Regarding accounting audit, I want to file a damages lawsuit against an external auditor who conducted a defective audit.

An actual case similar to your question regarding defective accounting audit has occurred and there is related precedent. In the Supreme Court Decision dated April 24, 1999, Case No. 97Da32215, it was ruled that, "Generally, the amount of damages that a stock investor who traded stocks based on an auditor's defective audit can claim against the auditor based on the tort liability under civil law is reasonably considered to be the equivalent of the stock price lost due to the defective audit."

It also ruled on whether the auditor's damages liability is recognized when, due to negligence, important matters are not stated or are falsely stated, finding that it constituted neglect of the auditor's duties for the auditor to fail to discover the fact of accounting fraud and express an unqualified opinion on the audited company.

Furthermore, in order to prove damages liability, it judged that there is a causal relationship between the false statements in the audit report and the fact of purchasing stocks based on that report.

Under the External Audit Act, if an auditor fails to record or falsely records important matters in the audit report and thereby causes damages to a third party who relied on and used the report, the auditor is responsible for compensating the third party for damages.

Through collaboration among civil law specialist attorneys, accountant attorneys, and accountants, our firm provides clients with assistance by representing them in damages lawsuits for defective accounting audits through finding evidence to prove damages suffered during accounting audits.

If you need help, please request consultation with the Accounting Audit Group at any time.