Just Show Up and Audit

The role played by external auditors in the La Polar case is marked by practices that leave much to be desired rather than by rules that went unenforced.

Abstract

The case has been described at length. La Polar extended consumer loans and cash advances to its customers at high rates and then concealed the unpaid loans  by disguising them as new receivables, a swollen portfolio yet fully current. It thereby avoided making the required accounting provisions, artificially and maliciously inflating expected profits and the value of the company. Continue reading...