Overview: cry Woolf

Kingston
Smith, the top twenty accounting firm, is usually a practice that prefers to
stay out of the spotlight and get on with business. This week the firm was
forced to break its customary silence and rush to the defence of one of its
favourite sons, Emile Woolf (pictured).

What’s Happened?

Woolf is one of the most respected personalities at Kingston Smith. In fact,
he is one of the most well-regarded partners in the entire profession, having
built up a wealth of experience and an impeccable reputation.

It is therefore difficult to quantify the intense shock that shook Kingston
Smith last week when its very own golden boy was on the receiving end of harsh
criticism in judgments from the independent panel of the
Accountancy Investigation
and Discipline Board.

Woolf had been called in as an expert witness during the AIDB’s Mayflower
tribunal, where complaints were brought against the collapsed firm’s finance
director David Donnelly and auditors PricewaterhouseCoopers.

The watchdog suffered a devastating defeat at the tribunal, after dropping
some complaints and later having others dismissed by the independent panel.In
the panel judgments following the AIDB’s defeat, Woolf was criticised for making
erroneous verbal claims and failing to answer questions.

The scathing criticism was not well received by
Kingston
Smith. A statement was immediately rushed out defending Woolf and
criticising the tribunal’s ‘factually

incorrect and prejudicial findings’. The criticism of Woolf in relation to
the scope of the investigation, Kingston Smith said, was wholly outside of his
control.

What’s Going to Happen?

The independent panel judgments have clearly upset Woolf and his firm, and
could not have done his reputation any good. So where does this leave the
veteran Kingston Smith partner?

A closer look at the panel judgments shows that there was one panel member
who offered a dissenting view that did not criticise Woolf. It just so happens
that this person, a Mr Arthur Harverd, was the only member of the panel that was
an accountant, which certainly does put a different spin on the majority
decision of the panel.

It would appear that the condemnation of Woolf is not nearly as emphatic and
comprehensive as initially perceived. This, coupled with the unwavering support
of his firm, means that Woolf is in a good position.

He would no doubt have preferred this matter not to have cropped up at all,
but it seems highly unlikely that once the issue is out of the way Woolf will be
too bothered by what happened with Mayflower.

In the meantime it will be interesting to see just how far Kingston Smith
will go to defend Woolf’s reputation. Michael Snyder, the firm’s senior partner,
is believed to be furious with the way the Mayflower tribunal was handled and
the way Woolf was criticised in the judgment. Time will tell what action
Kingston Smith will pursue, but don’t be surprised if a heated argument with the
Financial Reporting Council ensues.