As a follow up to our recent post ‘HP Autonomy debacle, many advisers but little good advice‘ it seems that the threat of litigation has already been realised.
According to Reuters news agency, a shareholder lawsuit has already been filed against audit firms Deloitte and KPMG alleging errors in their handling of the transaction.
Further, as we speculated in our first article on this subject, the lawsuit also named HP’s board of directors, officers, and former executives, alleging breach of duty and negligence for their role in HP’s acquisition Autonomy. Seems that we were right to identify the potential exposure of the HP board of Directors.
This is a very substantial case involving many billions of dollars but the principles regarding Director’s and Officers liability apply to every single limited company no matter how large or small. Further, the action against the auditors is a prime example of the exposure faced by accountants that can be protected by professional indemnity insurance.