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Four EY partners have left the firm after breaches of independence rules in its audit of Shell that resulted in the oil major stripping the accounting firm of a $66mn-a-year contract.
The partners left the Big Four firm in December as it rushed to contain the fallout from the compliance failure, according to public records and people familiar with the matter, one of whom added the exits followed an internal review.
The four who left included one partner who had been elevated to EY’s top ranks just months earlier and Gary Donald, who led the Shell audit and whose departure was previously reported by the FT.
The departures came as EY fought to limit the commercial and reputational damage from one of the worst compliance failures in its recent history.
Shell said in July that EY had breached strict auditor rotation rules set by US regulators when Donald remained as lead auditor for the oil company’s 2023 and 2024 accounts.
In October, the UK’s accounting regulator launched a probe into EY over its 2024 audit. The debacle prompted the oil company to revisit its decision to use the firm. Shell said on Friday that it had decided to switch to PwC from next year.
The other partners who left in December were Mark Woodward and Hee Yu Lee, both auditors with oil and gas expertise; and Alistair Denton, a former auditor whose role was in the national office that oversees EY’s compliance with rules, including on independence, according to people familiar with the matter.
Companies House records show that Lee had only become a member of EY’s equity partnership in June 2025. Denton and Woodward had been in the partnership since 2010 and 2017 respectively.
Woodward, Lee and Denton did not respond to requests for comment. EY declined to comment, including on the circumstances of their departures and the conclusions of its review. It is not known whether the former partners were found to have broken any rules or company policies or whether any appeals are in progress.
Rotation rules are designed to ensure that auditors remain independent of the companies whose accounts they check and generally limit senior auditors to working on a company’s audit for either five or seven consecutive years.
Before and during his time as Shell’s lead auditor, Donald was also EY’s global oil and gas assurance leader with overall responsibility for its audit services to companies in the sector.
An individual’s work for a client can count towards the time limit even if they are not the lead auditor.
While Donald only began leading the Shell audit in 2021, people familiar with the matter said a whistleblower had informed EY leadership that some of Donald’s prior work should have “started the clock” on his time on the mandate at an earlier stage. This meant he could sign off fewer years of Shell’s financial statements than had been planned, they added.
Another person familiar with how EY makes its independence decisions said there “isn’t always a black and white answer” to how to apply parts of the rules and that many people are often involved in making these judgments.
“Sometimes the wrong conclusion can be reached even though everyone thought it was right,” the person said. “It can be a fine balancing act, mixing rules and practice with knowledge and experience, to work out where the line needs to be drawn.”
Shell, London’s third most valuable listed company, said in July that EY had appointed a new lead auditor to re-examine the last two years of work and concluded that no changes to its financial statements were necessary.
PwC had been Shell’s auditor until 2016. It failed to win back the mandate when the 10-year engagement came up for tender in 2024.
Following last year’s independence breach, Shell’s audit committee asked PwC and EY to bid again and judged them on factors including independence, team composition, audit scoping and regulatory compliance, according to a person familiar with the process.