BusinessBusiness RecoveryRover not over for years

Rover not over for years

The investigation into Deloitte’s audit of collapsed car maker MG Rover’s accounts could take years

The conclusion of the investigation into Deloitte’s audit of collapsed car
maker MG Rover’s accounts could be years away, the body tasked with the probe
has hinted.

A spokeswoman for the Accounting Investigation and Discipline Board refused
to provide specific details of the investigation, which will look at the 2003
audit of Rover and parent company Phoenix Venture Holdings, but said that the
thoroughness of the probe was crucial and there is no time limit to reach a
conclusion.

The MG Rover case is only the second that the AIDB has taken on since
becoming part of the Financial Reporting Council in April last year. In July
2004 it announced an inquiry into the work of Andersen and
PricewaterhouseCoopers in relation to former bus manufacturer Mayflower. A
conclusion has yet to be published on the matter.

Previous investigations by the AIDB’s predecessor, the Joint Disciplinary
Scheme, have required several years of scrutiny. Earlier this year the JDS laid
complaints against Deloitte and its UK chairman Martin Scicluna in relation to
audit work at casino operator Capital Corporation in the mid-nineties. The
investigation kicked off in 1999.

Deloitte has stated that it is ‘disappointed’ by the AIDB’s decision to
investigate the Rover audit, along with the provision of some non-audit
services, but that it will fully cooperate with the investigation.

‘We are confident that we will demonstrate that our work was carried out to
the highest professional standards,’ it added.

The board has the power to impose unlimited fines or ban Deloitte from
auditing in the UK if the Big Four firm is found to be at fault.

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