ERNST & YOUNG has appointed an external committee to examine its audit of embattled camera maker Olympus, following accusations of “inappropriate” work by an independent panel.
The firm concluded its audit was satisfactory following an internal review, but has scrambled an external committee of its own due to international attention, Reuters reported.
Kaoru Kashima, executive board member at Ernst & Young ShinNihon, said: “The impact of this incident on society has been large. It is a problem we are taking very seriously.”
Earlier this week the independent panel engaged by Olympus concluded E&Y and its predecessor KMPG did not appropriately execute their duties.
“Even when we account for the fact that [E&Y had] just assumed their position as auditor and they lacked knowledge of the past events, we cannot conclude this was appropriate,” the panel said.
The two auditors were also criticised for their handover, which was described as “questionable” and “nothing but a mere formality”.
PwC has been hit with a £2.3m fine by the accountancy watchdog over its audits of the financial statements of Cattles and Welcome Financial Services Limited
KPMG has retained its position as the listed company auditor, according to the latest Adviser Rankings.
While everyone values audit quality highly we must be be careful that we don’t let it deter talent. We need to guard against its commoditisation and the threat to a unitary profession
Commissioning and preparing an asset valuation for financial reporting should involve a three way dialogue between the client, valuer & auditor