Auditors have to report on, amongest others, the completeness of balances at year end - that means that they cannot accept that the loan balance at year includes everything so you would look at the movement on the account particularly around year end to see if they have shifted anything out. The area of director’s loans is a very risky area as well so should be closely looked at.
who are there auditors.
The financial regulator would be the ones Id get rid of.
Ernst and Young I think.
Why get rid of the Regulator? They did their job.
[quote=“dancarter”]Ya thats understandable. I dont understand the whole audit process so bear with me
if the loan was gone off the Banks loan book, i.e. there was no directors loan at year end, then how/why would the auditrs have spotted it/be required to report it?[/quote]
As an ex auditor, I would have thought that internal/external transactions on directors loan balances would have been reviewed throughout the accounting period by the auditors rather than just looking at the year end balance and ticking off the balance confirmation letter. Presumably they did some interim audit work? It’s not as if there were hundred’s of directors balances.
Then again hindsight is 20:20…
Genius…we’ve had the ‘lets all buy a house’ stage…now its the ‘blame the government and civil service for everything’ stage…nation of fooking sheep…we’re like the Borg in Star trek…
How long more would you give Anglo lads before they’re bought out or nationalised?
[quote=“farmerinthecity”]Ernst and Young I think.
Why get rid of the Regulator? They did their job.[/quote]
Why didnt they do it before now, the loan is sitting out there for years. And they knew about this for months apparently.
And that is just the tip of the iceberg on the regulator
[quote=“balbec”]As an ex auditor, I would have thought that internal/external transactions on directors loan balances would have been reviewed throughout the accounting period by the auditors rather than just looking at the year end balance and ticking off the balance confirmation letter. Presumably they did some interim audit work? It’s not as if there were hundred’s of directors balances.
Then again hindsight is 20:20…[/quote]
ya I just didnt understand the auditors rolee obvisouly, I thought they would just sign off on final figs.
The lack of action by the financial regulator is common knowledge for many years.
IMHO the banks have been virtually self regulating for years. I have had dealings with the FR in the past and unimpressive is an understatement.
Farmer made a point that he thought the auditors had questions to answer in the Anglo fiasco. I said I felt the regulator had a bigger question to answer, based on the fact that the former CEO now chairman of one of Irelands largest banks had an 87 m facility with his own bank, undisclosed to the market for a number of years. On top of this the regulator appears to have known of the issues with Fitzpatrick for months at this stage (who knows how long really?) and yet the info only came into the public domain yesterday.
Maybe you dont remember the huge hoopla about the shorting of bank stocks, Anglo in particular, that went on earlier in the year, this led to shorting of shares ebing banned in Ireland on the back of largely Anglo complaining about info about them being leaked everywhere. Do you think that maybe a line could be drawn between all these various events?
Not just your opinion Dan but its fact. You’ve organisations like IFSRA and IPSO that try to drive new initiatives in banks but if one of them don’t want to do it then it won’t happen. Banks in Ireland (specifically BOI & AIB) have one of the cushiest numbers in Europe - no competition, market saturation, huge brand recognition, easy money as the “trusted” source. Didnt they each make an extra few million this year just because it was a leap year?
Who will buy them? No one will want to take on those problems Id say.
I think the governemt statement about recapitalising banks which have systematic importance to the Irish economy is not good news for Anglo, and Im not sure they will get bailed out.
Lads, I was on the piss last night and have been busy enough in work today so I haven’t had a chance to read the Fitzpatrick story in full. Without going anywhere dodgy legally, why did he not want to disclose the loan? Directors can take loans and obviously should disclose them. But what was going on in the background here?
Think he transferred the loans to other banks to “hide” them or something like that to give Anglo a better looking set of books? Dan seems to know more about the whole thing.
David Drumm has resigned now too.
3rd lad to go. Share price at 25c now.
Farmer as an ex-auditor you should be aware that related party transactions are very difficult to identify. If a client wishes to hide a related party transaction then they will do so fairly easily. In the context of Anglo’s loan book an 87m loan is nothing so it unless the auditors came across it by chance in sample testing then they won’t have found it. Auditors generally rely on enquiries with clients, representations from the Board and prior knowledge for identifying related party transactions, seeing as your are so quick to slate the auditors in this instance could you suggest some audit procedures for identifying related parties that would have identified this?
Tinnion,
You’re a freak.
Regards,
Farmer
Tinnion, is this a prime example of a systems failure?
I just worry that the audit environment in Ireland isn’t rigorous enough.
If anything good comes out of this sorry mess then hopefully it’ll be auditors in general showing a greater degree of professional scepticism.
Agreed Bandage, there has been a complete breakdown of the controls. This will make a great case study when it’s all done.
A great man once said to me: “May you audit in interesting times”. I most certainly am.
[quote=“briantinnion”]Agreed Bandage, there has been a complete breakdown of the controls. This will make a great case study when it’s all done.
A great man once said to me: “May you audit in interesting times”. I most certainly am.[/quote]
‘I audit, therefore I am’.