Deloitte to take cut in Quinn Insurance fees

Court approves reappointment of accountancy firm

Mr Justice Nicholas Kearns, yesterday approved the re
-
appointment of the accountancy firm as auditors

Mr Justice Nicholas Kearns, yesterday approved the re - appointment of the accountancy firm as auditors

 

Deloitte will take a 16 per cent cut in fees for auditing Quinn Insurance in 2014. The president of the High Court, Mr Justice Nicholas Kearns, yesterday approved the reappointment of the accountancy firm as auditors to the entity in return for reduced fees of €114,000.

What is left of Quinn Insurance – Liberty took over the trading business – is now under the charge of Grant Thornton and is effectively a vehicle for dealing with claims arising from policies written by the old insurance business, whose demise helped bring down the Quinn empire.

Deloitte has the job on the basis that certain other firms are likely to be conflicted and it is unlikely that a rival will do the work for less.Mr Justice Kearns was happy with this and approved the reappointment.

During the summer, the same judge heard that outstanding claims had been reduced from 10,500 in 2011 to around 3,500, while the number of new ones coming through the system was expected to peter out over the next 12 to 18 months. The administration is likely to finally end in 2016, around six years after it was begun on the basis that Quinn’s reserves were not adequate.

So far, the State’s Insurance Compensation Fund has paid out €1.158 billion to cover claims made by consumers insured by Quinn. That in turn has led to the imposition of a 2 per cent levy on all non-life policies issued in the Republic.

Quinn’s old auditor Pricewaterhousecoopers is facing a €1 billion damages claim for negligence from the administrators.

If this were to succeed, any damages recovered will be used to repay the compensation fund.

That case is due to begin around the time that the administration is scheduled to end. It will involve an estimated 40 million documents. Given the complexities and the sums at stake, it is going to be a long time before we know if there is to be any restitution for the fund.

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