Nearly two weeks after the Public Company Accounting Oversight Board’s audit inspection team cited Deloitte & Touche for audit deficiencies, the oversight body’s report on PricewaterhouseCoopers criticized a number of 2005 audits performed by that Big Four firm.

According to the Wall Street Journal, the audit watchdog’s findings in some nine audits ranged from improper applications of generally accepted accounting principles, to inadequate checks on revenue value, inventory and accounts receivable.

According to the board’s inspection guidelines, the audit firm has 12 months to correct any deficiencies.
A statement issued by PwC said that the firm believes it is "performing quality audits" and that it "will incorporate the board's findings" into the firm's practices.

Earlier this month, the PCAOB’s report cited Deloitte for failing to obtain sufficient evidence to back up decisions in a number of audits of public companies. The firm disagreed with the board's conclusions in nearly two thirds of the audits cited, offering a rebuttal of many of the board's criticisms as part of a response letter included with the PCAOB's report.

The overseer’s report cited 17 Deloitte audits as needing improvement. The report examined audits performed by Deloitte in 2005, of companies' 2004 financial results.

Meanwhile, the board's report issued in 2005 on work done in 2004, cited eight audits for criticism.
Separately, the board said at its meeting Tuesday, that it would consider whether to adopt a rule temporarily adjusting the minimum frequency with which it inspects registered public accounting firms having 100 or fewer issuer audit clients.

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access