December 6, 2021

internal controls are hard and stuff

Thumbs down BDO LLP

BDO USA’s Auditing Is Still Ass, According to 2020 PCAOB Inspection Report

When the PCAOB gave a preview of its first batch of COVID-era inspection reports for annually inspected public accounting firms in October, the audit cops said: For the majority of the annually inspected audit firms, we identified fewer findings in 2020 compared to our 2019 inspections. Notice how the PCAOB used the word “majority” and […]

PCAOB Inspection Report Day Is No Longer An Embarrassment For Grant Thornton

Once the laughingstock of the firms annually inspected by the PCAOB (and of us at Going Concern HQ), Grant Thornton has recently shown it has really gotten the hang of this thing called auditing. It really is a surprising turnaround for a firm that had epically bad PCAOB inspection reports for 2011 (43% deficiency rate), […]

You Know the World Is Getting Back to Normal When KPMG Has the Worst PCAOB Inspection Report of the Big 4

When the PCAOB released its first batch of 2019 inspection reports earlier this year, there was one outcome that left us at Going Concern HQ feeling like we were living in some auditing bizarro world: PwC had a worse audit failure rate (30%) than KPMG (29%). It’s rare when KPMG doesn’t have the worst PCAOB […]

ey orlando

EY Pats Itself On the Back For Not Blowing As Many Audits As Before

Last month the PCAOB teased the results of its 2020 inspection reports by saying audit firms were getting better at not being awful at auditing. From the PCAOB’s Staff Update and Preview of 2020 Inspection Observations: For the majority of the annually inspected audit firms, we identified fewer findings in 2020 compared to our 2019 […]

Deloitte Came Oh So Close to Having a Historically Low Audit Deficiency Rate

If it was any other year, champions of audit quality would be throwing Deloitte a ticker-tape parade for only having two glaring errors out of 53 audits inspected in the firm’s newly released 2020 PCAOB inspection report. But it was PwC auditors who were the ones pulling ticker-tape out of their hair while Deloitte was […]

It’s True: PwC Had a Nearly Flawless 2020 PCAOB Inspection Report

The PCAOB blessed us this morning with its first batch of 2020 inspection reports, which included BDO USA, Deloitte, EY, Grant Thornton, KPMG, and the highly anticipated one for PwC. Back in August PwC released its 2021 audit quality report, which included a lot of bragging about how much more competent P. Dubs’ auditors have […]

The Truth About Public Accounting, Part III: The ‘A’ In PCAOB Stands For ‘Accounting’

An article titled “PCAOB Inspections: Public Accounting Firms on Trial” describes the results from an academic study and survey about the effects on auditors who have been subject to PCAOB inspections. One of many good observations from that academic study is repeated below: Respondents collectively perceive that audit quality has improved as a result of […]

Here Are Two Contenders For the Biggest Turd of a 2019 PCAOB Inspection Report

Significantly screwing up half of your audits inspected by the PCAOB won’t get your firm included in the pantheon of worst PCAOB inspection reports of all time. RSM US beat that handily in 2017. BDO USA has had audit failure rates of 74% (2014), 67% (2016), and 65% (2013). Grant Thornton did a horrible job […]

Grant Thornton Auditors Are Just Showing Off Now

It’s fair to say Grant Thornton auditors are no longer on the struggle bus. From 2010 to 2015, the Purple Rose of Chicago had an average audit failure rate of 44% in its PCAOB inspection reports during that time frame, including a whopping 65% worth of screw-ups in the firm’s 2012 report, which gave GT […]

Thumbs down BDO LLP

Those Who Know, Know BDO … Is Consistently Terrible At Auditing

Here’s a number of the day for ya: 50.7%. That is the average failure rate of BDO USA audits in PCAOB inspection reports from 2010 to its most recent 2019 report, in which PCAOB inspectors found significant errors in 42% of audits reviewed. Public accounting firms that have been historically bad at auditing, like Grant […]

How Did RSM US Fare On Its Latest Auditing Report Card From the PCAOB?

Not too long ago, RSM US had one of the worst PCAOB inspection reports we’ve ever seen. How bad was RSM’s audit quality? R-E-A-L bad. The number in the red is … well … not a good number. That would be the number of audits the PCAOB inspected that had problems so big that the […]

KPMG Rocks signs held by a woman in a KPMG shirt

LOL, PwC: For Once, KPMG Doesn’t Have the Worst Audit Failure Rate Among the Big 4

Because it’s #TriviaTuesday, here are a couple of questions regarding PCAOB inspection reports: When was the last time KPMG did not have the worst audit deficiency rate among the Big 4? When was the last time KPMG had a lower deficiency rate than PwC? The answer to the first question is 2013’s inspection reports, when […]

EY Isn’t Botching As Many Audits These Days, According to Latest PCAOB Inspection Report

The Big 4 firm behind the most boring TV ad during Super Bowl LV last night has shown improvements in audit quality in its last two PCAOB inspection reports. Some may say that EY having a former PCAOB member on its Independent Audit Quality Committee is why the number of EY audits with deficiencies is […]

Deloitte Is Doing a Much Better Job Lately of Not Screwing Up Audits

While PwC waits with bated breath for the PCAOB to release the firm’s 2020 inspection report so it can presumably take an audit quality victory lap around the other Big 4 firms, Deloitte can at least say it has had the lowest audit failure rates among the Big 4 the past three years. For the […]

