Reviews of Audits Find Some Errors
The four biggest accounting firms misapplied some standards and failed to properly maintain records of some audits, the new U.S. auditing regulator said Thursday in its first inspection reports.
At Deloitte & Touche, eight clients were forced to restate their balance sheets because of the Public Company Accounting Oversight Board inspection. The other firms -- PricewaterhouseCoopers, Ernst & Young and KPMG -- also had clients make restatements after regulators found some audits in violation of generally accepted accounting principles.
The board said the reports, while critical, didn’t show widespread problems. The reviews were drawn from inspections last year of 16 public-company audits conducted by each firm.
“None of our findings has shaken our belief that these firms are capable of the highest quality auditing,” board Chairman William McDonough said.
The board was created by Congress in 2002.
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