EY report: Fortune 100 companies boost audit transparency, including on ESG
Many Fortune 100 companies continue to enhance their transparency about how their audit committees are executing their core responsibilities, according to the EY Center for Board Matters’ 10th annual review of voluntary proxy statement disclosures.
SEC executive pay clawback rule primed for ‘significant opposition’
The SEC is poised to pass an executive compensation rule that would require public companies to claw back incentive-based compensation if their finances are restated within the previous three years. Experts expect pushback to the proposed mandate.
Compliance Week National Conference is going back in person in May
Mark your calendars: Compliance Week’s National Conference in Washington, D.C. will be held in person for the first time in nearly three years from May 16-18, 2022.
PCAOB 2020 inspections preview: Deficiencies still high, although some improvements
The Public Company Accounting Oversight Board noted a high number of recurring deficiencies in its audits reviewed despite improvements over the previous year as part of its 2020 inspection observations spotlight.
FRC launches probe of BDO over NMCN audit
The Financial Reporting Council announced the launch of an investigation into BDO in relation to its audit of U.K. construction and engineering company NMCN, which filed for administration earlier this month.
Real estate rationalization programs on rise amid COVID
As the COVID-19 pandemic continues and businesses make strategic changes in response, one of the primary areas of focus is managing where employees will work and evaluating real estate portfolios.
Former Poseidon executive pleads guilty in securities fraud case
A former executive of U.S. operations at Canadian oil services company Poseidon Concepts pleaded guilty to perpetrating a scheme to fraudulently inflate the company’s reported revenue, resulting in more than $886 million in shareholder losses.
KPMG rapped for ‘untruthful defense’ in Silentnight investigation
KPMG and one of its former partners were found to be “untruthful” during an independent tribunal’s investigation into the audit firm’s advisory role regarding the sale of mattress company Silentnight to private equity firm HIG Capital.
Fed increasing LIBOR scrutiny as finish line nears
Financial institutions’ transition efforts away from the London Interbank Offered Rate will be intensely scrutinized by the Federal Reserve as the expiration deadline of the benchmark interest rate looms.
FRC investigating Mazars over French Connection audit
The U.K. Financial Reporting Council has begun an investigation into Mazars concerning its audit of financially ailing retail company French Connection Group, which has just been sold.
FRC probing Crowe over Akazoo audit
The U.K. Financial Reporting Council announced the start of an investigation into audit firm Crowe UK concerning the financial statements of Luxembourg-incorporated on-demand music streaming subscription company Akazoo.
PCAOB fines Deloitte Canada $350K for quality control failures
The Public Company Accounting Oversight Board imposed a $350,000 civil penalty on Deloitte Canada for reasonable assurance quality control failures regarding an electronic work paper system update.
Grant Thornton UK fined $3.2M for Patisserie Valerie audit lapses
Grant Thornton UK has been fined £2.34 million (U.S. $3.2 million) by the Financial Reporting Council for failures in its audits of collapsed café chain Patisserie Valerie between 2015 and 2017.
PCAOB penalizes EY partners for Synchronoss audit deficiencies
The PCAOB fined two EY partners for “failing to perform adequate procedures and obtain sufficient evidence” in connection with the Big Four firm’s audit of New Jersey software company Synchronoss Technologies.
Big Four mishaps in U.K. underscore need to challenge auditors
Companies should question their auditors throughout the audit process, particularly in the wake of a spate of recent enforcement actions in the United Kingdom targeting the Big Four and other large firms for audit deficiencies.
CPE Webcast: Why compliance & audit should support modern accounting
Traditional, manual accounting is not sustainable, and it can have negative downstream effects for compliance and audit teams. To modernize the way companies work, organizations must automate the manual, mundane processes that are holding them back.
FASB proposal seeks to clarify fair value standard
The Financial Accounting Standards Board issued a proposed update to Topic 820 that seeks to establish that a contractual restriction on the sale of an equity security should not be considered in measuring fair value.
KPMG Australia fined $450K over training test cheating
The Public Company Accounting Oversight Board announced a $450,000 fine against KPMG’s Australian subsidiary to resolve allegations of widespread cheating on personnel training tests at the firm.
CAQ report: Climate-related risk considerations in audited financial statements
A recent Center for Audit Quality report aims to provide an understanding of how company management and their auditors apply current U.S. accounting and auditing requirements for financial statements related to climate-related risks.
ESG matters have financial reporting implications now
While the possibility of SEC regulation mandating additional ESG disclosures remains a hot topic, the potential effects of ESG matters on a company’s financial accounting and reporting are not a future consideration.
Study: How COVID-19 has affected public company financials
Disruptions to normal operations and shifts in work environments as a result of the COVID-19 pandemic caused an increase in late filings and changes to controls, according to new research from Audit Analytics.
CPE Webcast: Emerging trends from Deloitte’s global TPRM survey 2021
Join ProcessUnity and Deloitte’s leading third-party risk practitioners as they explore key findings from Deloitte’s 2021 Global TPRM Survey. You will hear what organizations are doing in the wake of last year’s pandemic to make advancements in their approach to third-party risk.
Ex-Cavco Industries CCO charged with accounting control failures
The former CFO and chief compliance officer of Cavco Industries has been charged by the SEC with internal accounting control failures and for misleading the company’s auditor regarding an insider trading matter.
SEC fines telecom Pareteum $500K for overstating revenue
New York City-based telecom Pareteum Corp. will pay $500,000 to settle SEC charges it committed fraud by overstating its revenue by approximately $42 million over six quarters and providing false information to auditors.
Kraft Heinz fined $62M in SEC accounting probe
Kraft Heinz agreed to pay $62 million as part of a settlement with the SEC for improper accounting that led to the restatement of several years of financial reporting.
