The Federal Tax Service is accusing PwC of covering up Yukos's illegal financial schemes and compiling two different audits.
"The tax service has evidence that the auditor's report to the [oil] company's management and the official report were mutually contradictory," the tax service said.
The tax authorities said Yukos had failed to remove violations discovered in 2002 in the subsequent two years.
"The company continued to illegally transfer money to the Production Development Financial Support Fund in 2003-04. Nor did the company start mentioning its profitless operations with bonds in its financial reports," the tax service said.
The tax officials also said that these violations did not stop PwC from confirming that Yukos's financial operations in 2003-04 were in full compliance with Russian legislation.
In 2005, another auditor, Horwath, refused to approve the oil company's financial report, the tax authorities said, adding it was further evidence of PwC's involvement in Yukos's grey operations.
The tax authorities also said PwC had not replied to their enquiries made in August.
PwC said it would stick to its position denying the tax authorities' accusations and added that the management of a company, not an auditor, was responsible for financial decisions.
PwC said its report on Yukos contained an amendment highlighting the revealed irregularities, which PwC also included in a written statement recommending that the company review its operations.
On December 18, Moscow's Arbitration Court accepted a lawsuit from the tax authorities seeking to invalidate the contract between Yukos and PwC's Russian office on auditing services and demanding that PwC repay the cost of the contract totaling $145,000.
Tax officials said PwC approved Yukos's financial performance in 2002 but then notified the PwC management about the deficiencies and lack of basic documents.
