LEGAL

ICAEW hits E&Y UK with £40,000 fine

The Institute of Chartered Accountants
in England and Wales (ICAEW) has slapped Ernst & Young
(E&Y) UK with a £40,000 ($64,000) fine for issuing unqualified
audit reports in 2001 and 2002.

The firm was ordered to pay costs of
£17,020 relating to the audit of ‘Company X’ as the audit had not
been conducted in accordance with Statement of Auditing Standard
400, Audit evidence.

The institute claimed that on two
occasions the firm did not obtain sufficient audit evidence on
which to base its audit opinion in respect of market and client
debtors and creditors.

E&Y said in a statement that it
had fully co-operated with and assisted the ICAEW throughout its
investigation.

FINANCIAL RESULTS

Deloitte US revenue takes a dive

Deloitte US, the world’s largest
accounting firm, has reported a decline in revenue and workforce
size in the year to 31 May 2009.

The firm reported revenue of $10.7
billion, which is 3 percent less than last year’s results.

Deloitte shed more than 2,000 staff to
end the financial year with a workforce of 42,367, which included
2,968 partners and 33,605 professionals.

Although overall staff figures
dropped, the number of partners increased marginally and the number
of CPAs at the firm rose 2 percent.

The firm’s fee split continues to
shift more towards consulting services at the expense of audit.

In 2007, audit contributed 44 percent
of the fee split but in 2009 it dropped to 37 percent.

Over the same period consulting grew
from 30 percent to 37 percent of revenue.

FINANCIAL CRISIS

Big Four earn £19m from government scheme

KPMG, Ernst & Young (E&Y) and
PricewaterhouseCoopers (PwC) have all earned millions of pounds
from work related to the UK government plans to insure the risky
assets of two banks.

The Big Four firms have earned almost
£19 million ($30 million) for their work related to the
government’s asset protection scheme (APS), with KPMG earning £6.5
million, E&Y £4.3 million and PwC £4.2 million.

Part-nationalised Royal Bank of
Scotland and Lloyds Banking Group plan to insure about £585 billion
of their risky assets through the APS.