Singapore-based defunct oil trading company Hin Leong Trading in March 2021 started a legal suit against New York-based auditing firm Deloitte & Touche over its alleged failure to find “serious irregularities” in the company’s financial records, according to Bloomberg.
A hearing for the matter has been scheduled to take place at the High Court of the Republic of Singapore in the week ending 20 June 2021.
“Deloitte failed to detect the irregularities and the material misstatements” of Hin Leong’s financial matters, stated Hin Leong’s court document, as quoted by Bloomberg. “Deloitte acted in breach of the terms of its engagement with the plaintiff.”
Hin Leong’s suit noted the company had been insolvent since at least 2012; while Deloitte auditors had found no irregularities with the firm’s financial statements which it had been auditing for at least 16 years.
“The material misstatements in the plaintiff’s audited financial statements led to various banks and financial institutions being grossly misled as to the financial health and state of affairs,” states Hin Leong court documents.
“Deloitte knew or ought to have known that these banks and financial institutions were intended users of the plaintiff’s audited financial statements and would have relied on the same to extend financing.”
The mismanagement of Hin Leong would have been detected much earlier if Deloitte auditors “carried out the audits of the plaintiff’s financial statements properly”, stated documents.
Hin Leong Founder and Director Lim Ooi Kuin earlier purportedly instructed his company not to divulge losses over a duration of several years, he stated in a court filing; Hin Leong now owes creditors more than USD 3.5 billion.
Photo credit: Manifold Times
Published: 11 June, 2021
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