprus’ client base has dwindled significantly. That ultimately prompted three partners to launch Kiteserve this summer, a small office with about half of its clients from Russian relations, according to the Financial Times.

Managing Partner Theo Parperis of Kiteserve stated that the new office is aware of the sanctions imposed by the European Union, the United States and the United Kingdom, but the Big Four go much further in their sanctions policy. Unlike PwC Cyprus, Kiteserve also does not voluntarily comply with sanctions imposed by countries such as Australia and Canada.

Client

The founders of Kiteserve struck a deal with PwC to break free from hiring restrictions at PwC Cyprus and the usual five-year ban on former partners from selling audit, tax or compliance services. Financial details of the deal were not disclosed by either side. About twenty of the thirty employees of Kiteserve come from PricewaterhouseCoopers.

Bariris said the boutique company was very selective in dealing with customers. “Kiteserve could have done four times more work if it had wanted to.” About fifty percent of the new office’s clients still have ties to Russia, but Parperis expects that this will decline over time.

PwC assures FT that Kiteserve is “completely independent” of PwC Cyprus and is not a member of the PwC network. The parties only entered into an agreement on the sub-lease of office space.