Accounting & Auditing


KPMG

KPMG fined $4.1M for Conviviality audit failings, reaches settlement regarding Regenersis

2022-01-19T20:59:00+00:00By

The U.K. Financial Reporting Council announced sanctions against KPMG regarding its audits at now-collapsed alcohol retailer Conviviality, in addition to a settlement with the Big Four firm concerning its work at software company Regenersis.

PwCcrop

FRC expands probe of PwC’s Babcock International audits

2022-01-18T20:35:00+00:00By

The U.K. Financial Reporting Council has expanded its investigation into PwC over its statutory audits of British defense contractor Babcock International Group to include the fiscal years ended March 31, 2019, and March 31, 2020.

PCAOB

Erica Williams sworn in as PCAOB chair

2022-01-11T20:32:00+00:00By

Erica Williams assumes leadership of a newly reconstituted Public Company Accounting Oversight Board that can count implementation of the Holding Foreign Companies Accountable Act among its top priorities.

Magnifying glass

S&T AG orders Deloitte audit of short seller allegations

2021-12-28T18:37:00+00:00By

Austrian technology company S&T AG has ordered a forensic audit of its corporate structure and several recent acquisitions in response to allegations made by short seller Viceroy Research.

Documents

Should lawyers, accountants be filing more SARs?

2021-12-28T14:32:00+00:00By Jason Morris, International Compliance Association

A study of suspicious activity reporting data in the United Kingdom suggests accountants, lawyers, estate agents, and other service-facing professionals could be doing more to contribute to the fight against financial crime.

AuditTech

ISACA issues audit resources on SOX, VPNs, agile auditing

2021-12-23T15:46:00+00:00By

The ISACA, an international professional association focused on IT governance, released three new resources designed to assist audit professionals in enhancing their skills to meet the needs of the evolving audit landscape.

AccountingUpdateFeature

FASB proposal sets disclosure requirements for supplier finance programs

2021-12-22T15:00:00+00:00By

The Financial Accounting Standards Board issued a proposed update to its liabilities standard setting disclosure expectations for supplier finance programs.

AuditInspectionFeature

Cybersecurity trends continue in 2021 audit committee transparency report

2021-12-20T19:17:00+00:00By

The most dramatic increase in audit committee disclosures in proxy statements for the second consecutive year was in responsibility for cybersecurity risk oversight, according to the latest report from the Center for Audit Quality and Audit Analytics.

Accountingbestpractices

Report: Restatements drop to record low in 2020

2021-12-14T20:07:00+00:00By

Financial statement restatements by public companies declined in 2020 to their lowest level in 20 years, according to the latest Audit Analytics study.

WEX

WEX fined $350K over ICFR weaknesses

2021-12-13T19:32:00+00:00By

Financial technology service provider WEX agreed to pay $350,000 as part of a settlement with the SEC regarding violations of internal accounting control provisions in the federal securities laws at its former Brazilian subsidiary.

EY

SEC charges 3 EY employees with auditor independence violations

2021-12-13T18:04:00+00:00By

The Securities and Exchange Commission charged three Ernst & Young employees for violations of the agency’s auditor independence rules regarding services carried out at Cintas Corp. A former accountant at Cintas was also charged.

blackline 300x200

CPE Webcast: A crash course to achieving a seamless audit process

2021-12-09T14:00:00+00:00Provided by

Company management and their auditors might not see eye to eye on everything. But clients and their third-party examiners have the common goal of implementing strong controls that are performed and documented consistently.

Green accounting

FRC 2022 reviews to focus on climate risks, fraud

2021-12-08T18:42:00+00:00By

The U.K. Financial Reporting Council will prioritize climate-related financial disclosures in company accounts and climate risks in audits as key areas of supervisory focus for 2022/23.

Contract terms

SEC staff stresses importance of fallback language in LIBOR transition

2021-12-08T17:30:00+00:00By

Companies looking to avoid running afoul of the SEC in their LIBOR transition efforts would be wise to include fallback language in their contracts and investments that reference the soon-expiring benchmark rate.

