Where a Big 4 firm has a problem with an audit, it probably also involves a deficiency in the audit of internal control over financial reporting.
Big 4 firms exhibited problems in 35 percent of all audit engagements inspected in 2014, and a whopping 84 percent of those deficient audits involved problems with internal control over financial reporting, according to an analysis by Dan Goelzer, a former member and acting chair of the Public Company Accounting Oversight Board. The analysis shows the PCAOB found fault with slightly fewer Big 4 engagements in 2014 compared with 2013, but the share that also involved problems with the internal control audit was even higher at 89 percent.
