Sino- Forest Corporation was a Chinese company that produced fibre boards for residential and commercial use. It made an initial public offering on the Alberta Stock exchange in 1994, and it listed its shares on the Toronto Stock Exchange (TSX) in 1995. The company’s revenue grew from $ 3 million in 1994 to $ 395.4 million in 2010. It became the largest forestry company on the TSX with a market capitalization in excess of $ 6 billion. According to the company, it generated revenue by purchasing and selling forestry plantations in China. On June 2, 2011, allegations of fraudulent misrepresentation were levelled against Sino- Forest by the Ontario Securities Commission.
The OSC suspended trading of the company’s shares by September 2011 and laid charges on May 22, 2013, against co-founder Allen Chen and four other men who had been senior executives. These actions were undertaken after allegations made by a firm called Muddy Waters LLC, which accused Sino- Forest of falsely reporting both the value of its forestry assets and its revenue from sale of those assets. Muddy Waters, a Hong Kong company, published data it had gathered during a private investigation in China of Sino- Forest. The findings of Muddy Waters indicated that Sino- Forest never purchased timber in 2007 and therefore deliberately misled investors by overstating the value of its assets. Therefore, the sale of these assets in 2010 could not have occurred. It was alleged that Sino- Forest’s revenue for 2012 was overstated by 52 percent, or $ 157.8 million.
Sino-Forest filed for bankruptcy protection on March 30, 2012. Its corporate restructuring included a proposed settlement of a class- action lawsuit against Ernst & Young, which provides assurance, tax, transaction, and advisory services. A group of investors opposed the proposed restructuring because it included the settlement whereby Ernst & Young agreed to pay $ 117 million into a fund to compensate shareholders whose shares rapidly became worthless. Many articles were written about the alleged Sino- Forest fraud in the news media. Access some of these articles to answer the following questions.
Required:

1. Identify the important events related to Sino- Forest Corporation that occurred between June 2, 2011, when Muddy Waters published its allegations, and May 22, 2013, when the OSC laid formal charges against Sino- Forest’s former CEO and executives.
2. What role did the auditing firm Ernst & Young play in this situation?
3. If you were a leader at Ernst & Young, what recommendations would you make to avoid the same type of situation in the future?
4. What role may have been played by the Chinese government, which made the situation worse for shareholders, during the investigation by the OSC?