(Bloomberg) Billionaire Charles Munger, who dismissed Ernst & Young LLP as auditor of his Daily Journal Corp., compared the accounting firm to a misguided physician.
“They were like the doctor who wanted to cure the nosebleed by fishing around in the groin,” Munger, 90, said today at the annual meeting of the publishing company in Los Angeles. Munger, who is best known as Warren Buffett’s partner at Berkshire Hathaway Inc., is also chairman of Daily Journal.
Ernst & Young had determined there were flaws in the publisher’s accounting for acquisitions and deferred tax provisions, Munger’s company said June 24 in its report for the fiscal year ended Sept. 30. The document had been delayed amid a review of internal controls over financial reporting. Daily Journal said its internal controls were effective and replaced the auditor the next month with BDO USA LLP.
“Part of our trouble is that our business situation was complicated, and I’m sure we didn’t draw the top talent,” Munger said.
Ernst & Young spokesman John La Place had no immediate comment.
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