@Going Concern “Do Prospective Inspections of Broker-Dealer Auditors Present An Opportunity?”
By Francine • Jul 16th, 2010 • Category: Writing for OthersMy new column is up @Going Concern:
“It looks to me that more very small firms will register with the PCAOB because they are auditing non-public broker-dealers and the PCAOB may or may not be ready to inspect them well or on a timely basis. What’s the point of registering all these firms if the firms will not be inspected soon and are surely not ready to be inspected by the PCAOB?
Maybe the PCAOB can develop a pre-qualification for firms that register to do broker-dealer audits. They may be doing the audits now but are they really ready to do it at the nationally regulated level? Maybe the “nickel and dime” small firms should be taken out of the game before we raise expectations that these firms are now being monitored.
It’s going to be hard enough to effectively inspect the large audit firms who audit the broker-dealer piece of large issuers under these new rules. Even the big firms have trouble catching problems in these areas as evidenced by PwC’s £16bn miss at J.P. Morgan in the UK.
There’s nothing worse than the appearance of regulatory infrastructure and enforcement without the consistent and forceful execution of that regulatory mandate…”
Read the rest here.
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Francine McKenna (@retheauditors) has more than twenty years of experience in consulting and professional services including tenure at two Big 4 firms, both in the US and abroad. For more info, click the "About" page link at the bottom of this page.
[...] It was great to see that the Dodd-Frank bill addressed a couple of key PCAOB issues. The bill facilitates the PCAOB’s ability to share information with foreign auditor oversight authorities and closes gaps in the Board’s authority to oversee audits of brokers and dealers. However, the regulatory oversight of broker-dealers may turn out to be a pantomime horse. [...]