Responsibilities of Auditors in External Audit Assignment - Deloitte & Touche v. Livent Inc.

Deloitte & Touche v.
Livent Inc.

Executive summary
 Issue- responsibilities of auditors in external audit assignment.
 Quality of audit services provided by Deloitte will be examined in this
report.
 Auditors were not able to identify if management of Livent Inc. has used
accounting standards.
 Supreme court of Canada made decision in the favour of Livent Inc.

Event and issues
 Event- Management of the company does not prepare the financial statements in
accordance with financial standards.
 It continued from 1997 to 1998.
 Management has to revise their financial statements.
 Revision decreases their market price per share from $6.75 to $0.28 (Widhoyoko, 2014).
 It resulted in huge losses for investors.
 Issue- Auditor during these years was Deloitte
 Primary issue in this scenarios is whether Deloitte was responsible for this error of
management or not.