So for those of you that aren’t too fashion conscious, you probably don’t the name Dov Charney. He’s the Chairman and CEO of American Apparel and you’d be hard pressed to find something in one of his stores that qualify under your firm’s dress code.
Nevertheless! AA is a publicly traded company and is subje ities laws as everyone else. Last year they opted to drop Marcum as their auditor for Deloitte. One year later, the firm has apparently had all they can stand of AA because they resigned today, citing possibly unreliable financial statements for 2009, sending the company’s stock reeling.
The 8-K has the usual language that you would expect from a typical auditor/client break-up but here are the gory details for those you that enjoy that sort of thing (citations omitted and extra fun stuff is bolded):
During the period from April 3, 2009 through July 22, 2010, there were no “reportable events” except that (i) in Deloitte’s report dated March 31, 2010 (which was included in the 2009 Form 10-K) on the Company’s internal control over financial reporting as of December 31, 2009, Deloitte identified material weaknesses in internal control over financial reporting related to the control environment and to the financial closing and reporting process, which are further described under Item 9A in the Company’s 2009 Form 10-K, and advised that the Company has not maintained effective internal control over financial reporting as of December 31, 2009; and (ii) Deloitte advised the Company that certain information has come to Deloitte’s attention, that if further investigated may materially impact the reliability of either its previously issued audit report or the underlying consolidated financial statements for the year ended December 31, 2009 included in the Company’s 2009 Form 10-K. Deloitte has requested that the Company provide Deloitte with the additional information Deloitte believes is necessary to review before the Company and Deloitte can reach any conclusions as to the reliability of the previously issued consolidated financial statements for the year ended December 31, 2009 and auditors’ report thereon.
As we mentioned, this has spooked plenty of people, including Ed Yruma an analyst at KeyBanc quoted by Bloomberg in a letter to investors, “The company has struggled since its IPO with both its internal controls and its ability to file SEC filings on a timely basis. An ability to file SEC filings on a timely basis has been an ongoing issue.”
Back to the superficial. Dov Charney is, what you might call, a character. Here’s a brief chat we had with Nick, Breaking Media web developer and occasional contributor to our sister site Fashionista:
me: When i say the name
Dov Charney
your response is…
Nick: LECH
PERV
You only need to snoop around the web briefly (e.g. here, here, here) to pick up what Nick is referring to.
Deloitte’s letter to the SEC is brief and makes no mention about the plethora of models not wearing pants or Dov judging the young auditors’ hot or not-ness, so that likely wasn’t part of the problem. Anyhow, AA ran straight back to Marcum who might be more comfortable with, what we imagine to be, an interesting work environment.
8-K [SEC]
American Apparel Falls After Deloitte Resigns as Accountant [Bloomberg BusinessWeek]
Good
Such a worst company like Deloitte. Never seen this kind of companies. Compare to Deloitte Accenture is for better removing employees giving 3 months of notice and 7 months pay. But in Deloitte constantly laying off the employees without prior intimation..
Better not choose Deloitte for your Career, small companies are for better than this big bull..please don’t spoil your careers by choosing this.
Must be tough. Maybe spare a thought for the contractors who are working for them. Who have to give back time for toilet breaks whilst working from home. Working for what may seem like a reasonable daily rate, but being treated like the shi$ on the bottom of a shoe. Constantly monitored on screen to make sure you are doing what you are supposed to. Poor Deloitte eh? Breaching human rights, invading personal privacy, mistreating staff and then telling you not to mention them!
These large payments are at the expense of clients.
One of the worst organization never ever join this organisation this organisation will ruin your career. Startups are better than this.
Deloitte partners voluntarily took a pay cut so that the company didn’t have to lay anyone off in this pandemic. The other comments on this thread are laughable, do they really think that is what goes on at Deloitte?
Most of these negative comments look like a Bot wrote them.
I have worked in this company for almost 2 years. The Deloitte@Canada is the worst company in my last 7 years. They have ruined my work experience and my knowledge. Director of DMC don’t know how to work, how to manage and how to select employees for the project.
Personally, I’ve worked (by proxy) for worse organisations, however it is abundantly clear that it is a numbers game with Deloitte as they try to please the end client at the expense of quality customer service.
Whether this is down to Deloitte’s management being fixated on numbers or the client’s perhaps less than realistic targets is far less obvious & trickier to comment on.
Ultimately, it is the end consumer who suffers even if most the boxes are being ticked.