An unofficial panel of experts today cleared global accounting groups KPMG and Ernst & Young of any wrongdoing in the $1.7-billion accounting fraud at Japan's Olympus Corp, though the role of the firms remains under official review.
The scandal, one of the worst in Japan's corporate history, had led to questions over the role of the two audit firms, that had signed-off on the accounts of the maker of medical equipment and cameras before the 13-year fraud finally surfaced in October.
However, the panel of lawyers set up by Olympus to look at the role of auditors said in a report yesterday that individual auditors were to blame, saying five of them, former and current, were responsible for ¥8.4 billion ($109 million) in damages.
The company intended to file a suit later in the day for about ¥1 billion in damages, after taking into account the individuals' ability to pay, according to the Nikkei business daily.
The panel found the fraud, identified in a separate investigation to have been the handiwork of two former top executives in the 1990s to conceal losses, was rather too well concealed for unraveling by any external audit firm (See: Probe panel indicts top Olympus executives in $1.7-bn accounting scam).
According to the report, the masterminds of the case were hiding the illegal acts by artfully manipulating experts' opinions.