A Dubai court has ordered KPMG Lower Gulf to pay more than $231 million to a group of investors who claim they lost money due to poor-quality audit work by the firm on a fund managed by Abraaj Group – a private equity firm that collapsed due to widespread fraud. The amount awarded is one of the largest ever against an accounting firm and exceeds KMPG Lower Gulf’s revenues in its most recent fiscal year.
The judgment highlights the scrutiny facing the Big Four accountancy firms after a series of scandals related to audit work for clients that subsequently failed. It also adds to the challenges facing KPMG Lower Gulf's new chief executive Emilio Pera, who took office in January just after an Abu Dhabi regulator blocked the firm from new audit contracts.
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