Following a tumultuous relationship in recent years, highlighted by an accounting scandal, Nortel has turfed Deloitte & Touche as its auditor, although the decision “does not result from any disagreement or dissatisfaction”. Nortel’s new auditor is KPMG. Deloitte’s departure comes after it played a key role in fixing Nortel’s financial books that involved a multiple restatements. Of course, Deloitte was well handsomely for its services – picking up $72.7-million in fees in 2003 and $57-million in 2004.
Technorati Tags: Nortel
All Nortel, All the Time 
December 5, 2006 at 10:34 pm |
Didn’t one of the plaintiff’s screw up in the U.S. missing his homework to prove Deloitte was a U.S. firm to consequntly get them dismissed.
They got off lucky.
December 6, 2006 at 6:51 pm |
$72.7-million in fees in 2003 and $57-million in 2004.
and $81 mill in 2005!
total $210 mill in 3 years!!!!
read
http://tinyurl.com/y6sxnu
Fees from Nortel, which ditched Deloitte as its auditor this week, made up more than a third of the total audit and related fees Deloitte has been paid by its biggest Canadian clients in recent years.
“Deloitte bears some responsibility for [the Nortel restatements,]” said Bill Mackenzie, president of governance watchdog Institutional Shareholder Services. “If there were errors in the accounts that were not picked up, I’d say there should be a fair bit of accountability there.”
Deloitte was paid about $81-million by Nortel for audit and related work in 2005, the highest amount received by any Canadian auditor last year, according to a report by Workflow International Inc. The next-highest fees paid to an auditor were less than $30-million.
In total, Deloitte received about $236-million for audit and related work from the top 100 TSX companies.
That means the Nortel fees represented 34% of the total fees Deloitte earned from the TSX’s biggest companies in 2005 — the 2004 figure was about 37% — though the audit firm also earns consulting fees and fees from businesses outside the TSX top 100.
December 9, 2006 at 3:44 pm |
[…] Nortel shares had a good week, climbing about 10% to close Friday at $22.54 in New York. It wasn’t the most newsworthy week with the highlight being Nortel’s decision to turf Deloitte & Touche as its auditor after a 92-year relationship. […]
December 9, 2006 at 4:53 pm |
Good riddance to D&T. They were asleep at the switch.
December 10, 2006 at 11:08 am |
From inside Nortel, totally unbelievable how many times Deloitte changed their minds on revenue recognition. Every 3 months the rules would change, triggering a new round of internal navel gazing as all accounts had to be re-analyzed, and all this stuff is sitting in Excel spreadsheets. And they continue to change the rules on revenue recognition every 3 months, the madness has not ended. Deloitte was turfed because they could not reach an agreement with MikeZ’s hatchet man Dennis Carey on a more reasonable course going forward.
Deloitte was incompetent, and will eventually be sued by a shareholder due to unreasonable fees charged, and the outcome achieved which was poor.