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How do the audit firms keep winning the war while losing battles left and right? They use the law and the courts to delay, deter and distract from transparency by settling, and sealing what they can, before the public can find out what silly arguments they often make in their defense.
Could the audit industry, which thrives on a government mandate that subsidizes an oligopolistic business model, survive if we went, catastrophically, from four to three global firms?
Who has the last word on audit quality and compliance with GAAP and SEC filing requirements for US-listed foreign companies? If you were hoping it was the US audit firm, you’ll have to prove your case in court.
We now know more about what the firms have been hiding. The global capital markets, not just current shareholders, need full disclosure of the engagement teams on all public issuers over time, and in a way that is easily accessible.
If we can’t trust journalists to sort out who’s telling the truth and who’s just selling us, who can we trust?
Are auditors too cozy with management and the Audit Committee? Unfortunately, that the way they all seem to like it. Investors and the capital markets suffer.
PwC says it will acquire Booz. Don’t count on the SEC or the PCAOB to stop PwC and its audit firm competitors from “slipping back” into the old conflicts between audit and consulting. Is anyone guarding the guardians?
Deloitte has been caught thumbing its nose at regulators again. Deloitte is the best example in the Big Four of how a large consulting business corrupts an audit firm.
Last defendant standing. Not an enviable place for EY in the case, In re Lehman Brothers Securities and Erisa Litigation. Holding out until the end has now cost EY $99 million, more than Lehman officers and directors.
 Francine McKenna (@retheauditors on Twitter) is a CPA, writer, speaker and subject matter expert with more than twenty-five years of experience in consulting and professional services including tenure at two Big 4 firms, both in the US and abroad. She is a two-time Gerald Loeb Award finalist and a frequently quoted freelance journalist. For more info, click the "About" link at the bottom of this page. |
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