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Did KPMG Auditors Drop the Ball on FIFA?

An article on says that a former member of the US Attorney's Office says the KPMG should have discovered the fraud and corruption, but didn't. Needless to say the article doesn't paint either FIFA or KPMG in a good light. But it underscores a problem that continues and isn't addressed: -Are public CPA firms really independent -Who is auditing the auditors -Maybe it's time to rethink the paradigm What do you think?


James Scott
Title: Consulting CFO
Company: Early Growth Financial Services
LinkedIn Profile
(Consulting CFO, Early Growth Financial Services) |

The fraud was so pervasive the auditors should have discovered it. Publicly reported rumors, for years, about wrong doing should have raised a red flag. KPMG audited FIFA in Switzerland, and also the Russia and Qatar organizing committees who won tainted bids. (And others).

Topic Expert
Barrett Peterson
Title: Senior Manager, Actg Stnds & Analysis
Company: TTX
(Senior Manager, Actg Stnds & Analysis, TTX) |

Probably. At a minimum, they were far too cozy and careless.The rumors so long discussed should have made the audit a high risk engagement with enormous potential for embarassment, litigation, and costly settlements.

Amr Saudi
Title: Group Financial Director
Company: Waad Holding Company
(Group Financial Director , Waad Holding Company) |

Usually when situation is a set of conspiracy it is difficult to discover. However, FIFA it self should have the governance and internal controls in place which both should be assessed by risk advisor of the auditor. Not to mention the role of the audit committee of FIFA itself (assumed to have active organization within). Auditors like KPMG should have expand of their audit when there are infications of high doubt as appears in FIFA case. I do agree with Barrette in his concern.

Arthur Yip
Title: Audit Supervisor
Company: On Assignment Inc
(Audit Supervisor, On Assignment Inc) |

As long as these large public CPA firms are receiving huge audit fees from thier clients, they will never be truly independent. A better arrangement might be to have these CPA firms contract with the SEC for their audit services and have the companies pay audit fees to the SEC.

Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

That is a concept (in general) I have been proposing for years.

It's doable, relatively easy to set-up and because the auditing firm must change every x-years, much harder to corrupt.

Anonymous User
Title: CFO
Company: Local Government Agency
(CFO, Local Government Agency) |


The problem I have with that proposal, as someone who works in government in the first place, is that the average estimated effective life of regulatory requirements is about seven years. There are some academic studies that have proffered this.

That's how long it takes on average before the regulated get in bed with the regulators and corrupt the regulatory system that's been put in place.

The recent exposure of the PUC/PG&E relationship due to the San Bruno gas line rupture is a perfect example.

And, it's not just the profit motive of large public CPA firms that's driving this IMHO. It's also the individual selfishness of CPAs.

We see many discussions here of the employment desirability, career advancement and earnings value of a CPA designation. That question is driven by the misperception and misunderstanding by so many in the business world of what a CPA license really is. Particularly HR departments and non-financial managers. I've dealt with this since I got out of college in the 1970s and chose not to follow the audit path. (I spent years in the tax world on several levels.)

But, with only very limited exception, I've seldom heard CPAs themselves speak out against this ignorance and misuse of the designation.

Their silence is reflective of their their own self-interest and sense of self importance. But, who can blame them. It pays off. And it pays well.

CPA + MBA = CFO :-) Or, at least that's what so many employers both public and private, believe.

CPA society members acting together to 1) limit their profession to independent audit as it once was and 2) promote the highest standards of ethical conduct while ostracizing those who fail, might be the best we can hope for. i.e. restore professionalism to auditors.

Otherwise, it's just another self-promoting professional society without serious ethical boundaries. Like the state bars or the AMA. ;-(

John Miller
Title: Chief Financial Officer
Company: ACG Materials
(Chief Financial Officer, ACG Materials) |

Fraud and corruption FIFA?
"there is no fraud and corruption in FIFA! , Sir Rick, your payoff."

Anonymous User
Title: CFO
Company: Local Government Agency
(CFO, Local Government Agency) |

We need someone from AA to weigh in here. :-)


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