Study: Auditor assurance over ESG reporting still in early stages
Despite an increase in ESG disclosures that is expected to continue, a significantly low number of public companies have obtained audit firm assurance regarding that reporting, according to a new study.
SEC charges CCO for role in TMG fraud scheme
Steven Wolfe, the former chief compliance officer of investment adviser Tellone Management Group, has been charged by the SEC for his role in a fraudulent scheme to hide information from investors.
FRC: KPMG provided ‘false’ info in Carillion, Regenersis audit inspections
The U.K. Financial Reporting Council issued a disciplinary formal complaint against KPMG for allegedly providing “false and misleading” information during inspections into the Big Four firm’s audits of Carillion and Regenersis.
U.K. audit breakup plan hits snag without Big Four support
The Big Four audit firms have refused to back a U.K. government plan to break their dominance of the market by forcing them to share work with smaller competitors to give them a foothold.
Changing accounting standards driving financial process remediations
In response to new standards affecting leases, revenue recognition, and credit losses, public companies have significantly changed their financial processes in the past year and are not done yet, according to data from Deloitte.
EY fined $3M in U.K. for Stagecoach audit failings
The U.K. Financial Reporting Council ordered EY to pay a reduced fine of £2.2 million (U.S. $3 million) related to its audits of international transport company Stagecoach Group for the 2017 financial year.
SEC fines Healthcare Services Group $6M over contingency reporting lapses
Healthcare Services Group agreed to pay $6 million as part of a settlement with the Securities and Exchange Commission for contingency reporting failures that led to accounting and disclosure violations.
Two PCAOB members resign ahead of SEC overhaul
Rebekah Goshorn Jurata and Megan Zietsman have announced they will resign, meaning the PCAOB could soon be left with one active member ahead of SEC plans to clean house at the audit regulator.
One-on-one with Richard Jones: What lies ahead at FASB
A year into the job, FASB Chair Richard Jones catches up with Compliance Week regarding recent improvements to major accounting standards, ongoing projects, future topics of interest, and more.
Ex-Domino’s accountant settles insider trading charges
A former accountant at pizza chain Domino’s has agreed to pay $68,360 to settle charges of insider trading brought by the Securities and Exchange Commission.
KPMG fined $18M for ‘integrity and objectivity’ breaches in Silentnight sale
The Financial Reporting Council ordered KPMG to pay a £13 million (U.S. $18 million) fine for “breaches of the principles of integrity and objectivity” in its advisory role regarding the 2011 sale of mattress company Silentnight to U.S. private equity firm HIG Capital.
SEC seeks more risk disclosures from China-based companies
The SEC will require China-based public companies listed on U.S. exchanges to make more disclosures about the financial risks posed by potential interference in their operations by the Chinese government.
EY fined $10M for independence violations in Sealed Air engagement
EY has agreed to pay $10 million as part of a settlement with the SEC related to charges of auditor independence misconduct perpetrated by several partners of the Big Four firm to secure Sealed Air as a client.
Ex-KPMG partners barred by SEC over cheating scandal roles
David Britt and Thomas Whittle have been indefinitely barred from practicing as accountants before the Securities and Exchange Commission for their roles in the KPMG cheating scandal.
Three ideas to improve the whistleblowing process
It’s important to take stock of how far whistleblowing has advanced over the last few years. That said, there is still room for improvement. Aaron Nicodemus offers three suggestions.
Part 5: Waiting for payout a grueling test of tenacity for whistleblowers
The road to a payout for whistleblowers is long, lonely, and full of obstacles. Commitment to the idea that they are doing the right thing helped our whistleblower subjects endure years of hardship to bring their cases to conclusion.
Part 4: Retaliation pervades while whistleblowers persevere
Retaliation for blowing the whistle comes in all kinds of forms. Our whistleblower subjects share their stories—from losing jobs to getting blacklisted to being the target of a newspaper hit piece.
Part 3: Blowing the whistle weighs uncertainty against moral duty
Once someone decides to blow the whistle, their life is forever changed. Their action stands to benefit many people they don’t even know while putting much in jeopardy on a personal level. Our whistleblower subjects each explain what led them to their determinations.
Part 2: Internal reporting sends whistleblowers down path alone
Almost no one becomes a whistleblower by choice. A slow and steady whittling down of options often leads individuals to isolation in coming to their decision. Our whistleblower subjects share the roadblocks they faced in reporting internally.
What companies (and the SEC) can learn from U.K. ESG reporting guidance
The U.K. Financial Reporting Council has proposed a series of measures from which companies—as well as other regulators like the SEC—could benefit as ESG disclosures receive closer scrutiny.
Part 1: Finding the fraud launches whistleblowers on life-changing journey
Whistleblowers aren’t born—they’re made. For five individuals that have taken on that mantle, the story began with discovering a problem that could no longer be ignored.
FRC 2020/21 audit inspections: KPMG rebuked over continued struggles
The U.K. Financial Reporting Council released the results of its 2020/21 audit quality inspections, in which it singled out KPMG for “unacceptable” deficiencies regarding the firm’s audits of banks and similar entities.
ICFR failures cost Tandy Leather in SEC settlement
Tandy Leather Factory and its former CEO have agreed to pay a total of $225,000 as part of a settlement with the SEC to resolve charges of inaccurate financial reporting caused by a faulty inventory tracking system.
FASB issues standard update for variable lease payments
The Financial Accounting Standards Board finalized an update to its leases standard targeting sales-type leases with variable lease payments.
Former FTE Networks CEO, CFO charged with accounting fraud
The former chief executive officer and chief financial officer of telecommunications company FTE Networks were arrested and charged with accounting fraud among a series of other alleged crimes.