Deloitte settles Beazer lawsuit for $1m
Big Four firm pays out after being accused of ignoring red flags in accounts
Deloitte is to pay out $950,000 (£630,000) as part of a settlement with
investors of Beazer Homes USA, after a class-action lawsuit was filed claiming
the firm failed to spot inaccuracies in the company’s accounts.
The Big Four firm had been named alongside Beazer and former Beazer
executives in a lawsuit claiming $30.5m. Investors had accused Beazer of
managing earnings, recognizing revenue earlier than allowed under US GAAP,
improperly accounting for sales/leaseback transactions, creating ‘cookie jar’
reserves, and not recording land and goodwill impairment charges at the proper
time, according to
CFO.com.
The complaint, filed nearly two years ago, said Deloitte had turned a ‘blind
eye’ to a number of red flags that should have alerted them to potential
violations of GAAP rules.
The settlement payment is pending approval from the Northern District Court
of Georgia.