[ul]
[li]This is one of the rare occasions that an audit firm is facing legal action over the quality of its report — a move that is expected to open a new front in the raging corporate accountability debate.[/li][li]If determined in favour of Jamii Bora, the suit will open a new window for investors to hold book inspectors accountable for losses made in respect of investment choices based on their advice.[/li][/ul]
http://www.businessdailyafrica.com/Corporate-News/Jamii-Bora-Bank-sues-EY-in-Sh451m-Uchumi-shares-row/539550-3784946-okymop/index.html
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This is going to be nasty.
If the bank made any losses EY will be liable of negligence.
ION, KPMG stoked the fire.
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Do you think Jamii Bora will win the case and sue E&Y? I think not, as they indicated, an audit report is not an investment tool and Jamii Bora should have done some due diligence before pumping in the dough
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Kenyan banks cook books all the time and give the auditors clean books. They can only blame themselves. If jamii bora were looking at Uchumi as an investment they must have been high. *big banks
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Wacha ushenz kweli kazi ya auditors ni nini?
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To declare an opinion on the fairness and truth of a financial statement. There are different levels of the opinion but none of them can prove fraud. All they say is whether the fin statements have provided all relevant and accurate info.
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An audit report serves to assure the directors and shareholders that all the business functions are running as they are supposed to, reduce fraudulent activities by the employees so JBB should sue E&Y!!! Why are we prosecuting aki Kabura and praising that auditor that brought the NYS scandal to the public?
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Financial auditors are not forensic investigators. It becomes extremely hard for them to detect fraud especially if it comes from the top and the top guys provide fake information for audit
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external auditors EY, Deloitte, KPMG and PricewaterhouseCoopers
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EY were not the auditors, they were reporting accountants and they produced the information memorandum which investors rely on as a due diligence. They owe duty of care. They failed to report losses made by subsidiaries, they omitted to report material facts where uchumi had sold key properties and entered into sale and lease back contracts. This was for more than 1.1 B.
They are as guilty as sin!!! By the way I hate them . Kirinyaga idiots .
4 Likes
Even if the client is cooking books, certain things will not add up. The entries will not make sense. Entries will be too clean. The auditors are complicit.
And the CEO of Uchumi needs to be sued too. He needs to loose all his acquired property.