Big Four
Madoff Victims Sue KPMG for Negligence
Victims of disgraced financier Bernie Madoff’s multi-billion dollar Ponzi scheme are suing the U.K. branch of Big 4 accounting firm KPMG, alleging that auditors for the jailed billionaire’s financial operations failed to notice or ignored ample evidence of financial misconduct, making them, according to the complaint, the “primary players responsible for the fraud.”
McGladrey & Pullen to Divorce H&R Block
The lengthy relationship between embattled H&R Block and McGladrey & Pullen, the fifth largest accounting firm in the New York area, has soured. The latter has issued formal notice of intent to terminate its contract with H&R Block. While McGladrey & Pullen’s audit practice is an independent, partner-owned firm, related professional services have been offered through RSM McGladrey under an agreement with H&R Block.
FEI Survey: 'Slight' Audit Fee Increase in 2008
Companies saw only a slight increase in audit fees in 2008 compared with the previous year, according to an annual survey from Financial Executives Research Foundation (FERF), the research affiliate of Financial Executives International.
E&Y Partners Convicted of Fraud
Four current and former partners of the Big Four firm Ernst & Young were found guilty yesterday of fraud involving tax shelters that helped wealthy people evade income taxes.
Convicted were:
Ernst & Young Withdraws Swine Flu Confirmation
Less than a day after confirming to numerous media outlets -- including WCBS TV, which broke the story -- that one of its New York City employees had been diagnosed with swine flu, Big Four firm Ernst & Young today withdrew that confirmation.
KPMG Blamed For Subprime Audit Failure
Big Four firm KPMG is being sued over its audits of New Century Financial Corp. by the trustee overseeing the bankruptcy of the subprime lender, in one of the first examples of an auditor being blamed for the subprime mortgage crisis.
This follows last April's independent report solicited by the United States Department of Justice that said KPMG may be liable for allowing New Century to engage “in a number of significant improper and imprudent practices related to its loan originations, operations and financial reporting."
Oh, the Irony: Satyam is Sanskrit for 'Truth'
The Indian government has superseded the board of Satyam Computer Services, the outsourcing giant that announced this week that its chairman had concealed $1 billion in losses. It will appoint 10 nominee-directors, who will meet within a week and make a decision on a new management team for the company, whose name means "truth" or "this is true" in Sanskrit.
The Big Four firm PricewaterhouseCoopers is now under fire for signing off on Satyam's financial statements for several years. In a statement sent by email, the auditing firm defended itself: "The audits were conducted by Pricewaterhouse in accordance with applicable auditing standards and were supported by appropriate audit evidence."
CPA Firms Scrutinized in Madoff Wake
As prosecutors begin to unravel the details of how money manager Bernard Madoff was able to allegedly scam investors out of approximately $50 billion, large accounting firms are likely to be among the defendants, the New York Times reported Monday.
3 Convicted in KPMG Tax Shelter Case
A federal jury on Wednesday found Robert Pfaff and John Larson, two former employees at the accounting firm KPMG, and a former top tax lawyer, Raymond J. Ruble, guilty in a tax-shelter trial once billed as the largest ever. A third former KPMG partner, David Greenberg, was acquitted of the charges, the New York Times reported.
SEC Mandates Use of XBRL
The Securities and Exchange Commission (SEC) voted 4-1 to require 500 of the largest public companies to begin filing financial reports using the technology known as Extensible Business Reporting Language (XBRL) by mid-2009, Reuters reported. The rest of the companies will be phased in over a two-year period, the SEC said.