For Now, PwC’s Audit Quality Stinks

In Footnotes last Friday, we highlighted a recent Accounting Today article about PwC finally taking audit quality seriously what measures PwC is taking to improve audit quality. In the article, Wes Bricker, PwC’s U.S. assurance leader and former SEC chief accountant, dropped a bomb—a Bricker bomb, if you will—about the most recent PCAOB inspections cycle: […]

RSM US’s 2018 PCAOB Inspection Report Is a Lot Less Deplorable Than the Last One

When you talk about the worst PCAOB inspection reports of all time, the 2017 one for RSM US has to be in the conversation. During that inspection cycle, the PCAOB found significant problems in 11 of the 15 RSM audits selected, for a dubious deficiency rate of 73%. The other day, the newly branded PCAOB […]

KPMG Rocks signs held by a woman in a KPMG shirt

At Least KPMG Won’t Have the Worst 2018 PCAOB Inspection Report

We’ve finally reached the end of the six-pack of 2018 inspection reports released by the PCAOB on June 1. And we saved our favorite four-letter Big 4 firm for last. Among the Big 4, KPMG’s inspection reports have been the most abysmal. Since 2010, Deloitte, PwC, and EY have not had an audit deficiency rate […]

BDO USA Auditors Are Still Riding On the Struggle Bus, Latest PCAOB Inspection Report Reveals

People who know, know BDO USA has had some of the suckiest audit inspection reports recently among the firms that are annually inspected by the PCAOB. From 2012 to 2017, an average of 59% of BDO audits inspected by the PCAOB had significant errors. Yeesh. Things were sorta looking better when the PCAOB released BDO’s […]

EY’s Auditing Is Not As Sad As It Used to Be, Per 2018 PCAOB Inspection Report

It’s kinda sad, really, that we don’t bat an eye when the top audit firms in the world, the ones that are supposed to be the gold standard of the profession, still significantly screw up one-fourth of their audits of public companies that are inspected by the PCAOB. Why? Because the number of audits with […]

PwC’s Latest PCAOB Inspection Report Is Fairly Unspectacular, Part II

Let’s keep plowing through this pile of 2018 PCAOB inspection reports and take a look at how PwC auditors did during the 2017 inspection season. PwC auditors haven’t had a lot of great press lately: we had the Mattel accounting cover-up; Brandon Sprankle spectacularly violating independence rules, resulting in PwC being fined $7.9 million by […]

Grant Thornton’s 2018 PCAOB Inspection Report Is Not As Good As 2017’s, Not As Bad As 2012’s

Monday morning we got an email that the PCAOB had dropped six 2018 inspection reports on us—the Big 4 firms, Grant Thornton, and BDO USA—so everyone’s favorite audit cops could show off their new snazzy inspection report format. This might have been the largest one-day release of reports of firms that are inspected annually by […]

Deloitte’s 2018 PCAOB Inspection Report Shows They’ve Gotten a Lot Better At This Thing Called Auditing

So the PCAOB did a thing today. Everyone’s favorite audit regulator released the 2018 inspection reports for the Big 4, Grant Thornton, and BDO USA this morning in a “new user-friendly format.” And they’re actually pretty sleek-looking and informative. A couple years ago, Caleb called PCAOB inspection reports “beach reads” because executive summaries had been […]

Let’s Give a Big Hand to BDO For Not Having the Worst 2017 PCAOB Inspection Report

The PCAOB released the 2017 inspection report for BDO USA at the end of June, and while the firm should still hang its collective heads in shame for there being deficiencies found in nine of the 23 audits inspected in 2016, for a 39% failure rate, there are a few positive things that Bravo Delta […]

PwC’s Latest PCAOB Inspection Report Is Fairly Unspectacular

So far among the top seven firms in the U.S., the PCAOB has released 2017 inspections reports for five: one was god-awful (RSM US), one was horrible (KPMG), one was pretty, dare I say, good (Deloitte), and one was dynamic (Grant Thornton). PwC’s inspection report would probably fall on the “good” side (if you consider […]

Shocked monkeys

Grant Thornton Surprises Everyone By Not Sucking at Auditing

Grant Thornton gets a bad rap around here, much of which is kinda justified to be fair. They’re sort of like your annoying little brother who always wants to come with you to hang out with your friends but he smells like curdled milk and always has crusty gunk on the corners of his mouth. […]

Meddling Inspectors

The PCAOB Needs to Just Beat the Sh*t Out of KPMG Already

Story time. Many, many years ago when my favorite show was the Snorks and my Big Wheel was my only mode of transportation, there was this kid on my block who was a real little shit. He constantly broke everyone’s toys and once ran over my plastic Good Luck Bear with his bike, permanently rendering […]

Deloitte sign

Deloitte’s 2017 PCAOB Inspection Report Is Pretty Not Shitty

You know, when I sat down to start writing this, I contemplated some clever headline, perhaps something about a veritable smorgasbord of audit screw-ups, but then I was like, you know what, nah. We should recognize that Deloitte has posted its lowest audit deficiency rate ever, which is something worth applauding even if the fuck-up rate […]