Posts

Not Over Until It’s Over: Price Waterhouse India Settles Satyam

It’s the potential for sudden conflagrations in developing countries that keeps the global audit firms – PwC in this case – up at night. The legal quagmires in developed countries are messy, too. PwC may want to put the Satyam scandal behind them but, unfortunately, I fear there’s still much more pain for the firm to come.

@Forbes “Why Banks, And Their Auditors, Are Getting Away With Financial System Murder”

I wrote the post excerpted below for Forbes on February 25th, after seeing a great story by Jonathan Weil at Bloomberg on Citigroup. Now the WSJ reports that, according to “sources”, the SEC and Department of Justice are having trouble making a case against Lehman executives and Ernst and Young in that case. I’m sure […]

@Forbes “Auditors Abandon Investors On Liability Limits”

Tammy Whitehouse over at Compliance Week does a thorough job on the largest audit firms and their fear of catastophic litigation.  Yes, they’re admitting it – Tammy says they’re pleading with legislators – and fighting any legislative urges to open more avenues for lawyers and their clients to sue them. The Dodd-Frank Act gave the Securities […]

All Points Bulletin: Auditor Litigation Spans The Globe

Let’s consider for one moment that the US firms are not the center of the universe for the global audit franchise. Although US revenues are significant, profits and growth are not necessarily stellar compared to the potential in other geographies. So the firms will plow foreign fields instead.

Inside The Mind of An Inside Trader

The SEC has accused one of the most prominent businessmen ever implicated in such crimes, Rajat Gupta, a former McKinsey & Company Global Managing Director, of insider trading. It’s understandable that, in the heat of this moment, some might naïvely compare the consequences of the criminal indictment of an audit firm with civil charges against an individual, albeit one who trades on – pun intended – his association with a prestigious professional services firm. It’s not the same thing.

Update: Auditors and Consulting: Claims Of No Conflict Strain Credibility

Big 4 audit firms are focusing on growth in their global consulting businesses but the conflicts that drove three out of four of the firms in the US to sell them after Enron are a bigger problem than ever before.

2011 Loeb Award Application: Blogging

I thought some readers may find it interesting to see the applications I submitted for this years’ Loeb Awards for Distinguished Business and Financial Journalism. The award is sponsored by UCLA’s Anderson School of Management. Last year I was a finalist in the Blogging and Online Commentary Category. They’ve rearranged and added categories this year and so […]

2011 Loeb Award Application: Beat Reporting

I thought some readers may find it interesting to see the applications I submitted for this years’ Loeb Awards for Distinguished Business and Financial Journalism.

Deloitte’s Troubles Bubble To Surface

Mainstream media, and the Financial Crisis Inquiry Commission, are focused mainly on Ernst & Young as the auditor whipping boy of the financial crisis. That’s really by default not by design and is thinly justified. No one has given fly-over journalists anything on a silver platter that would draw in the rest. Give me a few minutes and I can make a case for PricewaterhouseCoopers as the one teetering on the edge of the abyss. Or KPMG. But today, let’s talk about Deloitte.

Dear PCAOB Board: Your Job Is To Serve And Protect Investors

It’s time for the PCAOB Board to think about how they might respond when the audit firms are not going to be so pleased as punch. There’s much for them to address. I’ll be talking about some of those changes and improvements in future posts. But, the most important role of the PCAOB is the inspections process. Let’s take a look at how well that’s going.

Nowhere To Hide: Ernst & Young Looking At More Civil Liability For Lehman Failure

The mainstream media (MSM) is now paying attention to the Big 4 – Deloitte, KPMG, PricewaterhouseCoopers, and Ernst & Young.

The financial crisis is now about accounting fraud.

Every two-bit journalist and blogger on the business beat is spitting out stories to keep up and one-up each other. It’s not every day that the accounting firms provide so much gossip about spectacular criminal and civil penalties. Well, actually, it is every day.

Let Me Tell You A Funny Story: Lehman’s Repo 105 Accounting

When a new batch of Ernst & Young auditors arrived at Lehman Brothers each year, Repo 105 transactions must have caused debate. After all, a transaction that’s called a “Repo,” short for “repurchase”, but that’s actually recorded on the books as a sale, is a little odd. It may have even quacked.