PracticeAuditSpeculation mounts on Cattles action against PwC

Speculation mounts on Cattles action against PwC

Auditor unaware of action against it for sub-prime audit

SPECULATION has emerged that Cattles, the troubled sub-prime lender, will make a claim of £840m against former auditors PwC.

The figure has been reported in The Daily Telegraph, but it is understood no claim has yet been lodged at court and Cattles remains in the preliminary stages of considering its next action.

Shares in Cattles were suspended in 2009 pending a report into the company’s 2008 accounts. The company eventually entered a scheme of arrangement earlier this year.

Cattles made provisions in its accounts totalling £850m, which related to the way the company accounted for bad debts.

A preliminary court hearing in October awarded Cattles the right to demand information form PwC.

A statement from PwC published in The Daily Telegraph said the firm was not aware of any claim against it.

In July 2009, the discplinary body for accountants announced an investigation of PwC for its work as auditor of Cattles. The investigation was due to look at the conduct of PwC staff and the audit of accounts for the year ending 2007 and 2008.

Cattles would not comment.

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