As we begin to see the beginning of an inevitable wave of lawsuits arising from the credit crisis and market meltdown I've come across a couple items that indicate not all lawsuits are equal. Recently one of the first lawsuits from the mortgage meltdown was filed, and I'm sure there will be many to follow. All the large firms will be hit with them and it will take years to resolve, however the ramifications could be significant. Take the E&Y settlement in the case of Healthsouth, as the 8th largest auditor settlements it's stay in the top 10 is likely to be limited.
Obviously I'm biased, but let's be realistic...what moves the market on a day-to-day basis, the accountants or the credit ratings agencies? My vote is the credit rating agencies, and I doubt I'm alone. As accountants we follow specific guidance and yes interpretations may be different and they are subject to bias, however at least we have something to stand on. In addition, it's not like we get paid more for a specific opinion (although recurrence has a value too I suppose). I don't think enough legal heat is being placed on the credit rating agencies, and they play by their own rules.
I can't understand why lawsuits against credit rating agencies are not as successful as they are against the accountants. Apparently it's an uphill battle against the ratings agencies, but a slam dunk against the accountants.
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