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Materiality at Overstock.com Inc.
Sam Antar made this nice find in regard to materiality, one of many issues at Overstock.com (NASDAQ:OSTK). You see… materiality is an issue because, in addition to “unusual” material items at Overstock, we’ve seen several immaterial “unusual” items as well. Users of financial statements have a tendency to overlook “immaterial” items, because by definition, they are [...]
Continue reading...KMPG associates apparently tired of the firm’s lame technology
23 Jan 2008
This one comes from Dennis Howlett’s blog, and to me, it’s hilarious. I’m not sure if you have to be a an auditor or not to think it’s funny. Apparently there are some emails from KPMG associates circulating and here’s an excerpt: The best question is: 4. Do you feel like KPMG’s lack of technology is [...]
Continue reading...More on the auditor change at Catapult
14 Jan 2008
Last week I wrote about Catapult Communications (NASDAQ: CATT) switching from Deloitte & Touche to a much smaller local firm, in a post called Big Four = Big Fees. In that post I referenced the CFO.com article from which I got my information. The article focused on the difference in fees between the firms: $985,000 [...]
Continue reading...Big Four = Big Fees
08 Jan 2008
Catapult Communications Corp. in Los Angeles quit their auditors, Deloitte & Touche. And they made public the reason. Deloitte’s fee for 2008 audit = $985,000 Local firm fee for 2008 audit = $561,000 or less (a 43%+ savings) The local firm is Stonefield Josephson, a 100 employee firm with 2007 revenues around $40 million. That fee level gets [...]
Continue reading...One way to spot a really bad auditing firm
27 Dec 2007
I’m embarrassed for this auditing firm. Here are their rates: Non CPA - Staff - $35 / Hour CPA - Non Partners - California Certified CPA - $50 / Hour CPA - Partner - California Certified CPA - $85 / Hour Sorry, but any auditor who charges rates like that is giving you an audit opinion that’s not [...]
Continue reading...Ouch! $1 million fine for Deloitte
11 Dec 2007
I suppose in the grand scheme, it’s not much of a hit for Deloitte & Touche to receive a $1 million fine, but the publicity ramifications could prove far more costly. The fine comes along with a censure from the Public Company Accounting Oversight Board (PCAOB) for a 2003 audit. The San Diego partner on an [...]
Continue reading...Auditors and OTC company clients
05 Dec 2007
An article in today’s Vancouver Sun makes some interesting points about auditing firms and their OTC company clients. OTC companies aren’t very good investments for shareholders, as many have shaky businesses or are really shell companies for other planned business ventures. Yet for auditing firms, they might seem like good clients. They need audits before they [...]
Continue reading...Forcing auditors to tell the secrets of their clients?
29 Nov 2007
As a general rule, communications between an auditor and client are private. The information given to an auditor can generally only be disclosed with the permission of the client, or in situations involving SEC filings. But the protection of communications between auditors and clients isn’t anywhere near that of the attorney-client privilege. And this is causing [...]
Continue reading...Putting auditor billing rates into perspective
21 Nov 2007
I am still settling in from my office move and upacking some odds and ends. Today I came across a billing rate card from Arthur Andersen. The rates are from 9/1/96 to 8/31/97 for the Milwaukee office, and they are interesting. Notice this is over ten years ago. These are the “Standard Rates” which were for [...]
Continue reading...I’m sorry sir, but we’re going to have to raise your audit fees!
20 Nov 2007
Sure, it’s easy to blame rising audit fees on Sarbanes-Oxley. But could there be more sinister forces in play? Witness this recent discussion between a senior partner and an audit client: Audit partner: “I’m sorry sir, but we’re going to have to raise your audit fees!” Client: “You don’t say? What is the cause of this action?” Audit [...]
Continue reading...- Mary Kay Cosmetics: Destroying half a million women a year
- A new pyramid scheme: United First Financial
- Ufirst Money Merge Account: Resistance is futile
- Vendor talks, Usana squawks
- The Sarah Palin pregnancy cover-up that wasn't (updated)
- $3,500 wasted with United First Financial, per Dave Ramsey
- What does Dave Ramsey think about United First Financial
- Why can't I pee on my neighbor's lawn?
- United First Financial agent compensation plan
- Searching for Shop to Earn scam
- Tracy Coenen: Roger - What exactly does MMA do if not encourage a user to pay...
- Roger Carman: Tracy, It is my opinion that you don’t know much of the...
- JoeTaxpayer: Roger, what it seems to do is use confusing terms (such as...
- marcy: Roger, I love that you are painting the UFF group as self sacrificing...
- Craig: For someone critical of the research capabilities of others, you seem...
- Tracy Coenen: What it really does is cause homeowners to waste $3,500 on an...
- Roger Carman: Craig, It would really impress me if you took your research...
- Craig: Hello Roger, or should I say UFirst Agent No. 864081? How is your...
- Craig: In fact, Quicken and MS Money are far better quality products, and...
- Tracy Coenen: The sad thing is that the quality of the $200 product will be...
- United First Financial broker numbers and earnings
- No Surprise: The “bailout bill” is falling apart
- More gifts from the government for the financially irresponsible
- Credit card company bailout next?
- Election fraud and the future of America
- Why audits are near worthless (yes, internal audit too)
- Bailout head Neel Kashkari wants transparency (except when he doesn’t)
- Overstock.com executives subject to clawback provision in Sarbanes-Oxley?
- Milwauke Public Schools: Obscene property tax increase
- But there’s no evidence of voter fraud!
About the Author
Tracy Coenen is a forensic accountant and fraud examiner who investigates white collar crimes, including cases of financial statement fraud, embezzlement, tax fraud, and insurance fraud. She is the author of Essentials of Corporate Fraud and more than 100 articles on fraud featured in industry publications.
21 Feb 2008
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