KPMG faces Elan questions in US
KPMG is facing serious allegations over its work at drugs company Elan, including accusations of issuing false and misleading statements.
The firm, together with executives of the Irish-based drugs company, is on the receiving end of a class action filed in the US alleging the company’s profits had been artificially inflated.
The writs from angry shareholders allege the use of deceptive accounting practices – earlier the Wall Street Journal had reported that two ‘qualified special purpose entities’, similar to those at the centre of the Enron scandal, had not been consolidated in the company’s accounts, hiding debts of $1bn.
Elan, which until last week had been Ireland’s most valuable company, recently issued a profits warning, saying earning could be 30% below analysts’ forecasts.
Details of the writ are available on the website of the law firm of Wolf, Haldenstein Adler Freeman & Herz LLP.