Archive for the ‘The Big 4 And Globalization’ CategoryHow Deloitte US May Be Held Liable For ChinaCast FraudBy Francine • Feb 28th, 2013What’s different about this Chinese fraud lawsuit is that it names a US Big Four firm as a defendant. Not only has that not been done before but the US firms have traditionally been able to insulate themselves fairly successfully from frauds that happen abroad. It’s that global network “thang”. Unaudited! Not Just A China Problem So How Do We Address It?By Francine • Dec 20th, 2012It’s sexier for the media to focus on audit failures by inscrutable China-based Big Four audit firms than the general failure of auditors all over the world to protect investors from fraud. Auditors Diss US Regulators Regarding ChinaBy Francine • Dec 4th, 2012I’ve been watching the developments for a while now between the global audit firms, their clients, the regulators on both sides, and investors – especially the shorts – who have been raising the issues of Chinese frauds. I’ve written quite a bit about these issue. If you’re playing catch up, this list of posts is a good place to start. Casino Industry Suffering From China Denial SyndromeBy Francine • Oct 8th, 2012When you think about the big Las Vegas casinos, you should be thinking about Macau instead. The casino industry is a good example of the U.S. based multinationals that would suffer from any bold moves by regulators against the Chinese member firms of the Big Four audit networks. What The SEC And PCAOB Fail To Acknowledge About Chinese FraudBy Francine • Jul 9th, 2012There have been significant developments on the issue of Chinese frauds and in the efforts by the SEC and the PCAOB to investigate and bring responsible parties to justice, including the auditors of the companies under investigation. But none of these developments will have any significant impact on the bigger problems facing China and investment in China. Why Is The SEC Pursuing Deloitte Shanghai? Looks Like It’s PersonalBy Francine • May 10th, 2012The Securities and Exchange Commission is rattling a dull sabre again towards Shanghai-based Deloitte Touche Tohmatsu CPA Ltd. for its refusal to provide the agency with audit work papers related to another China-based company under investigation for potential accounting fraud against U.S. investors. It looks to me like it’s personal rather than productive. How Do You Hide A Multibillion Dollar Loss? Accounting For The Olympus FraudBy Francine • Jan 2nd, 2012I asked CPA and blogger Jim Ulvog to write a guest post on the Olympus scandal because he was the only one to explain it to me from an accounting perspective. An investigative report prepared by auditor Ernst & Young Shin Nihon – yes, the one that missed the fraud – is a scathing indictment of the company and others potentially complicit in the multi-year subterfuge. @Forbes: Judge Slams Centro Directors But PwC Will Answer TooBy Francine • Aug 18th, 2011I wrote this post about a month ago for Forbes.com and my column, “Accounting Watchdog” on a very important legal decision related to a real estate company, Centro, in Australia. Centro’s auditors were PwC. Not Over Until It’s Over: Price Waterhouse India Settles SatyamBy Francine • Apr 11th, 2011It’s the potential for sudden conflagrations in developing countries that keeps the global audit firms – PwC in this case – up at night. The legal quagmires in developed countries are messy, too. PwC may want to put the Satyam scandal behind them but, unfortunately, I fear there’s still much more pain for the firm to come. @ Forbes: Chinese Reverse Mergers: The Auditor AngleBy Francine • Mar 16th, 2011My Forbes column today is about the Chinese reverse merger market and recent reports of potential frauds – plural. I waited for the inevitable case that implicated a Big 4 audit firm. When it came I got two for the price of one and a bonus – a great new research paper from the PCAOB on the Chinese reverse merger phenomenon.
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Francine McKenna (@retheauditors) is the Transparency Reporter at MarketWatch.com, a Dow Jones publication, where her work is also featured frequently in the Wall Street Journal. McKenna had 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 before becoming a journalist. Look for her prior columns, 