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Dram Oil sues Deloitte over audit negligence claim

Dram Oil sues Deloitte over audit negligence claim

An oil trading company, Dram Oil and Trading Limited, has filed a writ at the Commercial Division of the High Court, Acra. The company Is seeking court orders for the payment of $187,596,000.00, among others, from Deloitte and Touche, a globally famous audit firm, arising out of alleged negligence on the part of the audit firm against Dram Oil and Trading Limited.

The plaintiff, Dram Oil and Trading Limited, alleges that Deloitte and Touche, the defendant, had been appointed by the Accra High Court in 2018 to undertake audit work in a case involving the plaintiff and a Bulk oil Distribution Company, Vihama Energy Limited, whom the plaintiff had previously undertaken an oil transaction using a facility from Cal Bank.

These are according to the statement of claim of Dram Oil and Trading Limited, which was
filed in court by its counsel, Gaspar Lyle Nii- Aponsah, of Lex Premier Associates, a copy of which was obtained by the Ghanaian Times.

Dram Oil and Trading Limited stated that it had previously been involved in a dispute of a commercial nature brought against it and other defendants by Cal Bank Ghana Limited, arising out of a refined oil transaction between Dram Oil and Trading Limited, Vihama Energy Limited, and Cal Bank.

It is the case of Dram Oil and Trading Limited that after it became victorious in the year 2015 in the suit initiated by Cal Bank against it and the other defendants, Deloitte and Touche was appointed to audit the receivables, payments, and under-recoveries due from Vihama Energy to Dram Oil, which the court found in its judgment had been received by Vihama Energy, but withheld from Dram Oil causing Dram Oil to default on its facility obligation to Cal Bank.

In the current suit, Dram Oil also alleges that the judgment it won in 2015 had firmly found that Vihama Energy had been paid fully all fees owed it by Dram Oil under the Tripartite Agreement covering the oil transaction and, therefore, Vihama Energy was not entitled to any further sums, the reality of which led Vihama Energy to withdraw its previously filed counterclaim.

Dram Oil further alleges that it was for these reasons, amongst others, that in the High Court judgement dated May 18, 2015, Justice NovisiAryene made further consequential orders for the appointment of a reputable audit firm to audit the books, records, and inventory of Vihama Energy Limited.

Dram Oil said the orders were particularly with respect to payments, receivables, emergency cargo under-recoveries received and withheld by Vihama Energy Limited under its Tripartite Agreement with Cal Bank and Dram Oil and Trading Limited. It was compliance with the consequential orders that eventually led to Dram Oil and Trading entering into an agreement with Deloitte and Touche to undertake that assignment.

Dram Oil alleged that subsequently, Deloitte and Touche tendered its audit report from the assignment, which report concluded that Dram Oil was rather indebted to Vihama Energy by a significant sum of money. Dram Oil alleged the said report was being adopted by the court after Deloitte and Touche’s Partner who had been in charge of the audit, Mr. Daniel Owusu, had been cross-examined by lawyers for Dram Oil and Cal Bank on how Deloitte and Touche reached the conclusions it did in the audit report.

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