Deloitte steps down as Equitable receiver
Deloitte has stepped aside as receivers of Equitable Mortgages after missing a conflict of interest with their audit team during the tender process.
Thursday, December 23rd 2010, 2:05PM
In a statement on the Deloitte website it said recovery partners Rod Pardington and David Levin had been appointed to act as Equitable receivers, "However, it came to our attention that continuing as the receiver of Equitable Mortgages may give rise to audit independence issues for Deloitte. The relevant issues giving rise to this were not known and, given their nature, could not have been known by us until this was communicated after our appointment."
Deloitte said it had no choice but to take a "conservative view" and resign to maintain auditor independence and "ensure that we are well within the boundaries of those rules."
Approximately 6000 depositors are owned $178 million by Equitable Mortgages. They were covered by the government deposit guarantee scheme and their call was the first on the extended guarantee, though around $12 million of debentures are not covered.
Equitable cited ongoing asset deterioration, declining loan business and investment appetite linked to the government scheme for its failure.
KordaMentha has been appointed to act as receivers for Equitable.
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