My take on the latest at the PCAOB and KPMG
In Episode 449 of the FCPA Compliance Report, I spoke with Tom Fox to discuss the current status of the KPMG defendants and what their conduct means for the audit profession going forward.
Update: Botta v. PricewaterhouseCoopers LLP, Case 3:18-cv-02615-RS
/in Audit Firm Management, Audit Quality, Featured, PricewaterhouseCoopers, Pure Content, The Case Against The AuditorsA judge denied PwC’s motion for summary judgement. The case goes to trial in October. Mauro Botta brought an action in district court in California against PricewaterhouseCoopers LLP alleging that PwC wrongfully terminated him in retaliation for a whistleblower complaint he made to the Securities and Exchange Commission about PwC’s auditing practices. There’s been a lot written about the case, which is ongoing.
The Question of the KPMG Whistleblower
/in Audit Quality, KPMG, PCAOB, SEC, The Case Against The AuditorsThe timeline of who told whom what and when, this time around for KPMG, is a bit more complicated than David Middendorf described in his testimony in the criminal case against him for allegedly conspiring to steal PCAOB inspection data.
Update: KPMG: Whittle and Holder Plead Guilty
/in Featured, Pure Content, The Case Against The AuditorsKPMG partner Thomas Whittle broke ranks on October 29 and pleaded guilty to all five criminal charges. He is now cooperating with prosecutors. Do you have more information about this case? Leave a comment here, one I can leave unposted, if you wish to communicate confidentially or DM me on Twitter @retheauditors for Signal encrypted confidential messaging instructions.
A Requiem for Independent Audits: The Last Days of Theranos
/in Audit Quality, The Case Against The AuditorsLooks like the Theranos investors decided that audits are worthless, even if the cost is some “immaterial to them” fraud losses.
New Stories about the KPMG-PCAOB Scandal
/in Audit Firm Management, Audit Quality, Latest, Pure Content, The Case Against The Auditors“Innovation demands risk-taking… which, in turn, entails redefining failure, stripping away its power to inhibit.” Chairman and CEO of KPMG Lynne Doughtie
Another Update on the Case of FDIC v PricewaterhouseCoopers re: Colonial Bank
/in Fraud, Independence, Internal Audit, Latest, MF Global, PCAOB, Pure Content, Sarbanes-Oxley, SEC, The Case Against The AuditorsOn February 28 the US Justice Department fined Deloitte & Touche LLP $149.5 million for alleged fraud against the government related to its role as the independent outside auditor of Taylor, Bean & Whitaker Mortgage Corp. Also: The damages phase of the FDIC v. PwC case regarding Colonial Bank is set to begin in Washington DC on March 20.
More on KPMG and the Precedents for Possible Punishment
/in Featured, The Case Against The AuditorsWhy did they do it? The WSJ walks around the question but KPMG may face big fines and, I think, its partners and the PCAOB professional could face criminal charges.
Interesting Disclosures During TBW v. PwC Pre-Trial Period
/in Pure Content, The Case Against The AuditorsThe TBW v. PwC trial gave the public quite a few interesting disclosures about the audit industry and PwC, including some some pointing to how the firms’ finances, in this case PwC, work.
TBW Plan Trustee v. PwC: A Look at What Led To It and What’s Next
/in Latest, Pure Content, The Case Against The AuditorsHere’s a brief look at the TBW Plan Trustee v. PwC trial, what led to it and what’s next.
Best Case Yet For Publishing Audit Partner Names: Grant Thornton’s Koeppel
/1 Comment/in Audit Quality, Pure Content, The Case Against The AuditorsThe PCAOB will vote on final rule based on its proposal on Tuesday Dec 15. If audit partner names were published in the audit report, or anywhere, the public, audit committees, investors and journalists could stop lousy auditors in their tracks. Melissa Koeppel of Grant Thornton is the best case yet for making audit partner names and their engagement history, disciplinary history, and litigation history public.
PCAOB’s Franzel Speaks to AAA; Are Auditors’ ICFR Opinions Just “Busy-Work”?
/1 Comment/in Audit Quality, Partner Compensation, The Case Against The AuditorsAuditor opinions on ICFR are not only not being done well, they are not producing warnings for investors and regulators that a material error and restatement is likely. Worse than that, when auditors get them wrong they whitewash their mistakes.