Compliance_Fail_Main_Art

Top ethics and compliance failures of 2021

2021-12-07T13:00:00+00:00By

Systemic risk management lapses at a financial services firm, allegations of toxic culture at a video game giant, and more of the same baffling behavior from one of the world’s largest tech companies comprise CW’s list of the biggest ethics and compliance fails of 2021.

Dialysis machine

American Renal Associates to pay $2M in accounting fraud case

2021-12-06T22:26:00+00:00By

American Renal Associates Holdings has agreed to pay $2 million to settle Securities and Exchange Commission charges of accounting fraud allegedly perpetrated by three former financial executives at the dialysis provider.

Audit

What companies/auditors need to know for 2021 year-end audits

2021-12-06T13:00:00+00:00By

The continued effects of the pandemic, along with the implementation of new accounting standards, have companies and their auditors confronting substantial change in year-end audits.

Alcohol retail

FRC closes Conviviality accountant investigation; KPMG probe continues

2021-12-03T17:40:00+00:00By

The U.K. Financial Reporting Council announced the end of an investigation into an accountant that prepared and approved financial statements at collapsed alcohol retailer Conviviality.

Truckstock

Ex-Roadrunner CFO gets two years in prison for accounting fraud scheme

2021-12-02T22:31:00+00:00By

Peter Armbruster, the former chief financial officer of trucking and logistics company Roadrunner Transportation Systems, was sentenced to 24 months in prison for his role in a complex securities and accounting fraud scheme.

Sequential Brands

Sequential Brands avoids fine in SEC goodwill impairment case

2021-12-01T21:10:00+00:00By

Sequential Brands won’t be fined as part of a settlement with the SEC over charges it violated accounting principles in securities law when it did not acknowledge goodwill impairment that eventually landed on its balance sheet as a $304 million write-down.

Employee compensation

SEC updates guidance on ‘spring-loaded’ compensation awards

2021-11-29T21:45:00+00:00By

The Securities and Exchange Commission released new guidance for listed companies on how to properly recognize and disclose compensation costs for “spring-loaded” awards made to executives.

Accounting report

​FASB proposes CECL disclosure updates

2021-11-29T17:20:00+00:00By

The Financial Accounting Standards Board announced a proposed update aimed to enhance disclosures regarding troubled debt restructuring and gross writeoffs under its credit losses standard.

SECBooks

ProPetro avoids fine in executive perk case; ex-CEO to pay $195K

2021-11-23T21:28:00+00:00By

The former CEO of ProPetro Holding Corp. will pay $195,046 to settle SEC charges related to the company’s failure to disclose some of his executive perks and stock pledges to investors. ProPetro avoided a fine because of its remedial efforts.

Accounting

FRC report sets quality expectations for U.K. audit firms

2021-11-16T20:11:00+00:00By

The U.K. Financial Reporting Council published a blueprint for how it wants audit firms to perform to ensure they deliver high-quality audits.

Accounting trends

​FASB update improves discount rate guidance under leases standard

2021-11-15T16:14:00+00:00By

The Financial Accounting Standards Board issued an update to its leases standard regarding discount rate guidance for lessees that are not public business entities.

Stock data view

​FASB update provides expedient for valuing share-based awards

2021-11-11T21:09:00+00:00By

The Financial Accounting Standards Board has provided a practical expedient for private companies to reduce the complexity of determining the fair value of share-based awards.

Lease accounting

FASB passes on third leases delay

2021-11-10T23:42:00+00:00By

The Financial Accounting Standards Board declined providing private companies and certain not-for-profit organizations a third date delay to its leases standard, which is scheduled to take effect fiscal years beginning after Dec. 15, 2021.

Accounting

FASB proposes amendments to interim disclosure requirements

2021-11-09T15:57:00+00:00By

The Financial Accounting Standards Board proposed an update to its interim reporting standard as part of its disclosure framework project aimed at improving the clarity, consistency, and effectiveness of financial statement disclosures.

