Tuesday, December 16, 2008

What Does Madoff's Auditor Say? No Answer

The tiny auditor of Bernard Madoff's Wall Street firm, at the center of an alleged $50-billion Ponzi scheme, is being investigated by the district attorney in a New York City suburb.

Friehling & Horowitz had signed off on the annual financial statement for Bernard L. Madoff Investment Securities LLC, according to Bloomberg News.

CFO.com's calls to the auditing firm's headquarters in New City, N.Y., were not answered yesterday.

"We're trying to determine if there have been any state crimes here," Rockland County District Attorney Thomas Zugibe told Bloomberg in a telephone interview. "When you have a key player like that operating in your county, you have to look."

What Does Madoff's Auditor Say? No Answer

Labels: audit, bankruptcy, Madoff

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Friday, April 25, 2008

Crunching the Words

When auditors seek evidence of fraud, they take a careful look at a company's financial statements. Maybe they should examine other statements, such as those uttered by company executives.

That's the theory behind new fraud-detection software developed by two professors at Virginia Tech, who say that the story a company crafts around its numbers often says much about whether those number are solid.

"We want to add another tool to the auditor's toolbox," says Greg Jenkins, associate professor at Virginia Tech and the program's co-developer. The idea is "to look at all the communications a company makes public [including MD&A disclosures, public statements, and a range of SEC filings] and see if there are patterns that are inconsistent with the company's performance, or with the performance of other companies in the industry," he says.

Crunching the Words

Labels: audit, fraud, MD and A disclosure

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Tuesday, May 08, 2007

Accountants face day of reckoning on fees

The audit fee bonanza enjoyed by the Big Four accountants over the past four years has continued into the current annual reporting season but there are signs the boom may be dramatically slowing.

The Evening Standard can reveal that amid top-level calls for the major accountancy firms to reveal the profits they are making from auditing, the 10 most lucrative listed company audit contracts in the UK yielded a record £196m in fees last year, nearly 9% higher than in the previous year.

Accountants face day of reckoning on fees

Labels: audit, Big Four, fees

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