Let's Bash the Big 4 Some More: Lehman News Gets UK Regulators to Start Digging

Regulators in the UK are not mincing words like, say, the Saudis. Let it be known this has everything to do with Lehman (and they want to make sure you know that). Run, Big 87654, run!

Daily Mail:

The dominance of the 'Big Four' accounting firms could be under threat, as the Office of Fair Trading considers a probe into their role as auditors to the world's failed banks.

OFT chairman Phillip Collins let slip this week at the Future of Banking Commission that the competition watchdog was 'looking into this, but I can't say any more'.

A spokesman for the OFT confirmed it was considering whether or not to launch a formal investigation.

The possibility that Ernst & Young, PwC, Deloitte and KPMG could be broken up or have the scope of their activities limited comes in the light of allegations that E&Y did not flag up accounting trickery that hid the sorry state of Lehman Brothers' balance sheet in the lead-up to its collapse.

As I have previously stated, kindly shut the fuck up about EY and Lehman. Statements belong to management, and management is ultimately responsible for their content. Take care of that first and then we can move on to villainizing the accountants.

Jr Deputy Accountant

Some say he’s half man half fish, others say he’s more of a seventy/thirty split. Either way he’s a fishy bastard.


fatcity said...

I'm not sure I understand your hesitancy in vilifying E&Y. Did they sign off on Lehman's financial statement?
Whether this accounting trickery was legal or illegal still puts them in the same boat with Lehman - if we are to condemn Lehman for material misstatements, isn't E&Y tuning up the band while Dick Fuld rearranges the deck chairs?

I'm merely saying the media is calling for EY's head but this sort of thing goes on each and every day in the wonderful world of auditing. NOW we get outraged? NOW we start demanding answers?

Feels like a little late to me.

fatcity said...

If not now, then when?

Apologies for using the proverbial titantic cliche.