EY Hasn’t Finished That Independent Review Into Procedures to Prevent Another Cheating Scandal
TL;DR: After getting fined by the SEC for cheating on CPE and ethics exams in June 2022, an independent consultant review into EY’s testing procedures was supposed to be completed by March. It was not and the SEC has granted the consultants more time to get it done. As you may recall, last June the […]
A Bunch of Auditors at RSM F*cked Up
Today in Auditors Not Doing Their Jobs, the SEC has charged RSM, three senior-level employees who work there, and a couple partners with improper professional conduct for failing to properly audit Revolution Lighting Technologies Inc.’s financial statements over a four-year period when Revolution was violating accounting principles by inflating revenue with bill and hold sales. […]
The Talent Shortage Has Gotten So Bad Clients Are Now Doing Their Own Audit Documentation
The Securities and Exchange Commission has charged Deloitte China with failing to comply with fundamental U.S. auditing requirements because in numerous audits over numerous years Deloitte China asked clients to select their own samples for testing and to prepare their own audit documentation. From the SEC press release: The Securities and Exchange Commission today charged […]
How Exactly Did EY Auditors Cheat on CPE Exams? Details From the SEC Order
With the EY cheating scandal making headlines even outside of our precious little accountosphere we decided to take a look at the full SEC order to answer the question — how and why were EY auditors cheating on CPE exams? This post will be long so we’ll get deeper into the CPA ethics portion of […]
A Few EY Partners Didn’t Get the Auditor Independence Rules Right
The SEC on Dec. 10 decided that two EY partners and one principal didn’t take the auditor independence rules seriously and doled out a few fines and sanctions. And like many of these auditor independence violations that get firms in hot water with the SEC or the PCAOB, the flagrant rules bending by EY had […]
EY Learns the Hard Way Not to Screw Around with the SEC’s Auditor Independence Rules
Back on Aug. 12, 2019, Bubble Wrap maker Sealed Air Corp. disclosed in an 8-K that it had fired EY as its “independent” registered public accounting firm and stated that it had hired PwC. OK, no biggie, the auditor carousel is always going round and round in the Big 4. But the most interesting tidbit […]
Two of the ‘KPMG 5’ Barred By the SEC Indefinitely For Being Dirty Cheaters
Ex-KPMG partners David Britt and Thomas Whittle were told by the SEC on Wednesday that their accounting privileges were being taken away for a long time because of their involvement in a multiyear scheme with three other KPMGers to steal regulatory information from the PCAOB to cheat on audit inspections. The administrative proceeding orders released […]
Two Ex-KPMG Auditors Were Told By the SEC to Have a Seat On the Sidelines For a While
Two former KPMG auditors who worked on the ill-fated audit of a not-for-profit college agreed to having their wrists slapped by the SEC for their roles in the school’s collapse: The Securities and Exchange Commission today suspended two former KPMG auditors [Christopher Stanley and Jennifer Stewart] from practicing before the SEC in connection with settled […]
Your Naughty Corporate Controller of the Day
Edward Kelly has been suspended from appearing or practicing before the SEC as an accountant because he got caught insider trading. You can read the SEC order from Feb. 16 here. But the blog SEC Actions put together a nice little synopsis of the case against Kelly: Now the agency has brought an insider trading […]
Three Former KPMG Partners Charged by SEC For Being Dirty, Dirty Cheaters
Just when KPMG thought maybe everyone had forgotten about that whole cheating scandal debacle, the SEC announced Monday it settled charges with three more dirty cheaters who once called the firm home. The Securities and Exchange Commission today announced settled charges against three former KPMG LLP audit partners for improperly sharing answers to internal training exams […]
SEC Takes Away Privileges From Another Felon In KPMG/PCAOB Scandal
David Middendorf’s trial buddy, Jeffrey Wada, the now-former PCAOB inspections leader who fed confidential information about upcoming audit inspections to some folks at KPMG, including Middendorf, in the hopes of landing a job at the Big 4 firm, is now prohibited from appearing or practicing before the Securities and Exchange Commission as an accountant. Wada’s […]
Convicted Ex-KPMG Partner David Middendorf Suspended By the SEC
Another “KPMG 5” executive who will be serving prison time for his role in a scheme to steal confidential audit inspection lists from the PCAOB was suspended today from appearing or practicing before the Securities and Exchange Commission as an accountant. The SEC released the following two-page order of suspension against David Middendorf, former national […]
Jailed Ex-KPMG Executive Director Barred By the SEC Because Why Not?
Cynthia Holder, one of the “KPMG 5” who was sentenced to eight months in federal prison in August for her role in a scheme to steal confidential audit inspection information from the PCAOB, was “denied the privilege” of appearing or practicing before the SEC as an accountant, the commission announced on Nov. 29. The SEC […]
As a Result of Breaking SEC Rules, Deloitte Japan Is $2 Million Lighter In the Wallet
There was some bad decision-making going on at Deloitte Touche Tohmatsu in Japan. Dozens of its employees had bank accounts at the subsidiary of a client for which Deloitte Japan issued audit reports, which is a no-no because Securities and Exchange Commission rules don’t allow accountants to have bank accounts with audit clients that have […]
New Year’s Eve Was Kind of a Bummer for Hertz
Man, I hope executives at Hertz got shitfaced on New Year’s Eve, because being told the company has to pay a $16 million civil penalty to the Securities and Exchange Commission to settle a case involving numerous accounting violations is not a stellar way to end 2018/begin 2019. An SEC cease-and-desist order filed on Dec. […]
SEC Fines Company for Failing to Mention That They Paid for CEO’s Lavish Perks (and Some Non-GAAP Stuff, Too)
Normally I'd reserve mis-adventures in non-GAAP accounting for the news roundup, but it's not every day that an SEC order includes this: MDCA is New York-based marketing company MDC Partners and gosh, how do you fail to disclose the cosmetic surgery? Everything else is pretty standard fare as far as extravagant perks go, but if […]
Fake Occupants Caused Some Some Problems in Grant Thornton’s Audit of Assisted Living Concepts
The SEC announced a settlement with Grant Thornton and two partners today over some bad audits that went down in America's Dairyland. The firm will pay $3 million in fines, plus forfeit $1.5 million in audit fees with interest. The partners, Melissa Koeppel and Jeffrey Robinson agreed to a $10k fine and a 5-year ban and $2.5k and 2-year ban, respectively.
The Numbers Literally Didn’t Add Up In This Latest Case of Atrocious Auditing
On Friday we discussed a Florida CPA's bad auditing. Later that same day, the SEC issued a press release that told us about more bad auditing and I think you'll appreciate just how bad it is, so I'll share this one, too. This time around, we have a scam run by a Canadian lawyer and […]
Florida CPA’s Audits Didn’t Audit Much
This week in incredibly bad auditing, we have Terry L. Johnson of Casselberry, Florida. And if you like devouring stories of grossly deficient audits and Florida men doing ridiculous things, then this should satisfy your appetite. Let me just tell you first that some form of the words "so deficient that they amounted to no […]