Two of the biggest corporate scandals this year involved German payments company Wirecard AG and Chinese retail coffee company Luckin Coffee. These two companies have one other thing in common beyond their recent involvement in high profile accounting scandals – it turns out that both companies’ auditor was Ernst & Young, as was the case with several other companies involved in recent scandals. As discussed in an October 17, 2020 Wall Street Journal article entitled “String of Companies That Imploded Have Something in Common: Ernst & Young Audited Them” (here), a number of EY audit clients have faced financial issues in recent months, raising questions whether there is something about EY’s audit approach that contributed to the problems or allowed the problems to happen.
Continue Reading Financial Scandals Involve Ernst & Young Audit Clients
Another Accounting Scandal-Related Securities Suit
Earlier this week I wrote about the accounting scandal that has hit the UK-based grocer, Tesco, and the securities class action lawsuit against the company that followed in its wake. Now another company has reported accounting irregularities – and the company involved has also been hit with a securities class action lawsuit.
On October 29,