The Public Company Accounting Oversight Board (PCAOB) fined five consultancies, including Ernst & Young (EY), as the agency continues its crackdown on firms violating audit committee communications rules and reporting requirements.
Public company auditors are required to provide certain reports to their audit committees but four firms failed to do so, the PCAOB said in a press release Tuesday. The agency began shining a light on audit committee communications in July 2023, and has now sanctioned a total of 17 firms.
The firms in the recent sweep agreed to take steps to come into compliance with PCAOB rules and pay the following penalties:
- EY will pay a $45,000 fine;
- Accell Audit & Compliance will pay a $40,000 fine; and
- Crowe MacKay and Grant Thornton were each fined $30,000.
Crowe and Grant Thornton also allegedly failed to document audit committee pre-approval of certain services, and Accell allegedly failed to communicate all material weaknesses in writing.
An additional firm, Halpern & Associates, was fined for allegedly not reporting to the agency for a period of more than two years about a disciplinary action taken against it by the Securities and Exchange Commission. It agreed to pay $20,000.
“This latest round of orders shows that firms cannot neglect their responsibilities to keep audit committees informed and report required information to the PCAOB,” said Robert Rice, director of the PCAOB’s Division of Enforcement and Investigations, in the release.
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