Banks accuse Ernst and Young of professional neglect

According to unofficial information from Rzeczpospolita daily, the banks crediting Stocznia Szczecinska Porta Holding and the Szczecin Shipyard accuse their auditors, Ernst & Young, of a neglectful analysis of the shipyard's accounts. The creditors claim that Ernst & Young should have warned them that the shipyard is running the risk of going bankrupt. A member of one of the banks' management, who wished to remain anonymous, told Rzeczpospolita that members of the consortium crediting the shipyard are considering initiating legal proceedings against the auditor. "If the risk of losing financial liquidity exists, the auditor should include this information in the financial report," said president of the National Council of Certified Auditors (KRBR) Piotr Rojek. He added that an auditor is obliged to include such information in the report according to banking law. "The problem is not so clear-cut as the risk of losing the firm's liquidity depends on the size of the debt, cash-flow and many other factors. Therefore the evaluation of risk must be balanced," Rojek added. In a preliminary report for 2001, Stocznia Szczecinska Porta Holding registered an zl. 8.9 million net profit whereas the Szczecin Shipyard recorded around zl 96 million in losses. (Rzeczpospoilta, June, 1-2 p. B2) A.Z.