PracticeAccounting FirmsPeregrine defends $1bn Andersen action

Peregrine defends $1bn Andersen action

Peregrine CEO Gary Greenfield has defended the collapsed software company's $1bn lawsuit filed against its former auditors Andersen.

Link: Former audit client sues Andersen

In an interview with Accountancy Age, Greenfield reinforced what he claimed was a ‘solid course of action’ against the disgraced former Big Five firm, saying the ‘lawsuit has not been filed lightly’.

And he dismissed criticisms from Andersen that the lawsuit was merely an attempt to divert attention away from the failure of Peregrine’s own management, as the accounting firm has claimed.

While accepting that Peregrine’s management was not blameless, Greenfield said: ‘The question is why have a public accounting firm if it is not held accountable. If management is held accountable then so should Andersen.’

Headline results of an independent internal review, Greenfield claimed, had found $250m in bad revenue had been booked and $100m in options expenses inappropriately treated.

According to Greenfield, Peregrine has already implemented new controls while a number of people in the finance department have already had their contracts ‘terminated’.

Chief financial officer Ken Sexton is currently focusing his attentions on restating two years of financial statements as well as preparing statements for one year and two fiscal quarters.

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