SENIOR CAPITAL DISMISSES KPMG: Senior Capital Living Corp., a Dallas-based operator of senior residential communities, jettisoned its auditor, Big Four firm KPMG, and named Ernst & Young as its new independent accountant.KPMG's audit report for the year ended Dec. 31, 2005, noted ineffective internal controls over financial reporting. The auditor stated that SCLC's policies and procedures, and allocation of resources, did not provide for an effective review of the company's accounting for income taxes, which was prepared by tax consultants and third-party advisors.
As a result of the deficiency, the company's preliminary accounting for income taxes included errors. In KPMG's opinion, the deficiency also resulted in a likelihood that a material misstatement of the company's interim or annual consolidated financial statements would not be prevented or detected.
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