Anglo Irish Bank external auditors Ernst Young have declined to attend a Dáil committee hearing to answer questions on their audit of the bank’s accounts.
“We have received legal advice that confirms our own belief that to appear at the committee would not be appropriate,” Ernst Young’s Irish unit said today in a statement.
“As we have already said, we are confident that our audit work at Anglo Irish met the appropriate standards.”
Anglo's internal auditors were invited to appear before the Oireachtas Joint Committee on Economic Regulatory Affairs tomorrow, while the external auditors Ernst Young were due to attend on Thursday.
Former Anglo chairman Sean FitzPatrick has been invited to appear on February 17th.
Revelations that Mr Fitzpatrick concealed more than €87 million in loans from shareholders and the public over eight years prompted his resignation in December.
The controversy is thought to have played a key role in the Government’s decision to take full ownership of Anglo rather than simply recapitalising it with a €1.5 billion cash injection and taking 75 per cent control.
At an extraordinary general meeting in January, shareholders criticised the bank’s directors and its auditors, Ernst Young.
In its statement this evening, Ernst Young said the 2008 audit of Anglo is ongoing and "investigations into the issues in respect of the directors’ loan transactions have only just begun.”
It also noted the bank has commenced its own internal investigation into the controversy and that several external investigations have been initiated by various regulatory bodies.
“There is also a misguided threat of civil litigation,” it said.
“Once those matters are concluded we will be happy to co-operate with the Committee in a proper manner as we are doing with all interested parties,” it added.
Ernst Young said it hoped the committee will appreciate that it was not in a position to comment publicly on issues which are sub judice.
It said that while it was mindful that recent events at Anglo Irish had “upset” shareholders, its audit of the bank had met with met the appropriate standards. It also said that no information concerning “the re-financing transactions” that have been at the centre of the current controversy was made available to it until late 2008.
“As part of the normal audit process we received written representations from management confirming the completeness of directors’ loan disclosures and confirmation in respect of each of the directors’ loan balances outstanding at the financial year end,” it said.
“If we had not been satisfied that the financial statements on which we have issued an audit opinion gave a ‘true and fair’ view of the results and financial position of the bank, in accordance with the information and explanations we received, we would not have signed those opinions.”