James Roome Quoted in Financial News Story on Holding Auditors Accountable
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Akin Gump financial restructuring partner James Roome was quoted in the Financial News article “Auditors are the only ones who do not trust company audits.” The article addresses the issue of audit reliability and auditor accountability.
The article argues that auditors can hardly ever be held liable even when it emerges that audited accounts are inaccurate, citing the example of Britain’s Carillion, which collapsed despite its audited accounts showing that the company’s finances were solid.
According to the article, it is difficult to bring a claim against auditors and Roome agrees. He said that when a company collapses after accounting misstatements are disclosed, it is often hard to explain to investors why suing the auditors is not an option. “There remains even today a large gap between the reliance investors place on an audit and their rights in the event of fraud,” he said.
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