When accounting goes unaccounted for
At the Wall Street Journal's CFO Network event yesterday, a nameless CFO asked SEC Division of Corporate Finance, Keith Higgins, “What gives with the PCAOB? Do they really mean to be slow and not transparent?”
Although Mr. Higgins acknowledged that, "We've heard that concern," the correct answer is, "Yep! That's how audit firm lobbyists designed it!"
[MW]
We're still on this, apparently, and the PCAOB isn't letting up. In an attempt to […]
It seems we weren’t the only ones who were disturbed by the Wall Street Journal […]
So maybe you heard about Ernst & Young and how they kinda, sorta didn’t bring up the shady accounting going on over at Lehman Brothers to the audit committee until a Matthew Lee, your fired whistleblower du jour, brought it up. Some people have suggested that if E&Y had made a single peep about this prior to, say, 2008, maybe we wouldn’t be having this discussion (okay, we’d probably still be having it).
The controversy over this incommunicado has now jolted the PCAOB into action as the they have announced an open meeting for Monday at 9:30 am sharp. Basically, they want to feel everyone out on a standard for required communication for auditors with the audit committees.
As Emily Chasan of Reuters notes, “The PCAOB has considered issuing rules on this issue for the past several years to formalize ways that auditors are expected to communicate with the audit committee of the company they are auditing,” but in classic reactionary fashion, nothing has been done up to this point. Now that we’ve had bankruptcy reports, recycled stories in the press, E&Y hating back the haters, and everything else in this shitstorm, the PCAOB is ready to talk about this.
So, if you’ve got no plans on Monday morning and happen to be in DC, head over to hear the discussion and throw in your $0.02. In the meantime, we’d love to hear some of your suggestions for mandatory talking points from the serious (e.g. accounting treatment that makes the partner even slightly queasy) to the über-ridiculous (e.g. biggest whore on the audit team).