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It’s Ridiculous to Think That Enterprise Financial Dismissed KPMG Because of the Restatements
KPMG has been kicked to the curb by Enterprise Financial according to an 8-K that was filed on Friday by the company. The ubiquitous claim of “no disagreements with [insert firm]” was there along with a mention of a material weakness that was related to the restatements issued for both 2008 and 2007 but that couldn’t possibly have anything to do with the dismissal of the auditors:
In connection with the identification of the loan participation accounting error described in Item 7, Management Discussion & Analysis and in Item 8, Note 2 of the consolidated financial statements and elsewhere in the Form 10K dated March 16, 2010, the Company also determined that a material weakness in its internal controls over financial reporting existed during the periods affected by the error, including as of December 31, 2008. The Company’s management concluded that the material weakness was the Company’s lack of a formal process to periodically review existing contracts and agreements with continuing accounting significance. To remediate this material weakness, during the fourth quarter of 2009 the Company implemented a formal process to review all contracts and agreements with continuing accounting significance on an annual basis. As a result of the review conducted in the fourth quarter, management did not identify any other errors in its previous accounting for such contracts or agreements. Management believes that this new process has remediated the material weakness in the Company’s internal control over financial reporting.
So in other words, “Yeah, maybe we should have been looking at these contracts but we weren’t and so some material misstatements slid through. We’ve slapped some duct tape on it and it’ll be fine from here on it. End of story.”
The esteemed pleasure of auditing Enterprise now belongs to Deloitte who has now snagged three clients from KPMG this year (by our count) – picking up Jefferies and Select Comfort back in March.
Enterprise Bank parent dismisses KPMG [St. Louis Business Journal]
Rhode Island Just Can’t Quit Deloitte
And all it took was an apology for Rhode Island to fall back in love […]
Did Ohio State Dump Deloitte for PwC Over Colors?
Sounds like CFO Geoff Chatas and state auditor Dave Yost wanted to figure a way around a 15-year limit but it was to no avail, “Ohio State CFO Geoff Chatas said Yost discussed with him the possibility of letting Ohio State be the first to stick with the same audit firm, but the school opted to put the contract out for bid.”
A likely story. If you ask me, this has everything to do with the fact that Deloitte’s main color is blue while PwC has opted for slightly more appropriate hues.