PracticeAccounting FirmsNegligence claim hits Haines Watts

Negligence claim hits Haines Watts

Bank subsidiaries lodge £2.9m claim against mid-tier firm

Link: Equitable trial: E&Y fights for its future

Top 20 accountancy firm Haines Watts is facing a £2.9m legal battle after being accused of negligence by subsiduaries of a South African bank.

The subsidiaries of the banks – Guernsey-based FirstRand International and RMB International of Dublin – claim they suffered losses of over £2.6m due to the Newport firm’s audit of the 2001 group financial statements of metal trading company LN Metals International.

In papers lodged at the High Court, the banks claim that Haines Watts breached its duty of care, leading to losses caused when they invested in LN Metals. They are suing the firm for damages of £2,645,500 as well as interest of £338,623.76 and continuing interest of £579.84 a day.

FirstRand and RMB became interested in investing in LN Metals – a metal trading business in Newport, South Wales, Monza in Italy, and Eastern Europe – in 2002, and called in the firm to perform an audit.

But they claim the firm’s audit opinion was negligently misstated. Haines Watts said LN had assets of $906,000 (£492,000), when at the time the group had net liabilities of over $2.17m, leading to its position being overstated by $3.078m.

Haines Watts was unable to comment as Accountancy Age went to press.

Related Articles

BDO’s global revenues pass $8bn

Accounting Firms BDO’s global revenues pass $8bn

5d Alia Shoaib, Reporter
Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

Accounting Firms Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

1w Philip Smith, Reporter
Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

Accounting Firms Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

1w Emma Smith, Managing Editor
BDO reports revenue growth of 5.7%

Accounting Firms BDO reports revenue growth of 5.7%

2w Alia Shoaib, Reporter
Taylorcocks announces merger with Surrey firm

Accounting Firms Taylorcocks announces merger with Surrey firm

2w Emma Smith, Managing Editor
Kingston Smith reports 7% gender pay gap

Accounting Firms Kingston Smith reports 7% gender pay gap

2w Emma Smith, Managing Editor
RSM announces two partner promotions

Accounting Firms RSM announces two partner promotions

3w Emma Smith, Managing Editor
Backsourcing: The latest accountancy trend?

Accounting Firms Backsourcing: The latest accountancy trend?

1m Pillsbury Winthrop Shaw Pittman