Introduction The recent scandal between Big-Four firm KPMG and the Australian government centers around the firm’s solicitation of audit clients subsequent to receiving insider information about the bids from other firms to gain audit contracts. KPMG violated independence because of the conflict of interest emanating from ties of firm partners to board members at the […]
KPMG-Australia Scandal: A Cautionary Scandal Read More »
How can it be that three of the big four CPA firms were caught cheating on external and internal ethics and continuing professional education (CPE) courses, given that their role as auditors is to protect the public interest and the capital markets that rely on audited financial statements? My blog today explains what happened and
Audit Firm Professionals Have Cheated on Ethics and Internal Training Exams Read More »
Objectivity and Impartiality Replace the Strict Application of Independence Rules In June 2021, the Securities and Exchange Commission (SEC) made amendments effective for certain rules regarding auditor independence requirements (known as Rule 2-01 of Regulation S-X). The intention behind these amendments is to modernize the SEC’s rules governing auditor independence and more effectively focus the
Do “Modernized” Independence Rule Changes Protect Investor Interests? Read More »
The Case of GE and KPMG A new rule adopted by the U.S. Securities and Exchange Commission requires disclosure of the tenure of a public company’s external auditor in the annual report. KPMG recently reported that it has audited GE since 1909. This raises the question of whether there should be mandatory audit firm rotation
Should Auditors Rotate Every 109 Years? Read More »