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Negligence › Auditors

BakerHostetler

SEC Approves PCAOB’s Rule Expanding Contributory Liability

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For nearly two decades since its enactment in 2005, PCAOB Rule 3502 prohibited any “person associated with a registered public accounting” firm from taking or omitting to take an action knowingly or recklessly in a way that...more

DLA Piper

SEC Approves PCAOB Rule Amendment That Expands Individual Auditor Enforcement Liability

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The Securities and Exchange Commission (SEC) approved a proposed amendment to Public Company Accounting Oversight Board (PCAOB) Rule 3502. The amended rule expands enforcement liability for associated persons who...more

Hogan Lovells

Auditors’ liability – English case casts doubt on effectiveness of disclaimers in negligence actions

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A recent English case may cause concern amongst Hong Kong auditors hoping to protect themselves from liability towards third parties by the inclusion of standard disclaimer wording in their engagement agreements. The decision...more

Orrick, Herrington & Sutcliffe LLP

English High Court Sheds Light on the Scope of an Auditor’s Duty in Ickenham Travel Group Limited v Tiffin Green Limited

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The High Court recently dismissed a claim by Ickenham Travel Group Limited (ITG) against its former auditor, Tiffin Green Limited. The decision sheds light on how English courts are likely to approach audit negligence...more

Winstead PC

Federal Court Holds That Texas Does Not Have An Independent Aiding And Abetting Claim For Breach Of Fiduciary Duty But Holds That...

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In Taylor v. Rothstein Kass & Co., PLLC, a receiver for a failed business sued an accounting firm for various claims arising from the auditor’s issuance of a clean audit report concerning certain financial statements. No....more

Bennett Jones LLP

Supreme Court Denies Leave to Appeal Dismissal of Auditor Negligence Claim

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On May 2, 2019, the Supreme Court of Canada denied leave to appeal from the Ontario Court of Appeal’s decision in Lavender v Miller Bernstein LLP1. The Supreme Court’s decision marks the end of a 14-year legal battle that has...more

Blake, Cassels & Graydon LLP

Lavender Haze Lifts: Court of Appeal Clarifies Auditor’s Duty of Care

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On September 5, 2018, in Lavender v. Miller Bernstein LLP (Lavender), the Court of Appeal for Ontario (Court of Appeal) overturned a lower court decision that an auditor had a duty of care to its client’s clients. In doing...more

A&O Shearman

Swap close-out costs - causation but no assumption of responsibility by auditors

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A building society sued its auditors for the close-out costs of interest rate swaps entered into on reliance on advice that they could be accounted for as hedges. The High Court found negligence, which was the cause of the...more

Blake, Cassels & Graydon LLP

SCC Affirms Duty of Care but Reduces Auditor’s Damages in Livent Decision

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On December 20, 2017, the Supreme Court of Canada (SCC) released its long-awaited decision in Deloitte & Touche v. Livent Inc. (Receiver of) (Livent), which addressed the issue of the auditor’s liability for failing to detect...more

Blake, Cassels & Graydon LLP

SCC Rules on Impartiality and Independence of Expert Witnesses

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On April 30, 2015, the Supreme Court of Canada (SCC) released its decision in White Burgess Langille Inman v. Abbott and Haliburton Co. (White Burgess), relating to courts’ assessment of the impartiality and independence of...more

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