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Report: Deloitte Audits Carried Deficiencies

A review of Deloitte's audits found some contained deficiencies.

A recent review from the Public Company Accounting Oversight Board found that 26 audits that Deloitte & Touche conducted had failed to collect enough data and evidence to inform its

A recent review from the Public Company Accounting Oversight Board found that 26 audits that Deloitte & Touche conducted had failed to collect enough data and evidence to inform its audit conclusions, according to The Wall Street Journal. 

Among the PCAOB inspectors' findings was the revelation that Deloitte had not done adequate testing on inventory, fair value, goodwill impairment and other topics. However, the auditing firm is not the only one in the industry to be found lacking. The newspaper notes that the board also found PricewaterhouseCoopers and KPMG had some deficient audits. According to Accounting Today, Ernst & Young was found to have deficiencies that could be classified as "audit failures."

Reuters reports that the PCAOB also recommended adopting a new standard, which would require auditors in the U.S. to tell a client's audit committees if they doubt the company will be able to survive.

"You'd have to ask yourself, how could an audit committee be doing its duties if it wasn't having that conversation with the auditors," Lynn Turner, former chief accountant for the U.S. Securities and Exchange Commission, said of the proposal in an interview with Reuters.

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Comments

Paul Weinberg
Title: President
Company: The CPA Exchange, Inc.
(President , The CPA Exchange, Inc. ) |

This is the same old story with the Big 4 taking short cuts because they think they can. The "audit world" - VCs, Investors, Banks, need to understand their are other Audit Firms out there with Partner expertise in their business and industry, and not just assume they have to use a Big 4 Audit Firm.