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Andersen fined for inflating SSL profits
Robert Lea28.01.09
Defunct accountant Arthur Andersen has been found guilty of waving through false accounting at its former audit client, Durex condoms company SSL.
Andersen, which collapsed following revelations of culpability in another audit client Enron, the world's biggest corporate crash, was today found by the accountancy profession's Joint Disciplinary Tribunal to have failed to carry out basic accounting checks at SSL.
Andersen has been hit with penalties totalling £175,000 by the tribunal, a liability that will have to be picked up by the firm's former UK partners, many of them now working at Deloitte. The tribunal found SSL falsely inflated profits by booking sales early of almost £22 million in 1999 and 2000.
The tribunal said the case showed “the dangers and potential limitations of reliance without independent verification on management representations about matters which are highly material to financial statements”.
The tribunal previously fined Andersen £1.1 million, for failing to pick up on a fraud at DIY group Wickes.
