Goldman Sachs derivatives business may be audited, newspaper report claims

27 July 2010

The derivatives unit of Goldman Sachs may be audited by outside accountants, a newspaper report has claimed.

According to the Financial Times, the Financial Crisis Inquiry Commission (FCIC) could appoint external auditors to assess whether data provided by this arm of the investment bank was accurate.

Philip Angelides, chairman of the commission, told the news provider that executives from the firm have repeatedly told the commission that this information goes untracked.

“We have a deep level of questioning about whether we’re getting the straight scoop here and whether Goldman is working with us on information that they surely have,” he explained.

Mr Angelides added: “It’s not credible that that’s a black hole. It defies logic that these institutions have no clue of how much money they are making or losing from these derivatives.”

FCIC, which was set up to investigate the causes behind the global credit crisis, recently questioned president of Goldman Sachs Gary Cohn and its chief financial officer, David Viniar.

During questioning the pair said that the bank could not provide specific data for its derivatives business due to the limitations of its accounting system.

By Jim Ottewill

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