KPMG Faces Class Action Suit

Posted by accountingweb on Jan 19 2001 433 printer friendly

Shareholders from Lernout & Hausie are to launch a class action suit against auditors from KPMG, according to a report in the Financial Times.

The suit will claim that the auditors should have been aware of problems with the speech recognition software group's accounts.

L&H filed for bankruptcy in November after restating results for 1998, 1999 and the first half of 2000. At the time, KPMG said that the clean opinion issued in its audit report for 1998 and 1999 "could no longer be relied upon" - a common practice following the announcement of accounting irregularities by the audited firm.

The SEC is investigating allegations that Korean sales for the firm involved companies that said they were not, in fact, customers of the Belgian group.

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