For two days this week the audit regulator, the PCAOB, solicited feedback from investors, audit committee members, professional groups like the IIA, former regulators, academics and business leaders on improving auditor independence, professional skepticism, and audit quality.
re: The Auditors has seen a confidential, internal Deloitte training document, prepared this past summer, that reveals the firm expects the worst when the inspection reports for their 2009, 2010, and 2011 audits are published by the PCAOB. Is Deloitte truly committed to a sea change in tone as well as technique? I’m not convinced.
This post was originally published three years ago on September 17, 2008. Given everything that is going on – ongoing investigation of EY’s role in Lehman collapse, more lawsuits against the Big 4 audit firms for crisis failures, disclosure of Deloitte’s failings as an auditor as far back as 2006 – I thought it may […]
The release of Anton Valukas’ Lehman Bankruptcy Examiner’s Report on March 11, 2010 threw a fresh match on the still smoldering remains of the 2008 failure. The mainstream media, regulators, legislators and the business community had blamed everything but fraud for the financial crisis and everyone but the audit firms for preventing, warning or mitigating the devastating impact of the crisis.If you’ve been reading the stories on this site, however, you may have come to the conclusion that I did a long time ago:
There was widespread fraud at the highest levels and the Big 4 auditors will eventually be accused of malpractice and complicity for doing nothing to prevent it , to warn us, or mitigate the impact on stakeholders
Sarbanes-Oxley was supposed to end financial scandals once and for all. Will Dodd-Frank succeed where it failed? My OpEd for Boston Review is online today, Monday, August 22, 2011.
I was recently interviewed for the radio show, Background Briefing, and the segment, “Auditing the Auditors,” that aired Sunday August 14th in Australia. The transcript and a podcast are available. I get the last word in response to a defense of the auditors by John Hempton re: the Chinese reverse merger scandals.
It wasn’t even a verdict. Just a decision by New York Federal Court Judge Lewis Kaplan in one of the Lehman failure cases Ernst & Young is fighting. A decision to allow substantially all of the allegations against Lehman executives and at least one of the allegations against Ernst & Young to move forward to discovery and trial. That is, if there’s not a settlement first.
Don’t get me wrong.
I’m thrilled that there’s a lot of traffic in my lane. What I mean is, it’s good for everyone that we’re talking about these issues and that someone other than me and a few other broken records are playing these tunes.
Thank goodness for the plaintiffs’ bar and class action lawsuits. And state attorneys general. Without them, there’d be very little justice yet – or compensation – for any of the mortgage-related fraud perpetrated during the real estate bubble.
CNBC’s JIm Cramer went off this week on the JP Morgan Securities settlement with the SEC. In his mind, someone, everyone got off too easy. It’s a familiar lament.
George Packer writes this week in the New Yorker magazine about the case against Raj Rajaratnam, the head of the Galleon hedge fund. This afternoon, Packer answered readers’ questions in a live chat. I got a question in about one of my favorite subjects, Section 302 prosecutions and the lack thereof. Read the transcript, including Packer’s answer to […]
What’s the difference between Lehman/Hudson Castle – the structured investment vehicle (SIV) mentioned in the New York Times last week – and the SEC fraud charges against Goldman? Aren’t both about disclosure?