ARTICLE
17 October 2018

SEC Suspends Accountants For Predating Audit Documentation

CW
Cadwalader, Wickersham & Taft LLP

Contributor

Cadwalader, established in 1792, serves a diverse client base, including many of the world's leading financial institutions, funds and corporations. With offices in the United States and Europe, Cadwalader offers legal representation in antitrust, banking, corporate finance, corporate governance, executive compensation, financial restructuring, intellectual property, litigation, mergers and acquisitions, private equity, private wealth, real estate, regulation, securitization, structured finance, tax and white collar defense.
According to the SEC Order, three accountants failed to accurately complete an audit of a company's 2013 Form 10-K.
United States Corporate/Commercial Law

The SEC suspended three accountants for improper professional conduct, including "predating" audit documentation after falling behind schedule during an integrated audit of another company.

According to the SEC Order, three accountants failed to accurately complete an audit of a company's 2013 Form 10-K. After the audit firm fell behind schedule, one of the accountants instructed the audit team to state that all working papers and audit programs were complete, even if work still was remaining. The audit team subsequently "predated" audit documentation by signing blank or incomplete work papers and audit programs.

The SEC found that the two other accountants should have identified the audit deficiencies before releasing the documentation.

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