What You Need to Know About the Audit-Report Changes [WSJ]
[T]he industry strongly opposed one of the ideas that the PCAOB floated in 2011 – an “Auditor’s Discussion and Analysis” section of the annual report in which the auditor would have provided its own views about a company. Accounting-industry leaders say their role is to weigh in on what a company’s management says, not provide analysis of the company themselves.
U.S. Accounting Regulator Proposes More In-Depth Reports From Auditors [DealBook]
“If something caused a huge amount of agita, it’s probably incumbent upon the auditor to disclose that,” Peter H. Nachtwey, chief financial officer at Legg Mason, an asset management company. Requiring the extra information may draw opposition from some auditors because it could add expenses. Companies may also balk, fearing that investors may interpret the proposed disclosures by an auditor negatively. After the comment period that now follows, the rules may be diluted and they may not go into effect for many months. Still, the board has floated the ideas in the proposal for a long time and some auditors say they favor them. “PwC strongly supports any enhancements to the auditor’s report that will address the needs of today’s users,” said Vincent P. Colman, the partner who oversees the audit and accounting practices at PricewaterhouseCoopers, a large accounting firm. “And we look forward to working expeditiously with the P.C.A.O.B. and all stakeholders to achieve this objective.”
Tremont Group Ordered to Face $195 Million Madoff Claim [Bloomberg]
The Washington state appeals court revived a lawsuit brought by a group of investors, including FutureSelect Portfolio Management Inc., that lost $195 million in Tremont’s feeder fund when Madoff’s Ponzi scheme collapsed. The ruling reverses a lower court’s dismissal of claims against Tremont, its parent Oppenheimer Acquisition Corp., Oppenheimer’s parent Massachusetts Mutual Life Insurance Co. and auditor Ernst & Young LLP. […] “MassMutual, Oppenheimer and Tremont must be held accountable for their gross negligence in promoting Madoff,” Steven Thomas, an attorney for the investors, said today in an e-mail. “Ernst & Young violated its public duty by turning a blind eye to Madoff. This is yet another example of a Big Four accounting firm not just missing, but enabling a big fraud.”
FBI arrests former bakery accountant accused of embezzling millions [ABC]
FBI agents on Monday arrested the former Collin Street Bakery accountant accused of embezzling more than $16 million from the renowned fruitcake maker. Sandy Jenkins was taken into custody on a federal criminal complaint charging him with mail fraud. Jenkins, 64, has appeared before a judge and waived his detention hearings. […] The FBI says Jenkins bought a house in Santa Fe, N.M. They say he had 43 “luxury automobiles.” When he took a vacation, the feds say he frequently flew in private planes. He also apparently had a $3 million jewelry collection.
Grant Thornton taps Stokke to head Atlanta office [Atlanta Business Chronicle]
Succeeding Richard Gebert.
These people exist in our world. I hope you aren't one of them.