Five chair table

SEC appoints 4 to overhauled PCAOB; Erica Williams named chair

2021-11-08T22:34:00+00:00By

The SEC appointed Erica Williams to serve as chairperson of the newly overhauled PCAOB. Kara Stein, Christina Ho, and Anthony Thompson will join as new additions, while Acting Chair Duane DesParte will remain on as a board member.

China stocks

SEC approves rule establishing process for delisting foreign companies

2021-11-08T17:57:00+00:00By

The SEC approved a rule establishing the process for delisting foreign companies from U.S-based exchanges if they do not allow U.S. regulators to examine their finances.

PCAOB inspections 2020

PCAOB 2020 inspection reports: PwC bucks deficiency trend, dethrones Deloitte

2021-11-04T23:30:00+00:00By

PwC ended its three-year run of increasing deficiency percentages to boast the lowest rate among Big Four firms in the PCAOB’s 2020 inspection reports—the first time Deloitte hasn’t performed best since 2016.

Grant Thornton

Grant Thornton UK fined for ‘skepticism failures’ in Interserve audit

2021-11-01T20:07:00+00:00By

Grant Thornton UK received a “severe reprimand” and reduced penalty of £718,250 (U.S. $981,000) for breaches that arose in the context of audit work on the 2015-17 financial statements of now-collapsed construction firm Interserve.

AccountingUpdateFeature

FASB update addresses revenue recognition in business combinations

2021-10-29T17:37:00+01:00By

The Financial Accounting Standards Board announced an update to its business combinations standard aimed at clarifying how to apply requirements under its revenue recognition rule.

SECcrop

SEC: Akazoo to pay $38.8M in fraud case concerning SPAC merger

2021-10-28T18:02:00+01:00By

Akazoo, a music streaming subscription company based in Greece, reached a $38.8 million settlement with the SEC for allegedly defrauding investors out of tens of millions of dollars related to a 2019 SPAC merger.

Corporate reporting

FRC reporting review: COVID-19 disclosures lacking, new climate-related mandates

2021-10-28T17:42:00+01:00By

In its annual review of corporate reporting, the U.K. Financial Reporting Council found companies are struggling to provide stakeholders with enough detail about COVID-19 disruptions. The regulator also announced new requirements for climate-related disclosures.

AuditTransparency

EY report: Fortune 100 companies boost audit transparency, including on ESG

2021-10-26T20:13:00+01:00By

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.

Executive clawbacks

SEC executive pay clawback rule primed for ‘significant opposition’

2021-10-25T21:05:00+01:00By

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.

3x2 web graphic

Compliance Week National Conference is going back in person in May

2021-10-25T12:00:00+01:00By

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.

AuditResources

PCAOB 2020 inspections preview: Deficiencies still high, although some improvements

2021-10-22T16:35:00+01:00By

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.

BDO

FRC launches probe of BDO over NMCN audit

2021-10-21T18:42:00+01:00By

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 accounting

Real estate rationalization programs on rise amid COVID

2021-10-20T21:18:00+01:00By

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.

DOJ building

Former Poseidon executive pleads guilty in securities fraud case

2021-10-14T17:09:00+01:00By

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 building

KPMG rapped for ‘untruthful defense’ in Silentnight investigation

2021-10-13T16:33:00+01:00By

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.

Countdown clock

Fed increasing LIBOR scrutiny as finish line nears

2021-10-06T17:51:00+01:00By

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.

French Connection

FRC investigating Mazars over French Connection audit

2021-10-06T16:23:00+01:00By

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.

Accounting fraud

FRC probing Crowe over Akazoo audit

2021-10-04T17:02:00+01:00By

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.

Deloitte

PCAOB fines Deloitte Canada $350K for quality control failures

2021-10-01T17:23:00+01:00By

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

Grant Thornton UK fined $3.2M for Patisserie Valerie audit lapses

2021-09-27T19:30:00+01:00By

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.

EY

PCAOB penalizes EY partners for Synchronoss audit deficiencies

2021-09-23T18:37:00+01:00By

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.

Questioning

Big Four mishaps in U.K. underscore need to challenge auditors

2021-09-22T15:55:00+01:00By

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.