The Accountancy and Actuarial Discipline Board (AADB) has decided to take no further action against E&Y after its investigation into the auditor's role in the near collapse of the Equitable Life Assurance Society.

In June 2010, E&Y was fined £500,000 plus £2.4m costs and both the firm and its former partner Kevin McNamara were rapped by the Joint Disciplinary Tribunal (JDT), the previous accountancy watchdog for disciplinary matters.

Gregor Stewart, a former E&Y partner, and John Bannon, an actuary who worked with E&Y, were the subject of an investigation by Accountancy and Actuarial Discipline Board.

'Following the conclusion of this investigation, it has been decided that there is no realistic prospect that a Tribunal would make an adverse finding against the actuary concerned. Consequently, no further action will be taken and the case will be closed' the AADB said in a statement.

It gave an identical conclusion into its investigation into the conduct of 'certain actuaries of the Government Actuary's Department in connection with the provision of advice by or on behalf of the Government Actuary's Department to prudential regulators in respect of The Equitable Life Assurance Society'.

E&Y had appealed against a more severe judgment issued two years previously. In 2008 it secured an injunction preventing a report produced by the JDT from being disclosed. That injunction had stopped evidence about Bannon and Stewart being passed to their professional bodies for investigation. However, it was lifted six months later.

The JDT ruled in 2008, that E&Y and McNamara had been guilty of more than 20 instances of a 'lack of professional competence' when auditing Equitable's accounts for 1997, 1998 and 1999.

It also said they had been guilty of 'a lack of objectivity and independence' highlighted as 'the most serious' of the allegations - a finding reversed on appeal. At that juncture, E&Y was hit with £4.2m fine and £5.75m in costs, which were later reduced.