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January 2, 2012

E&Y Japan finds no faults in Olympus handover

The Olympus audit handover between KPMG AZSA and Ernst & Young ShinNihon (E&Y) was compliant with auditing guidelines, according to a panel set up by E&Y.

The panel’s findings are at loggerheads with Olympus-appointed panel that criticised the audit transition of 2009.

E&Y and KPMG ASZA are being investigated over their Olympus audit work after the camera maker revealed an ¥1.7bn accounting scandal late 2011.

Although offering a clean bill of health on the handover, E&Y’s panel admitted its investigation was limited because KPMG ASZA did not wish to take part.

“We have found no problems with the handover in terms of the guidelines,” Toshifumi Takada, an auditing professor at Tohoku University and panel member, told the news agency Reuters. “But we need to make further checks to see if more should have been done.”

E&Y formed the investigation panel in December following a damning report by the Olympus-appointed panel, which said the transition in 2009 was considered as “a mere formality” and the two auditing firms “did not go so far as to touch the substantive reasons for such replacement”.

E&Y’s panel is expected to publish a final report on its investigation in the coming days.

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