KPMG Covers Its Tush At Siemens

This just in from Accountancy Age:

Big four firm KPMG, which audits Siemens’ financial statements, said in a report which was part of the 20F filing that Siemens’ internal anti-corruption controls were ineffective. ‘As of September 30, 2007, the investigations of this failure, and the implementation of the company’s remediation plan to address it, were not far enough advanced to provide a sufficient level of assurance that such circumvention or override of controls and misuse of funds by management would be prevented,’ KPMG said. ‘We do not express an opinion or any other form of assurance on management’s statements referring to corrective actions taken after September 30, 2007.’

I have written extensively on Siemens, Debevoise, KPMG/Siemens, and Deloitte/Siemens.

This looks to me like the beginning of the end for KPMG as external auditor at Siemens. How such a qualified opinion on the internal controls could not be accompanied soon by a qualified opinion on their financials, I don’t know. But KPMG can’t issue the next auditor’s report. They are too close to the situation. Better that they set the stage, ring fence their liability and turn this bad boy over to someone else.

Stay tuned…