Ernst & Young 'respects' Saudi decision on licence

Ernst & Young, Saudi Arabia, yesterday said it "fully respected" the Saudi Capital Market's Authority (CMA) decision to revoke its Securities Business Licence.

In an statement, Ernst & Young said: "This decision is limited to the services provided by one of the entities of Ernst & Young in Saudi Arabia – Ernst & Young Consulting, Saudi Arabia (EYCSA) – and does not affect any other Ernst & Young entity in Saudi Arabia." It added: "The circumstances leading to that decision are not related to standards or quality of client service".

The CMA had yesterday announced that it was revoking the SBL licence of the company because of "several violations" of the law.

In yesterday's statement that sought to clarify the entire issue, Ernst & Young said that "in 2005 it became apparent that certain of our existing transaction advisory services could possibly fall under the new regulations issued by the CMA. In accordance with these regulations, such activities are required to be carried out under a separate legal entity. Hence, EYCSA was established and subsequently authorised by the CMA in 2006 to conduct regulated Advising and Arranging business in Saudi Arabia."

The auditing company said it was fair to say that expected business opportunities in the regulated advising and arranging marketplace did not emerge for professional services firms, as hoped. "Therefore, they did not form a significant part of Ernst & Young's core transaction advisory services. These services have not been impacted in Saudi Arabia or anywhere in the Middle East. Our clients are not and will not be affected by the CMA's decision."

Ernst & Young has been operating in Saudi Arabia for more than 30 years. It employs more than 4,200 professionals across the Middle East and Africa.

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