AccountantcyAge.com reports that Ernst & Young (E&Y) is picking up the pieces after a UK High Court judge ruled that the £300m negligence claim brought against the firm by DaimlerChrysler subsidiary Freightliner will go to the High Court for judgement. A financial controller and company secretary stand accused of a £294m fraud at Freightliner and E&Y is said not only to have failed to spot the alleged wrongdoing, but also did not follow up tip-offs it is claimed the auditor received concerning the alleged fraud.
And The Times reports that the auditor is to lose its CEO just over a year into his new job. 50-year-old Rick Bobrow is to step down with immediate effect. Bobrow was involved in a high profile divorce case earlier this year and E&Y attempted to prevent details of its own financials being made public. He will be succeeded by James Turley, the chairman and chief executive of E&Y's businesses in the Americas.
It's not all bad news, however, as the firm's numbers do look good. E&Y's global revenues rose 29.8% to $13.1bn for the year ending June 2003. Headcount increased from 87,000 to 103,000 in the twelve month period.