Cross Border Liability – I

Citat 1:

In an interview with the Financial Times last year, Sam DiPiazza, the global head of PwC, said: “We’ve done it [changed the standards] in a way that the consequences are very clear – all the way to the point of having the ability to actually change management around the world if we need to.”

Citat 2:

A case next month will determine whether BDO International, the umbrella organization that links all the BDO firms, is responsible for BDO Seidman, the US arm of its network. This firm has had damages of $521m awarded against it for a negligent audit of ES Bankest, a factoring company owned by Banco Espírito Santo. 

- Global auditors tackle problems of local scandals”, Jennifer Hughes, Financial Times, January 29, 2009

If BDOI is brought in, this could open the floodgates for all sorts of litigation against the big accounting firms which, because they face unlimited liability in most countries, have sought to present a single global brand but to distance themselves from each other when trouble looms.

“It makes sense that they want to have a brand just like IBM or Mercedes. But when they get sued, they say ‘that’s not us, it’s someone else’. No-one else gets to do that, why should accounting firms be able to?” says Steven Thomas, the lawyer leading the case against BDO.

He claims there is an agency relationship between the international unit and the local, meaning BDOI was responsible.1