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February 2, 2023

Accounting News Roundup: Big 4 Get Share of Blame for Carillion and Apology Letters for Embezzlement | 05.16.18

Key findings from the MPs’ report into Carillion’s collapse [The Guardian]
Two parliamentary committees spread the blame around for the collapse of the British construction company, with the Big 4 getting its fair share. The report called KPMG, Carillion’s auditor, “complicit” for “complacently signing off its directors’ increasingly fantastical figures.” Deloitte, the internal auditor, “too readily ignored” the “terminal failings” in the company’s risk management. The report pointed out that EY suggested deferring payments to the company’s pension, but not the firm’s fees. Meanwhile, PwC is managing the insolvency “effectively writing their own pay cheque, without adequate scrutiny.” The report talked of breaking up the firms, of course.

Another HR Startup Ousts Its CEO Over Misconduct Claims [Bloomberg]
There’s something wonderfully ironic about an HR company’s CEO being fired for bad behavior. “We offer a solution to better manage your employees, except we can’t manage our own CEO.” In this case, Namely ousted its CEO Matt Straz for “actions” that were “inconsistent” with the “leadership standards” at the company.

Judge orders restitution, apology letters for victims in Watford City embezzlement [BT]
Here’s a new one:

Hannah Lloyd, 39, pleaded guilty Thursday to three felony counts of theft. As part of her sentencing, Northwest District Judge Daniel El-Dweek ordered Lloyd to pay restitution in approximate amounts of $139,000 to the Watford City Park District, $50,000 to the Watford City Golf Course and $56,000 to Rink Construction, as well as write apology letters to the victims.

In my imagination, Ms. Lloyd phoned in the first apology. Something like:

Dear Watford City Golf Course,

I’m sorry.

Hannah.

Then the judge scolds her for an insincere letter and forces her to re-write it until he’s happy with it.

I’d like to see more judges require embezzling accountants to write apology letters. “You’re going to apologize for what you’ve done, and we’re going to sit here until you get it right!” This sounds like a decent sentence for most first-time embezzlers, frankly.

Previously, on Going Concern…

In Open Items, Stay mid-market or try to get big 4?

From the archives: Guy Who Tried to Ransom Mitt Romney’s Tax Returns Regretting His Choices Right About Now

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