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Communications and Information Technology Minister Amy Adams has today announced the firm that will undertake an independent assessment of Chorus’ financial position, and released the terms of reference.

Ernst & Young Australia will investigate Chorus’ capability to deliver on its contractual commitments with the Government, in light of the Commerce Commission’s decisions on final wholesale prices for copper-based broadband services.

“A wide range of consultants both in New Zealand and overseas were considered before making the decision,” Ms Adams says.
“The key criteria for selecting a firm were the absence of conflicts of interest, the availability of appropriate forensic accounting and corporate finance skills, and the availability of specialist skills in telecommunications.”

The independent assessment has been commissioned to provide the Government with a detailed analysis of the impact on Chorus of the recently announced determinations of the Commerce Commission and its ability to meet its Ultra-Fast Broadband (UFB) and Rural Broadband Initiative (RBI) contractual obligations through internal adjustments.

It will also distinguish between the impact of the Commerce Commission’s pricing decisions and any strategic choices that Chorus may have made which may contribute to any financial stress it could face.

The review is expected to be completed before the end of the year. A copy of the report will be made available to the public, with any commercially-sensitive material redacted.

“The immediate concern to the Government is if its UFB and RBI contracts are at risk.

“The findings of the independent assessment will help to inform any decisions the Government needs to make to ensure the successful delivery of the UFB and RBI projects.”