E&Y stung into independent Olympus audit review

by Rose Orlik

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09 Dec 2011

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Rear view of the Olympus E-P3 CSC

ERNST & YOUNG has appointed an external committee to examine its audit of embattled camera maker Olympus, following accusations of "inappropriate" work by an independent panel.

The firm concluded its audit was satisfactory following an internal review, but has scrambled an external committee of its own due to international attention, Reuters reported.

Kaoru Kashima, executive board member at Ernst & Young ShinNihon, said: "The impact of this incident on society has been large. It is a problem we are taking very seriously."

Earlier this week the independent panel engaged by Olympus concluded E&Y and its predecessor KMPG did not appropriately execute their duties.

"Even when we account for the fact that [E&Y had] just assumed their position as auditor and they lacked knowledge of the past events, we cannot conclude this was appropriate," the panel said.

The two auditors were also criticised for their handover, which was described as "questionable" and "nothing but a mere formality".

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